Iraq Events Dampen Kurdistan’s Usual Business Buzz

ERBIL, Kurdistan Region — As the militant Islamic State of Iraq and Syria (ISIS) continues its advance and claims to be within 20 kilometers of Baghdad, citizens of the autonomous Kurdistan Region fear that Iraq is unraveling.

The Kurdistan Regional Government (KRG) in northern Iraq has been watching the lightning advance by ISIS fighters since they captured Mosul on Tuesday, only 90 kilometers from the Kurdish capital, Erbil.

The KRG has moved its own Peshmerga forces into Kurdish-populated areas that are outside its official borders.  Authorities say that Kurdish forces are in full control of Kirkuk, a multi-ethnic city with immense oil reserves long regarded by the Kurds as the capital of a future state.

One worry for Kurdish officials is a humanitarian disaster, as more refugees flood to the enclave of five million people.

The KRG and the United Nations refugee agency (UNHCR) have made plans for three camps with 300,000 tents to shelter refugees arriving from Mosul and elsewhere.

The Kurdistan Region is already a refuge for some 250,000 refugees from the war in Syria – mostly fellow Kurds – as well as tens of thousands of internally displaced persons (IDPs) from within Iraq.

Yet many fleeing Mosul shunned tents, preferring to sleep in their cars.

The expectation of a quick return will be tested in the next days, as many analysts note that recapture of the city will not come easily, and would have to be carried out by ground forces.

The Barzani Charity Foundation, an NGO working with the IDPs, told Rudaw that many are heading back to Mosul, following reports that the city is relatively safe -- though under ISIS control.

“It hasn’t been this safe in 10 years,” one resident reported. “There are two ISIS guards on every street corner.” Electricity has returned and ISIS has appointed a new governor of Nineveh Province, of which Mosul is the capital. 

In Kurdistan, whose booming economy has transformed it into an oasis of relative peace and prosperity, the buzz is usually about conferences and projects. Violence across the rest of Iraq had become mundane before the ISIS assaults on the region’s border.

With Iraq unraveling and the KRG’s Peshmerga forces seen as perhaps the only bulwark against an ISIS sweep across Iraq, economic matters have taken a back seat to the unfolding political developments.

Under normal circumstances, two major conferences in Kurdistan should have made headlines.

Kurdistan Projects gathered investors, business leaders, and politicians internationally to engage in one of the fastest growing markets in the world. f

TradeUAE was the first event to formalize the growing relations between the United Arab Emirates and the Kurdistan Region, dubbed “the second Dubai,” because of its lax investment laws and the arrival of world-class Emirati developers like Emaar.

But for now, the task is for Iraq not to become “the second” Syria and for Kurdistan to contain the fallout from ISIS attacks.

On Tuesday, after news that Iraqi forces left their weapons and fled against ISIS without much of a fight, some conference participants started to notice something was awry.

A consultant who had just arrived from Seattle in the United States was shocked to find that ISIS, an offshoot of al-Qaeda operating in Iraq and Syria, had seized a military airbase the night before and had commandeered helicopters to patrol the city.

At that very moment, as many as 320,000 Mosul residents were crossing the border into Kurdistan’s Duhok and Erbil provinces, as a third of Mosul’s 1.8 million residents fled the city.

Shwan Zulal, the most prominent energy and risk analyst present at the Kurdistan Projects Conference, spoke to the audience before anyone really understood what was happening. 

Discussion was confined to the fate of two tankers currently transporting Kurdish oil for sale, the United Leadership and the United Emblem.

Just before the shock of Mosul’s fall, the KRG had been worried about its own crisis: The United States and Iraq were both opposing the oil sales, with two tankers, each loaded with one million barrels of Kurdish crude, adrift without reportedly having firm buyers.

The chips appear to be turning in favor of Erbil following the ISIS drive toward Baghdad: All eyes are now on the Kurds, whose Peshmergas are seen as the strongest military force in the country against the ISIS onslaught.

“Nobody knows how it’s going to work out.” Zulal admitted after the conference.

Iraqi Shiite leader Muqtada al-Sadr has called for “peace units” to defend religious sites; the very bloody sectarian civil war seen in 2006-2007 could be around the corner.

Maliki, meanwhile, entreated Shiite militias to halt ISIS’s relentless march. He called for a session of parliament at noon today to declare a state of emergency – which the Kurds oppose. 

When they met, parliament failed to reach a quorum to take the vote.