Iraqi Kurdistan - Economy

Economy

The Kurdistan region's economy is dominated by the oil industry, agriculture and tourism. Due to relative peace in the region it has a more developed economy in comparison to other parts of Iraq.

Prior to the removal of Saddam Hussein, the Kurdistan Regional Government received approximately 13% of the revenues from Iraq's Oil-for-Food Program. By the time of the US invasion of Iraq in 2003, the program had disbursed $8.35 billion to the KRG. Iraqi Kurdistan's food security allowed for substantially more of the funds to be spent on development projects than in the rest of Iraq. By the program's end in 2003 $4 billion of the KRG's oil-for-food funds remained unspent.

Following the removal of Saddam Hussein's administration and the subsequent violence, the three provinces fully under the Kurdistan Regional Government's control were the only three in Iraq to be ranked "secure" by the US military. The relative security and stability of the region has allowed the KRG to sign a number of investment contracts with foreign companies. In 2006, the first new oil well since the invasion of Iraq was drilled in the Kurdistan region by the Norwegian energy company DNO. Initial indications are that the oil field contains at least 100 million barrels (16,000,000 m3) of oil and will be pumping 5,000 bbl/d (790 m3/d) by early 2007. The KRG has signed exploration agreements with several other oil companies, including Canada's Western Oil Sands and the UK's Sterling Energy and Gulf Keystone Petroleum.

The stability of the Kurdistan region has allowed it to achieve a higher level of development than other regions in Iraq. In 2004, the per capita income was 25% higher than in the rest of Iraq. The government continues to receive a portion of the revenue from Iraq's oil exports, and the government will soon implement a unified foreign investment law. The KRG also has plans to build a media city in Arbil and free trade zones near the borders of Turkey and Iran.

Since 2003, the stronger economy of Iraqi Kurdistan has attracted around 20,000 workers from other parts of Iraq. According to Iraqi president Jalal Talabani, since 2003 the number of millionaires in the Kurdish city of Silêmani has increased from 12 to 2000, reflecting the financial and economic growth of the region.

Iraqi Kurdistan currently has the lowest poverty rates in Iraq. According to the KRG website, not a single coalition soldier has died nor a single foreigner been kidnapped since the 2003 invasion of Iraq in areas administered by the KRG.