By Aymen Salman, for The Station. Re-published with permission by Iraq Business News.

As the impact of the health and economic crisis ravages, the world start-ups are trying to overcome the economic difficulties they face; these projects face an existential threat that has damaged many companies around the world.

Despite the pessimistic circumstances, we can find many start-ups trying to adapt to the new reality by opening up to new activities or providing new services.

One of those projects is Science Camp (The Iraqi Maker Space), which is the Iraqi version of the Global Maker Movement. The maker space is a space and community of “makers” that provides an optimum environment for tech-innovation and entrepreneurship.

Science Camp was founded in 2013 by Nawres Arif in Basra, to recreate Iraqi society from technological, economic and cultural aspects. Science Camp’s community consists of innovators working in different fields.

The infrastructure and the friendly maker culture has made Science Camp, a unique space for innovators and “out of the box thinkers” to share new ideas freely and test it practically. It’s the first and only Iraqi Fab Lab (Fabrication Laboratory) 1 on the global Fab Labs map. Since the first wave of COVID-19 that hit Iraq, the Science Camp team started to think of how to use their makerspace to support the Iraqi health sector by keeping up with the needs of those at the frontline.

This assistance has come in the form of producing, designing, testing, and distributing more than 10,000 face shields freely for medical staff in Basra and other 6 cities in Iraq. They have also supported locals making more than 17,000 face shields in Tikrit in collaboration with Tikrit University. They have also shared their designs with 6 countries until now.

In addition, the team at Science Camp in an attempt to maintain jobs in the local private sector (particularly local water factories), Science Camp has successfully 3D-printed spare parts to be used in the local water factories as a replacement for the imported parts, which are unavailable because of supply chain difficulties due to the COVID-19 crisis. In the meantime, they are reverse engineering those parts and using the maker movement’s digital fabrication & 3D printing.

Science Camp has given everyone a great example of how to adapt to quick changes, and how to turn obstacles into opportunities. With their efforts and ambition, they definitely will play a tremendous role in empowering the youth of Basra.

More here: https://www.facebook.com/Iraqimakerspace%20%20/

By Ali Al-Makhzomy, for The Station. Re-published with permission by Iraq Business News.

Five One Labs recently hosted an online Start-up Showcase to celebrate the graduation of their first-ever Arabic incubator program in c.

Over 90 attendees joined the event from Iraq, Germany, USA and other places.

Ten of the entrepreneurs gave brief overviews of their businesses, and then answered audience questions. At the end of the event, Five One Labs announced that three startups would receive seed funding:

  1. Al-Ruaa for CNC, a company providing services, workshops, maintenance, installation and providing spare parts for the CNC machines, came in first place and won $15,000;
  2. For second place, EcoLift, a company providing an alternative power system (potential energy recovery system) to power elevators instead of using electricity, was awarded $10,000;
  3. And finally, Mosul Solar, a company providing and installing solar cells for houses, was awarded $5000.

This article has been originally published in the GIZ magazine ‘akzente’ at https://akzente.giz.de/en/artikel/iraqs-digital-innovators. It is reprinted here by kind permission of GIZ.

A new generation of young Iraqi entrepreneurs are confronting the country’s challenges, even during the coronavirus pandemic.

Text und Fotos: Olivia Cuthbert

The streets are eerily silent in Mosul’s old city. A fierce nine-month battle against Isis in 2017 left this once-bustling quarter in ruins and reduced its historic buildings to rubble. Even now, Iraq’s second-largest city is still reeling from Isis occupation, but there are visible pockets of progress.

Climbing the stairs to the Mosul Space innovation hub, the atmosphere lifts. The door opens onto a modern, open-plan room where young Maslawis, as the city’s residents are known, work to develop ideas that look ahead to the future.

Salih Mahmod

One of them is 23-year-old electronic engineering graduate Salih Mahmod, who devised the concept for the innovation hub back in 2014. He was in the first year of his engineering degree and frustrated with learning solely from books rather than also developing practical skills. Reading about makerspaces, that is, high-tech workshops offering digital training and opportunities to engage in dialogue and implement ideas, in Germany and elsewhere, he was inspired.

‘I thought, why not in our city.’ So he ordered computers and printers, but 20 days after taking delivery of the first computers, Isis descended on the city and he had to put his dream on the backburner for the time being.

