Iraq Threatens to Seize Kurdish Oil

Iraq threatens to seize oil shipped without its consent, sue dealers after Kurds begin exports

Baghdad Invest - 11/01/2013 Baghdad.

Iraq has threatened to seize oil exports made without its consent and sue companies dealing in what it sees as contraband crude just days after the country's self-rule Kurdish region began unilaterally exporting oil.

The spokesman for Iraq's Kurdish regional government, Safeen Dizayee, confirmed Friday that the largely autonomous territory began shipping oil unilaterally to Turkey in the past few days. He declined to say how much was being shipped abroad.

The move appears to have triggered Baghdad's threat. A statement quietly posted a day earlier on the website of the State Oil Marketing Organization warned that Iraq may confiscate what it sees as oil cargoes "smuggled across borders," and sue sellers, buyers and companies that transport the crude.

The statement said SOMO "is the sole legally authorized entity that has the exclusive right to export and import crude oil, gas and oil products" in Iraq.

A hard line from Baghdad over the shipments could exacerbate simmering tensions between Iraq's central government and the Kurds. The two sides appeared on the brink of war just two months ago after an exchange of fire prompted them to deploy troops and heavy weapons along their disputed internal border.

Iraq's central government and the Kurds have been at loggerheads for years about how to manage Iraq's vast oil wealth.

Since the 2003 U.S.-led invasion, the Kurds have struck more than 50 deals with foreign oil companies, including Exxon Mobil Corp., Chevron Corp. and France's Total S.A. Baghdad considers the deals illegal. It believes the central government should manage the country's oil policy and wants all exports to travel through state-run pipelines.

Dizayee said the Kurds are shipping the oil into Turkey by tanker truck. Much of the exported crude will be refined and then shipped back to the Kurdish region, which has a pressing need for fuel during the cold winter months, he said.

He insisted that the Kurds remain open to talking with Baghdad about the new exports within the framework of a comprehensive negotiation.

"If we need to address this issue, we need to address it as a complete package," he said.

The Kurds last month suspended oil exports through a pipeline managed by Baghdad over a payment dispute with the central government. Those exports fall under a tentative 2011 deal which calls on the Kurds to send the oil to Baghdad, which sells it, and pays 50 percent of the revenues to oil companies to reimburse their development costs.

Iraq sits atop the world's fourth largest proven reserves of conventional crude, with about 143.1 Billionn barrels.

Oil revenues make up 95 percent of the country's budget — a portion of which is earmarked for the Kurdish region.

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How China won the Iraq War

How China won the Iraq War

New fracking technology is going to make the US the number one oil producer by 2017

Baghdad Invest - Baghdad.
It seems the answer to the question “who won the Iraq war?” is – China. India might also be deemed an acceptable answer. But China looks like the real winner of the Iraq war. How come? Because if the point of that war was oil, as many critics have asserted, then China looks like coming away with the lion’s share of that oil – and without having to fire a shot.
According to the International Energy Agency, Iraq has loads of undiscovered oil, and unlike other countries in the region has opened up exploration to foreigners, many of them from China. Not only is the oil plentiful in Iraq, it’s also cheap to get at – 15 times cheaper than extracting Russian oil, 30 times cheaper than Canadian Oil sands.

In the view of the IEA, Iraq is going to become the number two oil exporter over the next couple of decades. And 90% of those exports are going to go to Asia – mostly China, then India.
Indeed much of the oil in the Middle East seems destined for Asian markets in the coming decades, setting up an interesting three way power relationship between Baghdad, Beijing and Delhi. That has profound geopolitical implications, according to the Chief economist at the IEA, Dr Fatih Birol, who gave a fascinating presentation of this year’s World Energy Outlook to the Institute of International and European Affairs in Dublin last week. Trade and Defence policies have a habit of closely tracking energy policy.
So what about the Americans, who did most of the fighting in Iraq? It seems they are headed for virtual energy self sufficiency – thanks to fracking. The controversial new extraction technology is going to make the USA the number one oil producer by 2017, according to the IEA. It may even start exporting oil.
The same fracking technology is also unleashing vast reserves of gas from shale deposits in the US, so much so that it may overhaul Russia in gas production sometime in the next decade.
But already fracking has had a major impact on the American – and world – energy scene. Firstly the spectacular rise of shale gas has led to massive price drops for gas users in the USA. So much so that electricity producers there have converted power stations from coal burning to gas burning to such an extent that two things have happened – over the past five years, the IEA says the US has seen the biggest drop in CO2 emissions of any country in the world – pretty amazing for a country with no climate change policy. Secondly, the price of coal has fallen to such an extent that Europeans have started importing cheap American coal to fire their own power stations. Europe has seen the second highest growth in coal imports in the world after boomtime China.
There has been one significant policy driver in the US which is also impacting on the global energy scene, and that is the CAFÉ fuel efficiency standards the Obama administration has gotten through the legislative mill. This will lead to a big average improvement in fuel consumption of the US vehicle fleet, reducing pollution and making their increasing fuel reserves last longer.
Up until recently, the Middle East region was exporting oil to both the East and the West on a 50/50 basis, but the IEA sees this shifting to a 90/10 split in favour of the East.
Meanwhile, the Chinese have become more concerned with energy import dependence, and are increasingly turning to alternative sources of energy and energy efficiency. Such is the vast scale of the Chinese market that, according to Dr Birol, when China decided which technology it will adopt, it will become the global standard because the scale effect will mean prices for that technology will plummet.
China, India and Europe are increasingly becoming dependent on imported energy: Japan has already reached 100% dependence on imports. Only North America is heading in the opposite direction, and moving towards self sufficiency.
The gas revolution – led by the US, Canada and Australia – is bad news for traditional gas producers like Russia and Algeria, who export to Europe in particular. Europeans are paying five times more for their gas than Americans (the Japanese pay eight times more!), largely because the contracts link gas prices to the price of oil. But the fracking revolution has decoupled those prices in the US. This price gap has been a present to European governments from the US , who now have some leverage to negotiate prices down. Which is, of course, bad news for the Russians and Algerians.
Not only will this major energy shift have implications for diplomatic and military relations between different regions of the world, they will also have big economic implications, especially for energy intensive industry.
The IEA estimates EU electricity prices will be 50% higher than US electricity, and three times higher than Chinese prices.
Why? For three reasons - firstly natural gas is more expensive. Secondly, Europe has significant subsidies for renewable energy sources like wind power. And thirdly, EU states have carbon taxes. The subsidies for renewable energy may be justified in building the critical mass needed to shift more production to this sustainable sector, and the Carbon Tax is driving technological change towards more climate friendly energy consumption patterns. But they do add to costs for energy intensive businesses in Europe, which may find themselves disadvantaged in their home market.
Indeed the high cost of energy was specifically mentioned by German chemical giant BASF and Bayer in recent decisions to increase investment in the low cost USA last month.
The IEA has taken a special look in this year’s report at Energy Efficiency, treating it as a fuel source in its own right. This is particularly important for European Countries like Ireland, which are very dependent on imports (and Ireland is one of the most dependent in the EU). The EU has a policy aimed at achieving a 20% improvement in energy efficiency by 2020. This involves all sorts of things, from low energy lightbulbs and electrical appliances to the virtual rewiring of the European electricity grid. But the promised gains are immense – a 20% improvement in efficiency would, according the European Commission, save the equivalent output of 1,000 coal fired power stations or half a million wind turbines. In cash terms, the annual saving is equivalent to the GDP of Portugal.
Ireland is pushing ahead with renewable energy investments, mainly in windpower. The Government is also trying to ramp up retro-fitting of Ireland’s housing stock to make it more energy efficient. Energy Minster Pat Rabbitte says the plan is to phase out direct grants for things like external insulation and more efficient gas boilers. Instead the Government and industry are working on a pay-as-you-save scheme, with the power utilities funding efficiency measures while consumers pay off the costs over the long term through savings in their monthly bills.
But according to the IEA, Europe’s ambitious policies only unleash about one third of the potential that energy efficiency has to offer. If the big energy using regions of the world went all out for efficiency by simply removing the barriers to using economically viable efficiency measures, energy demand would start to fall from the end of this decade. And it says the savings could push economic growth. The IEA thinks a $12 trillion investment in efficiency technologies would produce an $18 billion boost to GDP out to 2035. The biggest gainers in terms of economic growth would be India, China, The US and Europe.
And it would lead to cleaner air and might – just might – help to keep global warming within tolerable limits.

