In­vest­ment in Er­bil in­creases by eight times in one year

More than 4 bil­lion al­lo­cated for in­vest­ment in 2012

The Kurdish Globe - - NATIONAL -

Over the course of last year, a to­tal of 56 in­vest­ment projects were im­ple­mented in Er­bil on the government bud­get, to­tal­ing US$ 4.25 bil­lion. This data is avail­able at the Gover­norate of Er­bil.

The bud­get for in­vest­ment projects was as small as half a bil­lion dol­lars just a year be­fore in 2011.

How­ever, ac­cord­ing econ­o­mist Ab­dul­wahid Taha, this dras­tic boost in the amount of in­vest­ment in the province is not an in­di­ca­tion of a real im­prove­ment. Taha is more in­ter­ested in the way the cap­i­tal is in­vested and the qual­ity of the projects.

“If in­vest­ment is aimed at cre­at­ing job op­por­tu­ni­ties and im­prov­ing in­dus­try and pro­duc­tion, it would leave sig­nif­i­cant im­pact on the eco­nomic growth of the coun­try,” ex­plained Taha.

Although in­vest­ment has been made across many sec­tors in 2012, in­clud­ing hous­ing, arts, ed­u­ca­tion, trans­porta­tion, tourism, in­dus­trial, health and trade, the former had the lion share.

A sum of 20 res­i­den­tial hous­ing projects with a bud­get of US$ 3.6 bil­lion cov­ers the over­whelm­ing ma­jor­ity of in­vest­ment ac­tiv­i­ties in the province dur­ing the last year. Sec­ond place is taken by the in­dus­trial sec­tor with a to­tal of more than USD 500 mil­lion spent on 11 projects. This is fol­lowed by the tourism in­dus­try with its 12 projects con­sti­tut­ing a quar­ter of bil­lion dol­lar in­vest­ment.

The lo­cal econ­o­mist be­lieves that each sec­tor has its sig­nif­i­cance and pri­or­ity; how­ever, those fo­cus­ing on pro­duc­tion are more ef­fec­tive in pro­mot­ing eco­nomic devel­op­ment.

De­spite the fact that the hous­ing sec­tor has cre­ated a sig­nif­i­cant num­ber of jobs, Taha ar­gues th­ese projects only have tem­po­rary devel­op­men­tal im­pact on the province.

The agri­cul­ture sec­tor, that ac­cord­ing to many econ­o­mists is the key to the eco­nomic devel­op­ment of the re­gion, has a mi­nor share in this huge in­vest­ment bud­get with a US$ 375 thou­sand project dur­ing the whole year.

Statis­tics of the gover­norate show that lo­cal com­pa­nies had 40% share in the in­vest­ment ac­tiv­i­ties in 2011, while this rate reached 85% the fol­low­ing year. In 2011, an­other 40% of in­vest­ment was shared by joint ven­tures be­tween lo­cal and for­eign com­pa­nies, while in 2012 this rate was zero and the re­main­ing 15% was purely for­eign com­pa­nies.

This is a pos­i­tive move ac­cord­ing to econ­o­mists, due to the ar­gu­ment that the more lo­cals that are in­volved with eco­nomic ac­tiv­i­ties, the more cap­i­tal and prof­its are re­tained lo­cally and the less money will fil­ter out of the coun­try.

The to­tal area of lands al­lo­cated for all the in­vest­ment projects in Er­bil in 2012 was 1250 hectares, 1000 of which has been oc­cu­pied by hous­ing projects, while the small­est area be­longs to ed­u­ca­tional projects with only 0.375 hectares.

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