Gulf companies and their multinational counterparts are looking for opportunities in Iraq as research suggests people there are more concerned about jobs and the quality of their lives than the security issues that had deterred investment there. A young and consumer-savvy population is attracting greater attention from consumer-goods companies, in particular.
The soft drinks and snack foods giant PepsiCo is targeting further expansion in Iraq this year, having already achieved double-digit growth in the past year. "Iraq has one of the youngest populations in the Middle East," said Anton Botha, a finance manager with PepsiCo in Dubai. "The market is small at the moment but there's good growth opportunities and in 10 years' time as a global company you don't want to be in the Middle East and not in Iraq."
Openings are also emerging for petrochemical suppliers as demand grows from Iraq's increasingly active industrial and energy industries "Iraq is a newer market but it is one of our growth areas we are focusing on as there's plenty of potential as the industrial and automotive sector develops," said Ziad Soussou, the regional sales manager at Shell Lubricants, which is part of Shell Markets Middle East based in Dubai.
Shell Lubricants has been building its presence in Iraq over the past five years, having used a local partner to distribute lubricants, grease and fluids to the power sector. Oil services and tourism are the two areas where Emirati businessmen are looking to invest in Iraq, said Azos Rashid, the chief executive of the Baghdad-based conglomerate Sarasin Group and a former Iraqi government official.
"The UAE has been a hub for international companies but that focus is changing and Emirati businessmen are looking to put capital into Iraq," he said. The Iraqi government is loosening its hold on developing the country's vast oilfields by gradually inviting foreign oil majors to bid for production contracts. With exploration not yet complete in more than four fifths of the country, industry experts believe Iraq may yet prove to hold more crude than top-producing nation Saudi Arabia.
With foreign airlines launching direct flights to Iraq and global hoteliers starting to open hotels, the country is also looking to entice tourists. In another sign that the economy is starting to take centre stage over security in Iraq, the Middle East arm of the UK pollster YouGov published a report yesterday showing economic problems were more of a concern to Iraqis than security. A total of 36 per cent of the Iraqis it surveyed said economic problems were the biggest issue they faced, as opposed to 16 per cent of respondents who said security was their greatest concern. Unemployment (21 per cent) and financial insecurity (15 per cent) were the biggest anxieties of those Iraqis who said economic issues were their main problem.
Estimates suggest that unemployment in Iraq is running at between 30 and 40 per cent. "As security conditions improve, the economy takes centre stage. People want jobs, decent services and the improvements to quality of life that these things provide," said Stefan Kaszubowski, the managing director YouGov special projects, who headed the research. Their research also suggested their were opportunities for foreign companies in Iraq in the internet and mobile phone sectors.
Only 22 per cent of respondents said they used the internet. This compares with internet penetration of 61 per cent in the UAE. The research also showed there are 58 mobile subscribers in Iraq per 100 inhabitants, compared to 209 per 100 inhabitants in the UAE. @Email:firstname.lastname@example.org