Private Sector Development Strategy 2014 - 2030

January 6th, 2016

Follow-up of the new morning:
The government has developed a strategy to develop the private sector after a series of extensive consultations, both within the government, or with representatives of international development actors and the private sector in Iraq.
Were uncles of the first draft of a document private sector development strategy in January 2013, as the product of a partnership between the advisers - Prime Minister's Office and relevant agencies of the country team of the United Nations (United Nations Development Programme, the International Labour Organization, the United Nations Industrial Development Organization, and the Food and Agriculture Organization, the United Nations Human Settlements Programme, the United Nations and the Organization for Women and the United Office for Project Services).
The affiliated agencies of the United Nations country team, with funding from a grant fund a multi-donor to the United Nations Development Group, has developed private sector development program in Iraq in 2009, and who is involved with the government, private and other international development actors in Iraq and the sector in the boot to put the development strategy of the Trust These private sector to serve as a way for the government's efforts to stimulate and diversify the national economy and a fundamental change in it and improve the business environment in which the private sector operates map.
Theory of change, offered include within the private sector development strategy, to collect updated information on the private sector information, and the development of information system that contains data, and the results of surveys, and records of business Statements for the private sector, and the reform of the legal and regulatory frameworks that regulate the private sector, and to improve access to finance for companies, and the provision of incentives, financial incentives, and programs subscribe to small and medium enterprises in the restructuring of public companies, and the creation of a platform for dialogue and interaction between the government and the private sector, where all aimed at strengthening the private sector, where all aimed at strengthening the private sector, enabling it to become more productive , and more competitive, and to steadily increase its contribution to the GDP and provide employment opportunities.
Benefited private sector development program in Iraq from previous studies and ongoing efforts undertaken and carried out by the World Bank and the US Agency for International Development and other international actors in Iraq in the development of the private sector. And it owes much to the development of the private sector strategy of those organizations for their views and many have gained experience on the ground. Strategy and development of the private sector, these recent results of the program to develop the private sector in Iraq, which was carried out by the United Nations Country Team in Iraq in partnership with stakeholders in government and the private sector.
executive summary
1. The contracts have resulted from direct government control of all of Iraq's economic aspects almost to the weakening of the private sector, it closed down a lot of business, and diminished employment opportunities provided by the private sector.
2. Although financing capacity provided by oil revenues to the budgets of state, continued reliance on this revenue source of income in order to sustain the economy is undesirable and can not be sustained long-term Ay. And contributed to this dependence on oil revenues in the excessive reliance on cheap goods and equipment imported, often on the producers and providers of services to the local account who are unable to successfully tender under the investment environment and the current regulatory framework.
3. There is an urgent need to move towards economic diversification which checks and re-submit to revive the private sector. But despite the numerous opportunities for expansion, the current laws and regulations that govern the private sector often constitute obstacles to its development. In many cases, it restricted these laws and regulations to reactivate the private sector and thus hindered the creation of new jobs.
4. It is necessary to reform the general framework of policies and legislation, through the implementation of a government Bernameh responds to the priority needs of the private sector, in the framework of an effective dialogue between the government and the private sector.
5. The government will consult with the private sector on a regular and systematic before drafting or modify any laws affecting the business environment. Therefore, the establishment of a permanent platform for dialogue between the government and the private sector is essential if the corrective action to achieve the success that can be from the private sector to work more efficiently.
6. Made Ay limited access to financing is difficult to update and expand the sector. Therefore, it is necessary to develop a good funding mechanisms be available the most part from the private sector, especially small and medium enterprises.
v. Public companies seen as incompetent, low productivity, high cost of operation, and cause a significant drain on the state budget, as well as being isolated from the regional and global markets.
8. Public companies need to be updated and better integration with the private sector in order to increase productivity and competitiveness, and to take advantage of new business opportunities achieved through the strengthening of its ties with the regional and global markets. Moreover, the structure of public companies will provide re-greater opportunities for the private sector.
9. carried out during the past decade, many of the programs to support the private sector in Iraq, but these programs were, and still to this day fragmented and fall within a coherent strategy or plan that includes successive actions can be used by the government to address the problems that hinder the emergence of an active private sector.
10. This private sector development strategy aims to be a road map to consolidate the government's efforts to develop the private sector in the period 2014- 2030. It is expected that the application of private sector development strategy to achieve that Iraq is much better in the global indicators that measure the business environment in any results country (such as the annual report of the World Bank «Doing Business»), the private sector and increase productivity, and enhanced its ability to compete, and to be more socially and Peña commitment, and better able to create more new jobs.
11. allows the implementation of private sector development strategy opportunity for the government to find solutions targeting priority needs of the business community. While the government will press ahead with economic reforms, it will seek to provide a friendly environment for business and financial materials in order to: (1) improve the competitiveness of small and medium enterprises and (2) the establishment of our company among small and medium enterprises and public companies.
