Video: Prof Gunter On Iraq's Private Sector; Shwan Aziz On Energy Opportunities

(MENAFN- Iraq Business News) From the Iraq Britain Business Council (IBBC) :

Professor Frank Gunter outlines what Iraq needs to do to support the private sector and IBBCs Shwan Aziz on Iraq's energy opportunities via Iraq 24 channel

Professor Frank Gunter Economics professor at Lehigh University and long-term observer of Iraq's economy, is launching an 'Ease of Doing business 'report for IBBC, with observations and recommendations for changes at the IBBC Dubai conference on 13th December.

Here he undertakes a long interview outlining what the issues are and steps the Government of Iraq needs to consider supporting the economy going forward.

The key issues outlined here include: the rapid growth of the Iraqi population at 1millon a year, means the Government needs to create 350,000 jobs a year just to stop unemployment getting worse. Government income from oil is set to decline ( currently 96% revenues from oil exports) in the medium term due to price reductions to $70 per barrel, and it must find other sources of income from taxes, sales taxes or industrial production to fill the income gap and to provide investment and opportunities for jobs.

The education system is geared for pupils to get government jobs, but must reorientate towards the private sector, for engineers and businesspeople to work in the energy and other expanding sectors. Furthermore, the PPP system is not working as Governments have renegotiated terms after a year or two to make the long-term private investment conditions unviable.

Finally, the exchange rate was also uprated 11% to the dollar, which has made imports cheaper and exports more expensive and competitive for local producers. Expanding the private sector is the only real option to provide jobs, opportunities, and sources of income

All these conditions must change, to create incentives for the private sector to invest in Iraq. Professor Gunter is holding a roundtable at the IBBC Dubai conference for member and attendees to hear more about the report, its solutions to easing business in Iraq and what can be done to address the key issues outlined above.

During the same program, channel 24 Iraq, Mr. Shwan Aziz,also a member of IBBC's Advisory Council, discussed the electricity sector, pointing out that Iraq offers significant investment opportunities in power generation, particularly through clean energy sources like solar and wind.

However, the transmission and distribution sectors face considerable challenges, including limited profitability and difficulties in effectively collecting consumption fees from citizens and various sectors, which hinder the sector's overall growth and efficiency.

Mr. Aziz also discussed the potential shift in focus under the Trump administration, highlighting how its interest in Iraq is likely to extend beyond political considerations. He emphasized Iraq's strategic significance in the Middle East and suggested that the administration might prioritise strengthening economic ties, bolstering the private sector, and attracting both U.S. and international investments to drive sustainable development in the country.

Regarding Iraqi businesses, Mr. Aziz highlighted that the Iraqi economy faces significant challenges in transitioning small businesses into medium-sized enterprises due to pervasive government bureaucracy and rising inflation, both of which obstruct job creation and economic growth.

He stressed that ensuring a conducive business environment in Iraq requires robust support for the private sector, positioning it as a key partner for foreign companies. Prioritising collaboration with local private enterprises over reliance on the public sector is essential to enhance competitiveness and drive sustainable development.

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