Business council formed with Iraq to lift investment and trade

The UAE and Iraq have created a joint business council to look at ways to boost investment and trade between the two countries as Iraq looks to rebuild the country following years of violence, the UAE Ministry of Economy said.

“The two parties agreed to form a joint working team or technical committee to enhance investment co-operation and to identify related priorities in vital sectors of the Republic of Iraq as it undergoes reconstruction,” the ministry said.

“The proposed group will facilitate the necessary procedures and address the challenges that may be faced by UAE companies and investors wishing to enter the Iraqi market. The formation of a joint businessmen council for promoting co-operation between the business communities of both countries was agreed upon as well.”

Mohamed Al-Sudani, the Iraqi minister of industry and minerals, said that Iraq would rely heavily on the UAE’s private sector and its investors and that they would be given high priority because of their expertise and capabilities.

For his part, Sultan Al Mansoori, the UAE Minister of Economy, said that there was much promise for cooperative opportunities for small to medium-sized enterprises (SMEs) and that an SME memorandum of understanding may be in the offing.

The IMF said last month that Iraq’s economy remained open to risks stemming from the armed conflict with ISIL and sluggish oil prices, even though medium-term prospects are positive.

Lower oil prices caused Iraq’s international reserves to plunge to US$45 billion at end-2016 from $54bn at end2015, according to the IMF.

Increased spending associated with volatility and lower oil prices have fuelled a government deficit, which widened to 14 per cent of GDP in 2016 from 12 per cent in 2015, despite fiscal consolidation.

Iraq’s proven oil reserves were 153 billion barrels, the fifth largest in the world, according to the BP Statistical Review of World Energy.

The latest tie-up complements efforts by the Iraqi government to strengthen ties with Saudi Arabia this summer as the country seeks to bolster economic and investment relations with the kingdom.

Baghdad said it aims to improve co-operation with Riyadh in the areas of trade, industry and agriculture.