Since September 2004, the USAID IZDIHAR project has worked with the Government of Iraq and the country’s private sector to help promote a market-based economy.

KEY ACCOMPLISHMENTS AS OF 30 NOVEMBER 2007:

The USAID IZDIHAR project is stimulating economic development and generating employment for the private sector by enhancing the viability and growth potential of micro, small and medium enterprises through greater, more reliable access to sustainable financial services, training, and other technical assistance.  Follow the links below to learn more about our progress in:

Sustainable Microfinance
SME Development / Bank Lending
Business Management Services
Capital Market Development
Trade Policy and Market Access
Investment Promotion
Privatization

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Sustainable Microfinance

• $17,622,772 million in operational and loan capital grants provided (pending USAID approval of new loan capital grants) to three international non-governmental organizations that have been providing microfinance loans to businesses in all 18 provinces of the country.  Currently a combined loan portfolio of $32.2 million is extended to nearly 23,000 active clients and over 62,000 loans worth over $31 million have been disbursed by the USAID IZDIHAR-sponsored microfinance industry since 2004.
• $7,250,000 in loan capital grants (pending USAID approval of new loan capital grants) awarded for the establishment of seven indigenous microfinance institutions in Iraq through cooperation with coalition civil affairs programs in Kirkuk, Baghdad, al Qaim, Fallujah, Ramadi, Mosul, Tikrit and Baquba. MFIs in Kirkuk and Baghdad opened for business in 2006 and have awarded 871 loans worth $1,424,950 through October 2007; the al Qaim IMFI has awarded 85 loans worth $194,450 since opening its doors on August 21, 2007.  The MFI in Fallujah has awarded 32 loans valued at $32,200.  The IMFI in Tikrit has disbursed 13 loans worth $35,600.
• 1,245 training slots provided to 612 microfinance practitioners on topics such as The Principles of Microfinance, Strategic Business Planning for MFIs, and Human Resource Management for MFIS.
• Microfinance TOT training sponsored in conjunction with CGAP, providing TOT certification to 11 Iraqi microfinance practitioners;
• First ever Iraqi National Microfinance Summit organized and hosted, bringing together over 110 representatives of Iraqi microfinance institutions, national and local Iraqi officials, US government agencies, multinational forces, and international donors and experts; follow-on collaboration yielded The Iraq Microfinance Strategy.

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SME Development / Bank Lending

• Iraqi Company for Bank Guarantees (ICBG) established to enhance access to credit for small and medium enterprises (SMEs) and develop profitable SME portfolios in private banks nationwide.  Eleven private Iraqi banks subscribed $3.7 million in initial equity, augmented by a $5 million grant from USAID through IZDIHAR. Two additional banks are negotiating to become shareholders.  25 guarantees for loans with a total value of $984,085 have been approved.
• Banking and Finance Conference ("Banking in Iraq: The 21st Century Challenge") organized in Amman Jordan on April 4-5, 2007.  215 participants from the Iraqi banking industry attended and identified priority areas of modernization for the Iraqi banking system;
• 982 training slots provided to credit officers of private banks to introduce modern, cash-flow based lending techniques.

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Business Management Services

• Five Small Business Development Centers established in Baghdad, Erbil, Hilla, Kirkuk and Tal'Afar to provide needed business management skills to 1075 Iraqi entrepreneurs;
• IZDIHAR knowledge portal established to facilitate information sharing among USAID-funded projects and Provincial Reconstruction Teams;
• Alliance of 18 business associations formed to promote business-friendly legislation and programs to assist in private sector development;
• Business seminars for over 2,100 Iraqi businesspeople held;
• National business association for accountants and auditors consolidated and strengthened, the organization’s commitment to upgrading the skills of members to international standards supported and enhanced by improving training facilities to encourage computer-based methods, developing new course materials, training trainers, and helping to plan for sustainability through membership services;
• 38 master trainers, 802 professional accountants and 437 students trained on international accounting standards, reaching 17 of 18 governorates of Iraq;
• 643 students and professionals trained in international auditing methods, methodologies and standards at 14 university or professional association locations;
• Network of 45 Learning Resource Centers established throughout Iraq in co-operation with universities and professional organizations, equipped with over 8,000 modern texts in English and Arabic;
• ePRTs assisted in planning specific, targeted assistance in local markets.

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Capital Market Development

• Business association for securities industry professionals strengthened through training of staff, technical assistance and a grant to establish its Baghdad headquarters.

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Trade Policy and Market Access

• The Government of Iraq (GOI) assisted in preparing and submitting the Memorandum on the Foreign Trade Regime (MFTR) to the World Trade Organization (WTO), marking the start of the accession process, and to answer questions and issues raised by WTO members regarding Iraq’s agricultural regime, customs and tariff policies, technical barriers to trade, and other trade related topics;
• Coordination with 15 GOI ministries in preparation for the first formal WTO Working Party meeting in Geneva, which was successfully completed on May 25, 2007;
• Assistance to the GOI in drafting WTO-compliant legislation on Customs, Intellectual Property Rights, Technical Barriers to Trade, and Sanitary & Phytosanitary Measures;
• Revisions to Tariff Schedule for compliance with the Harmonized System;
• Training and technical assistance provided to GOI to complete its Aggregate Measure of Support documentation, involving review of all agriculture-related subsidies and state supports;
• Nearly 1,000 government officials trained on customs, trade policy and WTO accession issues;
• The Iraq Trade Information Center established to enhance the capacity of the Ministry of Trade to stimulate trade and create business linkages;
• Nearly 1,000 training slots provided to GOI and KRG officials on customs, trade policy and WTO accession issues.

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Investment Promotion

• New Investment Law passed by Iraqi Parliament in October 2006 (IZDIHAR provided technical assistance and reviewed drafts);
• Implementing regulations for the new Investment Law and bylaws for the National Investment Commission established by the Law drafted in collaboration with GOI counterparts;
• Iraq Investment Promotion Agency established in cooperation with key ministries to help Iraq attract foreign direct investment and increase private sector employment;
• Najaf Investment Center established to provide business skills training and information on area tourism and investment opportunities;
• Investor Roadmap developed, analyzing investment constraints and outlining corrective policies;
• Competitiveness Analysis Study prepared, highlighting 10 economic sectors with significant potential to attract foreign investors;
• Studies completed to guide investors in the food processing sector, the pharmaceutical industry and the tourism industry;
• Contacts between Iraqi counterparts and foreign investors facilitated;
• Iraqi participation in 15 investment or trade shows facilitated in Iraq and abroad.

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Privatization

• Drafting of best-practices Privatization Law assisted and other technical assistance provided to the Inter-Ministerial Committee for Reform of State-Owned Enterprises and its Executive Working Group;
• Groundwork laid for development of centralized privatization agency through development of blueprints for organizational structure and operating guidelines, proposed in the privatization law;
• Excess Employment Study completed to address potential displaced workers in privatized state-owned enterprises (SOEs);
• Database of technical information on SOEs developed to assist in their transformation:
• Model documentaton, analysis and advice provided on establishing joint ventures, comparative performance of private, mixed and state-owned enterprises, issuing public tenders, and leasing;
• Assistance provided to Central Committee for Transforming State Companies into Joint Stock Companies in preparing Privatization Files for presentation to the Council of Ministers.

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Capital Market Development

• Iraq Securities Commission (ISC) strengthened in its role as regulatory body through provision of technical infrastructure and training and assistance in moving towards membership in the International Organisation of Securities Commissions (IOSCO) provided.

Updated 4 December 2007