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OVERVIEW OF THE IRAQ OPPORTUNITYDoing Business in IraqAmman, 5th June 2023Achmed AlShahrabaniMcKinsey Company, Inc.AGENDA? Overview Iraq? Economic scenarios for Iraq? Required investments AGENDA? Overview Iraq? Economic scenarios for Iraq? Required investments Total area: 437,000 m2Limited arable land? Arable land: 11%? Permanent crops: 1%? Desert: 88%Largest governates? Baghdad ()? Nineveh ()? Basra ()Varying climate (Baghdad)? Summer temp: 3550186。? Winter temp: 515186。? Rainfall: 155mm/year Source:Country Watch, CIA world fact bookCar transport? 39,000 km paved roads? 765,000 privately registered passenger cars? 266,000 privately registered trucksAir? Major airports in Baghdad, Basra and MosulThree major railway routes? Baghdad–Kirkuk–Irbil? Baghdad–Mosul–Yurubiyah? Baghdad–Maagal–Umm QasrTele? 3% peration, no mobile workUtilities ? 250 water treatment facilities? Power generation capacity of 9500 (pre 1990), currently at 1800MWGeography and climate InfrastructureThe majority of Iraq is characterized by desertOVERVIEW IRAQI GEOGRAPHY Source:World outlook, EIU country risk report Iraq? 50% of population younger than 16 years? 28% of population is labor force? Approximately 51% males? 75% of population resides in urban areas? There is an estimated 1m–2m Iraqi’s living in exile? Fertility rate –5 children per women? Adult literacy at 54%? million foreign workersKey facts1980 1985 1990 1995 2023 2023CAGR 3%DEVELOPMENT IRAQI POPULATION 1980 TO 2023Iraqi population amounts to more than 24 millionsMillionSource:CIA world fact book100% = OthersArabs Shia MuslimsKurds – Sunni Muslims46212Arabs – Sunni Muslims22ESTIMATEPOPULATION SIZE BY ETHNIC GROUPShia Muslims form Iraq’s ethnic majority%Adult literacy at 54% (vs. 75% in Iran)*From 6 to 23 years Source:EIU country profile Iraq 20231980 1998EDUCATION ENROLMENT RATIO FOR ALL AGES* 1980 VS. 1998An increasing number of children does not receive formal education ESTIMATESource:Country WatchProven reservesUnproven potentialTotalGas Trillion m3, 2023OilBillion barrels, 2023OVERVIEW OF IRAQ’S NATURAL OIL AND GAS RESERVESIraq has one of the largest natural oil and gas reserves… ESTIMATESource:BP Statistical review, 20231. Saudi Arabia2. Iraq3. UAE4. Kuwait5. IranOil, proved reservesBillion barrels, 2023Gas, proved reserves Trillion m3, 20231. Russia2. Iran3. Qatar4. Saudi Arabia5. UAE10. IraqRANKING OF BIGGEST NATURAL OIL AND GAS RESERVES WORDWIDE… which are the second largest in oil and the tenth largest in gas ESTIMATE*Purchasing power parity method, current pricesSource:CIA World fact book。 Country Watch。 EIU country risk report on Iraq 20232023506025351980DEVELOPMENT OF IRAQ’S REAL GDP* 1980 TO 2023Over the past decade, Iraq’s real GDP fell by 50%…USD billionESTIMATE50%GDP estimates for 2023 subject to wide variation (USD 2460 billion)*Purchasing power parity method, current pricesSource:CIA World Factbook。 Country Watch20231980ESTIMATEDEVELOPMENT OF IRAQ’S REAL GDP* PER CAPITA 1980 TO 2023… and purchasing power parity on individual level even furtherUSD thousandsGDP/capita estimates subject to wide variation