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Baghdad Burger Boom

Baghdad Invest - 01/09/2012 Baghdad.

BAGHDAD'S embattled residents can finally get their milkshakes, chili-cheese dogs and buckets of crispy fried chicken - original recipe or extra spicy, of course.

A wave of new American-style restaurants is spreading across the Iraqi capital, enticing customers hungry for alternatives to traditional offerings like lamb kebabs and fire-roasted carp.

The fad is a sign that Iraqis, saddled with violence for years and still experiencing almost daily bombings and shootings, are prepared to move on and embrace ordinary pleasures - like stuffing their faces with pizza.

Iraqi entrepreneurs and investors from nearby countries, not big multinational chains, are driving the food craze. They see Iraq as an untapped market of increasingly adventurous eaters where competition is low and the potential returns are high.

"We're fed up with traditional food," said government employee Osama al-Ani as he munched on pizza at one of the packed new restaurants last week. "We want to try something different."

Among the latest additions is a sit-down restaurant called Chili House. Its glossy menu touts Caesar salads and hot wing appetisers along with all-American staples such as three-way chili, Philly cheesesteaks and a nearly half-pound "Big Mouth Chizzila" burger.

On a recent afternoon, uniformed servers navigated a two-story dining room bustling with extended families and groups of teenagers. Toddlers wandered around an indoor play area.

The restaurant, located in the upscale neighbourhood of Jadiriyah, is connected to Baghdad's only branch of Lee's Famous Recipe Chicken, a US chain concentrated in a handful of Midwestern and Southern states.

Azad al-Hadad, managing director of a company called Kurdistan Bridge that brought the restaurants to Iraq, said he and his fellow investors decided to open them because they couldn't find decent fried chicken and burgers in Iraq. He called the restaurants a safe investment for companies like his that are getting in early. He already has plans to open several more branches in the next six months.

"Everybody likes to eat and dress up. This is something that brings people together," he explained. "People tell us: 'We feel like we're out of Baghdad. And that makes us feel satisfied.'"

Baghdad's Green Zone and nearby US military bases once sported outposts of big American chains, including Pizza Hut, Burger King and Subway, but they shut down as American troops left last year. Because they were hidden behind checkpoint-controlled fortifications, most ordinary Iraqis never had a chance to get close to them, anyway.

Yum Brands Inc., owner of the Pizza Hut, Taco Bell and KFC chains, has no plans to return to Iraq for now, spokesman Christopher Fuller said. Burger King declined to comment on its Iraq plans, and Subway did not respond.

Dining out in Iraq is not without risk. Ice cream parlours, restaurants and cafes were among the targets of a brutal string of attacks that tore through Iraq on August 16, leaving more than 90 people dead.

Iraqis say the chance to relax in clean surroundings over a meal out is worth the gamble. For them, the restaurants are a symbol of progress.

"This gives you a feeling the country's on the right track," said Wameed Fawzi, a chemical engineer enjoying Lee's fried chicken strips with his wife Samara.

Baghdad's Mansour district is the heart of the fast-food scene.

At the height of sectarian fighting in 2006 and 2007, it was tough to find shops open along the neighbourhood's main drag. Militants targeted shop owners in a campaign to undermine government efforts to restore normality.

These days, roads are packed with cars. The traditional Arabic restaurants long popular here now find themselves competing against foreign-sounding rivals such as Florida Fried Chicken, Mr. Potato, Pizza Boat and Burger Friends.

There is even a blatant KFC knockoff called KFG, which owner Zaid Sadiq insists stands for Kentucky Family Group. He said he picked the name because he wanted something similar to the world-famous fried chicken chain. And he believes his chicken is just as good.

"In the future my restaurant will be as famous as KFC. Why not?" he said.

One of Mansour's newest additions is Burger Joint, a slick shop serving up respectable burgers and milkshakes to a soundtrack that includes Frank Sinatra. It is the creation of VQ Investment Group, a firm with operations in Iraq and the United Arab Emirates.

Its Mansour store is outfitted with stylish stone walls and flat-screen televisions. Another branch just opened across town in the commercial district of Karradah.

The group also runs the Iraq franchises of Pizza Pizza, a Turkish chain, and is planning to launch a new hot submarine sandwich brand called Subz.

Mohammed Sahib, VQ's executive manager in Iraq, said business has been good so far.

Even so, running a restaurant in Iraq is not without its challenges.

Burger Joint's servers had to give up the iPads they originally used to take orders because the Internet kept cutting out, he said. Finding foreign ingredients such as Heinz ketchup and year-round supplies of lettuce is also tricky, and many customers need help understanding foreign menu items like milkshakes and cookies.

