Citigroup Inc., the third largest lender in the US by assets, has just received approval to open an office in Baghdad. It will be the company's first country opening in six years, and will be followed by more offices being opened in the country over the coming years.
Mayan Malik, the CEO for Jordan, Iraq, Syria, and the Palestinian territories, told Bloomberg that "Iraq is a giant that's waking up and the opportunities are immense. The most significant opportunities are twofold -- oil revenue generation and infrastructure creation. We estimate this to be $1 trillion initiative over time." Citigroup hope to take full advantage of infrastructure spending in Iraq as the country begins to rebuild after the war.
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Iraq plans to increase its budget spending by 18% to $118 billion this year as it begins to rebuild after the war, and Citigroup hopes to take full advantage of this. The International Monetary Fund predicts that the economy will grow nine percent over the year.
Citigroup expects to find customers in Iraq as foreign companies search for capital after moving to the country to build roads, telecommunication networks, and energy and water infrastructure.
According to the central bank's website, foreign banks were barred from Iraq until after the US invasion. Now there are a total of 15 international banks, seven state banks, 23 private lenders, and nine Islamic banks operating in the country.
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com More