12. The government will lead the process of applying the sector development strategy in the beginning, and then gradually move the task of leadership to the private sector. It will be a decentralized approach in the implementation of the development strategy of the private sector where possible.
13. Government will achieve the strategic goals by following a three-pronged approach, the three pillars of development:
A - The first pillar: understanding the private sector
B. Alrkiz second to improve business environment
(C) third Alrkzah: the development of small and medium enterprises program
14. Another pillar, fourth pillar: the structure of implementation, which will be implemented through the planned business development in the three pillars.
15. The Council will be a private sector development, which will include representatives from the government and the private sector, to be a platform for dialogue, coordination and supervision of the implementation of activities limited in the private sector strategy.
16. Under the umbrella of the Council for the Development of the private sector, will develop and unit planning, research and implementation activities described under the four pillars.
17. The first pillar aims to provide accurate information, both on the private sector: the formal and informal to the government and to stakeholders in the private sector for the purposes of planning and decision making.
18. Alrkzah will achieve the first objective through the following business
a. Surveys, both the private sector: the formal and informal
B.ttaiwir information with the government and stakeholders from the private sector system.
C. Build the capacity of both the government and the private sector on how to use the information in planning, implementation, and monitoring and reporting on the progress achieved
(D) develop a network of local business registration centers.
19.ahdav second pillar
A. Simplify and facilitate policies, laws, regulations, instructions and procedures in order to stimulate private sector development.
B. Promote business opportunities in access to finance.
J.thvez increase production and innovation, and to encourage registration, investment and employment in the private sector
Dr.. Improve the quality of services offered by unions and associations of private sector
E. Strengthening the systems of quality control and quality assurance and certification and licensing.
20 .sthakq second pillar objectives through the following activities:
A. The launch of a dialogue between the government and the private sector, where the government consult and share with the private sector when developing policies or laws, regulations or instructions pertaining to the latter.
B. Review and simplify the legal and regulatory framework for the private sector, and the issuance of new laws, and the removal of red tape
C. Amendment procedures and controls in order to improve the private sector's access to financing.
Dr.. Develop and propose a new strategy plans and policies aimed at the private sector.
e. Providing financial incentives for new investments, innovation and business registration.
And. Strengthening the systems of quality control and quality assurance and certification and licensing
G. Support of unions and associations of the private sector and increase the coverage of services provided to members
21. The objectives of the third pillar
A. Improving the productivity of small and medium enterprises and competitiveness.
B. The involvement of the private sector, inclusive of large companies and small enterprises, the restructuring of public companies.
22 .sthakq the third pillar of its goals through the following activities:
a. Provide advisory and extension services, and service business planning, training and networking of small and medium enterprises.
B. Establishment of a fund to provide capital Elementary, facilitator and financing and loan guarantees to the private sector in order to expand its activities and the establishment of new institutions and increase competitiveness and foster innovation.
C. The introduction of a special program to provide opportunities for the private sector, including large corporations, small and medium enterprises, to work with public companies.
D.ttaiwir industrial and technological zones, business incubators, and business development centers and other similar initiatives.
e. The formation of a specialized unit to promote awareness of equality and inclusiveness between the social types in the private sector and increase job opportunities for women in the private sector.
And. The launch of a public awareness campaign.
23. The fourth pillar goal is to ensure the efficient and effective implementation of the strategy to develop the private sector.
24. worth Alrkzah fourth goals through the following activities:
a. The Board of the development of the private sector.
B. The formation of a planning and implementation of research and development by the Council of the private sector to follow the coordination and implementation of planned activities in all pillars
C. Create a monitoring and evaluation board trace the development of the private sector
Dr. The formation of the National Commission for small and medium enterprises.
25. will implement private sector development strategy in three phases:
a. The first phase 2014- 2017 government-led.
B. Phase II 2018 - 2022 government-led partnership with the private sector
C. Phase III 2023 - 2030 led by the private sector.
26. expected the first phase 2014-2017 indicators of success
a. The government understands its role as a facilitator and possible private sector, and that prepared Hrkiya and certain.
B. Understanding of the private sector role and responsibility as a social and economic actor and contribute to the collective efforts to achieve national development and economic development.
C. The establishment of the Board of the development of the private sector and the exercise of his functions effectively.
Dr. The establishment of the National Commission for small and medium enterprises and management of small and medium enterprises fund.
E. The private sector has been growing for good Not, contributing about 35% of the gross national product and occupies 30% of the labor force in 2017.
And. Reducing the unemployment rate from 11% in 2011 to a rate of 6% target of national development from 2013 to 2017, especially among women and young people.
27. indicators of success expected for the second phase from 2018 to 2022
a. Increase private sector investment in basic economic and development sectors.
B. The arrival of the contribution of the private sector in the GDP to 45% by 2022.
T. Iraq marked improvement in the rating in Doing Business Report issued by the World Bank.
W. Reduce the unemployment rate of less than 6%.
28. anticipated for the third phase from 2023 to 2030 indicators of success.
a. Increase the proportion of operating full-time in the private sector to 50% or more of the total employment opportunities available.
B. The growing proportion of the contribution of the private sector in the GDP to 60% by 2030.
T. The arrival of fixed capital formation in the private sector the proportion to 50% of the national total.
W. Restructuring of all public companies and Adamjha in a market economy led by the private sector.
C. Reducing the unemployment rate to 4% or less.

