Economy of Kurdistan Region

Last updated

Economy of Kurdistan Region
Hewler-Kurdistan.jpg
Erbil (Hewlêr), capital of Kurdistan Region
Currency Iraqi Dinar (IQD)
Calendar year
Statistics
GDP 66,000,000,000 $ (PPP,2022) [1]
GDP growth
Decrease2.svg [2]
GDP per capita
5,372 IQD (Nominal, 2018) [1]
GDP by sector
 Petroleum industry (80% of revenues) [3]
Decrease2.svg 97% (August 2016) [4]
Population below poverty line
Decrease2.svg 12% (August 2016) [5]
Labour force
1,300,000 (September 2016) [6]
UnemploymentIncrease Negative.svg14% (September 2016) [6]
Decrease Positive.svg13% (May 2017) [7]
Decrease Positive.svg10.2% (July 2018) [8]
Decrease Positive.svg 9% (July 2019) [9]
External
Decrease2.svg$17 billion (2018) [10]
Public finances
Revenues$5,4 billion (2016) Decrease2.svg [3]

All values, unless otherwise stated, are in US dollars.

Economy in Kurdistan Region [11] consists of the autonomous economy in Kurdistan region in northern Iraq. The Kurdistan region's economy is dominated by the oil industry, agriculture, manufacturing and tourism. [12] [13]

Contents

1992–2003

In Kurdistan been semi-autonomous since the 1990 Gulf War and subsequent protection of the region from the hostile forces of the Hussein regime forces by the Allied establishment of a no fly zone. [11]

Prior to the removal of Saddam Hussein, the Kurdistan Regional Government received approximately 14% of the revenues from the UN's Oil-for-Food Program. By the time of the US invasion of Iraq in 2003, the program had disbursed $8.35 billion to the KRG. Iraqi Kurdistan's relative food security allowed for substantially more of the funds to be spent on development projects than in the rest of Iraq. By the program's end in 2003 $4 billion of the KRG's oil-for-food funds remained unspent. Between 1992 and 2003, the GDP growth rate was between 6% and 10%.

During US occupation of Iraq (2003–2011)

Following the removal of Saddam Hussein's administration and the subsequent violence, the three provinces fully under the Kurdistan Regional Government's control were the only three in Iraq to be ranked "secure" by the US government. According to the KRG website, not a single coalition soldier has died nor a single foreigner been kidnapped since the 2003 invasion of Iraq in areas administered by the KRG. [14]

The relative security and stability of the region has allowed the KRG to sign a number of investment contracts with foreign companies. In 2006, the first new oil well since the invasion of Iraq was drilled in the Kurdistan region by the Norwegian energy company DNO. Initial indications are that the oil field contains at least 100 million barrels (16,000,000 m3) of oil and will be pumping 5,000 bbl/d (790 m3/d) by early 2007. The KRG has signed exploration agreements with several other oil companies, including Canada's Western Oil Sands and the UK's Sterling Energy and Gulf Keystone Petroleum.[ citation needed ]

The stability of the Kurdistan region has allowed it to achieve a higher level of development than other regions in Iraq. In 2004, the per capita income was 50% higher than in the rest of Iraq. By 2009, this was 200% higher. The highest growth rates achieved was around 12.7% in 2005–2008 and again 11.5% in 2010–2012. Since 2012, the growth rate has stabilized between 7% and 8%. The government continues to receive a portion of the revenue from Iraq's oil exports, and the government will soon implement a unified foreign investment law.

The KRG also has plans to build a media city in Arbil and free trade zones near the borders with Turkey and Iran by 2016. The KRG is an integral part of the general cultural and economic region also containing Syria, Turkey, Lebanon, Israel, Cyprus, Armenia, Azerbaijan, Iran, Georgia, Greece, Bulgaria, Romania, and Moldova, i.e. the Eastern Mediterranean-Black Sea-Caucasian region. As such, the KRG leadership has expressed plans for a more thorough integration and relationship with these countries, especially the three Caucasian Republics, Turkey, and Moldova. This would give the Kurdish economy a better bridge-head or foothold into Russia, Europe and the EU. According to President Barzani, this would also cement KRG's essentially Eurasian character rather than an undesirable Middle Eastern-Arab character. According to Barzani, the Kurdish culture, national characteristics, work ethics, business culture, etc. are more similar to that of Georgia, Moldova, etc. than to that of the rest of Iraq. It also has a similar Eastern Mediterranean climate, cuisine and thus a favourable tourist destination.

