Prime Minister Barzani highlights the role of private sector in reviving Kurdistan’s economy

Erbil, Kurdistan Region– Kurdistan Regional Government Prime Minister Nechirvan Barzani praised the role of the private sector in stimulating Kurdistan’s economy, as the region is dealing with financial challenges.

During a speech at a conference organized by the Kurdistan Federation of Chambers of Commerce and Industry on Sunday, Prime Minister Barzani said that his government “believes that the private sector could play a major and important role in developing, reviving and diversifying the Kurdistan Region’s economy.”

Below is the transcript of Prime Minister’s speech:

Ladies and gentlemen,

Good morning.

Welcome to the opening ceremony of the third conference of the Kurdistan Federation of Chambers of Commerce and Industry. A special welcome to Mr. Adnan Al-Qasar, the Honorary President of Arab Chamber for Commerce and Industry, and participants from neighboring and friendly countries. It is my wish to see this conference provide a favorable and successful platform to the participants. I commend the organizers of this conference in Erbil.

The role of the private sector in revitalizing the Kurdistan Region’s economy, which is the title of this conference, is an important issue and has always been a priority of the Kurdistan Regional Government.

The Kurdistan Regional Government believes that the private sector could play a major and important role in developing, reviving and diversifying the Kurdistan Region’s economy. Therefore, the government has provided incentives for local and foreign companies and created major job and investment opportunities in all sectors.

The Kurdistan Regional Government is also exploring more options to provide more opportunities and further empower the private sector. The government is considering to gradually privatize certain public services, which will provide more opportunities for the private sector. The privatization policy, especially during economic and financial challenges, will ease the burden on the regional government and help revive the economy of Kurdistan Region.

Lessons from the developed countries show that the private sector could play a major role in improving industry, agriculture, tourism and other sectors, and could become a cornerstone of a strong economy. In order to achieve that, the private sector needs the support and oversight of the government by having laws and regulations that encourage labor and investment, whether for major and strategic projects, or for medium and small businesses.

The role of the private sector becomes more prominent during crisis and economic hardship, as we have seen in the Kurdistan Region. As you are aware, Baghdad’s decision to cut the Kurdistan Region’s share of the federal budget, the war against ISIS terrorist organization, hosting more than 1.8 million Syrian and Iraqi refugees and internally displaced persons, and the drop of oil prices, all contributed to creating a major economic and financial crisis that has affected all aspects of life in the Kurdistan Region.

Due to these reasons, which are beyond our control, dozens of projects have been halted. As a consequence, jobs, businesses and the daily life of citizens have been hurt. However, despite these challenges, Kurdistan’s economy is still functioning, thanks to the private sector. Tens of thousands of workers, which provide for thousands of families, are still working in the private sector.

If not for the budget cut, ISIS war, high number of refugees, which puts a huge financial burden on the government, and drop of oil prices, the Kurdistan Regional Government could have provided more support and coordinated better with the private sector, and could have had a stronger and more robust economy.

As we mention these reasons, we don’t mean to say that we are free of any shortcoming. The weakness of our administrative system, high expenditures, multi-salaries, excessive hiring, and other faults in our administrative and financial management systems also contributed to the financial crisis. We need to admit that and address these issues. The financial crisis is a major challenge that is hurting the government and the people of Kurdistan Region and Iraq; however, it offers a golden opportunity to reform our administrative and financial systems. The Kurdistan Regional Government is very serious to make the best use of this opportunity to reform its systems.

Distinguished participants,

The Kurdistan Regional Government’s vision for 2020, which has been drafted with the help of the World Bank, along with indicators and recommendations of the World Bank, which are in accordance with global standards and benefit investors and private sector, are an integral part of the Kurdistan Regional Government’s policy to further strengthen the private sector in the Kurdistan Region.

If we examine the Kurdistan Regional Government’s policy of supporting the private sector, we find that there has been major improvements in economic indicators between 2004 and 2013. For example, a year after the fall of Saddam Hussein regime in 2003, the unemployment rate was 10.4 percent, and it had declined to 5.2 percent in 2013.

