ENABLING AND SUSTAINING PRIVATE FOREIGN INVESTMENT IN IRAQ Second Meeting of the Working Group on Investment Zones in Iraq Agenda Organised by the MENA-OECD INVESTMENT PROGRAMME In association with Turkish Industry and Business Association (TUSIAD) 23-24 November 2011 Best Western Plus The President Hotel Istanbul, Turkey
A Network of Investment Zones for Iraq A workshop on the Iraqi economic zones (EZ) strategy was held at the OECD headquarters in Paris on November 25-26, 2010, at the request of the Iraqi National Investment Commission (NIC). The workshop was attended by the Chairman of the NIC and five of his key staff, as well as several international experts. The topics discussed included: economic zone models ranging from traditional export-processing areas to special economic zones; the Iraqi legal framework for economic zones; the status of existing zones; sector prioritization; EZ policy frameworks and incentives; and EZ management structures. The participants agreed on the following actions: 1. The NIC will provide a detailed evaluation of existing economic and industrial zones in Iraq to determine their role in the new investment zones strategy; 2. The new strategy will give priority to an investment zone model focused on the domestic market and offering an incentives package based on quality infrastructure, security, and streamlined administrative services rather than tax and customs duty preferences; 3. The new strategy will target multiple sectors in accordance with the Iraqi National Development Plan 2010-2014 and with WTO and trade agreement obligations, but especially: a. General manufacturing, transport and logistics b. Oil refining, petrochemical and heavy industry c. A wide area special agricultural economic zone d. A multi-modal sea transport hub/economic zone at Al-Faw e. A multi-modal air transport hub/economic zone at Baghdad International Airport (BIAP); 4. The new strategy will favour the use of the simpler forms of public-private partnerships (PPP), such as build-operate-transfer (BOT) models; 5. A dedicated investment zones unit will be created within the NIC to coordinate implementation of the strategy; 6. The will provide drafting assistance for a new investment zones implementation regulation for the 2006 Investment Law, covering: a. A description of the investment zones concept b. Privileges and incentives (other than tax or customs related) for zone tenants, including one-stopshop licencing services, security and infrastructure c. Site selection criteria d. Creation of an NIC unit responsible for investment zones e. Authorization of private sector involvement in zone management via: The institutional and management structure of investment zones (including the delegation of certain responsibilities) Investment zone Boards (including representatives of the NIC, relevant PICs, private developers, tenants, the Ministry of Industry, and the Ministry of Planning) A one-stop-shop located in each investment zone; 7. A broad study of the tax and customs duty issues that may affect investment zones as the Iraqi tax system develops, involving the relevant Task Force for Economic Reform and Private Sector Capacity (TFER) working group; 8. The Grand Al-Faw Port project or the BIAP site could be the focus of initial implementation efforts given their advanced and strategic status. At the first meeting of the Working Group on Investment Zones in Iraq (29-30 March 2011, Amman, Jordan), a draft Investment Zones Strategy prepared by the NIC was commented on by the MENA-OECD Investment Programme, and this was followed by debate on such questions as tax and customs incentives for investment zone users, the interconnection between on-site and off-site infrastructure, the delegation of powers to one-stop shops within zones, and the relationship between investment zones, free zones, and industrial zones. A round table discussion on intra-governmental cooperation led into a review of key provisions of the draft implementation regulation prepared by the, focusing on institutional arrangements and licensing
procedures. Participants in the meeting included top officials of the Iraqi National Investment Commission (NIC), the Babil Provincial Investment Commission, the Iraqi ministries of planning and industry, the Office of the Iraqi Deputy Prime Minister for Infrastructure, the OECD, the Jordan Enterprise Development Corporation (JEDCO), the Jordan Development Zones Commission, Shannon Development (Ireland), and a Jordanian law firm. Since the meeting, the draft Investment Zones Regulation has been finalized after further rounds of revisions and comments, and it will be among the topics discussed at the second meeting of the working group. The second meeting of the Working Group (23-24 November 2011, Istanbul, Turkey) will focus on a comparative benchmarking of international good practices for attracting economic zone developers and users. The topics covered by this study include a review and benchmarking of the Iraqi Investment Zones Regulation; options and benchmarking for the structure, staffing and work plan of the Department of Investment Zones, NIC; and plans for the pilot investment zone: location, sectors, financing mechanism, feasibility study, tender documents, and marketing (to both potential zone developers and users).