Mahmod’s family fled the terror group, finding refuge in the northern Iraqi countryside. Determined to continue, he and his friends offered improvised computer and programming workshops for people from the region. When Mosul was liberated in summer 2017, he returned and hosted an engineering festival that drew more than 500 participants. The tremendous response spurred Salih Mahmod on to set about realising his original dream once again.

He decided to work with like-minded individuals to create a meeting space where young technology enthusiasts would be taught the skills they need, such as programming, the use of new robotics technology and business aptitude. The space would offer them inspiration and an environment in which to develop their innovative ideas, paving the way for the establishment of Iraqi start-ups. Mahmod found a small room and began by launching a project to produce parts for broken hospital machines.

Using a 3D printer, a group of young people created plastic screws and wheels that couldn’t be sourced locally, fixing incubators and other devices that had fallen into disrepair during the Isis occupation. ‘It was a clear example of how an innovative idea can be implemented in the field,’ said Mahmod.

Rapid response to the coronavirus pandemic

The young creatives were able to build on this experience when looking for ways to support the country’s medical professionals in the fight against the coronavirus pandemic. The makerspace in Mosul quickly switched to developing face shields and is now working with Iraq’s four other innovation centres. Over 10,000 of these shields have already been manufactured and delivered to hospitals throughout the country in recent weeks.

This was all achieved by the Mosul Space, as the innovation centre in the old city is now known, having grown from small beginnings. Salih Mahmod had already made contact with GIZ several years ago. The federal enterprise is working throughout Iraq on behalf of the German Development Ministry to promote the establishment of an ecosystem for tech start-ups and young computer enthusiasts.

There are now five innovation centres in the country where Iraqis can be trained to meet new requirements on the labour market or prepare for self-employment. Over 5,500 people have now completed courses or attended events at these centres. Offerings include workshops and mentoring programmes for aspiring start-up entrepreneurs looking to find solutions to the challenges facing the country.

Talent platform in Erbil

It’s not just in Mosul either. An hour down the road in the autonomous Kurdistan region, another hive of entrepreneurship buzzes with creative energy. Re:Coded House is pioneering the co-working concept in the city of Erbil. Prior to the coronavirus lockdown, a growing community of young people used the space to develop projects. ‘People tend to come here with ideas and we support them to make them a reality,’ said Wafa Al-Attas, Iraq Innovation Advisor at non-governmental organisation Field Ready.

Wafa Al-Attas

She runs the makerspace in Re:Coded House and manages the fund for Mosul Space. Al-Attas explains that the concept is quickly catching on in Erbil, fuelling a fledgling creative ecosystem that, five years ago, didn’t seem possible. But strict regulations, cumbersome bureaucracy and limited infrastructure have dampened creative ambitions. Nonetheless, she says things have started to get off the ground. With GIZ’s support, Re:Coded House, which opened in April 2019, has become a platform for talented youth who want to bring their ideas to life.

Refugee refines handbag design

Before the outbreak of the coronavirus pandemic, the space was busiest in the evening, when students came after university classes to work on their projects. Book shelves and indoor plants add a cosy touch. Re:Coded House is normally also a social hub. ‘I don’t have many friends here in Erbil, but in the makerspace it feels like a family,’ said 26-year-old Sliman Khazal, who fled Syria before the war.

Sliman Khazal

He dreams of one day launching his edgy, geometric handbag designs onto the market. ‘Everyone in here is supporting me to work harder and dream bigger.’

Online courses during the lockdown

Mallak Al-Rifaie

Re:Coded House, Mosul Space and the other Iraqi innovation centres are focusing during the pandemic on online courses and video presentations on subjects such as ‘software products for the post-Covid 19 period’. 24-year-old computer expert Mallak Al-Rifaie has been working on these kinds of ideas for some time. As the only female on her university degree course, she initially met with a lot of opposition. ‘At first, all the boys told me that I didn’t have a right to be there.’

But classmates quickly changed their minds when she gained top grades for her project which saw her develop a digital system to allow individuals with limited mobility to stay at home and receive rapid assistance in an emergency. Al-Rifaie also specifically promotes training for children. One of her teams of school pupils even won a national robotics competition last year. ‘I taught them university-level coding and they grasped it incredibly quickly. This generation is really smart,’ she says. And she doesn’t appear to be worried about the future.

Contact: Inga Niere, inga.niere@giz.de

The research in Iraq was conducted prior to the outbreak of the coronavirus pandemic. The young people used digital media to update the editorial team on their initiatives during the lockdown.