Special Economic zones

The KRG currently has four SEZs , in Dohuk, Batifa, Shaqlawa and Chamchamal. The first SEZ was set up in 1999 in Batifa, and the last in 2011 in Shaqlawa. The SEZs are mainly for manufacturing of hydrocarbons, pharmaceuticals , packaged food and processed food. These include the largest bottling plant for Coca-Cola in the Middle East outside of Egypt, Israel and the GCC; and the largest production center for ice cream in Iraq and Syria combined. The Chamchammal SEZ is dedicated solely for the petroleum and natural gas sector. Further two more SEZs, in Amedi and Bazian, have been planned to be completed before 2016. SEZs together account for nearly 30% of all industrial jobs and 40% of all industrial revenue and output.

2011–present

Despite objections from Baghdad, the Erbil governate says the KRG has signed contracts with 42 oil companies from 17 countries [15] with more favourable terms than those offered by Iraq's central government. [16] As recently as 2014 KRG officials claimed to sell 200,000 bpd and optimistically predicted exports of 1 million barrels annually. [17]

The Kirkuk-Ceyhan Oil Pipeline allows the export of oil from the Taq Taq and Tawke oil fields Kirkuk-Ceyhan oil pipeline.svg
The Kirkuk–Ceyhan Oil Pipeline allows the export of oil from the Taq Taq and Tawke oil fields

The Kurdistan Regional Government begun exporting crude oil by truck to Turkey during the summer of 2012. [11] In 2013, the Kurdistan Regional Government completed a pipeline from the Taq Taq field through Khurmala and Dahuk to Faysh Khabur on the Turkey-Iraq border, where it is connected to the Kirkuk-Ceyhan pipeline. This 36-inch (910 mm) diameter pipeline has capacity of 150,000 barrels per day (24,000 m3/d). It allows the export of oil from the Taq Taq and Tawke oil fields. [18] On 23 May 2014, the Kurdistan Regional Government announced that the first oil transported via the new pipeline was loaded into tanker at Ceyhan. [19]

Financial crisis

The Kurdistan region was hit by an economic crisis in 2015. Despite an increase in overall production, [20] oil revenues have decreased significantly since 2014 due to lower oil prices, disputes with the central government and the rapid expansion of the Islamic State. In June 2015, Exxon Mobil, the largest exporter by volume, evacuated its staff and left its facilities in the care of Peshmerga. In early December 2015, Peshmerga reportedly repelled an IS attack on those facilities, though the prospect of such attacks poses a deterrent to foreign investment. [21] 17% of the central government's budget is earmarked for distribution to the KRG, but no funds have been disbursed since February 2014. A US-mediated agreement in 2014 would have resolved the conflict between the oil ministries of the KRG and the GOI, but this too collapsed over allegations of under payment. Erbil's independent contracts sold for less than market price due to its poor quality. [22]

Wealth

Currently, most industrial supplies from Kurdistan are being supplied from abroad, trade with kurdistan region is a large part of the economy and trade of the frontier. [23]

See also

Related Research Articles

<span class="mw-page-title-main">Peshmerga</span> Military force of Iraqs Kurdistan Region

The Peshmerga comprise the standing military of Kurdistan Region, an autonomous political entity within the Republic of Iraq. According to the Constitution of Iraq, the Peshmerga and their security subsidiaries are solely responsible for the security of Kurdistan Region, chiefly due to the fact that the Iraqi Armed Forces are forbidden to enter Iraqi Kurdistan. These subsidiaries include Asayish, Parastin û Zanyarî, and Zêrevanî. The Peshmerga's history dates back to the 18th century, when they began as a strictly tribal pseudo-military border guard under the Ottoman Turks and the Safavid Iranians. By the 19th century, they had evolved into a disciplined and well-trained guerrilla force.

<span class="mw-page-title-main">Kirkuk–Ceyhan Oil Pipeline</span> Oil Pipeline

The Kirkuk–Ceyhan Oil Pipeline, also known as the Iraq–Turkey Crude Oil Pipeline, is a 600-mile-long (970 km) pipeline that runs from Kirkuk in Iraq to Ceyhan in Turkey. It is Iraq's largest crude oil export line.

