The glitzy Qatar-financed Rixos resort is taking form in Baghdad’s Green Zone, a closely fortified legacy from Iraq’s war-torn years. This highlights rising funding curiosity from Gulf Arab states.
The authorities of Prime Minister Mohammed Shia Al Sudani hopes to host Gulf Arab monarchs and different Middle Eastern emissaries in Rixos Baghdad’s 470 luxurious rooms and suites once they arrive for a deliberate Arab League summit subsequent 12 months.
His authorities has been pushing for extra funding from the area for an economic system ravaged by a long time of warfare and instability however benefiting from report oil revenues. These revenues are serving to to spur demand for shopper items from the quickly rising inhabitants of not less than 43 million.
Organization of the Petroleum Exporting Countries (OPEC) member Iraq has seen relative calm since defeating the Daesh terrorist group in 2017, though there was sporadic violence, together with amongst ruling Shiite Muslim factions and, extra lately, assaults from Iran-aligned teams.
The nation’s prime commerce companions are at the moment China, Iran and Türkiye.
However, Gulf Arab states, which have had a sophisticated relationship with Iraq, have pledged a string of investments as they search to develop delicate energy in a rustic the place regional rival Iran has unparalleled affect by way of a robust community of allies. This has been partially enabled by a detente in ties between Iran and Saudi Arabia.
“It is the right time to go there,” mentioned Moutaz Al Khayyat, chairman of Qatar’s Estithmar Holdings, which is behind the Rixos challenge. He cited the Iraqi authorities’s capacity to construct enormous initiatives and appeal to worldwide traders.
“The country is safe and more controlled. We believe that Baghdad will be one of the most important Arab capitals for the next 25 years.”
Sunni-dominated Gulf states severed ties after Sunni strongman Saddam Hussein’s 1990 invasion of Kuwait, solely to see Iran-backed Shiite factions achieve the higher hand when he was ousted within the 2003 U.S.-led invasion.
In 2014, then-Prime Minister Nouri al-Maliki accused Saudi Arabia and Qatar of inciting and funding Daesh fighters within the nation, claims the 2 states denied.
Improving ties
But hyperlinks have been rising as Baghdad seeks to show Iraq into a spot of cooperation between regional rivals. For instance, it hosted Saudi Arabia-Iran talks in 2021 and 2022 that helped pave the way in which for his or her landmark normalization of ties in March 2023.
Saudi Arabia, Qatar and the United Arab Emirates (UAE) subsequently got down to strengthen financial ties with Iraq to push Baghdad away from Iran and nearer to the “Arab political environment,” mentioned Mahjoob Zweiri, director of the Gulf Studies Centre at Qatar University.
In May 2023, Saudi Arabia mentioned it had put aside $3 billion for funding in Iraq by way of its Public Investment Fund. Later, it introduced a $1 billion mixed-use challenge that would come with places of work, retailers and greater than 6,000 residential models.
Qatar’s Emir Sheikh Tamim bin Hamad Al Thani visited Baghdad in June 2023, throughout which Estithmar signed memorandums of understanding (MoUs) price $7 billion to develop two new residential cities, five-star resorts and offers to handle and function hospitals.
“Iraq is a huge country. They have great potential. They have probably realized the biggest and the best partner should come from the region,” mentioned Abdul Aziz Al Ghurair, chairperson of the Dubai Chamber of Commerce (DCC).
Exports from DCC members soared virtually 96% within the first half of final 12 months.
Gulf nations have additionally signaled rising curiosity in Iraq’s vitality sector, a key zone of affect for Iran that at the moment provides as much as 40% of Iraq’s energy.
Qatar final 12 months took a 25% stake in a $27 billion deal led by France’s TotalEnergies to develop oil manufacturing and seize gasoline Iraq at the moment flares, whereas Qatar’s UCC Holding signed a $2.5 billion MoU to develop two energy vegetation totaling 2,400 megawatts.
UAE-based Crescent Petroleum final 12 months signed three 20-year contracts to develop pure gasoline fields within the southern Basra and Diyala provinces. Saudi Arabia’s ACWA Power plans a 1,000 MW photo voltaic farm.
Iraq is within the means of linking its energy grid to Kuwait and, sooner or later, to Saudi Arabia.
Rocket assaults
Questions stay over how Iran will react to a rising Gulf presence, whereas an upswing of violence has highlighted the fragility of Iraq’s relative stability.
There have been greater than 4 months of near-daily rocket and missile assaults by Iran-aligned armed teams on U.S. forces, who’re in Iraq to assist native troops forestall a resurgence of Daesh. In January, an Iranian ballistic missile assault on Iraq’s Kurdistan Regional Government (KRG) killed a distinguished businessman.
Many traders even have issues about rampant corruption and stifling forms, which make every part from signing a contract to getting paid troublesome. These issues place a heavy emphasis on political connections and guarantees.
“I’m not sure these outside investments in Iraq will help politically or economically,” the Gulf Studies Centre’s Zweiri mentioned, on account of excessive corruption and political infighting.
Iraq’s prime court docket dominated in September that an accord demarcating maritime borders with Kuwait was unconstitutional, a blow to rising goodwill with Gulf neighbors.
The court docket determination slammed as “null and void” by the Gulf Cooperation Council (GCC) is remaining, though parliament might endorse a brand new settlement and Iraqi officers say talks are ongoing.
“We remain positive about working in Iraq, though there are fears that some in the region could seek to spoil that,” a Gulf Arab diplomat mentioned.
Source: www.dailysabah.com