Business | Investment
Investments worth millions to flood Basra
Most headlines about Basra, the port city in southern Iraq that is home to the bulk of the country's vast oil wealth, tend to focus on death, destruction and wasted opportunity after five years of war.
- Reuters
- Published: 00:04 August 2, 2008
London: Most headlines about Basra, the port city in southern Iraq that is home to the bulk of the country's vast oil wealth, tend to focus on death, destruction and wasted opportunity after five years of war.
Yet after seven months as co-chair of the Basra Development Commission, a British-Iraqi body responsible for kick-starting the area's economy and attracting foreign investment, Michael Wareing is a confirmed optimist.
Not only has security shown sustained improvement in recent months, but large multinational companies are actively looking to pour money into the country, not just into oil and gas industries, but secondary ones such as fertiliser and finance.
In fact, says Wareing, the international chief executive of tax and consulting giant KPMG, a turning point may have been reached that could see billions of dollars of international investment flow into the city in the next two to three years.
"There's significant interest, with active investor visits," Wareing told Reuters at KPMG's headquarters in London.
"We're talking about a dozen companies, most of them, but not all, significant multinationals, who are looking at quite significant opportunities," he said, referring broadly to Middle Eastern, European and US firms but not wanting to be more specific because of the imminence of contract announcements.
"Providing there isn't a fallback in the security position, my sense is that security today would not need to improve further in order for us to see quite significant investment."
When quizzed about the size of flows, Wareing prefers to talk in hundreds of millions or billions of dollars, saying investment when it comes - and he believes the breakthrough will occur before year-end - will be large and sustained.
Development
Iraq has the world's third-largest oil reserves at around 115 billion barrels but it needs heavy investment to modernise and diversify its oil industry.
As well as oil and gas, the major areas of interest are ports and shipping, construction, infrastructure - including the airport and railways - and in industries that range from fertiliser production to iron and steel and banking.
"Basra has got an awful lot of things going for it," said Wareing, listing its geographic position as a port on the Gulf, its natural resources, its university and ready labour supply.
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