OVERVIEW OF THE IRAQ OPPORTUNITY Doing Business in Iraq Amman, 3th June 2005 Achmed Al-Shahrabani McKinsey & Company, Inc. AGENDA Overview Iraq Economic scenarios for Iraq Required investments Total area: 437,000 m2 Limited arable land Arable land: 11% Permanent crops: 1% Desert: 88% Largest governates Baghdad () Nineveh () Basra () Varying climate (Baghdad) Summer temp: 35-50º Winter temp: 5-15º Rainfall: 155mm/year Source: Country Watch, CIA world fact book Car transport 39,000 km paved roads 765,000 privately registered passenger cars 266,000 privately registered trucks Air Major airports in Baghdad, Basra and Mosul Three major railway routes Baghdad–Kirkuk–Irbil Baghdad–Mosul–Yurubiyah Baghdad–Maagal–Umm Qasr 3% ration, no work Utilities 250 water treatment facilities Power generation capacity of 9500 (pre 1990), currently at 1800MW Geography and climate Infrastructure The majority of Iraq is characterized by desert OVERVIEW 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 workers Key facts 1980 1985 1990 1995 2000 2002 CAGR 3% DEVELOPMENT IRAQI POPULATION 1980 TO 2002 Iraqi population amounts to more than 24 millions Million Source: CIA world fact book 100% = Others Arabs- Shia Muslims Kurds – Sunni Muslims 4 62 12 Arabs – Sunni Muslims 22 ESTIMATE POPULATION SIZE BY ETHNIC GROUP Shia Muslims form Iraq’s ethnic majority % Adult literacy at 54% (vs. 75% in Iran) * From 6 to 23 years Source: EIU country profile Iraq 2002 1980 1998 EDUCATION ENROLMENT RATIO FOR ALL AGES* - 1980 VS. 1998 An increasing number of children does not receive formal education ESTIMATE Source: Country Watch Proven reserves Un