In this article, we interviewed Chiya Sharif, MP in Kurdistan Region Parliament on the economic policy of the Kurdistan Region of Iraq. Before beginning, we would like to introduce Mr. Sharif. Sharif was born in Zakho, Kurdistan in 1975. He has a Master’s degree in Health Now he is MP in Kurdistan Region. He has worked as director of a health center in the Netherlands.
The Kurdistan region continues to be a typical example of a rentier economy, where massive payments from the Iraqi national budget and oil exported by the region itself provide periodic injections into its fragile economy. However, these brief bursts of cash have a chilling effect on overall growth, hiking prices from the markets to the real estate and service sector while shuttering factories and undermining agriculture. Does the government have a long-term policy for a sustainable economy? If yes, could you please explain us?
Unfortunately, the Baathist regime has no so far paid attention to agriculture but just oil revenues. The economy of Iraq is almost entirely dependent on oil sales. To talk with numbers, 88 percent of Iraq’s income is from oil venues. In the Kurdistan region, about 60% of income comes from oil venues. Other incomes make up 40%. So the situation in the Kurdistan region is better than in the rest of Iraq. As soon as the new government came to power, it started implementing a very reliable and immeasurable economic plan.
Prime Minister Masrour Barzani pays a lot of attention to this issue and takes care of it personally. He said that we should reduce oil revenues share and increase cultivation. Also, the PM would like to empower tourism share in the income pie.
The long-term plan is to gradually abandon oil venues and focus on increasing agriculture, exports, and tourism to establish a sustainable economy in the region.
The region’s agricultural sector is faring even worse; farmers can no longer compete with the low prices of products imported from neighboring countries. What is the government’s agriculture policy?
Currently, the Kurdistan Region depends on neighboring Turkey and Iran for cheap imports of fresh produce – benefiting consumers but harming local farmers. This is despite the Kurdistan Region possessing some of the richest soil and most clement growing conditions in the Middle East.
The agriculture sector in the Kurdistan Region has seen considerable change in recent years and therefore has the potential to play a prominent role in supporting the growth of the local economy. The KRG has prioritized the development of its agriculture industry to encourage greater foreign investment. The KRG sees the improvement of the agriculture industry as critical for the development of the Region’s economy.
In accordance with these goals, The PM visited the Netherlands to gain experience from the Netherlands and to negotiate with the Dutch government to establish plants for some of the most important agricultural products in Kurdistan. Some contracts were executed, for example, chicken and tomato factories.
The Kurdistan Regional Government plans to support the growth of greenhouses, develop infrastructure on farming and other food-production, and increase tariffs charged on imported agricultural goods as part of efforts to make the Kurdistan Region more self-sustainable.
In terms of current production, Kurdistan has re-established itself as a strong local producer of tomatoes, eggplant, cucumbers, onions, watermelon, peppers, and many other fruits and vegetables. However, large-scale investment is needed to bring about the dramatic change that the sector requires.
The Ministry of Agriculture and Water Resources is investing in the marketing of local wheat farmers’ products as one of its most expansive strategic projects. This project will help sell 500,000 tons of locally-produced wheat every year. The project will make use of three large factories in Erbil, Suleimani, and Duhok, which mainly produce flour. Another plant will be established for the production of a variety of wheat-based products.
The project will help create thousands of job opportunities, with the assurances from the Ministry of Agriculture and Water Resources that agricultural graduates from the Kurdistan Region will be employed.
The price of wheat will also be adjusted to a higher price than that of flour to encourage domestic production by farmers. Currently, farmers produce between 1.6 million tons to 2 million tons of wheat every year, 500,000 of which will be recovered by the project to sell.
Another development, a deal has been struck in the cities of Duhok, Suleimani, and Erbil to allow the government to buy wheat and barley, at a reasonable price, sell them to local factories to produce products. This plan has been completed 35%.
Another plan is to export vegetables such as pomegranate and tomatoes. In this case, a committee has been set up for marketing work. The marketing council has to work on which countries will increase our product and export it from Kurdistan to abroad, especially to Europe, Britain, and the Gulf. For instance, agreements were signed regarding the export of Halabja pomegranate to England and the UAE. Thanks to the council that Mr. Barzani himself oversees, the Kurdistan region is gradually increasing its exports.
On February, Kurdistan Region Prime Minister Masrour Barzani met with several young entrepreneurs in the autonomous region to hear their ideas and suggestions for more effective government support of enterprising youth and their small to medium-sized businesses. What do you think about the Kurdish youth’s place in the economy? What is the government’s plan to decreasing unemployment and support the startups and initiatives founded by youth?
We know that the future of Kurdistan, in many respects, lies with the youth. In a region where more than half of the population is under the age of 30, KRG focuses on prospects and opportunities presented to this age group. Almost 80% of Kurds in Iraq are employed by the Kurdistan regional government, leading to a bloated and unprofitable public sector.
Creating jobs and opportunities come through encouraging startups and entrepreneurship under the patronage of Kurdish businesspeople, venture capitalist and government.
The government plans to provide subsidies to young people to help young people develop their projects. With these funds, KRG aims to empower the private sector.
Attracting investment of modern infrastructure requires an educated workforce able to adapt to new advances in technology and the demands of the globalized economy. The KRG Board of Investment is therefore prioritizing the development of the higher education sector, by establishing scientific centers for various specializations. Also, the board plans to establish a technical sector, offering space for young people to develop their interest in the digital and high-tech sectors.
With these plans, KRG’s aim is gradually reducing the number of members in the government and increasing the private sector.
I should mention that the new cabinet headed by Mr. Masrour Barzani has worked better than any other cabinet. this is confirmed by your documents and statistics.