Economic Overview

Country Factsheet: Iraq

Official Land Name Republic of Iraq
Area 438,317 km2 (59th in the world)
Population Approx. 32.0 million (2013, World Bank)
Population Growth 2.29% (2013, expected to reach approx. 46.0 million by 2025)
Capital Baghdad (population: 5,751,000)
Governorates (excl. Kurdistan) Baghdad, Anbar, Basrah, Al Muthanna, Al Qadisiyah, Najaf, Babil, Dhi Qar; Diyala, Karbala, Kirkuk, Maysan, Ninawa, Salaheddin, Wasit
Urban Population 66.5% of population (2011)
Ethnic Groups Arab 75%-80%.; Kurdish 15-20%; Turcoman, Assyrian, or other 5%
Currency Iraqi Dinar – IQD
Economy Improvements in the security environment and foreign investments are helping to spur the economic activity.
Main Exports Crude Oil, Crude Materials excluding Fuels, Food & Live Animals
Main Imports Food, Medicine, Manufacturers

Regional Factsheet: Kurdistan

Official Land Name Kurdistan
Area 40,643 km2
Population Approx. 6.0 million (2013)
Population Growth 3.0% (2011-12)
Capital Erbil (population: 1,009,000)
Governorates (excl. Kurdistan) Erbil, Dohuk, Sulaymaniyah
Labor Force 1.2 million (2012)
Economy From 2006 to mid-2012, overall investments amounted to USD 22 billion of which 79% were national investment, 15% were FDIs and 6% were Joint Ventures.
Main Exports Crude oil 84%, crude materials excluding fuels, food and live animals
Main Imports Food, medicine, manufactures
Sectors of Activity Services (30.1%), Public services (20.6%), Agriculture (17.5%), Trade & Transport (13.5%), Mining & Manufacturing (9.4%), Construction (7.6%), Banks & Insurance (1.3%).

Macroeconomic Overview: Iraq

The recent macroeconomic developments in Iraq have been largely positive over the past few years.

Economic Growth

  • Iraq is one of fastest growing economies in the world.
  • Economic growth reached 8.4% in 2012 according to the IMF forecasts and is expected to have
    grown to around 9.0% in 2013.
  • Overall, growth is projected to remain above 8.0% and inflation at 5% to 6% over the medium term.
  • Inflation declined from about 6.0% EOY 2011 to 3.6% EOY 2012.

 

Macroeconomic Overview: Kurdistan

Kurdistan, governed by the Kurdistan Regional Government (“KRG”) is a semi-autonomous region in northern Iraq.

  • Kurdistan enjoys a relatively stable and self-contained economic system.
  • Foreign and domestic investment in the region has been rising annually for the last six years, with over 500 major projects valued at almost USD25 billion awarded to non oil and gas projects since 2006.
  • USD 6 billion in investment projects were awarded in 2012 alone.

 

Healthcare Sector: Iraq

Increasing Importance in Government Budgets

The Iraqi government is planning to allocate USD 275 billion over the next five years to infrastructure projects and other investments. The 2013 budget allocated 5.3% of investments to the health and environment sectors (USD 6.3 billion).

Healthcare Sector Iraq Lebanon Turkey Germany In addition to low availability of beds per capita, the Iraqi population lacks experienced and knowledgeable labour and equipment to serve its population.
Health expenditure , total (2011) 8.3% of GDP 6.3% of GDP 6.7% of GDP 11.1% of GDP
Of which: Public Expenditures 80.7% 25.5% 74.9% 75.9%
Hospital Beds per 1000 People (2010) 1.3 3.5 2.5 8.3
Physicians per 1000 people (2010) 0.6 3.5 1.7 3.7

Healthcare Sector Highlights

  • A relatively high population growth (2.5%) and a low life expectancy in Iraq (69 years) are major drivers for the sector.
  • Iraq’s per capita health expenditure rose from $34 in 2000 to more than $300 in 2011.
  • With a continuously increasing demand for healthcare provision, and relatively lower quality standards
  • provided by the public sector, there is a good upside potential for the private sector.

Healthcare Sector: Kurdistan

Erbil Duhuk Sulaymaniyah Kurdistan
Year 2006 2011 2006 2011 2006 2011 2006 2011
Nb. of Public Hospitals 19 22 7 9 23 27 49 58
Nb. of Private Hospitals 4 10 3 5 9 18 16 33
Nb. of Beds 2,123 2,730 1,119 1,334 2,617 3,038 5,931 7,102
Nb. of Patients 2,168,112 3,194,170 1,617,876 2,434,319 2,032,596 3,972,630 5,818,584 9,601,119
Nb. of Doctors 1,271 2,540 471 663 766 2,900 2,508 6,103

Challenges

  • No private or public hospital can meet the needs of the health sector. Many patients have no other choice but to go abroad for treatment, even for the slightest illnesses.
  • Many services are failing: no cancer, mental or heart center, no official blood bank in the region.

Government Targets

  • The MoH has prepared a 5-year master plan to provide basic health services in Kurdistan, with a focus on modernization of hospitals.
  • There are existing plans to build hospitals, to create a DNA laboratory and to implement quality control by extending the existing facilities.

Real Estate Sector: Kurdistan

Commercial Real Estate

  • Underdeveloped commercial real estate sector in Erbil, with a shortage of quality office space.
  • Current demand is expected to grow alongside population growth and increase in purchasing power and is estimated at 770,000 m2 according to the Kurdistan Board of Investment.
  • As the market remains undersupplied in the near future, the rental rates and selling prices are expected to continue to increase.

Residential Sector

  • According to the Kurdistan Board of Investment, there are 78 housing projects that have emerged in recent years amounting to around USD 5.8 billion in investments.
  • Facing the growth of the population, the region has enormous housing needs with a shortage, according to the Ministry, estimated at 120,000 dwellings.

Kurdistan Business Enviroment

A liberal investment law providing attractive incentives and guarantees for national and foreign investor.

Objectives

  • The Investment Law was passed in 2006 in order to:

1)Open up ways to sustainably support the development and diversification of the Region’s economy beyond oil and gas.
2)Create a conducive business climate that promotes investment in the Kurdistan Region.
3)Remove legal obstacles and open the way for investment of national and foreign investors.

Incentives

  • Provision of land plots for subsidized lease.
  • Provision of public infrastructure (e.g. water, electricity, sewage, public roads) to the project fence.
  • Exemption from corporate taxes (10 years).
  • Exemption from customs duties for imported raw materials (5 years); additional differentiated customs duty exemptions.

Guarantees

  • Full repatriation of profits generated by the project and wages earned by foreign employees.
  • Transfer of investment to another foreign or national investor
  • Possibility to invest in Kurdistan with or without local partners and to employ foreign labor.

To arrange a presentation or to request an executive summary please contact the American Kurdistan Life Center LLC via our contact page.

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