This article has been originally published in the GIZ magazine ‘akzente’ at https://akzente.giz.de/en/artikel/iraqs-digital-innovators. It is reprinted here by kind permission of GIZ.

A new generation of young Iraqi entrepreneurs are confronting the country’s challenges, even during the coronavirus pandemic.

Text und Fotos: Olivia Cuthbert

The streets are eerily silent in Mosul’s old city. A fierce nine-month battle against Isis in 2017 left this once-bustling quarter in ruins and reduced its historic buildings to rubble. Even now, Iraq’s second-largest city is still reeling from Isis occupation, but there are visible pockets of progress.

Climbing the stairs to the Mosul Space innovation hub, the atmosphere lifts. The door opens onto a modern, open-plan room where young Maslawis, as the city’s residents are known, work to develop ideas that look ahead to the future.

Salih Mahmod

One of them is 23-year-old electronic engineering graduate Salih Mahmod, who devised the concept for the innovation hub back in 2014. He was in the first year of his engineering degree and frustrated with learning solely from books rather than also developing practical skills. Reading about makerspaces, that is, high-tech workshops offering digital training and opportunities to engage in dialogue and implement ideas, in Germany and elsewhere, he was inspired.

‘I thought, why not in our city.’ So he ordered computers and printers, but 20 days after taking delivery of the first computers, Isis descended on the city and he had to put his dream on the backburner for the time being.

Mahmod’s family fled the terror group, finding refuge in the northern Iraqi countryside. Determined to continue, he and his friends offered improvised computer and programming workshops for people from the region. When Mosul was liberated in summer 2017, he returned and hosted an engineering festival that drew more than 500 participants. The tremendous response spurred Salih Mahmod on to set about realising his original dream once again.

He decided to work with like-minded individuals to create a meeting space where young technology enthusiasts would be taught the skills they need, such as programming, the use of new robotics technology and business aptitude. The space would offer them inspiration and an environment in which to develop their innovative ideas, paving the way for the establishment of Iraqi start-ups. Mahmod found a small room and began by launching a project to produce parts for broken hospital machines.

Using a 3D printer, a group of young people created plastic screws and wheels that couldn’t be sourced locally, fixing incubators and other devices that had fallen into disrepair during the Isis occupation. ‘It was a clear example of how an innovative idea can be implemented in the field,’ said Mahmod.

Rapid response to the coronavirus pandemic

The young creatives were able to build on this experience when looking for ways to support the country’s medical professionals in the fight against the coronavirus pandemic. The makerspace in Mosul quickly switched to developing face shields and is now working with Iraq’s four other innovation centres. Over 10,000 of these shields have already been manufactured and delivered to hospitals throughout the country in recent weeks.

This was all achieved by the Mosul Space, as the innovation centre in the old city is now known, having grown from small beginnings. Salih Mahmod had already made contact with GIZ several years ago. The federal enterprise is working throughout Iraq on behalf of the German Development Ministry to promote the establishment of an ecosystem for tech start-ups and young computer enthusiasts.

There are now five innovation centres in the country where Iraqis can be trained to meet new requirements on the labour market or prepare for self-employment. Over 5,500 people have now completed courses or attended events at these centres. Offerings include workshops and mentoring programmes for aspiring start-up entrepreneurs looking to find solutions to the challenges facing the country.

Talent platform in Erbil

It’s not just in Mosul either. An hour down the road in the autonomous Kurdistan region, another hive of entrepreneurship buzzes with creative energy. Re:Coded House is pioneering the co-working concept in the city of Erbil. Prior to the coronavirus lockdown, a growing community of young people used the space to develop projects. ‘People tend to come here with ideas and we support them to make them a reality,’ said Wafa Al-Attas, Iraq Innovation Advisor at non-governmental organisation Field Ready.

Wafa Al-Attas

She runs the makerspace in Re:Coded House and manages the fund for Mosul Space. Al-Attas explains that the concept is quickly catching on in Erbil, fuelling a fledgling creative ecosystem that, five years ago, didn’t seem possible. But strict regulations, cumbersome bureaucracy and limited infrastructure have dampened creative ambitions. Nonetheless, she says things have started to get off the ground. With GIZ’s support, Re:Coded House, which opened in April 2019, has become a platform for talented youth who want to bring their ideas to life.