Health experts are predictably not thrilled about the new arrivals.

"The opening of these American-style restaurants ... will make Iraqis, especially children, fatter," said Dr. Sarmad Hamid, a physician at a Baghdad government hospital. But even he acknowledged that the new eateries aren't all bad.

"People might benefit psychologically by sitting down in a quiet, clean and relatively fancy place with their families, away from the usual chaos in Iraqi cities," he said.

Purveyors of traditional Iraqi specialties, who might be expected to oppose the foreign-looking imports, don't seem to mind at all.

Ali Issa is the owner of fish restaurant al-Mahar, which specialises in masgouf, the famous Iraqi roasted carp dish. He said every country in the world has burger and fried chicken restaurants, so why shouldn't Iraq?

Besides, he said, he and his family are fans of "Kentucky," the name Iraqis use for fried chicken, regardless of where it's made.

"Sometimes we need Kentucky. Not just fish, fish, fish," he said.

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Iraq Oil Producers Opec

Iraq has finally overtaken Iran as the second largest oil producer in OPEC according to the International Energy Agency. Baghdad chalked up 3mb/d production compared to 2.9mb/d from Tehran. For some, that’s cause for celebration – ‘proving’ that international sanctions against Iran are ‘working’ – but it merely highlights the profound supply side problems afflicting the oil world. Bad news all round.
The idea that Iraq, now the second largest producer in OPEC, could be relied upon to provide consistent (let alone) excess supplies, flies in the face of all the political problems afflicting the country. Its main output gains have come in Kurdistan, a region that the central Shia government in Iraq refutes as a self-standing oil producing region. The dictum was very clear after Saddam fell; those who do business in Kurdistan will be barred from far bigger fields in the centre and South of the country. Ballpark numbers certainly backed it up. Baghdad sits on 143bn barrels of ‘proven’ oil reserves, compared to 40bn barrels in Kurdistan. For a time, it was a message that most IOCs were happy to heed. The likes of Exxon, BP, Lukoil and Shell signed very unattractive service contract agreements (i.e. hired help), with a view to securing proper production sharing agreements with Baghdad down the line. The problem is that Baghdad has never worked out what’s good for them; decent contracts have never been put on the table to entice IOCs (or national counterparts) to see Iraq as a serious proposition. Fields haven’t been developed. New infrastructure hasn’t been built.
That’s exactly why the biggest players, including Exxon, Chevron, and Total have called Baghdad’s bluff by signing bilateral deals with Kurdistan as the more credible (if modest) output option. Unless Iraq blinks first to revise contractual terms, don’t expect IOC investment anytime soon. Baghdad might take their chances with the Chinese, (if Beijing happens to still be interested). Russia might invest when asked, but they’ll make sure new fields only come online at times of their choosing for global fundamentals. Alas, far from blinking, Baghdad has kept their eyes wide shut. Although it didn’t chuck Exxon out of West Quarna plays, it barred them from their latest licensing rounds, and indeed Chevron for their ‘Erbil betrayals’. Baghdad will hit its ‘12mb/d’ production targets by 2017, with or without international help – or so the story goes. The snag isn’t just that Kurdistan provides IOCs with the perfect hedge to put pressure on Baghdad, but that Iraq hasn’t understood the unfolding contours of the new energy world. Ten years ago, the greatest risk for IOCs wasn’t operating in high risk, uncertain return markets, but not having access to prospective elephant fields in the first place. It was ‘follow the resources, or die’.
The global unconventional explosion has totally re-written this analysis. If you aren’t willing to offer decent terms and decent conditions, investment won’t come. International players can pick and choose jurisdictions for the best returns. You’re as likely to find a herd of elephants in the US Mid-West these days as you are in a highly explosive Middle East, which, if anything, provides the real kicker for Iraq here: Not only is Baghdad offering poor fiscal terms on new concessions (without any serious legal structure), it’s doing so in an increasingly large security vacuum. Since the US upped-sticks, local grievances have been sharpened without a common enemy. 19% unemployment and chronically high levels of absolute poverty afflicting the population don’t help. But it’s sectarian schisms that remain the most divisive fault lines rather than rich vs. poor in Iraq. Oil sits at the heart of this debate.
However you spin things, IOCs are bankrolling Kurdish succession in the North thanks to enhanced oil receipts (Turkey could obviously do without such developments), while Sunni politicians (let alone insurgency groups) have never come to terms with Shia power, embodied by the al-Maliki central government. Something will eventually have to give in Iraq on how state formation does (or doesn’t) play out, with oil providing the underlying formula for who gets what, where, and when. That’s before you ‘price in’ external meddling from neighbouring Iran, a nation that’s more than happy to stir the Shia pot to progress its economic and political interests in the region. Clipping Iraqi oil production is the perfect way of doing that. It hardly went unnoticed in Tehran that Iraq made as much cash ($22-24bn) in the last quarter. That’s not been the order of things since the 1990 Gulf War; Iran will work hard to keep it that way.
Put all that together, and Iraq will struggle to nudge output towards 4mb/d over the next few years, let alone hitting 5, 6, or 7mb/d over the next decade. As for 12mb/d production targets by 2017 as a the new ‘swing producer’, forget it. Iraq has squeezed out all it can from its older fields; any further gains will be attritional, at best. The upshot is that we’re left with the same oil market equation we’ve had for decades: Saudi Arabia and Russia are simply too big to fail. No one, least of all Iraq is going to change that anytime soon when it rejoins OPEC quotas in 2014. It’s therefore all the more disturbing that the IEA are pinning their main global supply growth hopes on Iraq over the next decade.
But let’s be generous and assume Iraq prevails against all the odds; you then have to beg the serious question: Would enhanced oil royalties from 7mb/d oil production be the catalyst to hold Iraq together from sharing the spoils, or would it rip the country apart? In a winner takes all system between its constituent parts, my bet would be on the latter. The more Iraq gets it oil ‘right’, the more likely things will end in spectacular (and very crude) failure…

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Double-Decker Red Bus in Baghdad

                                      

Common across Baghdad in years past, red double-decker buses are again plying the Iraqi capital's traffic-choked streets after many were ransacked in the years of unrest following the 2003 invasion.

The brand-new red buses with long white and black stripes on their sides began limited operations on Saturday, making halting progress amid masses of taxis and pedestrians in central Baghdad.

They have metal floors and plastic seats that are comfortable enough, though somewhat cramped for taller passengers. Air conditioning keeps the buses cool in spite of the Baghdad heat, which will only worsen in the summer months.

