In Iraq, major infrastructure, like access to water, sanitation, and electricity, is in short supply. There is enormous potential for substantial projects to be undertaken that could help put unemployed, under-skilled Iraqis to work and help improve the lives of ordinary citizens.
But for some reason, projects in Iraq aren’t finished, electrical cables aren’t built, water isn’t provided, and oil production is the same as it was before the US invasion in 2003. Considering the potential for development, it can be difficult to understand why nobody can start a business and why businesses that do start can’t do anything. In the U.S., coming out of high school, I started a business selling soccer jerseys. It took $20 and 15 minutes to get a tax license, and another $10 lining up a place to sell. It’s not hard to put your name on a form and get to work.
So take the case of Aziz Kudari, highlighted by Adam Davidson in an NPR interview. Mr. Kudari is an Iraqi businessman who contracted with the US government in 2006 to install electrical generators at health clinics in Iraq. Ideally, clinics wouldn’t have even needed generators, because electricity would have already been available. But they did, and he had to move just one generator, from Amman, Jordan to Baghdad. Not wanting to take the direct highway through Anbar province because of security fears, he decided to take a circuitous route through Saudi Arabia and Kuwait. Three weeks later, his single generator was still stuck on the Jordan-Saudi border, waiting for paperwork. Kudari could only wait, interminably, for the red tape to unwind and for the generator to start moving again.
Even on bad roads, some movement is almost always possible. There’s always a tiny bit of progress to be made. But in the face on an entrenched, inefficient bureaucracy, even the best-laid business plans can go awry. Corruption is a major hurdle that businesses have to contend with, particularly if they want to transport their goods along Iraq’s major highways. A 2010 Economist article reported that there were something like 40 security checkpoints on the main highway between Baghdad and Tikrit. They’ve essentially turned into customs stations though, where a truck driver pays around $9 if he has all of his papers in order and many times that if he doesn’t. Security checkpoints are now so lucrative that they’re being bought and sold, sometimes for something like $45,000, which is an incredible sum where the per capita GDP is around $3800. Even if a businessman could afford the $360 to move something 118 miles, the inefficiency of having to stop and wait in a line 40 separate times slows commerce on the road to a crawl.
The biggest problem, though, for businesspeople, factory owners, and ordinary citizens is the lack of access to reliable electricity. Major enterprises usually require generators to stay in operation, and may encounter problems similar to Mr. Kudari’s, though the security situation in Anbar has improved since 2006. Buying fuel in bulk to run them required paperwork (and presumably bribes) to be filed at five different government ministries for one businessman, which took up the majority of the time he could have spent otherwise improving his factory. Electricity output throughout the country has more than doubled, but so has usage. An International Republican Institute survey in 2010 asked Iraqis in five northern provinces how they felt oil revenues should be spent, with 45% responding that basic services like water and electricity were most important, well above other priorities like job creation, security, or education.
Situations like this make it even more important to promote entrepreneurship and partnership among the youth who will lead Iraq into the future. People who work together, and really view the community and the country as something in which they have a vested interest, are more likely to look for their own creative solutions to Iraq’s very real problems.