Refugee refines handbag design

Before the outbreak of the coronavirus pandemic, the space was busiest in the evening, when students came after university classes to work on their projects. Book shelves and indoor plants add a cosy touch. Re:Coded House is normally also a social hub. ‘I don’t have many friends here in Erbil, but in the makerspace it feels like a family,’ said 26-year-old Sliman Khazal, who fled Syria before the war.

Sliman Khazal

He dreams of one day launching his edgy, geometric handbag designs onto the market. ‘Everyone in here is supporting me to work harder and dream bigger.’

Online courses during the lockdown

Mallak Al-Rifaie

Re:Coded House, Mosul Space and the other Iraqi innovation centres are focusing during the pandemic on online courses and video presentations on subjects such as ‘software products for the post-Covid 19 period’. 24-year-old computer expert Mallak Al-Rifaie has been working on these kinds of ideas for some time. As the only female on her university degree course, she initially met with a lot of opposition. ‘At first, all the boys told me that I didn’t have a right to be there.’

But classmates quickly changed their minds when she gained top grades for her project which saw her develop a digital system to allow individuals with limited mobility to stay at home and receive rapid assistance in an emergency. Al-Rifaie also specifically promotes training for children. One of her teams of school pupils even won a national robotics competition last year. ‘I taught them university-level coding and they grasped it incredibly quickly. This generation is really smart,’ she says. And she doesn’t appear to be worried about the future.

Contact: Inga Niere, inga.niere@giz.de

The research in Iraq was conducted prior to the outbreak of the coronavirus pandemic. The young people used digital media to update the editorial team on their initiatives during the lockdown.

By Safa Fadhil, Head of Exploration and Sundus Abass, Gender Advisor at UNDP Iraq. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

This year marks the 20th anniversary of the UN Security Council (UNSCR) Resolution 1325, which helps to ensure women are on the frontlines of achieving stability and peace in Iraq.

With this in mind, UNDP Iraq’s  Accelerator Lab and Gender Division partnered with French Embassy in Iraq, Ambassade de France en Irak, The Station for entrepreneurship, Agence Universitaire de la Francophonie , Zain Iraq Telecommunications Company, and Ashur Private Bank on a competition to support Iraqi women entrepreneurs.

The Raa’idat Competition encourages women to develop and grow their own enterprises. Despite the financial stress and anxiety resulting from the outbreak of Coronavirus in Iraq, the initiative captured the enthusiasm of Iraqi women keen to expand their business know-how.

To start, leaders from 20 entrepreneurial projects participated in training courses related to business planning and management, and other relevant topics prescribed by telecommunications company Zain Iraq. Seventeen projects progressed to the next stage of the competition, with leaders participating in financial budgeting training undertaken by UNDP Iraq’s Accelerator Lab.

The competition is ongoing – from these seventeen, five finalists will be selected, and then one overall winner, who will receive $ 10,000 in the form of a six-month incubation period, consultant support, recruitment costs, and purchasing specific equipment for its development. Cash prizes will also be awarded.

UNDP Iraq’s training offered participants a holistic approach to women’s economic empowerment, defining it as ‘a process whereby women’s and girls’ lives are transformed from a situation where they have limited power and access to economic assets, to a situation where they experience economic advancement’. In addition, it underlined the factors that enable and constrain women’s economic empowerment, while using the Design Thinking and Behavioral Insight methodologies to guide the work.

UNDP Iraq provided expertise to highlight the importance of women’s economic empowerment and financial budgeting techniques to enable women entrepreneurs to effectively compete in the market. The training was conducted virtually and used a combination of interactive methods to deliver the target. The Accelerator Lab in Iraq used a human-centered approach to structure the training material, commencing with a needs-assessment session before planning the three lectures that followed.

The competition was integral to amplifying women’s voices. “I want to prove myself; I do exist, and I have the right to participate in my country’s economic empowerment,” says participant Nadia. For UNDP, this sentiment sits at the heart of the organization’s work.

it also enhanced the Accelerator Lab’s mandate in fostering collaborations with local and international partners to solve the issues of tunnel-vision employment experienced in Iraq, – i.e, pressures placed on young people to attain certain jobs. The competition also led to the discovery of 17 new, local, under-the-radar solutions and opened the door to experimenting with them.

To ensure the sustainability of the project, The Accelerator Lab in Iraq will be part of the training and competition evaluation that will take place after COVID-19. This will ensure the empowerment of women is prioritized alongside sensing and exploring innovative local solutions.