One bus was packed with boisterous Iraqis who were pleased by the features, especially the air conditioning.

"With this comfort, I will stay here enjoying the air conditioning and won't get off until the electricity generators start working in our area," joked Kadhim Karim, a 31-year-old musician.

"The new bus contains all the amenities, including air conditioning and cleanliness," said Kadhim Saba Rasan, 57, a government employee.

Only 70 buses have so far been bought from a Jordanian firm -- 60 double-deckers and 10 single-storey buses -- but 100 more are expected to be added later this year, said Adel al-Saadi, the director general of the state-owned firm responsible for public transport.

Even at its peak before the 2003 US-led invasion, the Baghdad bus network was a limited one. Its 300 buses at the time pale in comparison to the 8,500 that ply London's streets, according to the British capital's public transport authority.

This despite the fact that London's population of seven million is not vastly greater than Baghdad's six million residents.

The firm providing Baghdad with the buses, Jordan-based Elba House, first made its name constructing pre-fabricated buildings, but since 1992 has also built a variety of vehicles, including buses.

Each double-decker bus costs around $205,000.

Tickets for the buses are 500 Iraqi dinars, about 40 cents, offering a far more comfortable alternative to the cramped minibuses that criss-cross the city, and one that is cheaper than the fleets of mustard-yellow taxis.

"The new buses are very successful and better than taxis, which cost at least five or six thousand dinars ($4-$5)," said Mohammed Samir, an 18-year-old policeman.

Security remains a key priority in a city where brutal sectarian bloodshed killed countless residents, partitioned off key neighbourhoods and badly damaged Baghdad's infrastructure in the years following the invasion that ousted dictator Saddam Hussein.

The buses are equipped with cameras that allow the driver to monitor both floors of the interior, and Saadi said that each bus driver will work with an assistant whose role it will be to monitor the vehicle for signs of explosives and to search each passenger getting on the bus.

But while an assistant collecting fares was present on one of the buses, many passengers were not searched.

Samir, the policeman, said that he thought it would be better if they were searched.

Smoking, which is banned on the new buses, is another challenge -- one passenger lit up soon after sitting down on the upper deck of the bus, and the numerous cigarette butts in the trash bin indicated that he was not alone.

In the immediate aftermath of the US-led invasion of Iraq, while many people stayed at home and government buildings were all but shut, the red double-decker buses would still traverse the city from 7:00 am every day.

As worsening violence racked the city, many bus drivers transformed their vehicles into ad hoc taxis, ambulances and hearses. Over time, though, looting and pillaging across Baghdad eventually targeted the city's buses.

Rasan, who said he had ridden Baghdad's old double-decker buses and now on one of the new buses as well, described the style of bus as a fixture of the Iraqi capital.

"These buses are a beautiful means of transport and represent a part of the history of Baghdad," he said

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Arab Summit Baghdad 2012

Baghdad Invest - 12/03/2012 23:10 G.M.T Baghdad.

Iraq has spent hundreds of millions of dollars in a bid to ensure the upcoming Arab Summit in Baghdad on March 29 is a success but analysts believe their efforts may lead to naught.

“There won’t be any high-profile attendance at the Arab Summit in Baghdad,” said Ali al-Zakari, a UAE-based political analyst, citing division amid an Arab Spring-hit region as the reason.

“It is expected that no important decisions will be made towards countries like Syria or Somalia,” Zakari added.

Late February, the conference of “Friends of Syria” did not lead to any consensus among Arab countries; Tunisia pressed for stricter sanctions against the government of Bashar al-Assad but not for military intervention, while Gulf countries who support military intervention in Syria, seem to be leading calls for the arming of the Syrian opposition.

In Iraq, Prime Minister Nouri al-Maliki has warned that toppling the Assad regime could result in the rise of Islamists in Syria, henceforth dire consequences to be expected in Iraq that is already suffering from al-Qaeda. Because Syria was expelled from most Arab nations, as well as suspended from the Arab League for its refusal to halt its crackdown on protestors, it was not invited to the Baghdad meet.

“The only way for the summit to be successful is if high-profile figures come together to send a strong message to Iran, but the current mood is not for escalation [of tension],” Zakari added.

On Wednesday, Iraq’s deputy foreign minister announced that that U.N. Secretary-General Ban-ki Moon will attend the upcoming summit, but analysts are skeptical about that.

“Attendance of Ban-ki moon or other representatives of certain organizations will be as mere observers.”

Meanwhile, a Jordan-based political analyst who wished to remain anonymous said that Baghdad’s announcement of Ban’s attendance is an attempt to show that the meet will have “international” attendance. The analyst said that with or without high-ranking officials’ attendance, Ban is there to make use of the event to talk about international issues related to Iraq such as Camp Ashraf, a camp that houses members of the anti-Iranian group, People’s Mujahideen Organization of Iran.

Iraq’s deep division

Apart from the divisions with the Arab nations, Iraq’s political schism and Iran’s influence in its politics threaten to make the summit ineffective, said the Jordan-based analyst.

“If Iraqis do not reconcile, the representation of Arab states will be at a ministerial and ambassadorial level … and this depends wholeheartedly on Iraq,” he said.

The Gulf countries had, after all, demanded Iraq’s divisive factions to put their problems aside and work towards creating a solid national partnership government and oppose the one party domination that is Maliki’s State of Law coalition. Gulf States see Maliki’s coalition as an ally to Iran so they are hesitant to have its highest-ranks officials attend the summit unless Iraq fulfills the precondition of a partnership government, the analyst said.

Ground realities, however, show that the divisions run deep and pose incredible challenges to governance.

There was ambiguity on whether Maliki or the Iraqi President Jalal Talabani who, according to the country’s constitution, must represent Iraq at the upcoming summit.

Rumors that Talbani may not even be at the summit were rubbished by a source who told the London-based Asharq Alawsat newspaper that while the president is going to the U.S. for medical reasons, he is expected to return on March 12, rebuffing critics that there is an Iranian pressure to make the president hand over responsibility to Tehran’s ally Maliki to head the summit.

Other Iraqi factions also do not wish to see Maliki’s coalition succeed.

The secular yet Sunni-backed Iraqiya List headed by Ayad Allawi who is currently in Turkey, is lobbying against the summit. Iraqiya List says that Iraq is not ready to host the Arab Summit in Baghdad as the country’s politicians are divided and won’t represent the country under one voice which in turn will weaken the country’s position.

According to the Jordan-based analyst, Maliki’s making the summit successful will mean that his faction has won over against others and that an Iran-ally bloc has finally won the acceptance of the Arabs.