And in 2006, about 20,000 jobs were created in the private sector, but in 2012 the number had increased to 340,000 jobs. Per capita income had increased from $500 in 2003 to $5,000 in 2012.

In 2007, the total investment in the Kurdistan Region was four billion dollars. Today, that number stands at 47 billion dollars, with many investments in industry, housing and tourism sectors.

The government’s policy and the support it offers are the main incentive for investment in the Kurdistan Region. Only the local private sector market has 669 investment projects, worth $37 billion. This is an indication that the private sector trusts the government and its supportive policy in further boosting the role of the private sector in the Kurdistan Region.

Ladies and Gentlemen,

One of the aims of the government’s plan to overcome the current challenges is to further support the private sector in order to grow its activities effectively and efficiently, generate further income and attract more job seekers instead of the public sector. The government will exert all its efforts to meet this objective.

I hope that the researches and studies presented in this conference will provide constructive recommendations that would help implementing the Kurdistan Regional Government’s policy to further support the private sector.

The Kurdistan Regional Government also works to remove all the obstacles that had hampered the private sector’s growth; namely those legal and constitutional obstacles under the Iraqi laws related to financial policy, commerce and customs along the borders and in the provinces of the Kurdistan Region.

We have examined laws and issued various regulations to help the private sector to play a greater role in building and developing our economy. In the past, based on observations and recommendations by the private sector, we amended some laws and regulations and will continue to do so until the private sector is able to provide its most effective contribution to the country’s economy.

Ladies and Gentlemen,

The recent visits by the Kurdistan Regional Government delegation, President Barzani and his accompanying delegation to Baghdad, holding meetings with the Iraqi Prime Minister Haydar Al-Abbadi and other senior officials, have created hope and opportunity to settle the disagreements with the Iraqi government. We hope that we reach an agreement, through dialogue and mutual understanding, on all standing issues, including the nature of the future relations between Kurdistan and the Iraqi state, in a way which serves the interests of the citizens of Kurdistan Region and Iraq. It’s important to us that our friends and brothers in Baghdad know that the current situation cannot continue.  Through dialogue and mutual understanding, we must reach an agreement on our future in Iraq and assure that stability continues across Iraq.

As the preparations, at both local and international levels, are underway for the liberation of the city of Mosul, this operation will have direct impact on the situation in the Kurdistan Region, particularly in the economic, investment and commercial domains. After the liberation, we hope to see more Iraqi and foreign businesses invest in the Kurdistan Region.

But we should not forget that Mosul issue is more a political issue than a military one. Liberating Mosul militarily will not settle the issues of this province. It is true that the capital of what ISIS calls Caliphate or the Islamic State will be liberated from the terrorists. However, what is more important is the post-liberation period, for which all its ethnic, religious and sectarian components should play a role in the political process and have a say on the future of their region and the way it will be administered. If this is not done, rather than solving the current problems, additional problems will certainly surface. Therefore, this important and sensitive issue should be settled now through an agreement among all the components of Mosul.

In the end, I welcome you again and wish to see the conference achieve its goals. I commend the Kurdistan Federation of Chambers of Commerce and Industry, its president Mr. Dara Jalil Khayat and his colleagues as well as the Kurdistan Centre for Information and Strategic Research for having organized this conference. I hope its outcome will contribute to improving the situation in the Kurdistan Region and solidifying the role and position of the private sector in the Kurdistan Region. I congratulate Erbil Chamber of Commerce and Industry as it celebrates its 50th anniversary.

I would like to convey my condolences to the families of the martyrs and salute our fallen heroes, whose ultimate sacrifices protect Kurdistan and its bright future. I also wish a speedy recovery for the injured. I express my gratitude to the heroic Peshmergas and all members of the security forces of the Kurdistan Region. Thanks to their heroism and sacrifice, our country is safe and secure today.

I express my gratitude and appreciation to the people of Kurdistan, all the public servants and pensioners who understand the magnitude of the challenges facing our country and have remained resilient. We reassure everyone that we will overcome the current situation and a bright future is waiting for Kurdistan.

Thank you, and have a nice day.