Kurdistan economy booms
Inflation only concerns few people
New report shows that economic situation of KRG has improved significantly, and the region is attracting many international companies.
Kurdistan Regional Government (KRG) has been praised in a report by the Swiss Refugee council for their remarkable investment in the area, and the enhanced job opportunities created regionally. The report highlights that in general salaries have risen, and employment opportunities have increased significantly in the past years for the public. The report mentions the staggering difference between Southern Kurdistan, and Baghdad where the salary of ‘a construction worker in Baghdad is US$ 12 (IQD 15,000) while in Kurdistan they can make up to US$ 20 (IQD 25,400) in a day’.
He dropped his head into his hands and then peered out from behind his fingers. It wasn’t a half-wit gesture, perhaps he was trying to mock when asked how much he makes per month. He cleaned his throat as if he braced for a tough competition and stated “everybody in Kurdistan has a magic wand for money!”
I, pivoting my shoulders to the wooden chair in a café where all people seemed to have fun, shrugged and asked what does “magic wand” mean here. He slurred the last words a little, like a speaker just getting started, “It means that everybody everywhere in Kurdistan makes money easily more than enough.”
He was sodden with hope. Ghafour Soran, a taxi driver from Erbil, the capital of Kurdistan, is not in a propertied class but a middle class who makes $2000 USD per month. He is married to a housewife who has no income at all. Together they raise three children now. He owns a halffinished house and tries his best to complete his house by end of next year. He saves $1200 USD per month.
“I live like a king,” he stated with a barking laugh and complained a bit about the lack of basic services in his neighborhood such as the streets are not paved, water and sewage shortages as well as absence of public parks, library, schools and hospitals.
Throughout my interviews, I heard different people in diverse fields saying: the Kurdish boom is unprecedented. Inflation is rife. Average families make $2500-3500 a month. No cars, no goods, no fruit, no furniture is ever stuck in the markets. People buy them day in and out. You go to a furniture store, all of Kurdistan is there to buy furniture. You visit the downtown; Everyone is there shopping and money flies at the hands of everyone. You go to the car shows, people are busy with bargaining and buying 2013 model and brand new cars.
Ako Khalid, an economist living in Kurdistan with dual citizenship: Kurdish and German, stated that Kurdistan is really “the land of money” and the boom is at its peak.
Though the price of real estate is more expensive than in Istanbul, Paris and even California, people still buy villas, lands and rows of houses! One 200 meter square house- two floors is worth one million USD in an undeveloped district called Kalar in the south east of Kurdistan. One meter of land in Erbil hits five thousand USD. These prices were nothing more than a dream some five years ago in Kurdistan. As Khalid said everything is up for grabs in Kurdistan you just need to “put your trust in the right people” and you might wake up the next day as a millionaire.
Kurdistan has become the land of big companies competing on the consumers who don’t know what is the taste of local fruit, vegetables and other diets because almost everything is imported from Turkey and Iran and some European and gulf countries.
Chinese, European and American oil firms beat each other very hard to sign oil contracts with the Kurdistan Regional Government (KRG) and rush to get started. The funniest part, maybe the worst, is that MacDonald hasn’t showed up yet in this big market. As Khalid said when one sees the restaurants full all the time, even during brunch times, you’d think that nobody eats at home in Kurdistan. “And that’s a big sign that people have money in this part of the world.”
But Khalid thought that this boom is not robust in Kurdistan and “it might plunge soon” because there is control over nothing. He termed the situation like “it’s a wild free market”.
Soran’s son and daughter, go to school and this needs money, of course. He can manage all this only by the income he gets from his taxi. However, there are people who are taxi drivers and at the same time are working in public sectors too. Many policemen are taxi drivers after they finish their shift on call. You can find many teachers, civil servants, health staff, education personnel and even headmasters who own a taxi and work at their leisure. Everyone can be a taxi driver because there are no regulations, restrictions and rules whatsoever to prevent someone from being a taxi driver and having a taxi. Khalid claimed that this is one of the conundrums of the whole boom because even villagers left their villages and are now taxi drivers in Kurdistan.
A traffic policeman, on condition of anonymity, said that 30 per cent of traffic staff have taxis and work as taxi drivers after their formal work hours. The least monthly salary of a traffic policeman is $1200 USD. He said that he earns twice more than his salary per month.
Walid Khidir is a primary school teacher, at the same time he owns a mini-market in a busy neighborhood in Duhok. He earns more than $4,000 USD per month. He also said that he lives like a king. As a matter of fact, through my interviews I heard many people referring to that “Kingish Life” they have in Kurdistan. I eagerly asked Khalid to explain what is a “Kingish Life”. The Kingish life means to have best of best: best car, best house, best indoor, best job, at least one trip per year to outside Kurdistan, another house for renting.
The Kings in Kurdistan still complain about basic services like water, bad roads, sewage shortages and others. Khidir buys water from the water tanks. “I buy 500 liters of water every ther day.” Soran used to buy water but recently the local government tackled the lack of water and now he has water from the national pipelines.
“You can manage all problems if you have a good income,” he proudly stated. Karim Hussein, another economist and teacher of economy in a high school in Sulaimaniya, stated that the reason behind the fact of having good income is that people have more than one job. Both economists Khalid and Hussein agreed that the political, economic, social and business tumble in Iraq is a big reason why Kurdistan’s boom gets bigger and bigger every day. “It’s like blowing a balloon. One day it will burst and many will badly fall down,” added Hussein with a serious look.
Soran concluded by saying that after his house is built completely, he will start saving some money for the days after the balloon blows.
A view of the giant Empire World villas, apartment and business tower project in Erbil.
Erbil lohangoran @yahoo.com