Iraq's ambitious Development Road Project: Concerns and challenges, 15 JUNE

Iraq's ambitious Development Road Project: Concerns and challenges

Shafaq News/ The Turkish President Recep Tayyip Erdoğan's first visit to Iraq in 13 years, last May, resulted in the signing of 26 memorandums, one of which is for the Development Road Project. This project aims to establish a trade corridor from Basra to Turkey and eventually to Europe, enhancing regional stability and prosperity.

Burak Yildirim, a Defense and Security Analyst, published an article at "The Wilson Center," identifying the opportunities, challenges, and obstacles associated with Iraq's ambitious "Development Road" project.

According to Yildirim, "the trade corridor from Basra, Iraq, to Ovaköy, Turkey, entering European Union customs, known now as the "Development Road," promises its stakeholders the possibility of commerce and stability in the region. "

"Due to the narrow and shallow coastal regions near Basra and the Shatt Al-Arab, constructing a high-capacity port there was not feasible. Consequently, Iraq was compelled to channel its energy exports through Kuwait, Saudi Arabia, and Turkey.

 The construction of the Grand Al Faw Port on the Persian Gulf, the largest infrastructure project in Iraqi history, was planned to address this challenge. The Development Road will link the Al Faw Port to Turkey's border and extend into Europe." The analyst said.

The project's objective is to establish an uninterrupted highway and rail corridor between Basra and London, with the initial phase of the project anticipated to be completed by 2028.

"Although the project's cost was announced at $17 billion, it will likely exceed $24 billion. Given that the railway cost between Gaziantep and Ovaköy alone could reach $5 billion, it becomes clear that $17 billion is an unrealistic estimate. However, the other signatories of the memorandum, namely the governments of the UAE and Qatar, possess resources that can alleviate uncertainties regarding the project's financing." Yildirim explained.

According to him, the Development Road's "greatest promise" lies in its high speed and low cost. "Transporting products to the European market from Al Faw via the Development Road offers a 10-day advantage over the Suez Canal. Since Iraq is the only country outside the EU Customs Union along the route, it also provides significant bureaucratic benefits. Costs are substantially reduced. Besides the planned infrastructure between Basra and Türkiye, the logistics lines in Türkiye are already mostly complete. In this regard, the Development Road presents an undeniable advantage in terms of speed and transportation capacity compared to the India-Middle East-Europe Economic Corridor (IMEC) announced in September 2023."

Despite the importance of this Project, Iraq and Turkiye shared concerns. 

"The expectations of the governments of Iraq and Turkey for the project are high, as shown by the willingness of both sides to take political risks. Notably, the Iraqi central government has declared the PKK an illegal organization for the first time, despite opposition from PUK-influenced groups in the Kurdistan Region of Iraq (KRI). This is a significant development. The Iraqi government and the Kurdistan Regional Government's (KRG) positive response to Turkey's security concerns is likely due to their high hopes for this project, which will position Iraq as a key economic player. Supporting Turkey's security stance is a manageable cost for Iraq in exchange for such a gain." Yildirim pointed out.

"In the summer of 2024, Turkey, Iraq, and the KRG will initiate a significant military operation to secure the route and address Turkey's terrorism concerns. This three-fold alliance aims to eliminate the presence of the PKK and ISIS. Turkey's participation at the corps level is expected to make this the largest cross-border military operation in its history."

Furthermore, Yildirim said that the KRG portion of the project faces frequent criticism from PUK leader Bafel Talabani and his allies, who question the KRG's gains amid the Talabani-Barzani rivalry. "The route between Al Faw and Ovaköy passes through Mosul's administrative borders, mainly avoiding the KRI due to its mountainous terrain. However, the project benefits the KRG by providing a significant rationale for the agreement on oil exports between Baghdad and Erbil and reducing the cost of imported goods to the KRG. The project motivates the parties to resolve the dispute between Baghdad and Erbil regarding oil and gas exports."

Another concern, according to the analyst, is the unresolved water-sharing issue between Turkey and Iraq, which resurfaced during Erdogan's visit to Iraq.

"The decrease in Euphrates and Tigris river levels could lead to drought and famine. Iraqi officials have been highlighting the impact of reduced water levels, particularly from Turkey, since 2021. This reduction, along with decreased water flow from Iran, has reduced agricultural land use by 50% in Iraq. Turkey contends that the decreasing water flow is also a major problem for itself and emphasizes the need for cooperation between the two countries to address this issue, which is exacerbated by global warming."

In addition to the concerns, The Development Road is not without challenges.

Yildirim stated that Turkey's security policies and efforts to combat terrorism significantly impact the project. "The eradication of PKK and ISIS from northern Iraq is essential. Turkey must address this issue with Iraq and the KRG within a foreseeable timeframe."

"Eliminating terrorist organizations that pose security risks in the region is quite challenging. The demography in Iraq and Syria provides resources, including labor, weapons, and finances, for both PKK and ISIS. The elimination of these terrorist organizations, at least in practice, cannot be achieved without the support of Kurdish and Sunni Arab tribes."

A second challenge is "Iraq's struggle to achieve political and economic stability and widespread corruption among decision-makers pose additional obstacles to the project. Iran can sway some Iraqi politicians and bribe decision-makers to disrupt the project, thereby generating substantial risks. Delaying the project's schedule will reduce its productivity."

Meanwhile, China, which is not a stakeholder in the project, "will lose significant leverage for its Belt and Road Initiative. Consequently, it will not hesitate to manipulate the parties involved. China may use the investments and loans that regional countries expect as tools of manipulation; existing loans become threats to countries that act against its interests and new loans can be offered to do things in its favor."

The analyst added that the Development Road could significantly impact Iran's Middle East policy and its sway in the region as well. In the short term, Iran risks losing its logistical routes supplying weapons to its proxies from Iraq to Lebanon. If the project's economic promise takes shape, it will become less feasible for Iran to allocate resources to proxy forces and maintain its spheres of influence. Faced with these strategic risks, Iran may engage in ventures that could destabilize Iraq. 

"The Development Road clearly faces significant obstacles. Its competitors, especially the IMEC, face even greater challenges in cost and feasibility. However, supporting alternative development programs instead of merely isolating China's Belt and Road Initiative could yield more effective results for the United States. The US should show it offers more options than China and can develop multiple alternatives simultaneously. This could persuade regional countries that disapprove of Israel's military actions in Gaza to join a new alliance against Iran and its Chinese enablers for the economic as well as security benefits."

Yildirim concluded that Iraq could use this project as a milestone to transform its deep-rooted corruption problem and inefficient economy. It could convince Iraqi society to unite around a common goal, countering the internal instability caused by strong Iranian influence and reducing separatist sentiments of the Kurdistan Regional Government (KRG). Iraq could solidify citizenship and shared identity for its entire population, preventing the rapidly growing population from triggering a new global migration crisis from the outset. 

Regarding Turkey, "with its strong industrial presence in the Middle East, could increase its market share and expand its output with greater profits, thereby reducing inflation, increasing employment, and creating a stronger foundation for its economy. It could also rid itself of security threats from groups like the PKK and ISIS through greater security cooperation with its southern neighbor."

"Middle Eastern and European stakeholders could earn billions through decreased shipping costs. Furthermore, achieving lasting peace in the Middle East requires regional consensus on a plan designed by regional counterparts. Mere summit meetings and diplomatic texts lacking binding authority are insufficient. However, gradual transformation through initiatives like the Development Road can foster enduring peace. The ensuing stability would benefit both regional populations and Western countries grappling with economic and political unrest of their own."