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Despite ongoing political and security turmoil in the Middle East, the Kurdistan Regional Government (KRG) has succeeded in maintaining — and even expanding — its investment momentum. Dr. Mohammed Shukri, head of the KRG’s Board of Investment, announced that more than 100 investment licenses have already been issued in 2025, with the goal of reaching 200 by the end of the year.
According to Shukri, the current (ninth) cabinet of the KRG has so far granted 723 licenses, representing about 45 percent of all investment permits issued under previous governments combined. He attributed this progress to the prime minister’s determination, the KRG’s supportive policies, and its ongoing administrative reforms designed to simplify investment procedures.
Major Electrical Appliances Project in Erbil
One of the year’s flagship initiatives is the creation of a large industrial complex for electrical home appliances in Erbil. The project is a joint venture between Turkish, South Korean, and Kurdish investors and will produce a range of goods including hair dryers, refrigerators, freezers, and washing machines. The final step before construction begins is the official handover of land for the project site.
Shukri described the venture as “a model of partnership between local and international investors,” highlighting its potential for technology transfer, job creation, and industrial diversification. The KRG, he said, aims to transform the Kurdistan Region into a modern industrial hub in northern Iraq.
Impact of the Erbil–Baghdad Oil Agreement
Asked about changes in investment levels compared to 2024, Shukri admitted that early 2025 saw a temporary slowdown due to the Israel–Iran conflict, which had direct economic repercussions across the region. However, from August onward, investment activity began to recover.
He stressed that the recent oil export agreement between Erbil and Baghdad has had a strong positive impact, restoring investor confidence and stabilizing markets. The construction and real-estate sectors, in particular, have seen a sharp rise in project sales, signaling renewed economic vitality across the Kurdistan Region.
Industrial Sector Leads Growth
The industrial sector has become the main driver of investment. Shukri explained that the KRG is focusing on preparing land and infrastructure for factories and production zones. In Duhok, 35 fully serviced industrial sites — equipped with roads, water, and electricity — have already been made available, allowing investors to obtain licenses the same day they submit their proposals.
This approach, he added, is now being expanded to other areas including Erbil, Sulaimani, Garmian, Raparin, Zakho, Halabja, and Amedi. Sixteen designated industrial zones are currently in various stages of preparation. In Garmian alone, 2,500 dunams have been allocated for large industrial projects, while 400 dunams in Halabja’s Parwezkhan area will soon be ready once local land issues are resolved.
Domestic Investment Dominates
According to the Board of Investment, 83 percent of projects are funded by local investors, while 17 percent involve foreign capital. Shukri noted that many local investors now possess the expertise and capital to lead large ventures, often partnering with foreign firms to import technology or equipment. This hybrid model, he said, strengthens domestic capacity while fostering international cooperation.
Toward a Competitive Investment Climate
Although no legal barriers exist for foreign investment, Shukri acknowledged that certain bureaucratic inefficiencies and coordination gaps still need improvement. The KRG is currently developing a digital licensing system to streamline procedures and increase transparency.
He expressed optimism that continued political stability and cooperation between Erbil and Baghdad would sustain the upward trend in investment. “Our goal,” Shukri said, “is not just to issue licenses but to ensure that each license turns into a real, functioning project that creates jobs and supports long-term development.”
With its strategic location, skilled workforce, and abundant natural resources, the Kurdistan Region is positioning itself as a regional industrial and commercial center. Despite regional tensions, investment continues to grow — led by the industrial sector and supported by domestic entrepreneurs, structural reforms, and emerging partnerships with international investors.