The Kurdistan Regional Government (KRG) established in June 2019 focuses its priority to shift the economy towards an open diversified economy to balance the actual dependence on oil and gas.
The Economic Policy of KRG
As one of the frontline cabinet within the Regional Government of Kurdistan which is leading the drive to position KRG as future hub and base and commercial network for economy activity in the Middle East.
The KRG core responsibility is the promotion and development of Industry and Agriculture activities, with an emphasis on generating sustainable development and economy growth in Kurdistan Region, by securing enhanced access to foreign market for local companies as well as more foreign capitals to be accessed to the Local Kurdistan market:
– Adopting the free Market-Policy to promote and support the role of private sector such as the Chambers of Commerce and Industries and other business associations and unions.
– Drafting new laws of Trade and related themes to be in harmonization with the plan of development and amending many other articles of previous laws.
– Providing new legislation administrations and procedures.
– Creating a healthy environment for business and investment.
– Cooperation with central government to take part in the committees of WTO and other organisations and collaborating in other different activities.
– Providing all facilities for the process of rehabilitating the infrastructure of economy of the Kurdistan Region.
– The legal system in the region is more developed than many other legal systems in the Middle East, which is relying on the following sources:
1- The constitution of Iraq and the Region.
2- Rights and Liberties.
3- The Federal Authorities.
4- Power of the Regions
- Relying on Iraqi constitution, Kurdistan Regional Government has the constitutional right to deal and sign commercial agreements and MoU with regional governments; this will assist the promotion of economy in Iraq as general and the Region in particular, and will meet the demand of commitments of the new era.
- Considering the political and economic stability as a factor, the KRG plans to make the region as a hub for the future economy in the Middle East, to draw attention of the capitals around the world to get in close relation with the local investors who could develop their financial capabilities depending on the modern methods of business.
Safe zone for business
The Kurdistan Region is safe, stable and prospering area in northeastern Iraq. The Kurdistan Region of Iraq is blessed with plentiful water, fertile land and forests. Oil and Gas and many other energy and mineral resources, energetic petrol, stunning energy and historical sites that have always attracted visitors and are beginning to attract regional and international tourists once again.
In terms of trade, Kurdistan Region is also geographically well placed between the potentially growing markets of Iraq, Iran, Turkey and Syria.
The KRG is governed by a democratic system. It has an elected parliament and government. It enjoys free press, free flow of information and open boarders for free flow of goods and people, the Region enjoys also peace and stability.
The per capita income in the Region in 2014 ranges between 5,500 USD and 6,500 USD, which is well above the average in a number of neighbouring countries and stands to rise substantially with return normality to the rest of Iraq.
Due to exceptional situation in the Kurdistan Region and Iraq the economic growth in 2015 and 2016 has recorded some slowness and reluctance. KRG has a supportive reform policy which has a cardinal target to diversify the economy and increase the sources of income and decrease the expenses.
The signs are showing the success of the new policy which has been applied the beginning of 2016.
The Kurdistan Region has been enjoying and continues to build a stable macro-economic environment since the demise of the previous regime. Strict monetary and fiscal policy discipline is observed which has helped to stabilize the exchange rate, the interest rate and inflation.
Iraq has also managed to build a healthy financial reserve, and is currently modernizing its trade laws in preparation for the membership of the WTO and other international organizations.
The Kurdistan region has been promoting itself as the commercial gateway to Iraq, the Kurdistan Region is secure and politically stable. Any foreign and local visitor can move anywhere alone and without guards.
The international airlines are getting more operative to start direct flights to Erbil and Sulaimanyah international airports including Austrian Airlines, Lufthansa, Gulf Air, Turkish Airlines, Royal Jordanian, Qatar, Middle East and Etihad, many other international airlines are operating their flights to the region.
The role of the Ministry of Trade and Industry
Since the establishment of the Ministry of Trade and Industry in 2010 and approval of the law, the ministry is engaged to organize the different sector of Trade, Commerce and Industry and the entire activities which give the economy more energy and promote the methods and also to modernize the way to deal with other countries and at the same time to provide the factors of food security in the region. Main targets of the Ministry of Trade and Industry:
– Ensure food security for the inhabitants of the Kurdistan Region and become self-sufficient in critical areas.
– Reform trade policies and regulations to bring them further into the line with good international practices, and to ensure efficient trade with Kurdistan Region’s neighbouring countries.
– Work within the private sector to rehabilitate the Kurdistan Region’s industrial infrastructure.
– Issue new laws and amend previous laws to facilitate commerce and industry.
– Strengthen commercial ties with other parts of the world.
The priorities of the KRG
The Kurdistan Regional Government is engaging to have its priorities in the region in order to draw the foreign capital to Kurdistan.
The main target of the government is to enhance the role of the private sector which could noticeably gain achievements in various fields.
The priorities of the KRG:
- Agriculture and Water Resources: Kurdistan Region mainly is an agricultural part of Iraq which has magnificent possibilities to have projects. This part contains different sectors of agriculture and Water projects such as; Green Houses, new Dams and Channels, Cooling Warehouses, scientific methods of treating with agriculture diseases, food security and building new Silos and Grain Warehouses.
- Education and Higher Education and Scientific Researches. The KRG is supporting the private education and issues the certificate of establishing private Universities and Colleges.
- Health; KRG is adopting new systems from the developed countries and encourages the health sector and building new clinics and hospitals.
- Oil and Gas sector; this sector has top treatment of KRG because this will be future strategic priority.
- Banking system and Insurance: the economy in the Kurdistan Region is witnessing as economic growth therefore, it is the priority of the KRG is to develop a modern banking system.
- Industry sector which has noticed major steps forward to rehabilitate and reconstruct the infrastructure of industry through adopting the similar foreign experience.
- Tourism which has distinguished factors for having four season tourism. The Kurdistan Region plans to implement many big tourism projects.
- Human Resources there are huge possibilities to promote the capabilities of the young generation. The KRG is giving too much attention this issue.