Another Jordan-based analyst, Ahmed al-Abyadh, said that a successful Arab Summit in Iraq should be seen as an achievement for all Iraqis, and Iraqiya is short-sighted in not wanting the summit to be an effective one.

Abyadh said the constant prodding by Gulf states demanding Iraq end its political division is an intervention into the country’s affairs.

Iraq, a founding member of the Arab League, has not hosted a regular Arab summit since November 1978, but an extraordinary summit was held in Baghdad in May 1990, just months before Saddam Hussein’s invasion of Kuwait.

Iraq which has spent at least $450 million in preparation for the summit that was supposed to be held on March 29 last year has recently received 400 Chevrolet armored vehicles to transport senior foreign officials. It has been criticized by sections of the public for wasting money that is badly needed to build the country’s infrastructure on a summit.

Iraq has also prepared itself diplomatically. Iraq and Saudi Arabia saw closer ties as the Kingdom named an ambassador to Iraq for the first time since Kuwait’s invasion. Iraq’s Foreign Minister Hoshiyar Zebari said that Iraq has also compensated Kuwait $4 billion in 2011.

Latest Iraqi related news from: www.baghdadinvest.com

Hotel Investment Karbala



Baghdad Invest - 08/03/2012 20:15 G.M.T Baghdad.

Fancy buying some timeshare with a twist? How about timeshare in Iraq?
Timeshares in Iraq may seem an unlikely proposition but for one developer in Dubai, that model has helped to fund a five-star hotel project it is building in Karbala.

Range Hospitality, which is developing the US$100 million (Dh367.3m) hotel to cater to demand for accommodation from pilgrims travelling to the city, is hoping to complete the property by the end of next year, having raised funds from buyers within the Gulf region and globally, it said.

"We went for the timeshare model because, from the outset, we knew it wouldn't be possible to get funding from banks," said Munaf Ali, Range Hospitality's chief executive.

"Because of the difficult environment - what the world was experiencing - obviously a bank could not lend you a very large amount to build a hotel, especially in a country like Iraq," he said.

"Although we perceive it to be low risk, not everyone agrees with us."

Timeshare and "fractional ownership" - owners taking a percentage share of the same asset - have garnered a poor reputation in Europe and the US in the past, as some unscrupulous developers exploited buyers.

But Mr Ali said that by focusing on pilgrims rather than holidaymakers, there was inbuilt demand. Karbala is home to two of Shia Islam's holiest shrines.

"Timeshare didn't work very well in Europe when it came to holiday destinations because Spain can be in fashion one year and then it goes out of fashion and people want to go to a different country. But a religious destination never goes out of fashion. When economic times are good, people go;
when economic times are bad, people still go."

The money raised from the timeshare sales is going through an escrow account with Standard Chartered, he said.

"We managed to sell a significant portion of the building, which meant construction is fully funded now." He declined to say how many timeshares had been sold.

The prices begin at $6,350 for ownership of a studio in the property for one week in the low season for a 50-year period, Range said. A two-bedroom flat for a week a year for 50 years during high seasons costs up to $68,000.

The hotel has 624 suites and rooms. Foundations are nearing completion and work is about to start on the superstructure of the hotel, Mr Ali said. The property is to be managed by Shaza Hotels, a joint venture between Kempinski Hotels and Guidance Hotel Investment Company, based in Paris.

Travel accommodation revenues in Iraq reached $489.3m last year, up from $475.5m the previous year, according to figures from Euro-monitor International. Its data also shows that religious tourism has grown in Iraq.

"As soon as the old regime ended, Shiite travellers were able to practise their faith in two holy Shiite cities, Najaf and Karbala; these two continue to welcome many Shiite arrivals every year, mainly from Iran and Lebanon," a Euromonitor report said.

International hotel operators have increasingly looked to opportunities in Iraq, but they remain wary.
Most of the focus has been on Erbil in Iraqi Kurdistan, which is considered more stable.

But Abu Dhabi's Rotana Hotels has a property under development in Baghdad, and Millennium and Copthorne Hotels also has projects in southern Iraq.

Airlines have also expanded their operation in the country. Last week, Etihad announced plans to launch flights to Basra next month. Emirates Airline and the budget carrier flydubai have also increased their flights into Iraq this year.

The Proposition

• Shariah compliant fractional ownership in Karbala by specific unit for for specific time period
• First five star hospitality complex in Karbala
• Fully serviced and fully furnished suites

Investment Security

• Escrow account with Standard Chartered Bank
• Construction fully funded
• Shaza Hotels appointed as the hotel operator assuring five star service adding value to your investment

Investment Returns

• Greater returns due to first mover advantage
• Costing as low as US$ 5 per bed per night
• 3 to 5 years payback period
• Highly granular investment structure for retail proposition
• Attractive payment plan

Flexibility and Accessibility

• Transferable ownership
• Potential capital gain through resale in the secondary market
• Option to swap the periods, seasons and units based on availability through the Range Exchange Program

The prices begin at $6,350 - Find out more by visiting the website here: http://www.rangeholdings.com/

Latest Iraqi related news from: www.baghdadinvest.com

Basra Sports City Construction Update

Baghdad Invest - 25/02/2012 23:22 G.M.T Baghdad.

Basra is the capital of Basra Governorate, in southern Iraq near Kuwait and Iran. Basra is Iraq's main port, although it does not have deep water access, which is handled at the port of Umm Qasr.
The city is part of the historic location of Sumer, the home of Sinbad the Sailor, and a proposed location of the Garden of Eden. Basra has an important role in early Islamic history, being built in 636 CE, or 14 AH. It is Iraq's second largest and most populous city after Baghdad.

Basra sports city is the largest sport city in the Middle East, located on the Shatt al-Basra.

The construction was started on 15 July 2009 and expected to be completed in 2012. The sports city is being funded by the government of Iraq with a budget spending of $550 million dollars, contributed to contain main stadium with capacity of 65,000 people, secondary stadium with capacity of 20,000, four Five Stars hotels and other sports related facilities.
The contract of this project was given to Abdullah Al-Jaburi, a major Iraqi construction contractor, two American companies, 360 architecture and Newport Global.
This project will play host to the 2013 Gulf Cup of Nations that will be held in Iraq.

A man-made lake in the shape of Iraq encircles the stadium.

Basra Sports City is not a pipe dream. Construction is already well underway, with completion expected by 2012. The Youth Ministry Undersecretary stressed recently that work in the sports city in Basra is moving smoothly according to its time table.

Isam al-Diwan, at a recent press conference, disclosed that 80 percent of the project was completed.

