Iraqi Housing Projects Held Up By Government Red-Tape

Iraq’s new 5-year development plan calls for the construction of two million housing units by 2014. The goal is to end the housing crisis in the country. The Planning Ministry is in charge of the project, and has already set out a number of deals. In May 2010 for example, Karbala announced that it was going to build 250 low-cost housing units within four months after their location was chosen. By the end of June nothing had happened yet however, because getting licenses to use the land was being held up. Iraq’s bureaucracy and red-tape is a major impediment to companies working in the country. In 2009 the World Bank ranked Iraq 153 out of 183 countries for ease of doing businesses. It was ranked 94 out of 183 countries when dealing with construction permits. 14 permits were required to build anything in the country, that took an average of 215 days to complete. Iraq has a state-run economy with a slow and arduous top-down management system, and conflicting authorities and regulations between the different ministries. All of these factors provide enormous obstacles to private firms attempting to work in the country and for the government to even complete its duties. They will be a continued barrier to the growth of the economy outside of the energy sector until real reform is brought to the system.

SOURCES

Adel, Shaymaa, “Housing tops Iraq’s priorities in next five-year development plan,” Azzaman, 7/1/10

Aswat al-Iraq, “Allocating lands hampers housing projects in Karbala – official,” 6/30/10
- “Project to build low-price housing units in Karbala,” 5/9/10

World Bank Group, “Doing Business 2010 Iraq,” 2009