Background and determinants
Starting in 2003, many works carried out in the development of the private sector through recovery programs, economic diversification and with the help of national and international organizations. This resulted in the issuance of a number of analytical studies and propose draft laws and regulations and the embodiment of a leading initiatives on the ground.
Over the last five years, the government has taken further steps to improve the business environment and to restore the competitiveness of Iraqi companies, specifically, the Government launched in 2009, and through the body Almstharian- Prime Minister's Office. With the support of the UN and international partners, private sector development program in Iraq, which took over the compilation of input affiliated agencies of the United Nations country team in Iraq-related areas of mandate and expertise.
Tzafart these efforts with the work carried out by other partners, particularly the World Bank and the US Agency for International Development, who provided support at the level of policies and promising studies and provided direct financial support and technical assistance to a number of private sector organizations. That what was carried out by private sector development program in Iraq, international and other partners to stimulate the reform process through the introduction of new methodologies with the acquisition of additional information highlighted many of the gaps and limitations that affect the private sector. It was in the course of it, to confirm the conclusion that the private sector faces many obstacles that hinder its development. including that:
a. The lack of effective policies and strategies to support the private sector.
B. Obsolescence and complexity of the legal and regulatory frameworks, which were designed for a centrally planned economy.
T. Erratic policies and enforcement of existing laws.
W. The inadequacy of the means of access to finance.
C. Damage to physical infrastructure and inadequate power supply.
H. Lack of qualified human resources, especially skilled labor.
X. The low level of healing in the public procurement system.
Dr. The complexity of recording companies and the closure of operations.
Y. The existence of unfair competition on the part of the public sector.
T. The absence of a permanent dialogue between the government and the private sector.
G. Insufficient knowledge of the dynamics of the global and regional market.
It resulted in the above-mentioned factors for the increasing closure of private sector companies. As a result, the limited contribution of the private sector in the gross domestic product, and to his lack of ability to contribute to economic diversification or job creation.

Timeframe and interim targets
The time frame for 2014-2030, will be implemented in the private sector development strategy in three successive stages:

The first phase 2014-2017
Government will lead the implementation of the first phase activities in full partnership with the private sector, local governments and other stakeholders. It will focus first phase of the implementation of the priority to achieve rapid success in the development of private sector activities, in particular the formation of the private sector development and activation (under the umbrella of the fourth pillar), the launch of direct support for the private sector activities (National Commission for small and medium enterprises, industrial areas, business development centers, business incubators, value chains and clusters of processing), and legislation and / or amend laws and regulations in the main, and implement a public awareness to inform citizens about the positive changes envisaged in the business environment campaigns
In the first phase, it is expected that the private sector achieve modest growth to contribute in 2017 about 35% of GDP, compared B30,5% in 2012 and provides opportunities for full-time work for about 30% of the labor force, compared with 25% in 2008 and the unemployment drop from the rate of 11% in 2011 to 6% rate targeted by the National Development Plan 2013-2017, particularly among women and young people.
Private sector development executive initial strategy for the first phase consists of 21 active distributed on four pillars include. These activities have included, and the parties supervising and coordinated, and the parties executing and indicators of success for each of them, while indicating the time frame and the estimated cost for each activity in term time for the first phase, with an estimated cost of implementing the first phase of the activities of about 447 billion dinars, about 67% of which (300 billion dinars ) will be directed towards the provision of grants and soft loans and loan guarantees and a variety of incentives to the private sector.

The second phase 2018-2022
It will invest the second phase of the successes achieved in the first phase, the implementation and activation of all direct support activities. And it will lead them to the expansion of the private sector, size and activity, to provide about 45% of the national GDP and about 35% of employment opportunities, and the unemployment rate drop below 6% in the same time, there will be a substantial improvement in the business environment, investment climate and the order of Iraq in the practice of annual business issued by the World Bank reports.
By the year 2022 will be a restructuring of all public companies has been completed and introduced in complementary companies with the private sector across the value chains and clusters of processing.

Phase III 2022-2030
During the third stage, the government will be transferred gradually to the private sector lead the implementation of private sector development strategy, and there will be a rapid growth in the private sector, achieving by 2030 the contribution of not less than 60% of GDP and 50% of gross fixed capital formation and providing what At least 55% of the employment opportunities of the labor force, while the unemployment rate will stabilize at 4% or less.
By 2030, too, will see the private sector development strategy have been achieved, and Iraq will have a dynamic private sector and a prosperous, pro-active locally, regionally and competitor, and integrated globally, in order to achieve economic diversification and sustainable development and job creation.

* Of the report of the advisers in the Cabinet