Alwaght- As the global developments unfold, the political and economic groupings and cooperation are transforming, and in the meantime some developing countries whose significance and place for international investors was neglected earlier are coming to the center of focus.
One of these new actors is Iraq that has major attractions for regional countries, and the Persian Gulf Arab investors over the past two years have rushed to invest in this country in a faster pace.
To this end, agreements have been signed with Baghdad aiming to facilitate investment.
In April, the Iraqi Ministry of Planning announced signing of 12 MoUs with Saudi Arabia for specific investment projects aimed at increasing cooperation in a number of qualitative investment projects in Iraq.
Also, in 2022, the Saudi State Investment Fund announced foundation of a new company with an initial capital of $3 billion to invest in Iraq, which is part of the Saudi plan to invest in 5 Arab countries. These investments cover various fields including infrastructure, mining, agriculture, real estate development and financial services.
Saudi Arabia also signed a contract to supply electricity to Iraq in 2022 to meet part of its northern neighbor's electricity needs.
Iraq, which needs foreign capital to break out of its difficult economic situation, has prepared a draft law to support Saudi investment so that, if approved by the parliament, it will strengthen the process of economic cooperation between the two countries.
Ahmad Saddam, an economist, told Khaleej Online that 13 agreements have been signed between Iraq and Saudi Arabia and this means that passing the draft law will upgrade the level of Saudi investments in Iraq in the years to come as it will provide a guarantee to the Saudi investors.
The UAE, another member of the (Persian) Gulf Cooperation Council, has recently stepped up its investments in Iraq and announced its willingness to strengthen its strategic partnership with Baghdad in all areas.
The Emirates Minister of State for Foreign Trade Thani bin Ahmad al-Zeyoudi said earlier that "there is a mutual desire to develop economic relations in a way that provides common interests and provides more opportunities for business and private communities."
The official UAE news agency (WAM) reported that this interest in the UAE and Iraq was positively reflected in non-oil infrastructure and mutual investment flows.
In 2021, Abu Dhabi announced it would inject $3 billion worth of investment into Iraq as part of a new effort to boost economic and investment ties between the two countries.
In turn, Qatar's financial resources flowed to Iraq after Sheikh Tamim bin Hamad al-Thani's visit to Baghdad in June last year.
After that, 3 Qatari companies and Iraq's National Investment Organization agreed to develop projects worth $9.5 billion in Iraq, including the construction of two power plants with a total capacity of 2,400 MW.
In July last year, Qatar entered into a major deal of Iraq with Total Energy, worth $10 billion, in a project aimed at producing electricity from solar energy and gas flaring.
Qatar's investment plans in Iraq will be in the fields of oil, electricity, refineries, gas and the "Development Path" project. In addition, the construction of two towns of 50,000 residents was also included on the agenda of the two countries.
In the meantime, Turkey, which competes with the Arabs for a wide influence in the region, has risen to invest in Iraq.
In the recent visit of Turkish President Recep Tayyip Erdoğan to Iraq, the two neighbors signed a memorandum of joint cooperation on the Development Path project and cooperation agreements in various fields, including business, tourism, education, religion, culture, media, energy, health, technology, transportation, investment, and defense, were inked by the two countries.
Commenting on these agreements and MoUs, the head of Iraqi-Turkish Business Council said that such agreements bolster business between the two countries and encourage investment.
Economic goals a priority to Arab states and Turkey
Undoubtedly, the geographical position of Iraq very well puts this country in the center of focus for global trade since it links Europe to Asia. This is why regional countries try to take advantage of this Baghdad position to sieze the reigns of regional trade.
In the past decade, a kind of competition started between Saudi Arabia and the UAE to become the top economic power in the region, and both sides are trying to get ahead of their rival by attracting the countries of the region to their side in this competition.
By strengthening relations with Iraq, Saudi Arabia is striving to build a bridge to Europe and conduct part of its trade from the north. Until now, the Saudis used to do their business with all over the world only from the Persian Gulf and the Red Sea, but now with the changes and developments that have taken place in the world, they are planning to diversify their trade corridors, and Iraq is one of these options that can help Saudis realize their agenda.
Rail corridors have once again regained their place in the world transit, and from the point of view of experts, any country that can take over more corridors can control world trade. This is why the Chinese have invested heavily in these corridors and other countries are also struggling not to fall behind.
The Asia-Europe manufacturing connection complements Saudi Arabia's efforts to link African trade with Asia and Europe through the transit belt known as the Development Path that will increase Persian Gulf cooperation and investment in Iraq.
This issue has pushed the Saudis to think of alternative routes at a time when the Red Sea has become unsafe due to the tension between Yemen's Ansarullah and the US over Israeli genocidal war on Gaza.