<span class="mw-page-title-main">Kurdistan Region</span> Autonomous entity in the Republic of Iraq

Kurdistan Region is an autonomous administrative entity within the Republic of Iraq. It comprises four Kurdish-majority divisions of Arab-majority Iraq: the Erbil Governorate, the Sulaymaniyah Governorate, the Duhok Governorate, and Halabja Governorate. The KRI is bordered by Iran to the east, by Turkey to the north, and by Syria to the west. It does not govern all of Iraqi Kurdistan, and lays claim to the disputed territories of northern Iraq; these territories have a predominantly non-Arab population and were subject to the Ba'athist Arabization campaigns throughout the late 20th century. Though the KRI's autonomy was realized in 1992, one year after Iraq's defeat in the Gulf War, these northern territories remain contested between the Kurdistan Regional Government and the Government of Iraq to the present day. In light of the dispute, the KRI's constitution declares the city of Kirkuk as the capital of Iraqi Kurdistan. However, the KRI does not control Kirkuk, and the Kurdistan Region Parliament is based in Erbil. In 2014, when the Syria-based Islamic State began their Northern Iraq offensive and invaded the country, the Iraqi Armed Forces retreated from most of the disputed territories. The KRI's Peshmerga then entered and took control of them for the duration of the War in Iraq (2013–2017). In October 2017, following the defeat of the Islamic State, the Iraqi Armed Forces attacked the Peshmerga and reasserted control over the disputed territories.

<span class="mw-page-title-main">Masrour Barzani</span> Prime Minister of Iraqi Kurdistan since 2019

Masrour Barzani is a Kurdish politician and serving as prime minister of the Kurdistan Region, an autonomous region in Iraq, since June 2019. He is also the chancellor of the Kurdistan Region Security Council and a member of the Kurdistan Democratic Party. He was sworn in as prime minister of the KRG’s ninth cabinet on 10 June 2019, after receiving 87 votes out of 97 legislators in the Kurdistan parliament.

<span class="mw-page-title-main">Kosrat Rasul Ali</span> Kurdish politician

Kosrat Rasul Ali is a Kurdish politician and the leader of the Supreme Political Council of Patriotic Union of Kurdistan (PUK), veteran Peshmerga military leader, former Prime Minister, and former Vice President of the Kurdistan Region.

<span class="mw-page-title-main">Iraqi–Kurdish conflict</span> Series of wars and rebellions by ethnic Kurds against successive Iraqi administrations

The Iraqi–Kurdish conflict consists of a series of wars, rebellions and disputes by the Kurds against the central authority of Iraq starting in the 20th century shortly after the defeat of the Ottoman Empire in World War I. Some put the marking point of the conflict beginning to the attempt by Mahmud Barzanji to establish an independent Kingdom of Kurdistan, while others relate to the conflict as only the post-1961 insurrection by the Barzanis. Since the US-led invasion of Iraq and the subsequent recognition of the Kurdistan Region (KRI) in the new Iraqi constitution, the number and scope of armed clashes between the central government of Iraq and the Kurds have significantly decreased. In spite of that, however, there are still outstanding issues that continue to cause strife such as the disputed territories of northern Iraq and rights to oil and gas, leading to occasional armed clashes. In September 2023, Masrour Barzani sent a letter to the President of the United States expressing concerns about a possible collapse of the Kurdistan Region and calling for the United States to intervene.

<span class="mw-page-title-main">Disputed territories of northern Iraq</span> Geographic territories

The disputed territories of northern Iraq are regions defined by article 140 of the Constitution of Iraq as being Arabised during Baath Party rule in Iraq. Most of these regions are inhabited by non-Arabs, including Kurds, Assyrians, Yazidis, Turkmens/Turkomans, and Shabaks.

<span class="mw-page-title-main">Foreign relations of Kurdistan Region</span> Largely independent foreign policy of the autonomous region

Relations of Kurdistan Region of Iraq with foreign states and organizations are conducted by the Kurdistan Region. Political stability and a rapidly developing economy have given the KRG the opportunity to pursue a foreign policy independent from the central government's. The KRG's primary body for directing its foreign affairs is the Department of Foreign Relations (DFR). The DFR's foremost objectives are to raise the global profile of the Kurdistan Region, improve the Region's international ties with various governments and international organizations, and present emerging business opportunities in the Kurdistan Region to regional and international actors.

<span class="mw-page-title-main">Falah Mustafa Bakir</span> Iraqi Kurdish politician

Falah Mustafa Bakir is a Kurdish politician from Kurdistan Region, Iraq serving as Senior Foreign Policy Advisor to President Nechirvan Barzani with a ministerial rank.

