Foreign investment in Kurdistan was headed for a record year in 2012 as investors from around the world become more aware of the opportunities and advantages the region offers.
During the first six months of 2012, more than $3 billion of new investment came into the region and the total of both foreign and domestic funds were forecast to reach $7 billion for the entire year. Halfway through the year, more than 450 major development projects were under way, with a total value of over $21 billion.
Target areas for foreign investment include agriculture, banking and insurance, energy, hotels, health, ICT, industry, tourism, transportation and infrastructure projects.
Eager to overcome the concerns about security issues, Kurdistan has passed one of the most liberal foreign investment laws in the Middle East. It provides a series of incentives to investors, including a 10-year tax holiday, the possibility of owning land and freedom from export and import tariffs for goods related to investment projects.
Foreign investors receive the same legal treatment as their local counterparts. Additionally, profits can be repatriated and capital as well, if the project is liquidated. Employers are permitted to use foreign labourers, who also have the right to remit their earnings to their home countries.
The largest source of foreign investment in Kurdistan is Egypt, which during the first five months of 2012 accounted for $497 million, followed by Lebanon with $231 million.
Official data indicates that there are approximately 1,600 foreign companies registered in Kurdistan, up from 1,170 in 2010. Between 50 and 60 per cent of all foreign investors are Turkish.
From 2006 to mid-2012, overall investment in Kurdistan, including foreign investment, amounted to $22 billion.