With vast oil and gas reserves, a large, well-educated workforce, and about $376bn of major projects planned or underway, there is no doubting the huge potential of the Iraq market for anybody looking for new project opportunities in the Middle East. The reality however is that the country’s vast potential has been undermined for decades by war, insurrection and sanctions – leaving it to face major political, economic and capacity challenges.
An improvement in Iraq’s security situation in 2018 following its “liberation” from the Islamic State in Iraq and Syria (Isis) in December 2017, combined with an improving economic outlook, gave Iraqis hope that perhaps they could look forward to a period of stability during which they could start rebuilding their country.
But the joint issues of Covid-19 and falling oil prices have created a fiscal crisis as the government struggles to meet its financial commitments. Projects have had to be delayed as Baghdad prioritises social expenditure. At the same time, crude prices around $50-60 a barrel and OPEC quotas on production have meant that the Oil Ministry has asked the various international oil companies to slow down project expenditure and pare back output, further limiting the projects market.
Like elsewhere in the region, falling state revenues have placed a greater emphasis on bringing greater private sector participation in the projects market either through public-private-partnerships (PPPs) or attracting direct foreign investment in projects.
However, the political and security situation and lack of regulations make the successful implementation of PPP projects extremely challenging no matter what the support. Instead, the projects that are more likely to proceed are those which have funding support from international development banks and funds. Recent successful major projects like the Basra refinery upgrade project are examples where direct foreign funding can provide a way forward for much needed infrastructure development in the country.
Iraq Projects H1 2021 is the update to last year’s popular report. Focused on data, it is aimed at helping companies create strategies for targeting and growing the market. It uses almost exclusively data from MEED Projects (www.meedprojects.com), the region’s leading online projects tracking service. With 15,000 active projects tracked and more than 35,000 in total in the database, MEED Projects makes it possible to quantify current, historical and future trends in the projects market in the region.
I am certain that this report can help you achieve success in Iraq.