<span class="mw-page-title-main">2017 Kurdistan Region independence referendum</span> Referendum for Kurdish Independence

An independence referendum for the Kurdistan Region of Iraq was held on 25 September 2017, with preliminary results showing approximately 92.73 percent of votes cast in favour of independence. Despite reporting that the independence referendum would be non-binding, the autonomous Kurdistan Regional Government (KRG) characterised it as binding, although they claimed that an affirmative result would trigger the start of state building and negotiations with Iraq rather than an immediate declaration of independence of Kurdistan. The referendum's legality was rejected by the federal government of Iraq.

<span class="mw-page-title-main">Sirwan Barzani</span> Kurdish businessman

Sirwan Saber Barzani is an Iraqi Kurdish businessman and military commander. He is a member of the Kurdish Barzani family. He is the older brother of Saywan Barzani, an Kurdish diplomat.

<span class="mw-page-title-main">Kurdistan Region–Netherlands relations</span> Bilateral relations

Kurdistan Region–Netherlands relations are bilateral relations between Kurdistan Region and the Netherlands. While Kurdistan Region has no representation in the Netherlands, the Netherlands has a consulate general in Erbil since 2012. The Netherlands has a military presence in Kurdistan Region and have aided the region with humanitarian aid. The Netherlands also contributed to reforms of the Kurdish economy with 250,000 euros in 2017. In August 2016, Dutch Prime Minister Mark Rutte visited Kurdistan Region and met with high-ranking Kurdish officials and deployed Dutch soldiers. Concerning Kurdish independence, Dutch MP Harry Van Bommel stated that: "I will ask my party to support independent Kurdistan because I think independence is the best way to secure the future of the people in this Region".

<span class="mw-page-title-main">Belgium–Kurdistan Region relations</span> Bilateral relations

Belgium–Kurdistan Region relations are bilateral relations between Belgium and Kurdistan Region. Belgium has no representation in Kurdistan Region and the latter has no representation in Belgium. Kurdistan Region's representation to the European Union is located in the Belgian capital of Brussels. Belgium has a military presence in Kurdistan Region with circa 30 soldiers training Kurdish soldiers (Peshmerga). In 2017, Kurdish President Massoud Barzani visited Belgium and met with Minister-President Geert Bourgeois of the federal region of Flanders, where the latter stated that the upcoming Kurdish referendum in September 2017 should be respected and Deputy Prime Minister of the federal government in Belgium Jan Jambon has stated that all nations have the right to self-determination.

<span class="mw-page-title-main">Kurdistan Region–United Arab Emirates relations</span> Bilateral relations

Kurdistan Region–United Arab Emirates relations are bilateral relations between Kurdistan Region and United Arab Emirates. While Kurdistan Region has no representation the United Arab Emirates, the latter has a consulate general in Erbil since 2012. The opening of an Emirati consulate general was discussed during a visit in Erbil by Emirati Foreign Minister Abdullah bin Zayed Al Nahyan in February 2011. Kurds in the United Arab Emirates.

<span class="mw-page-title-main">Germany–Kurdistan Region relations</span> Bilateral relations

Germany–Kurdistan Region relations are bilateral relations between Germany and Kurdistan Region. Germany has a consulate general in Erbil since 2012, and Kurdistan Region has a representation in Berlin since 1992. Many high-level meetings have been held between the two parties, including a visit to Berlin by Kurdish President Masoud Barzani in 2009, where he met with German Chancellor Angela Merkel and Foreign Minister Frank-Walter Steinmeier. In 2014, President Barzani described Germany as "one of Kurdistan Region’s staunch allies in the war against the Islamic State." German Consul General Marc Eichhorn described the relations as "excellent".

<span class="mw-page-title-main">France–Kurdistan Region relations</span> Bilateral relations

France–Kurdistan Region relations are bilateral relations between France and Kurdistan Region. France has a consulate general in Erbil and Kurdistan Region has a representation in Paris. The ties between France and Kurdistan Region have been very close since the presidency of François Mitterrand (1981–1995), when his wife Danielle Mitterrand played an instrumental role in the campaign for the no fly zone over Kurdistan Region in 1991. France has a military presence in Kurdistan Region, and Consul General Dominique Mas described their relations as being "historic" and "long-term".

<span class="mw-page-title-main">2017 Iraqi–Kurdish conflict</span> Armed disputes over Kurdish autonomy and sovereignty

The 2017 Iraqi–Kurdish conflict, also known as the Kirkuk crisis, was a conflict in which the Iraqi government retook disputed territories in Iraq which had been held by the Peshmerga since ISIL's Northern Iraq offensive in 2014. The conflict began on 15 October 2017 after tensions arising from the Kurdistan Region independence referendum of 25 September. The tension between the federal Iraqi government and Kurdistan Region escalated into conflict when the Peshmerga ignored repeated warnings to return Kirkuk to Iraqi government forces. Part of the conflict was the Battle of Kirkuk, when Iraqi forces routed Peshmerga forces from the city in a surprise dawn-offensive, marking the beginning of clashes.