The project includes a number of play areas, in addition to Tennis and Bowling playgrounds, sports halls, housing complex and other services facilities.

But for Iraq's football-mad masses, at least there's the possibility of seeing some top-quality international games on home turf.

The project can restore the Iraqi people's sense of pride and national identity – much needed.
Latest Iraqi related news from: www.baghdadinvest.com

Champagne and Crude in Kurdistan Iraq

Baghdad Invest - 19/02/2012 02:30 G.M.T: Baghdad.

Foreign endorsements are coming thick and fast in the city of Arbil in Iraqi Kurdistan--Genel Energy , the Kurdish region's largest oil producer, was snapped up last year by former BP chief executive Tony Hayward and financier Nat Rothschild.

Dusty, windswept and interspersed with military checkpoints, the city of Arbil in Iraqi Kurdistan is the Middle East’s unlikely latest investment hotspot. Only 400 kilometres and a border of disputed territories separate this semi-autonomous oasis of calm from the risk of suicide bombings and political instability that troubles Baghdad. Oil majors are mobilising to tap the estimated 40 billion barrels of crude reserves in the north, positioning Kurdistan for a major economic boom.

Foreign endorsements are coming thick and fast. Genel Energy , the Kurdish region’s largest oil producer, was snapped up last year by former BP chief executive Tony Hayward and financier Nat Rothschild. Exxon Mobil has signed a deal with the Kurdistan Regional Government. France’s Total has confirmed it is also weighing an entrance, in defiance of the central Iraq government, which receives all oil export revenues before sharing them out and deems illegal the contracts signed by the KRG.

Kurdistan is currently producing oil at just a fraction of its potential. But it already boasts of an 8 percent GDP growth rate. Wealth per capita is more than twice that of Egypt. Foreign financiers fill the bars of the city’s newest five-star hotels. Many still only travel beyond their luxury confines in armed-security conveys. Arbil’s less fearful growing clan of millionaires, meanwhile, host lavish parties, importing chefs, magnums of champagne, the finest seafood and mountains of strawberries. Like Arbil’s ambitions, the aptly titled “Dream City” residential area is vibrant — but only half built.

A model economy

Unusually for an oil-rich Middle Eastern economy, Kurdistan is embracing the private sector. Investors don’t need a local partner to start a business. They benefit from tax breaks and can freely transfer profits abroad. The government is a minority partner in oil projects, and its contracts are available to view online. At least when the internet works. The deals struck by the KRG offer oil majors long-term value of around $5 or $6 per barrel, compared to estimates of around $1 in Baghdad.

But it isn’t all an easy ride. Kurdistan has two international airports within a three hour drive, but it remains a cash economy without the tools of a sovereign state, like the ability to print money or issue banking licenses. Oil companies, predictably, do their business in dollars.

The command economy of the Baath regime has long gone in Kurdistan. But the KRG still can’t forge public-private partnerships to develop its industries because, under the federal system, it depends on Baghdad for its funding. Power cuts often plunge meetings into darkness, and it’s hard to tell whether the dimming of lights in the hotel bar is meant for aesthetic effect, or not.

Turkey holds the key

The KRG publicly supports a unified federal Iraq, but Kurdistan might be richer as an independent country. In the current system, if the region’s export capacity grows and political problems keep holding things back in the South, the KRG could become a net contributor to the Iraq budget.

In a perfect world, Kurdistan would export its oil directly to energy-hungry Turkey and avoid the bureaucratic black hole of Baghdad. Iraq would just be one of the troubled neighbours on its periphery — alongside Syria and Iran. Currently the KRG and Baghdad can’t agree on oil revenue sharing, resulting in delayed and irregular payment. Until the dispute is resolved, the KRG is placating its oil producers by effectively letting them profit more than they would otherwise for what they sell domestically.

Turkey doesn’t want to encourage its own restive Kurdish population but is heavily invested in Iraqi Kurdistan’s success. Relations between Ankara and Baghdad have weakened of late. Turkish Prime Minister Tayip Erdogan fears that his Iraqi counterpart Nuri al-Maliki, under the influence of Iran, might steer the rest of the country into sectarian conflict. Turkish national colours can be seen on construction sites in Arbil, and Turkish banks finance many of the projects.

The oil majors eyeing up small and mid-sized producers with operations in the North — like Gulf Keystone Petroleum and Norway’s DNO — bet that Turkey could eventually agree to buy Kurdish oil directly if Baghdad fails to agree on a revenue-sharing law soon. Due for completion in 2013, Genel Energy’s planned pipeline running from its Taq Taq field surrounded by snow-capped mountains up to the main Iraqi-controlled one could easily be extended by a few kilometres to reach the border.

Baghdad breaking point

Political pressures are growing but, for now, in Kurdistan, optimism rules. The Kurdish diaspora is returning to be part of the growth story. Arbil’s millionaires want to become billionaires. That can only happen if more of Kurdistan’s oil explorers turn into producers that can export their oil. Production capacity is already ramping up and is expected to reach 1 million barrels per day by 2018. The impasse requires a solution. With the stakes so high for all sides, investors wouldn’t look foolish to bet on an amicable and lucrative one. 

Latest Iraqi related news from: www.baghdadinvest.com

Dinar Currency of Iraq

Baghdad Invest - 12/02/2012 17:35 G.M.T: Baghdad.

When Michael Capps set foot in Iraq with Halliburton, Iraqi Freedom was well underway, but the buzz in the American bases had nothing to do with politics.

“The minute you hit the ground, there was hype,” said Capps.

Servicemembers were talking cash, Iraqi money called dinar.

“You couldn't almost walk into an American base without somebody mentioning the Iraqi dinar, the revaluation, the investment…we're going to become instant millionaires,” said Capps.

The idea? Buy dinar at the current low value, near worthless, and hope for appreciation.

When Capps bought his currency in Iraq, $14,000 worth, the dinar was valued around 1,500 to one dollar.
Best case scenario, the dinar would return to its pre-war value 3.5 to one, making Capps and many other investors instant millionaires.

“If it sounds too good to be true, come on wake up, it's too good to be true,” said Certified Financial Planner, Don Grant.

Grant is the first to steer potential investors away from the dinar. He starts with the dinar's valuation. Unlike the U-S dollar, the dinar isn't backed by a stable government.

“The dinar has been valuated initially by Saddam Hussein. He is the one who said, ‘This is what it's worth,” and it’s pretty much maintained that same value for the past decade,” said Grant.