(Source: UNDP)

The Iraq Energy Institute (IEI) has published an interview with Dr Ahmed Tabaqchali, CIO of Asia Frontier Capital (AFC) Iraq Fund; it is re-published with permission by Iraq Business News:

In the latest instalment in our series on sustainable job creation in Iraq, we spoke to Ahmed Tabaqchali, visiting fellow at the American University of Sulaimani’s Institute of Regional and International Studies (IRIS). Mr. Tabaqchali is also CIO of Asia Frontier Capital’s Iraq fund and Board Member of the Credit Bank of Iraq. Additionally, he has decades of experience in finance, having also worked with the National Bank of Kuwait’s investment arm.

In our last interview, we spoke with World Economic Forum contributor and distinguished economic historian Ewout Frankema, who discussed the role of the state in job creation.

This month we take a different tack and hear Mr.Tabachali’s views on the role of finance and markets, Iraq’s early efforts mobilizing financial technology (FINTECH) for the unbanked and kickstarting small and medium-sized enterprise (SME) growth.

AT: In terms of strategy, everything the new government will have to do has to go through parliament, including accessing foreign loans and reforming the public sector. When it comes to Iraq it is not a question of how strong the institutions are or how competent individuals are, it is a question of passing this through parliament with all of its political fragmentation, between the different pollical parties and within each party between its leadership and members, all of which makes reaching a consensus to embark on real, and thus difficult, reforms very hard. However, the scale of the crisis, brought by COVID-19 both socially and economically, might act as a catalyst for real change.

What is the current risk with having so much of the hiring in the public sector and what might be done to minimise this problem?

AT: Some things have to be done now that are comparatively easy and have been done in the past. Ad hoc measures such as freezing new hiring, cutting staff through attrition, putting a cap on benefits and letting this cascade through every department. This worked last time to a limited extent. But these changes are small scale, easily reversible and they do not solve the wider problem.

One problem is that you cannot have every ministry manage its own human resource processes, there is a need to have a central human resource structure. One course of action could be to separate benefits from salaries and link them to performance. This may sound horrendously complicated but on the public sector side, there is a little alternative. I don’t subscribe to the idea that this is a crisis that will pass, it is a multi-year crisis, a lot of oil demand will come back, but I cannot see a recovery anywhere near the pre-COVID situation.

Iraq is now not only battling a difficult internal situation but a weakened global economy. We are not just talking about a major disaster in one sector only. Consider such effects on hospitality and tourism; that will affect entire countries dependent on tourism, and then consider the knock-on effect on other sectors: what does that do to worldwide aggregate demand? What does that mean to Iraq? It means that oil prices will recover but they won’t be anything sustainably higher than $50 or $55. This points to the need for a complete change in mentality within the Iraqi governing elite and indeed, society at large.

Within Iraq, the government has very limited space to manoeuvre. If you look at Central Bank data on bank lending to the government and on T-Bill issuance, we survived in 2014-2017 through using reserves, via indirect monetary financing, and government bank lending. But while some of that has been paid off, CBI data as the end of November 2019 show that total domestic debt has increased to the prior crisis’ peak. So, I cannot see that being repeated, not in the same way as then. This time, I struggle to see the state banks’ lending beyond a few billion. The reserves are there but not un-limited and then there are conditionality constraints on any upcoming IMF loans. So, there will be no waiting out this crisis, there has to be decisive reform.

What danger is there to the SME sector, in terms of constrained available credit from banks, given this lending is important for start-ups?

AT: For the private sector banks, if you look at the end of 2018’s data, there is something like a $9 bn deposit base, 70% of which is in current accounts, so they can’t lend more than one-third of this, maximum. So, you can’t look to the private sector for state loans. That leaves the state banks, and they are so undercapitalized, burdened by un-resolved legacies of the prior regime, they function by a miracle or by pushing the accounting rules’ envelope. For example, you have an asset that is no longer a creditworthy asset, but you leave it on the books without making realistic downward adjustments to its value and without taking sufficient provisions. So that room for manoeuvre is very limited. Iraq has the foreign deposits at the Ministry of Finance, there is about $6bn there so there are some available funds here and there to meet immediate needs, but how far will you go with that? The need for the state to access domestic debt will eventually place restrictions on available funds for the SME sector.

Iraq is sliding towards a danger zone, a crunch point with foreign reserves where there is a risk of currency devaluation.

