Consultancy says Iraq needs $30 billion in FDI per year for stabilisation

22 February 2018

As an element of political stability returns to Iraq, the consulting firm Frost & Sullivan has said that the country will require $30 billion per year in foreign direct investment if its stabilisation goals are to be met within the next ten years.

Frost & Sullivan, a US-based market research and growth consultancy which has regional offices in Saudi Arabia and the UAE among its 45 globally, has undertaken an assessment of the high-priority development sectors in Iraq as the nation emerges from multiple conflicts over recent generations, concluding that a $30 billion per annum sum of foreign direct investment (FDI ) is required for the country to achieve its redevelopment aims within a decade.

The consulting firm’s report notes the enormous economic potential of the country as to its strategic location straddling three continents and immense wealth of natural resources, including the world’s fifth largest proven oil reserves, as well as its relatively educated population of nearly 40 million representing a potential consumer market worth upwards of $40 billion.Consultancy says Iraq needs $30 billion in FDI per year for stabilisation

Following the latest ISIS conflict, however, which according to the firm has amounted to $150 billion in battle losses, most of the country’s primary sectors are in a state of disarray and require massive redevelopment, with, says Ali Mirmohammad, a senior consultant with Frost & Sullivan, an injection of sustained investment of as much as over $900 billion in the next ten years.

As the initiation of national redevelopment plans and reform initiatives gets underway, the report notes that, while the focus will be on oil, the government is looking to diversify the economy away from its reliance on the commodity, in line as such with the other initiatives from states in the region such as Saudi Arabia, the UAE and Oman.

Investment priorities

Mirmohammad said, “Iraq plans to focus on the Oil & Gas downstream value chain as well as minerals value chain, construction and infrastructure industries, healthcare, energy, tourism and financial services sectors to move the GDP growth rate by 10 per cent annually within the next decade." As a breakdown, Oil & Gas (21%), industry and minerals (16%), housing and infrastructure (14%) and the services sector (14%) will account for 65% of the investment over the next ten years, with ICT, transportation, healthcare, water and electricity, renewables and tourism attracting the remainder.

Other than the obvious potential that comes with the need for widespread infrastructural redevelopment, the firm cites further factors which could contribute to the country becoming an attractive centre for foreign investors, such as opportunities in local manufacturing due to a current heavy reliance on imports, a non-crowded market, and a national legal framework which offers extra protection and incentives for new investors.

Highlighting the enormous potential the country “holds to establish itself as an economy to reckon in the next decade,” the consulting firm concludes; “Iraq is just emerging from the destruction and strategising the rebuilding of the country to position as a regional super power... This opens up significant opportunities for investors to address.”

Construction consultancy Drees & Sommer launches innovation hub in Dubai

18 April 2019

The Middle East branch of international construction and real estate consultancy Drees & Sommer has launched a new innovation hub in Dubai

Following the appointment of ex-Ramboll exec Abdulmajid Karanouhas as its Head of Interdisciplinary Design & Innovation earlier this year to spearhead the firm’s R&D drive in the Middle East, the local branch of German-origin construction and real estate consultancy Drees & Sommer has now launched a new innovation hub in Dubai – designed as a collaborative environment to serve both external start-ups and its own employees.

“It has always been part of our corporate culture to promote our own ideas and initiatives,” said Drees & Sommer executive board member Steffen Szeidl. “Increasingly, digital transformation and our clients are calling for completely new and disruptive business models. The Innovation Centre is one of our responses to these challenges. All 3,200 staff members can upload their ideas virtually.”

According to Szeidl, from there, promising concepts and solutions addressing identified market gaps in areas such as planning, construction and operations will be developed, funded and localised for any market which sees the potential. He continues: “Adding the Dubai innovation hub emphasises our status as a global innovation company by being one of the few companies doing R&D in this region.”Construction consultancy Drees & Sommer launches innovation hub in DubaiLocally established in 2003, Drees & Sommer was founded close to 50 years ago in Stuttgart, since growing to include some 40 offices worldwide, with its global headcount of 3,200 professionals generating revenues upwards of $430 million in 2017. The firm’s offerings span the gamut of real estate and infrastructure requirements, delivered according to its ‘blue way’, which takes into account economic, functionality, and ecological aspects together.

This, for Drees & Sommer, is an important point in the regional context.  “There is a huge demand in this market for contextual solutions as most models and systems are imported from abroad with little to no adaptation to the local culture, economy, and environment,” explains Karanouh. “As a consequence of this approach, we are facing major challenges related to user-comfort, efficiency, manageability, durability, and overall sustainability and feasibility of the built environment in the region.”

Accordingly, the firm has tailored each of its innovation hubs rolled out so far across the world to drive specific initiatives. In Aachen, Germany’s ‘Silicon Valley’, for example, there is a focus on customised smart buildings, IoT product testing and cyber-security, while the firm’s Stuttgart hub focuses on start-ups and processes and its Berlin one on smart cities and smart quarters. The Netherlands hub meanwhile focuses on wellbeing and sustainable innovation.

Karanouh: “The innovation hub brings together specialists of various disciplines from across the industry as a single interdisciplinary team that advises clients from early feasibility studies all the way to operation and revitalisation of buildings to maximise comfort, efficiency, sustainability, return of investment and overall value. The platform allows for brainstorming ideas, identifying market gaps and needs, adapting existing solutions or/and developing new solutions tailored to the local market and environment.”