Iraq investors should stick to banks and hotels, traders say

As the thinking goes in the cramped, air-conditioned room lined with flat-screen displays and buzzing with noise, financial firms will help finance Iraq's economic recovery while hotels will receive more customers as security improves.

“I would recommend the tourism and banking sectors (for foreign investors),” said Ali Jamal, a senior broker for Al-Jawhara, an investment firm.

“Especially tourism because new hotels are being built and existing ones are being refurbished — the door is being opened for investment in tourism,” he added.

On the other side of the glass screen that separates brokers from their clients, the consensus appears to be the same.

“Hotels and banks will do well — once the security situation gets better, their value will rise at an extraordinary rate,” predicted Salman Hassan Salman al-Khafaji, who said he had made a profit of 50 million Iraqi dinars (US$43,000) on the markets so far this year.

“Foreigners should invest in tourism — it will definitely get better here.”

Their optimism regarding Iraq's economic development comes as a delegation led by Prime Minister Nuri al-Maliki visits Washington to court foreign investment from major companies on Tuesday and Wednesday.

While National Investment Commission chief Sami al-Araji has conceded he does not expect deals to be inked at the conference, some 750 projects will be presented to potential investors, and presentations will be made, encouraging investment in Iraq.

The conference will be attended by more than 200 companies, Araji told reporters earlier this month, and while the focus will be on basic infrastructure, investment in industries such as housing and construction, agriculture, health and transport will also be targeted.

More than six years after a U.S.-led coalition invaded the country and eventually ousted dictator Saddam Hussein, Iraq's economy remains in shambles — government revenues are almost entirely dependent on oil, and infrastructure remains dated and, in many cases, decrepit.

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