In Iraq, a country most recognized for its oil production, it’s the micro - small - and medium-enterprises (MSMEs) that bring life and colour to the streets. Despite being the ‘small’ players in business, the private sector (excluding oil) accounts for close to 60% of employment, with MSMEs active in the widest range of sectors and with the greatest opportunities for youth.
In Basra City and Al-Qurna, two cities in the largest oil producing region in the nation, the unemployment rate has risen to at least 30% in recent years. Largely attributed to the lack of government employment opportunities and the skills mismatch of the growing youth demographic, investment in micro- small- and medium-enterprises is bringing new hope and opportunities for economic development.
Since mid-2019, the United Nations Development Programming (UNDP), in partnership with the Norwegian Refugee Council (NRC), has provided targeted support to 319 new and established MSMEs across Basra City and Al-Qurna through business development training and cash-grants. The training worked to build skills that would enable enterprise growth, such as finance and accounting, marketing, human resources and employment management, as well as soft skills such as communication, leadership, negotiation skills, decision making and problem solving.
“I learned the importance of good leadership,” says Labieb, 57, father-of-5 and owner of a cherry and nuts store in Basra City. “I also learned how to best deal with customers and be part of a team.” Following completion of his training and receiving his cash-grant, Labieb was able to hire an additional staff member to manage increased stock and customers and enjoyed a 15% increase in profits.
But like most other cities around the world, the socio-economic impact of COVID-19 was also felt in Basra and Al-Qurna. Businesses took all precaution to prevent the spread of the virus, ensuring the safety of both staff and customers by wearing personal protective equipment (PPE) and adhering to the government curfews, with limited operating hours. By demonstrating solidarity, these business owners were not only able to continue making a livelihood for themselves and their employees, but to set an example for the community.
“As a business owner, I am empowered to build something successful – that I created the plan for, and that enables me to give back to the community,” explains Hisham, 40, father-of-2 and owner of a small five-a-side football stadium in Abu Al-Khaseeb.
For Kawthar and Jenan, both mothers-of-five and owners of successful beauty salons in Basra and Al-Qurna respectively, hygiene and care are always a big part of their daily work. “After receiving the grant, I was able to hire three new staff members and saw my profits increase by 40% - this is because I put together a good business plan, but also because we take the necessary precautions to keep ourselves and others safe,” says Kawther.
MSMEs continue to face challenges to their growth during COVID-19 pandemic, limiting their capacity to hire additional employees, but with the recognition and support they need, could MSMEs be the way forward for economic growth in Iraq?
Sustainable livelihoods through small business development and job placement in Basra
Together with NRC, and generous funding support from the Government of Japan, UNDP has supported 319 MSMEs through training and cash-grants and placed 125 individuals in jobs through private sector partnerships, since mid-2019.