Saad al-Hamid, a Saudi analyst and author, commented on the matter, saying: "Saudi Arabia is looking forward to achieving an enabling environment for investment in neighboring countries that will help Riyadh achieve the goals of Vision 2030", a plan unveiled in 2016 by Saudi Crown Prince Mohammed bin Salman aiming to reduce the kingdom's reliance on the oil revenues.
The UAE, which has become a trade hub in the Persian Gulf thanks to foreign investments, has tried to take full advantage of various corridors in the region in the past years.
Involving in the corridor from India to Europe and trying to use Iran's land corridors to reach Central Asia have been part of Abu Dhabi's efforts to diversify its trade with the countries of the region, and Iraq was the last missing link for the rulers of the UAE to invest and upgrade their business position in the region.
Saudi Aramco and Emirati National Oil Company, which want to remain in the game as major global energy companies, are looking to strengthen their presence in the renewable energy business, particularly in solar and hydrogen production for electricity and transportation fuels. Finding markets to these activities is essential and Iraq can be a good initial consumer.
Although Qatar is a small country on the edge of the Persian Gulf, thanks to the huge reserves of oil and gas and huge income from these resources, the new generation of leaders of this monarchy, like other Arab countries, are trying to improve Doha's position in the international system. For this purpose, energy takes a center stage in the agenda of this country.
Qatar Energy company, through partnership in some global projects, intends to become the largest company in the world's LNG market in the next decade.
Qatar has signed many contracts with large gas consumers such as China and Germany for the transfer of LNG and is trying to seize this lucrative market in its hands and has taken great steps to achieve this goal by developing its energy infrastructure. Therefore, due to its large oil reserves, Iraq is one of the regions where the Qatari Energy tries to hold control.
Experts suggest that Qatar has a lot of financial and practical capabilities and can contribute a lot to the success of energy projects in Iraq and will have the desired investment share in the projects.
Since the Iraqi Prime Minister Mohammad Shia al-Sudani has also put on his agenda in recent months integration with Arab countries, this issue paves the way for Qatari companies to make their way into Iraqi market even more smoothly.
The tension between Qatar and the Saudi-led bloc in June 2017, which even led to a four-year diplomatic hiatus, was a good experience for the rulers of Doha who came to the conclusion that they should remove themselves from under yoke of the policies of Saudi Arabia and the UAE, and to reach this goal, they used financing and investment.
Also, Turkey has designed plans for Iraqi market. This country is trying to use the country's oil and gas resources for the development of its struggling economy by investing in different parts of Iraq.
Turkey is in desperate need of Iraq's oil and gas and is trying to convince the central government to export oil and gas by investing in this sector and can meet part of its needs in this way.
Also, due to the improvement of relations with Arab countries, Turkey is looking to connect to the Persian Gulf through Iraqi corridors and facilitate trade with Arab partners.
On the other hand, the Development Path project, which will connect Basra to Mosul with a wide network and finally connect to Turkey, will transform the regional trade.
Turkey holds a key role in east-west corridors and can improve its geopolitical position by connecting the Arab transportation routes to Europe and make huge profits from international trade. On the other hand, Turkey, which is opposed to the American plan for the India-Middle East-Europe corridor, is trying to connect the Arab states of the Persian Gulf to Europe using Iraqi rail corridors and stymie the American project that is intended to bypass Turkey.
Political intentions of Arab countries
Though Arab countries ostensibly intend to develop Iraq's infrastructure, they pursue political agenda behind their trade and invest partnership with Baghdad.
The Arab states, which have been playing in the American puzzle game since years ago, have started efforts to cut Iranian influence in Iraq, and the plans they could not implement in Iraq using ISIS terrorist group are trying to implement using investment in the country's infrastructure in order to make Iraq dependent on them and ease its dependence on Iran.
Cooperation in Iraq's power supply sector, which has been on the agenda of the (P) GCC for several years, is part of the project to reduce the influence of Iran, which currently supplies most of Iraq's power.
The US tries to put the skids under the considerable Iranian-Iraqi trade partnership. Pushing Baghdad to dependence on Arab power supply and also encouraging Arab investors in Iraqi markets are a Washington scenario to cut off Iran's $3 billion power supply income. But it has failed so far.
From another perspective, Arab rulers see Iran's influence in Iraq and power gain of Iran-aligned resistance groups in Iraq a threat to their and Western interests. So, they resort to business gate to get a foothold in Iraq. This issue has become more worrisome to the Arab-Western camp, especially after Gaza war that led to further power gain of the resistance groups. So, they are trying to block Iran's growing power in the region.