AT: Yes. And one problem here is that the last government, to appease the October demonstrations, hired additional employees and lowered the retirement age, adding at least another $6bn to the salary and pensions outlay which is now baked into the current budget. So, the $44bn in salaries and pensions in 2019, is more like $50bn for 2020. Similarly, the $73 bn spent on current expenditures, which also includes transfers to SOE’s, social security and subsidies for fuel and energy, is now more like $80 bn in current expenditures. How much can you cut from that without real restructuring?

So Iraq is facing an emergency situation to mobilise the private sector and there is a risk state banks may have limited room for lending to SMEs. One thing Iraq can do perhaps is maximise export finance and partnerships with foreign banks for SME lending, such as the recent scheme with Commerzbank. And of course, the Iraqi government has its own fund for this, the One Trillion Dinars initiative.

AT: There is no doubt that these initiatives are vital for new business ventures. The issue is structural impediments that are limiting these schemes. Access to finance is very crucial for start-ups to work, but in order for these organizations to operate you need to remove the stifling regulatory environment. The arbitrary nature of taxes, the expenses involved in just setting up and the many bureaucratic steps required to get started. So at the moment many of these start-ups are informal. The only way for these schemes to work is for them to start in the informal sector.

But they can’t make the transition to formality because the process to attain that status is so complicated and expensive, to start and to maintain. We always talk of mobilizing the private sector, but we are throttling it on a daily basis. Look at the UAE for example, they have the Free Zones, a very low time required for company registration, but with Iraq it is a stifling number of procedures.

The solution as far as the Iraqi government are concerned sadly seems to be another level of bureaucracy. In order to mobilise more start-ups, the government following the October demonstrations allowed for 18-35-year-olds to have fast-track separate set of regulations for start-ups in certain industries. So, the same bureaucracy will handle two parallel categories. You open up the door for even more corruption with more bureaucracy.

Every country, of course, has bureaucracy. But we have absurd requirements on top of the usual. Even just very small things, like paying a bill, can be a nightmare. And this is the legacy of formal socialism.

You are saying that in Iraq, socialism is not simply a term to be used as a political label, it is a word that is formally used in laws that are still on the books from decades ago.

AT: That’s right. So what Iraq needs is a change in the political economy. Look at the informal sector -it is mostly in retail, such as hawking goods, and in hospitality such as restaurants, and not in productive sectors. It’s informal because it is so expensive to start up formally. Change the regulations so it is more like the UAE, give them a year’s amnesty before you implement a much easier, formal registration process. These businesses hide because the only way they can operate is by bribing various officials. An amnesty would free them from harassments and un-necessary expenses during the transition to sensible regulations. The government needs to do something that is drastic, and very different from the past, to mobilise the private sector.

You can’t have a top-heavy, authoritarian socialist bureaucracy creating jobs or opening up the private sector. During the Kuwait conference, Iraq’s National Investment Commission came up with the One-Stop-Shop initiative – more bureaucracy on top of the bureaucracy. Why not follow the Kurdish Region of Iraq’s approach? Just get a visa on arrival for certain nationalities. That is the direction we need to be going in.

There has been a growing relationship between telecoms and banks in Iraq to provide services such as mobile wallets. Some of it is Iraqi initiative, some of it is fostered by development agencies. Perhaps one danger now is that if public sector payments are digitized, the salaries are still in jeopardy. How important have these FINTECH developments been?

AT: This is where we will see a lot of growth and excitement. One barrier to further progress is not technological. We have decent internet so the issue is firstly, we need to increase the number of areas where these innovations can be used. Right now they are quite limited. I am thinking of using a mobile e-wallet but I have to go to an official shop in town and register, supply the required set of documentation, and once you use it, the places you can use it in are rather limited. A part of the potential in this technology is that it will make it difficult to cover up small scale corruption, which is easy with cash. But there is still a chicken and egg situation in terms of outlets where e-wallets can be used.

So we could say in the long run, the public demand for convenience may crowd out the demand for corruption?

AT: Yes, and in the long run, it can have a huge effect on the “unbanked” and that will have huge potential for job creation. I have some relatives in government who started receiving their salaries through their banks, and their usage followed the same patterns seen by those in the private sector who were provided with Bank cards as I learned from speaking to bankers. At the beginning where there was an ATM when salaries were dispersed the ATM would just empty as people used it as a cash-out outlet. But in time they started leaving money in the bank and starting using the cards for making purchases. So, the cards have been extremely useful in the transition away from cash.