<span class="mw-page-title-main">Kurdistan Region–Turkey relations</span> Bilateral relations

Turkey’s historic relationship with Iraq and Kurdistan Region has wavered between indifference and courtship, but the constant has been a layer of mistrust emanating from both ends that appears to have been set aside in 2001 when the new Turkish government reversed the status quo and embraced a policy of engagement that has successfully catapulted the country to becoming a leading economic player in the Middle East.

Operation Claw-Lock was a military operation of the Turkish Armed Forces in northern Iraq. The operation was taking place in the Duhok Governorate against the Kurdistan Workers' Party (PKK), as part of the ongoing Kurdish–Turkish conflict.

The Kurdistan Region–PKK conflict is a series of battles and clashes in Iraqi Kurdistan between the ruling Kurdistan Regional Government against the Kurdistan Workers' Party (PKK) and its allied groups. It started in 1983 and is still ongoing in the form of an insurgency. The PKK's primary method is using guerrilla warfare against the Peshmerga.

References

  1. 1 2 "Kurdish GDP" (PDF).
  2. ↑ "Standard of living lower in Kurdistan than rest of Iraq for first time: study". 31 August 2016. Retrieved 23 December 2016.
  3. 1 2 "KRG budget deficit narrows despite ongoing financial crunch, official data show". Rudaw. 4 April 2017. Retrieved 6 January 2017.
  4. ↑ "Consumer Price Index (CPI) and Inflation Rate in Kurdistan Region August/ 2016" (PDF). p. 2. Retrieved 23 December 2016.
  5. ↑ "Iraqi Kurdistan Economic Report 2016: Kurdistan's Great Recession". 1 August 2016. Retrieved 23 December 2016.
  6. 1 2 "Unemployment rate in Kurdistan is 14%". Rudaw. 21 September 2016. Retrieved 23 December 2016.
  7. ↑ "Unemployment Rising Rapidly in Kurdistan Region: Official". Basnews. 13 May 2017. Retrieved 12 May 2017.
  8. ↑ "Demographic Survey – Kurdistan Region of Iraq" (PDF). p. 39. Retrieved 31 October 2018.
  9. ↑ "Iraq economy: Positive indicators in the north". www.aljazeera.com. Retrieved 26 July 2019.
  10. ↑ "Is Iraqi Kurdistan heading toward civil war?" . Retrieved 6 January 2017.
  11. 1 2 3 "Iraqi Kurdistan's Economy: Overview".
  12. ↑ British agency Hinterland Travel has recently started small scale tourism tours to the region .
  13. ↑ Time magazine article mentioning Australian/Kurdish tour company Kurdistan Adventures on tourism in Kurdistan
  14. ↑ "Kurdistan Regional Government". KRG. Archived from the original on 1 January 2016. Retrieved 28 December 2010.
  15. ↑ http://www.hawlergov.org/en/article.php?id=1360563574 [ permanent dead link ]
  16. ↑ "Kurdistan Oil & Gas: Oil Sector Growing Amid Political Wrangling".
  17. ↑ "Kurdistan's Oil Ambitions". Bloomberg.com. 15 November 2013.
  18. ↑ "Operations in Kurdistan Region of Iraq". Genel Energy. Archived from the original on 12 June 2014. Retrieved 14 June 2014.
  19. ↑ "KRG statement on first oil sales through pipeline export" (Press release). Kurdistan Regional Government. 2 May 2014. Archived from the original on 15 July 2014. Retrieved 14 June 2014.
  20. ↑ Whitcomb, Alexander (12 September 2014). "In Kurdistan, Oil Industry Ramps up despite War". www.rudaw.net.
  21. ↑ "Peshmerga Commander: IS Militants Wanted to Seize Exxon Mobil equipment in Khazir - باسنیوز". Archived from the original on 14 February 2016.
  22. ↑ "Is the KRG heading for bankruptcy? - Al-Monitor: The Pulse of the Middle East". 20 January 2016.
  23. ↑ "Kurdistan Board of Investment | Trade & Industry".

14. https://kurdistanchronicle.com/babat/2587 15. https://aiti.org.ir/uploads/exhibitionconference/exh-41-3.pdf

This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.