According to online exchange site xe.com, today's value of the dinar is about 1,160 to every dollar. Back in 2005, it was around 1,500. That’s a seven year appreciation of about 30 cents.
Capps is well aware his investment might take time. He's well-aware it's nothing more than a gamble in the first place.

“I think there's definitely some potential for some real opportunity, but anybody that's got the view that it's a get rich quick overnight, it definitely isn't going to happen that way,” said Capps.

But Grant and many other advisors have one undeniable reason they don't see that potential. The Iraqi government may be the last one to want their currency to appreciate. They're in big debt. If their currency gains value, that just deepens their debt. In fact, many say Iraq would be far more likely to scrap the dinar altogether and create a brand new currency, making all that dinar sitting in American houses nothing more than pretty paper.

But say, the dinar stays put and it does appreciate. Here comes the next problem, says Grant. Where do you cash them in?

“I don't know of a place in America where I can go trade dinars other than some place that is perhaps illegal,” said Grant.

The currency is not regulated. To see for yourself, Grant offers a challenge to those thousands of Iraqi dinar dealers online.

“Present them the opportunity of buying some that you have. Tell them you'll sell them at a discount. I don’t think they'll buy it,” said Grant.

That's something both Capps and Grant agree on. It's the middle men you need to be wary of. With shipping and handling and commission charges, you end up paying two to three times the dinar's true value, making the dealers the ones who may be getting rich.

Yet the trend of dinar investment continues to grow and there's one reason for that; hope.
No one knows for sure if it will or won't pay off.

But even Capps offers this advice:

“The dinar as a whole is completely a risk. You know, one of the things people will tell you about any investment is, don't invest money you're not prepared to lose.”

Grant encourages anyone interested in foreign currency investment to get with a certified financial planner. Visit cfp.net for more information.

Latest Iraqi related news from: www.baghdadinvest.com

Iraqi Dinar Scam - RV

                         I have been hearing about an RV “very soon” for years.

The dealers make some money on fulfillment costs (shipping and handling) but most of it comes from the spread. They are able to buy dinar at a much lower rate (about 20%) than they sell it for. A spread on investment products is normal but 20% is extreme. To give you some sense of perspective, if you were to buy the Euro through an FX dealer it would cost you about three ten-thousandths (.0003) of a penny per dollar of value. Even the hard currency dealers at the airport only charge a point or two.

The Iraqi dinar is the perfect storm of financial desperation, ignorance and the internet. It is heartbreaking to see so many people fall for the foolish claims of the pumpers and promoters.

A revaluation, as proposed by these people, has never happened in the history of the world. Germany after WWII and Kuwait after the Gulf War was not the least bit similar. But, of course, people don’t know that. They hear “revaluation” and figure they’re all the same. Currency exchange is a zero sum game. Wealth is neither created nor destroyed in the process, it is only transferred.

People that believe wealth will be transferred to them through a revaluation of the Iraqi dinar should ask themselves from whom the wealth is going to be transferred. For them to receive the wealth of an RV, someone (or something) else must give up their wealth. Who will that be? The Central Bank of Iraq? The government of Iraq? Why would they do that? Why would anybody? It makes no sense. It’s an absolutely foolish notion. The government of Iraq would not willingly and voluntarily relinquish the wealth of its nation. No country would. They may squander it through fraud, corruption and mismanagement, but they would not willingly transfer it.

Layman terms – as simple as counting from 1 to 10

A scenario that to me makes perfect sense in explaining how there is NO way that this could play out the way these “dream chasers” believe it will.

According to numbers I’ve seen from 2009, the “average hourly pay” for an Iraqi citizen is roughly US $2.10 per hour. That currently equates to ~2,500 Iraqi dinar, per hour. So let’s take an average early 20′s Iraqi boy that gets a job, say “moving rocks”. He goes out and puts in a hard 10 hour day worth of work. At the end of the day his supervisor approaches and hands him his fresh, crisp 25,000 dinar note.

The boy takes his note and heads for the convenience store. He proceeds to fill his car up with gas, grab a coke, a bag of chips and a candy bar, basically spending his entire days pay. He goes home and goes to sleep happy. The next day the boy gets up, goes to work, and again earns his 25,000 dinar. However, his car is full of gas and his belly is still full of sugar, so he takes this 25,000 dinar note home and puts it in a little tiny box under his bed.

Now, day 3 begins and low-and-behold, this is the day that this magical “RV” happens. This is the day that an Iraqi dinar transforms from being worth a fraction of a US dollar to being worth 3 US dollars. The Iraqi boys wakes up, sees the morning news, grabs his 25,000 dinar note from under his bed, and proceeds to go down to the local Mercedes dealership where he buys himself a brand new $75,000 Mercedes SLK 500.

Wait………what???????????

If the U.S. government had a massive conspiracy to create a bunch of millionaires why wouldn’t they do it by “revaluing” the dollar rather than the dinar?

Latest Iraqi related news from: www.baghdadinvest.com

Iraq Dinar Revaluation News

Baghdad Invest - 29/01/2012 22:55 G.M.T: Baghdad.

Delete three zeros from the Iraqi currency likely to add significant inflation to Iraq

A member of the Finance Committee from the Kurdistan Alliance - Najiba Najib wants to find the solution in order to strengthen the Iraqi currency, stressing that the proposed deletion of the three zeros will only bring high inflation in the country which will ultimately not lead to the strengthening of the Iraqi currency.

Najiba explained in a statement “the project to delete three zeros from the Iraqi currency will put an extra burden on the shoulders of the Iraqi citizen”.

The Finance Committee representative has asked the central bank to provide full studies on the project to delete the three zeros from the currency (IQD) to analyze the negative and positive aspects for this project, as well as the required changes to existing legislation to be formally submitted to the House of Representatives for a vote.

The main aim is to ensure the project to eliminate 3 zeros is of interest to all the Iraqi people!

The member of the parliamentary finance committee added that the project needs to have plenty of time to be implemented; the currency switch needs to be implemented at a slow pace to ensure no volatile movements spook the currency markets; this will need to be a gradual change.

The CBI (central bank of Iraq) has received widespread criticism surrounding the following plan:

• 200,000 dinars exchanged for 200 dinars.
• 100,000 dinars exchanged for 100 dinars.
• 50,000 dinars exchanged for 50 dinars.

This will not result in a country of 32 million becoming wealthier nor poorer - it will result in the banks exchanging 200,000 dinars for 200 dinars.

Of course the 200,000 dinars and 200 dinars will equal the same purchasing power.

For example: 20 cans of Coca Cola today will equal 20 cans of Coca Cola once the 3 zeros are dropped from the Iraq Dinar.