Similarly, for the government’s initiative when the card/ e-wallets were linked to a Mastercard, people started keeping some funds on the card. In the process they were creating deposits, giving the bank the ability to lend as these deposits grow and become sticky. So, there is convenience and value there, and that could spark wider financial development. But there needs to be a bigger deposit insurance scheme in banks, more than the very small $25,000-dollar limit recently introduced. But in the long term, this is extremely exciting. And these are the reforms that need to be pushed, and they should be COVID-inspired reforms because this is how Iraq gets out of its nightmare.

Would you say then, this is not about what the government needs to do but in some ways, about what the government should not do?

AT: I agree although of course there is a vital role for the government in general. The government should ensure there are law and order. Without that, a business cannot run, they need reliable mechanisms of exchange, debt and credit, and the enforcement of contracts. That is only done through law and order. It doesn’t have to copy a Western model either, but what is needed is the monopoly of violence by the state, and its monopoly to enforce the law, i.e. when rules of the game are predictable, enforceable, and applicable to all. Other competencies of the government are in infrastructure. Roads and electricity are enablers, as well as education and healthcare. Healthcare is a great equalizer, at least with decent healthcare you are helping the most vulnerable, and in the process building the state’s legitimacy. And if the government focuses on these and opens up the private sector, it will flourish.

(Source: IEI)

By Fatimah Oleiwi, for Iraqi Innovators. Any opinions expressed here are those of the author(s) and do not necessarily reflect the views of Iraq Business News.

People face many situations in life. Some are positive and bring us joy, whilst others carry challenges that make us realise things we did not before.

Some situations can be more difficult to accept than others. However, the perceived difficulty of any situation depends on that person’s personal experiences and outlook.

Though some may find quarantine to be extremely tough, others may be enjoying the time they have at home.

Coronavirus in Iraq and across the world has given us a collective experience that will make us rethink our approach to difficult situations and how we must adjust.

Click here to download the full report

(Source: Iraqi Innovators)

By Alice Bosley and Patricia Letayf, Co-Founders of Five One Labs. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

Iraq’s Startups will Overcome Coronavirus – And Be More Important Than Ever

Over the past months, coronavirus has changed the world as we know it. Almost every person’s family, community, and livelihood has been affected. Societies have had to adapt to social distancing, and economies have suffered the consequences.

After forecasting that the world’s economy would contract by 3% in 2020 – the worst downturn since the Great Depression – the Chief Economist at the IMF noted, “The magnitude and speed of collapse in activity that has followed is unlike anything experienced in our lifetimes.

As is happening across the world, startups in Iraq are suffering from the ripple effects of coronavirus and the country-wide lockdown, which, in Iraq, has included closing all non-essential businesses and restricting movement between and within cities. At the beginning of April, Five One Labs sent out a survey to all of our alumni, startups that have graduated from our full-time startup incubators, and community  to see how they were affected by coronavirus.

Out of the over 40 startups that responded, close to 60% of them were experiencing challenges with financing their businesses and funding delays. Another 60% were not able to sell or deliver their product because of the lockdowns, and around 40% responded that they either could not get the materials to make their products anymore or the demand for their products had suffered due to the lockdown and subsequent economic downturn.

In response to the needs of our entrepreneurs, Five One Labs recently published our “Startup Survival Kit: Rebuilding After Corona.” The guide has resources and tools for managing a startup through crisis, but also has case studies and lessons learned from other startups in Iraq in terms of how they’re adapting to the situation.

As the case studies in the Survival Kit and our recent Facebook Live interviews have shown, there’s no end to the resilience of Iraqi entrepreneurs. Entrepreneurs are buckling down and doing what needs to be done to survive: 50% have reduced non-staff expenditures, and 10% laid off staff or reduced salaries to make ends meet. Entrepreneurs are reporting that they’re spending more time communicating with their customers, learning new skills, and working on building out their strategy for the future.

With the lockdown also came an increased demand for delivery and app-based services. In Kurdistan, startups like CharaPlus in Sulaimani (a pharmacy-delivery service) or Tdallal in Erbil (grocery delivery) are experiencing a growth in demand. On-demand delivery service Lezzoo added new features, like delivery of water, gas, and groceries from Carrefour in both Sulaimani and Erbil. With even local governments sharing information about grocery delivery services to encourage their use, the lockdown has introduced a larger part of the population to e-commerce. This shift could have a lasting impact on the success of tech startups moving forward.

