The document discusses the private sector in Iraq and efforts to strengthen it. It notes that the private sector currently accounts for a small percentage of GDP, employment, and labor force despite rules requiring development and encouragement of the private sector. A joint private sector body and center have been formed to identify reform barriers and encourage public-private dialogue to support business development, investment, and economic growth. The private sector development strategy aims to improve understanding of the private sector and the business environment through several programs and pillars. Success is defined as increased private sector contribution to GDP and employment over time. Strengthening the private sector is important for Iraq to realize its economic potential.

1. FDI & The Iraqi Private Sector
MENA-OECD Investment Programme
Khalid Mahdi
Baghdad, 2 February 2014

2. A joint private sector body in Iraq focused on economic reform. Its mission is to contribute to:
◦Business Development
◦Investment
◦Economic Growth
◦Entrepreneurship
The Center will achieve the above by:
◦Identifying barriers to reform
◦Working with the Government to implement tangible solutions and encouraging PPD

3. Working Groups
Secretariat
Steering Committee
The Center is led by the Steering Committee.
The Secretariat provides support to the steering committee and the working groups.
Regular discussions on reform issues will take place through Working Groups.

4. Working with: Zaha Hadid . Global Banking Alliance for Women . Chamber Trade Sweden . Risk Reward . Finance Interns . Middle East Association . Accenture (via Time to volunteer programme . Microsoft*. Iraq Business News. + Individual journalists from international media groups including New York Times. *(in discussion with Microsoft around their new Aspire Woman portal)
Nina is a new magazine and web portal for Iraqi women everywhere. Published initially in English and Arabic, distributed in country (and globally via the internet. Nina targets the special needs and interests of working women, reaching women executives and managers, as well as female entrepreneurs and thought leaders with an aspirational focus. The magazine is age inclusive however, it is expected that the main market will be aged 22 - 55. Nina recognises the importance of women as consumers and so creates a powerful forum for companies wishing to advertise their services to women with purchasing power.

6. 50% of GDP (for 2012, constant prices)
> 90% of INCOME
<2% of LABOR FORCE
This reliance of economy on oil comes at the expense of local producers and service providers. i.e. THE PRIVATE SECTOR

8. Accounted for 5% of 2010 GoI expenditures
Receive 87% of the total budget for economic subsidies
Take additional forms of hidden and off- budget subsidies (e.g., loans from state- owned banks; preferential access to electricity)
Source: World Bank

9. In order for Iraq to realize its potential
and resume its position as a regional
economic power we will have to
vitalize the private sector

10. Article 25 of Iraq’s Constitution stipulates that
"the State shall guarantee the reform of the Iraqi economy in accordance with modern economic principles to ensure the full investment of its resources, diversification of its sources, and the encouragement and development of the private sector".

11. Business ownership
Source: CIPE

12. Business Size
Source: CIPE

13. Financing Business Activities
Source: CIPE

14. The Private Sector Development Strategy (2014-2030)
i.Understanding the Private Sector
ii.Improving the Business Environment
iii.The SME Programme
iv.Implementation

15. The main success indicators for Pillar one is:
a.The Government understands its role as a facilitator and enabler for private sector, and views the private sector as a partner and associate. b. The private sector understands its role and responsibility as a socio-economic actor and is working collectively to contribute to national economic growth and development

17. Some of the success Indicators expected for the PSDS Phase Three (2023-2030):
a. Employment in the private sector increases to 50% or more of total employment;
b. Private sector contribution increased moderately to provide 50% of GDP by 2030;

18. The NIC is faced with a colossal task of attracting investors and facilitating the investment process
Engaging the Iraqi privet sector in investment activities as a 3rd party will aid in building its capacity, facilitate transferring knowledge and reduce the burden on the NIC and PICs

19. For example:
The development of properly managed economic zones where there is a clear legal framework
PPPs to include Iraqi private sector as well as international companies
Establishing a ‘Business Link’ department within the NIC and PICs

20. info@psdc-Iraq.org www.psdc-Iraq.org
Questions?