What did ISIS do for the Kurdish economy?
Although the short- term effects of the ISIS may have been devastating for the Kurdish economy, but the long- term effects seem to be quite the opposite!
Since the fall of Mosul to the hands of IS, the Kurdish economy has taken a downturn. As they advanced towards the areas closer to the Kurdistan Region, the economic situation became increasingly worse. The market came to a standstill, prices of necessity items such as staple food and fuel shot up. Non-essential items such as luxury goods and property dropped severely. People were gearing up for war and the economy withdrew within itself for basic survival function. The much envied political stability of Kurdistan seemed severely under threat. Previously the “Other Iraq” i.e. Kurdistan was the only region where business and economic growth could be seen as possible, but is that true?
Certainly the short- term effects of ISIS on the Kurdish economy were undeniably negative, however with further analysis a different prospect emerges. As ISIS troops are being snuffed out in the disputed areas that have a Kurdish population the market is starting to pick up again. These disputed areas, next to the Kurdistan Region, are now under Peshmaraga (Kurdish soldiers) control. This includes Kirkuk, one of the major cities in terms of crude oil reserves, estimated at 15 billion barrels. Within weeks Kirkuk oil is going to be pumped via the newly constructed pipeline that connects the Kurdistan Region to Cihan seaport in Turkey. This will boost oil production, estimated to reach 1 million barrels per day by 2015.
In addition to oil, the Kurdistan Regional Government is currently receiving wide international support including arms supplies. This is strengthening the Kurdish Peshmarga force, presently the only Iraqi bulwark against ISIS. This will boost the Kurdish economy by having a stronger military force that will protect the Kurdistan Region against possible future threats, and it will also be a good bargaining chip with the central Iraqi government for the current Iraqi government negotiations. Rumors are flying that the Kurds will be given a major ministry; maybe finance or oil. This would serve Kurdish economic interests better than the previous foreign ministry post.
ISIS maybe is the catalyst that will bring about a new phase in the Kurdish economy. With more oil production, wider territorial and military influence, the world awaits the birth of a new proWestern, economically powerful nation.