What we’ve seen in Iraq is that startups here are built to weather crisis and fluctuation. Many startups have approached growth as “camels,” a new term coined to show a potentially smarter approach than the “unicorns” made famous in the Silicon Valley. Entrepreneurs in Iraq grow sustainably, ensuring that their costs in general don’t exceed the revenue they’re bringing in. They make sure they have reserves on hand to adapt to the ups and downs of the economy, and they’re innovative in the face of obstacles.

This resilience after crises is more important now than ever. In Iraq, coronavirus comes on the heels of the economic hit caused by the global drop in oil prices along with growing regional instability. The coronavirus response has shown the ability of startups to adapt quickly to local challenges.

Moving forward, there’s a chance for startups to have an outsized impact on Iraq’s economy moving forward as they fill gaps in the market and help the country diversify its economy. So, to all the entrepreneurs out there – time to start rebuilding!

If you are interested in reading our Startup Survival Kit, you can find it here. Five One Labs published the Startup Survival Kit with the support of the German Federal Government through the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. We will also be running a series of brainstorms and workshops for startups on how to rebuild after coronavirus. If you’re interested in joining one of the workshops, please email us at info@fiveonelabs.org.

___________

Five One Labs is a start-up incubator that helps refugees and conflict-affected entrepreneurs launch and grow their businesses in the Middle East. Launching first in the Kurdistan Region of Iraq, we aim to empower individuals to rebuild their lives and livelihoods and to contribute to the economic growth of their communities.

Five One Labs entrepreneurs are provided with training; mentorship by world class entrepreneurs from the USA and the Middle East; and a community of creative changemakers to share their experiences with. 

Our vision is to develop an inclusive network of innovators and entrepreneurs that have the support, skills, and connections to positively change their communities and countries.

A group of organizations supporting start-ups in Iraq have joined forces to create the Iraqi Innovation Alliance (IIA).

The initiative, which includes Fikra Space, Kapita, The Station, 51Labs, Basra Science Camp, and Re:Coded, aims to empower and support technology and entrepreneurship communities around the country.

The process to create its brand identity was led by CrazyTown X Solo Creative Studio, which worked together with the alliance members to present an identity that interprets the values of the alliance and its core functions.

(Source: IIA)

Roadmap to Startup Iraq, your guide to register a startup in Iraq. It is a guideline for every entrepreneur in Iraq to know how to register her/his startup legally and know from A to Z the requirements of registration.

It will show you why you need to register your startup, detailed road from reservation of the name to the memorandum of association and beyond. Contains addresses and contacts of the agencies shall be addressed during the road to registration.

KAPITA’s research team aimed to set things clear for those willing to legally register their projects by comprehensively stating every essential detail about this matter to come up with a simplified guide, that’s freely accessible, easy to understand and has all in-depth knowledge needed.

This guide is funded by the Embassy of the Netherlands and Orange Corners Baghdad, it has been written & proofread by professional researchers and experienced lawyers and it shall provide you with the information necessary to register your project in an obstacle-free & timely manner.

الطريق للمشاريع الناشئة في العراق, دليلك لتسجيل مشروعك الناشئ  في العراق. هي دليل اساسي لكل رائد اعمال عراقي ليعلم كيفية تسجيل المشروع الخاص به قانونياً و معرفة المتطلبات اللازمة للتسجيل من الألف الى الياء.

ستوضح لك خارطة الطريق اسباب حاجتك الى تسجيل مشروعك بشكل قانوني بدءً من حجز الاسم إلى مذكرة التأسيس وما بعدها. يحتوي على عناوين و جهات الاتصال للدوائر التي يجب مخاطبتها خلال طريق التسجيل.

يهدف فريق البحث في كابيتا لتوضيح خطوات التسجيل للراغبين في تسجيل شركاتهم عن طريق ذكر كل التفاصيل اللازمة حول هذه المسألة و إعداد َهذا الدليل المبسط ، والذي يمكن الحصول عليه مجاناً، والذي صمم بطريقة سهلة الفهم ، محتوياً على  جميع المعلومات المطلوبة.

هذا الدليل ممول من قبل السفارة الهولندية و اورنج كورنرز بغداد وتمت كتابته وتنقيحه من قبل باحثين مختصين ومحامين ذوي خبرة ، ونأمل أن يوفر لك جميع المعلومات اللازمة لتسجيل شركتك بدون عواقب وفي أنسب وقت.

Download Arabic Version

Download English Version

(Source: Kapita)