Kurdistan advances Oman-Kuwait economic and trade cooperation
Shafaq News/ The Kurdistan Region holds a strategic location in northern Iraq, sharing borders with Turkiye and Iran, making it a key hub for trade and investment in the Middle East.
This Region is particularly rich in natural resources, especially oil and gas, which has attracted significant interest from both Gulf and international investors. Over the past two decades, substantial investments in energy infrastructure have led to the rapid development of this sector.
Joint Investment
The energy sector in the Kurdistan Region is one of the most vital for the local government, which heavily relies on oil and gas revenues to sustain and grow its economy.
Despite political and security challenges, the Kurdistan Regional Government (KRG) has successfully secured international agreements to boost energy production and attract further investments from Gulf and foreign companies. This dynamic has positioned the Region as a key center for international investment, particularly in oil extraction and refining.
Kurdistan Prime Minister Masrour Barzani recently met with Sheikh Ahmed Suhail Bahwan, Chairman of the Omani Bahwan Group, and Louay Jassim Al-Kharafi, CEO of Kuwait’s Al-Kharafi Group, to discuss potential collaboration in renewable energy sectors with both government and private entities.
The visit is part of the broader vision of the Oman-Kuwait alliance aimed at enhancing economic and trade cooperation between the Gulf states and Kurdistan. It also coincides with the Iraqi Parliament’s expected passage of the Renewable Energy Law, which is seen as a critical step in boosting partnerships in this important sector.
Al-Kharafi emphasized that the law will significantly benefit Iraq by leveraging solar energy and other renewable sources to generate electricity. The Renewable Energy Law is expected to address several challenges, such as Iraq’s dependency on imported gas and energy, while resolving technical issues related to imports.
The law also covers carbon credit distribution, investment licensing, and emission trading guidelines, based on bilateral agreements between the investor and the host state. It will also set pricing mechanisms linked to national efforts to promote renewable energy once the law is ratified.
This visit follows meetings held during the "AIM Investment Summit" in Abu Dhabi last June, where the Kurdistan Region's delegation had a prominent presence. The summit focused on recent global investment trends and presented innovative solutions to tackle both current and future challenges, aiming to foster a sustainable and prosperous global economy.
A high-level governmental and economic delegation from Kurdistan also showcased nearly 200 investment opportunities across various sectors, including tourism, agriculture, infrastructure, manufacturing, and mining.
Anticipated Benefits
Economic expert and academic Ahmed Saddam believes that the Omani-Kuwaiti partnership for investment in the Kurdistan Region is of significant importance, particularly due to its focus on the renewable energy sector.
In an interview with Gulf Online, Saddam explained that both Bahwan and Al-Kharafi groups seized this investment opportunity at a crucial time, coinciding with the near approval of Iraq’s Renewable Energy Law. This timing has allowed both companies to gain a competitive edge by capitalizing on early investment opportunities in the Kurdistan Region, a critical move from a business perspective.
He further highlighted the economic benefits for both Oman and Kuwait, noting that a substantial portion of the companies' profits will be repatriated, thereby boosting their home economies. This could also enhance the capabilities of these firms to reinvest locally in Oman and Kuwait.
On the other hand, Iraq stands to gain from this strategic investment partnership, particularly as it faces significant energy shortages. Moreover, such investments align with Iraq’s environmental objectives, contributing to reducing carbon emissions and addressing climate change—an important step in fulfilling the country’s international commitments.
Saddam emphasized that this Omani-Kuwaiti venture will encourage other companies to invest in Iraq, fostering a competitive economic environment that benefits Kurdistan by driving down project costs. He also noted that this partnership could open the door for further investment in other sectors, such as tourism and various commercial ventures, including electronics and electric vehicles.
Finally, Saddam remarked that, as general trading companies, Bahwan and Al-Kharafi have the flexibility to pursue new investment partnerships after their anticipated success in the renewable energy sector, further expanding cooperation between the two Gulf states and the Kurdistan Region in various industries.
A Look at the Companies
Kuwait and Oman have extensive experience in managing major energy projects, while Kurdistan offers a resource-rich environment with ample investment opportunities. This collaboration fosters economic integration and increases the potential for sustainable growth in the Region. It also helps achieve a greater economic balance between Gulf states and resource-rich countries like Iraq.
Bahwan Group is one of the leading commercial institutions in the Middle East, known for its professional management. The group’s activities span a wide range of sectors, including automobiles, electronics, travel, healthcare, agriculture, chemicals, fertilizers, construction and engineering, IT, manufacturing, oil and gas services, telecommunications, as well as furniture and building materials.
Al-Kharafi Group from Kuwait is another prominent family-owned conglomerate, and one of the largest companies in the Arab world. Initially starting as a construction company, it quickly expanded its activities alongside the booming oil sector. Today, its operations cover diverse fields such as general trade, agriculture, food industries, restaurants, steel production, real estate, entertainment, hospitality, and tourism. The group’s reach extends across 27 countries globally.