The CBI has announced the project is expected to be completed at some point in the year 2014.

Latest Iraqi related news from: www.baghdadinvest.com

Rabee Securities Iraq Stock Broker ISX

Baghdad Invest - 27/01/2012 17:23 G.M.T: Baghdad.

Rabee Securities (RS) was founded on January 7th 1995, and is headquartered in Baghdad. Rabee Securities is licensed and regulated as Securities Brokerage Company by the Iraq Stock Exchange (ISX). One of the best brokerage houses catering to institutional investors from all over the world.

The Iraq Stock Exchange is expected to double in size many times during the next 10 years, when looking for a broker - Rabee Securities would be an ideal choice as they intend to continue their growth too.

Rabee Securities is represented by Shwan Taha - CEO for Rabee Securities Incorporated.

Twenty five years of war and sanctions have devastated the Iraq economy – but for Shwan Taha, CEO of Baghdad-based Rabee Securities, "now is the perfect time to invest in a nation that is rebuilding from scratch".

Shwan Taha had previously worked in emerging/frontier market asset management initially as part of Mark Mobius’ Templeton emerging markets team and then at Soros. In 2008 Shwan arrived back in Iraq and took over Rabee Securities, a small local brokerage dealing with retail investors on the Iraq stock exchange.

Since then Rabee Securities have tried to model it on fund management best practice.

Opening an Account
Rabee Securities offer a very simple opening process for companies and individuals interested to trade the Iraq Stock Exchange (ISX). We recommend Rabee Securities as your Stock Broker in Iraq.

www.baghdadinvest.com/

How to Invest in Iraq? Foreign Investors.

BAGHDAD: Foreign investors seeking a foothold in Iraq take heed: You’ll need a healthy dose of patience, a flexible schedule and a love of tea. Nearly nine years since the U.S.-led invasion that toppled dictator Saddam Hussein, Iraq remains a state-centric economy and, beyond oil, private businesses have yet to play a significant role in the rebuilding of the once thriving Middle East bread basket.

Infrastructure remains dilapidated after years of war and economic sanctions, and investment is needed to reform banking, build houses and roads and fix a chronic electricity shortage.
That means plenty of opportunities for investors, but foreign executives already on the ground say it can take more than a year to become operational in Iraq, where security is one of the most costly risks.

Taking the time to build relations with local partners is the key to success, they say.
“Nothing is fast in Iraq,” said Alan Morrell, vice president of American bottled water firm Oasis. “We’re going to have to start with tea and relationship building and we may dance for three or four months if it’s a big deal. If it’s a simple deal, we might dance for two weeks, but we’re going to dance.”

Attracting foreign investment is essential to the rebuilding of Iraq and the OPEC-member state has already signed a series of contracts with oil majors to develop its vast oil reserves – the fourth-biggest in the world.

Iraq set a goal to attract $86 billion in investment by 2014 under a five-year economic development plan. The infrastructure, housing and electricity sectors need the most development.

The National Investment Commission was created in 2006 to facilitate the process for international firms. It offers “one-stop” shopping, including help with visas, registering a company, and housing and security for investors during a first visit.

NIC chairman Sami al-Araji said dozens of companies contact him a month regarding business opportunities in Iraq. Iraq’s market – an educated populace of 30 million with big requirements after years of war and sitting on huge oil reserves – is considered a potential gold mine in a weak global economy.

But risk factors – corruption, security against an ongoing and lethal insurgency and lack of legal safeguards – are high.

“I don’t know anywhere else in the world where it’s more essential [to have a local partner]. There’s so much uncertainty, so many unknowns to be navigating,” said James Hogan, former chief executive of banking giant HSBC’s business in Iraq.

“Even before you navigate, you’ve got to understand the socio, economic, political drivers. And it is complex.”

A lack of clear regulation makes even a simple process like obtaining a visa an arduous task.
According to Araji, getting a 10-day single entry visa to Iraq should take four to five days and a six-month to one-year multiple entry visa about 10-14 days. Many foreign investors say it has often taken months to get visas for themselves or their workers.

Most businessmen say getting a good Iraqi lawyer should be the first step, especially to assist with licensing. The cost of a lawyer to facilitate registering a company can range from $1,000 to $40,000, investors say.

Some investors say the sheer number of different licences needed makes the process of starting a business lengthy. Each ministry operates separately and has different requirements. “We admit that right now we have some difficulties time wise but we are in the process of trying to simplify it,” Araji said.

While the banking sector is undergoing reform with the help of the World Bank, Iraq remains a cash-driven society. At the height of the war, it was common for businessmen to carry suitcases of cash into the country. Investors can transfer money directly into bank accounts but some still use bags stuffed with greenbacks to pay for services.

“They’re not big bags, they’re very normal. Like the ones you get from the supermarket, just not transparent,” said Daniel Zamfiropol, Iraq branch manager for Romanian firm Octagon Contracting & Engineering.

“That’s the way you should carry [money]. Don’t carry it in a nice bag ... low profile, that’s the key word.”

Security remains a primary concern nearly nine years after the U.S. invasion, with bombings a daily occurrence, and most foreign companies hire personal security teams.

Hogan said HSBC spends around $3,000-$6,000 a day on security. Ground Works Inc, an engineering, construction and logistics firm, said security for housing and business compounds can run at $14,000-$18,000 a month, while a local bodyguard costs $1,500 a month and a foreign guard $4,000 per month.

Electricity is intermittent and having a generator is a necessity. Businessmen say fuel for generators can cost around $3,000-$8,000 a month.
While high overheads, low initial returns and delays in licensing are frustrating, many investors say the steepest learning curve is understanding the culture.

“What we found is that Iraqis don’t appreciate a direct conversation of pressure associated with their performance. They would prefer patience and ongoing communication and relationship building,” Morrell said.

“In a Western culture, we’re used to going in and saying ‘it’s your job, sort it [out], what’s the problem?’ and demanding services. In this culture, that’s not what they’re looking for.”
Face-to-face communication is highly valued but telephone calls and text messages are also acceptable. Iraq did not have a mobile phone industry under Saddam and the sector has since boomed. Emails are rarely answered.

“I stopped relying on emails as a means of communication. Either they don’t get read, or even if they do get read, they might not necessarily generate a reply,” said Hogan.
So what are the essential rules for doing business in Iraq?

“Throw your timeline out the window, stick to your budget, and your plan needs to be able to be fluid,” Ground Works President Greg Holmes said.

http://www.baghdadinvest.com/How_to_Invest_in_Iraq.html