Government of Iraq Representatives Dr. Sami Al-Araji, Chairman, National Investment Commission Mr. Abdulla Albander, Advisor to the Chairman, National Investment Commission Mr. Alaa Harba, Chairman, Babil Investment Commission Mr. Muqbil Abdulrahman Ahmed, General Director, Office of Deputy Prime Minister Shawis Mr. Riyadh Yousef Aboud, Chairperson, Infrastructure Committee, Office of the Deputy Prime Minister for Infrastructure Dr. Sabah Salih Mahdi Al-Qaysi, Director General, General Commission for Free Zones, Ministry of Finance Mr. Amer Abdulrazak Abdul Lateef, Expert, Ministry of Industry and Minerals Mr. Qassim Enaya Frez, Ministry of Planning Dr. Abdul-Jabbar Mahmoud Ahmed, Legal Expert, National Investment Commission Mr. Basim Abdalhade Hassan, Economist, National Investment Commission Mr. Khaled Yassin Khudair, Legal Expert, National Investment Commission Ms.Basma Amer Omar Nadhmi, Legal Expert, National Investment Commission Ms. Afaf Khairullah Hussein, Office of Deputy Prime Minister Shawis Mr. Ather M. Kalaf, Coordinator, Working Group Committee, Office of the Deputy Prime Minister for Infrastructure International and OECD Experts Mr. Carl Dawson, Iraq Project Coordinator,, OECD Mr. Adnan Nas, US Working Group Chairman and International Executive Board Member, TÜSİAD Mr. Zuhair Al-Maliki, Iraq Project Advisor,, OECD Ms. Christelle Monteillet, Iraq Project Advisor,, OECD Mr. Eugene Brennan, Director, Consultancy Services Group, Shannon Development, Ireland Mr. Mostafa El-Erian, El-Erian Associates LLC, United States Mr. Craig A. de Ridder, Lawyer, Pillsbury Winthrop Shaw Pittman LLP, United States Mr. Christopher Gunson, Lawyer, Pillsbury Winthrop Shaw Pittman LLP, Abu Dhabi Mr. Ben Aissa Abidi, CEO, Industrial Land Agency, Tunisia Ms. Rand Hannun, Partner, Nabulsi and Associates, Jordan
Wednesday 23 November 2011 9:30-10:00 Opening Remarks Adnan Nas, US Working Group Chairman and International Executive Board Member, Turkish Industry and Business Association (TÜSİAD) Carl Dawson, Iraq Project Coordinator, Sami Al-Araji, Chairman, National Investment Commission (NIC), Iraq 10:00-12:00 Session 1 Attracting Investment Zone Developers 10:00-10:45 Convincing a potential zone user or developer of the merits of a site involves meeting a certain number of preconditions in terms of the legal and institutional frameworks, taxation, customs incentives, and other issues as they apply to investment in general and to economic zones in particular. This session will identify preconditions for attracting zone developers, and case studies drawn from relevant countries will illustrate possible approaches to meeting them, problems likely to arise, and effective solutions. International good practices for attracting investment zone developers Zuhair Al-Maliki, Iraq Project Advisor, Case study: Tunisia Ben Aissa Abidi, CEO, Industrial Land Agency, Tunisia Discussants: Sami Al-Araji, Chairman, National Investment Commission, Iraq Eugene Brennan, Consultancy Services Group, Shannon Development Discussion 10:45-11:15 Coffee Break 11:15-12:00 Session 1 continues 12:00-13:30 Lunch 13:30-15:30 Session 2 Attracting Investment Zone Users This session will identify preconditions for attracting zone users, and case studies drawn from relevant countries will illustrate possible approaches to meeting them, problems likely to arise, and effective solutions. International good practices for attracting investment zone users Zuhair Al-Maliki, Iraq Project Advisor, Case study: The Dubai free zones Christopher Gunson, Lawyer, Pillsbury Winthrop Shaw Pittman LLP Case study: Tunisia Abidi Ben Aissa, CEO, Industrial Land Agency, Tunisia Discussants: Basim Abdalhade Hassan, Economist, National Investment Commission Discussion Mostafa El-Erian, El-Erian Associates LLC, United States 15:30-16:00 Coffee Break
16:00-17:30 Session 3 Benchmarking the draft Iraqi Investment Zones Regulation This session will focus on a benchmarking of the draft Iraqi investment zones regulation against relevant good practices, the needs of zone developers and users, and the policy priorities of the Government of Iraq. Benchmarking the draft Iraqi Investment Zones Regulation Zuhair Al-Maliki, Iraq Project Advisor, Discussants: Khaled Yassin Khudair, Legal Expert, National Investment Commission Carl Dawson, Iraq Project Coordinator, Craig A. de Ridder, Lawyer, Pillsbury Winthrop Shaw Pittman LLP Thursday 24 November 2011 9:00-10:30 Session 4 Benchmarking the proposed Department of Investment Zones, NIC This session will focus on a benchmarking of the proposed Department of Investment Zones, NIC, which was first outlined in the investment zones strategy document and later incorporated into the draft implementation regulation. Benchmarking the proposed Department of Investment Zones, NIC Christelle Monteillet, Iraq Project Advisor, Discussants: Abdulla Albander, Advisor to the Chairman, National Investment Commission, Iraq Mostafa El-Erian, El-Erian Associates LLC, United States 10:30-11:00 Coffee Break 11:00-12:30 Session 5 Plans for a pilot investment zone This session will examine plans for a pilot investment zone, including aspects such as location options, sectoral foci, financing and management mechanisms, feasibility study issues, tender documents, and marketing. Plans for a pilot investment zone Christelle Monteillet, Iraq Project Advisor, Discussants: Alaa Harba, Chairman, Babil Investment Commission, Iraq Eugene Brennan, Director, Consultancy Services Group, Shannon Development 12:30-14:00 Lunch 14:00-15:30 Session 6 Approval of final declaration and closing remarks This session will approve the final declaration and focus on continued collaboration between the, the NIC, and Iraqi ministries. Moderators: Sami Al-Araji, Chairman, National Investment Commission, Iraq Carl Dawson, Iraq Project Coordinator,
Contacts Government of Iraq Dr. Sami Al-Araji Chairman, National Investment Commission E-mail: samialaraji@yahoo.com Telephone: +964 7901 933821 (www.oecd.org/mena/investment) Dr. Alexander Böhmer Head of Unit E-mail: alexander.boehmer@oecd.org Telephone: +33 1 45 24 19 12 Mr. Carl Dawson Iraq Project Coordinator E-mail: carl.dawson@oecd.org Telephone: +33 1 45 24 75 53 Ms. Maha El Masri Consultant, Iraq Project E-mail: maha.elmasri@oecd.org Telephone: +33 1 45 24 96 54 Mr. Fifi Luhumbu Project Assistant E-mail: fifi.luhumbu@oecd.org Telephone: +33 1 45 24 88 23 Fax: +33 1 44 30 60 14