Ministry of Industry and Minerals Ministry of Industry and Minerals Iraq Is The Right choice for...

Ministry of Industry and Minerals

I raq Is The Right choice for

Business and Investment



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Iraq is considered as one of the distinguished economic attraction country in the world, progressive and viable for investment due to the availability of:

• Strategic location in the Middle East. Makes it a country well positioned for trade and investment.• Rich in natural recourses, in addition to Oil an Gas.• Availability of experienced workforce.• Wide spread market with high demand percentage.• Could be called as a Virgin Land for Investment in all economic sectors because the huge need for rebuilding.

Introduction



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▪ The environment in Iraq is favorable for business

▪ The Ministry of Industry and Minerals and State Owned Enterprises are preparing for growth

▪ International firms recognize this potential, and are beginning to invest in Iraq

▪ Legal and regulatory frameworks are structured to facilitate investment

Encouraging Business Environment

Ministry of Industry and Minerals 4


Iraq Ministry of Industry and Minerals manages key industrial sectors and is leading business development and growth initiatives

The Ministry of Industry and Minerals (MIM) overseas public and private industry in Iraq▪ 61 state-owned-enterprises (SOEs)▪ 251factories▪ 220,000 employees▪ Budget exceeds $1.8B

The industrial sectors under MIM include▪ Construction Industries▪ Textile Industries▪ Petro-Chemical Industries▪ Industrial Services▪ Engineering Industries▪ Food and Pharmaceutical

Industries

MIM is at the forefront of working with foreign partners and coordinating investment activity



Iraq’s chemical sector is poised for growth as it supports other industries in Iraqi GDP growth

Sector overview

▪ The Chemical Sector includes:– Petrochemicals– Fertilizer– Chemicals– Sulfur– Rubber– Paper

▪ Iraqi chemical industries have access to low cost feedstock and energy which is a significant source of competitiveness

Sector overview

▪ Iraq has abundant and very high quality raw materials distributed throughout the country, and plants are located throughout Iraq

▪ The construction sector includes– Cement– Glass and Ceramics– Plastic Industries

The construction sector benefits from Iraq’s abundance of high quality raw materials and strong demand



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Sector overview

▪ There are two pharmaceutical companies within MIM; Samarra and Nineweh

▪ Pharmaceutical companies produce generic products from imported active ingredients

▪ Products include:– Tablets, capsules, and powders– Ointments and creams– Oral and eye drops

The pharmaceutical sector is expected to show strong growth with the increase in per-capita spending

Sector overview

▪ Engineering sector companies include:– Steel production– Fabrication of steel products– Electrical– Manufacturing – Water treatment

▪ End products include:– Rebar / steel pipes– Sponge iron– Steel structures / towers / lighting poles– Agricultural machinery– Electrical fixtures

Engineering sector growth is driven by reconstruction and population growth



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Sector overview

▪ Industrial services sector can provide a variety of services to support investment:– Project management– Process engineering– Design and implementation of Control systems

Supervisory Control and Data Acquisition (SCADA) systems

– Information and communication technology

– Chemical processes– Consulting engineering and feasibility

studies– Assistance in working with the Ministry

and its government and business partners

Industrial services have advanced capabilities to support investors’ projects with the SOEs Strategic Opportunities to Implement New

Industrial Projects Plants

Petrochemical Industries project No.2:

Fertilizer Industries projects

Sulphur Mining Project:

New Iron and Steel Plant:

Concentration of Raw Phosphate Project

Longitudinally Welded Pipes Plant Erw Plant

New Float Glass Plant



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1. Allow transformation of SOEs to public and/or private share holding companies; Law 22, 1997 (Rehabilitation of existing Plant on partnership basis with International Companies)

2. Develop requirements and formation of private and mixed shareholding companies; Law 21, 1997.

3. Enable sale and lease of Government property and real estate to private sector; Law 32, 1986.

4. Organize Investment in Mining and Natural Resources Law No. 91, 1988.

5. Establish framework for foreign investment in Iraq, Law No. 13/2006.

Existing Industrial Investment Legal Framework

Industrial Investment Legal Enhancements

1. Protect locally produced goods through tariffs on imported goods; 2009

2. Align existing arbitration law with International standards and best practices

3. Establish method of SOE privatization; Law on SOE Economic Reform



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MIM took the task of development and promotion of all sectors of Iraqi Industry by adopting a comprehensive economic reform on the following basis:

First: Rehabilitation and Upgrading some if the plants on Partnership basis by establishment of Joint Ventures and Production Sharing agreements between foreign companies, businessmen and Iraqi public sector to increasing the design production capacity to cover the huge demand for most of the Iraqi products.

Investment Files are available with all technical, financial information and visibility study for each plant.


Second: Transforming some of the SOE's to share holding companies giving the big share of about 45% of the capital to a strategic partner through transparent evaluation process.

Third: Establishing new Private Companies.

Fourth: Investing in new Industrial plants in accordance with Investment Law No (13) 2006.

Fifth: Investing in new Green Field Cement plants utilizing available raw materials (Lime Stone) at several locations in Iraq owing to of the high local demand for construction materials needed for rebuilding Iraq.

Sixth: Investing in new strategic large scale Industrial plants on Joint Venture basis ( Petrochemicals, Fertilizer, Phosphate, Sulphur Plants).




Advantages Enjoyed by the Investors for Rehabilitation on Partnership basis

Well trained, experienced labor force.

Availability of major raw materials.

Reduced time to market due to the availability of markets and high local demands.

No Real Estate Expenses.

Clear cost advantage over imports.

Fast return on investment. Full support of the Government of Iraq Investors are insured that their interests are

in parallel to the government's interests. Both parties will have the incentive to rehabilitate and operate the factory to its greatest potential. The Ministry of Industry and Minerals will serve as an effective interlocutor between the investor's need and the government's requirement.

Exemption of all Duties and Taxes.



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Iraqi business with international investors

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International companies with operations in Iraq

150Sinjar Cement

45Fallujah Cement

60Diyala Electric

150Northern Fertilizer - Baiji

150Kubaysa Cement

90Al Qaim Cement

100Karbala Cement

Investment$ millionsBusiness

▪ Case New Holland has begun to assemble tractors in Iskandiriah

400 tractors already deliveredOn track to deliver 1,250

tractors

▪ Daimler Benz has agreed to build trucks in restarted SOE factory in Iskandiriah

▪ Cummins Diesel has agreed to rebuild and assemble generators at Iskandiriah

▪ Caterpillar has agreed to rebuild and assemble generators in Baghdad

▪ Scania has agreed to build 500 trucks in Iskandiriah

International firms recognize Iraq’s potential and have already invested


▪ This is a unique window of opportunity to invest in Iraq

▪ MIM sectors have natural competitive advantages

▪ Iraqi industries are building capabilities and preparing for growth

▪ The environment in Iraq is favorable for investment, and investors are already recognizing the potential growth

Conclusion

For Further Information

Visit our website www.industry.gov.iq

Contact our Investment Dept. at: [email protected]

13Ministry of Industry and Minerals

Ministry of Industry and Minerals Ministry of Industry and Minerals Iraq Is The Right choice for...

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