Kurdistan’s Economic Divide

Stephen DeAngelis

May 21, 2007

A freelance writer, who has spent a lot of time in Erbil, contacted me believing that I have painted an overly optimistic picture of life in Kurdistan. He wrote:

“The city, or for that matter the entire Kurdistan ‘Region’, is ruled by a select political elite who live in luxury. Their contribution to the people of Erbil to date includes: 5 star hotels and Iraq’s biggest shopping mall; Luxury housing complexes; 100s of luxury apartments in preparation for the upcoming UN (they are planning to move here soon); new highways and underpasses which we don’t need yet; private schools, colleges and universities for the privileged few; Private health care; More government jobs for the selected few (usually their own relatives) than any other previous administration; and vast property empires (they’ve taken over entire villages and real estate which used to belong to Saddam Hussain’s cronies.

What they haven’t achieved:

Education for everyone; a power grid which operates for more than a few hours a day ([the elite] live in areas supplied by private generators providing a 24 hour power supply); adequate sanitation (the city’s sewers and water supply have not been maintained for decades); anything remotely resembling a health care; enough housing (many people live without running, water or electricity); and streets which are drivable, apart from the fancy underpasses.

What’s more:

The average citizen earns less than $300 month. Prices are similar to [those] in the US. The price of gasoline has trebled over the last 4 months. Street kids and beggars are everywhere. Most have migrated into the cities. Farmers grow crops and can’t sell their produce because the government sits back and watches most fruit and vegetables being imported from abroad. The people of Kurdistan are not enjoying any form of prosperity. Like the rest of Iraq most are worse off than when the Baathists were in power. We’ve just had the first uprisings in Sulymania! The police used live ammunition. A number of people were injured. The rest were jailed. Some are still awaiting a hearing.”

The writer paints a clear picture of the divide between rich and poor. I don’t believe, however, that his picture of Kurdistan is fundamentally different than mine. What I am enthusiastic about is the ripeness of conditions for development, not its progress to date. If everything were moving along smoothly and all sectors of Kurdistan society were benefiting equally from development, then it wouldn’t be necessary to introduce Development-in-a-Box™ into the mix. But Development-in-a-Box is required to stimulate the economy in ways that benefit more than the wealthy.

The fact of the matter is that private housing enclaves, luxury apartments, 5-star hotels, and shopping malls wouldn’t be under construction if conditions in Kurdistan were not capable of sustaining the kind of development that is needed to create jobs and build the infrastructure (both physical and social) necessary to improve the quality of life for all Kurds. That kind of development does not come from foreign aid, but from foreign direct investment. That kind of development does not come from black markets, but connection to international markets. Peace and prosperity cannot be maintained if the population is uneducated and sick. As India is finding, it cannot be maintained if the physical infrastructure is not in place to support it. Kurdistan sits on the cusp. Whether it moves forward ensuring that all its citizens benefit from development or falls backward into the kind of oligarchy that plagues so much of the developing world, remains to be seen.

Good friend Mark Safranski has added to this discussion with an interesting post on his ZenPundit site [The Virtual State of Kurdistan]. His post includes a great map, wonderful insight, and some excellent links to other sites discussing Kurdistan. I greatly appreciate both Mark and the freelance writer for weighing in.