March 30th, 2012
09:22 AM GMT
Baghdad (CNN) - As Iraq's capital emerges from almost a decade of conflict and civil strife it is becoming an economic battleground for Turkey and Iran.
Turkish firm Tefirom is contracted to build Baghdad Mall. Featuring a five-star hotel more than 100 meters tall, it is set to be the tallest building in Baghdad. It will also house shops, gyms, a giant parking garage and a state-of-the art medical center.
Ashken Alkgoum is one of the engineers. He told CNN’s Fred Pleitgen: "Our costs are low, our labor quality is very good, and our engineers especially are really good.”
The Iraqi clients paying for the Baghdad Mall, with a budget of nearly $100 million, agree. They say construction is on schedule.
Falah al Sayegh, the chief engineer, says Turkish companies have an edge in Iraq because they moved into the market fast - even when the security situation was a bigger problem.
"Before I came here I heard a lot of stories about the Turkish companies,” said al Sayegh. “But to come to Baghdad with all of the circumstances – I think that is maybe one of the major issues. I think they are making a very brave move, because from so many other places nobody will come."
Taking a chance on the Iraqi market is paying off for Turkish companies. Trade between the two neighbors reached about $12 billion last year, according to the Turkish government, and Ankara says it wants that figure to double in 2012.
But there's another player on the field, and you just need to head to Baghdad's street-side shops to see Iranian consumer goods on display.
Aziz Jaber, an Iraqi political analyst, says Turkey and Iran are in a competition to gain both economic and political influence.
"The two countries try to put their hand on Iraq and try to make Iraq as the market to them, from one side, and also to make the political situation tend to them," said Jaber.
Iraq's trade with Iran is based much more on consumer goods than its trade with Turkey - at a high price for Iraqi producers, says Jaber.
"Iran is invading Iraq with the vegetable - in that the Iraqi farmers cannot compete with the Iranian productions. Because the agricultural production in Iran is very cheap and the costs of products in agriculture in Iraq is very high."
According to Iran, bilateral trade with Iraq reached $7 billion last year, and Tehran's Shiite-led government says it is wants a substantial increase in 2012 as well.
There is also a sectarian element to the Turkish-Iranian economic competition in Iraq. While Turkish companies are successful in the predominantly Sunni center and the Kurdish north, Iranian companies have an edge in the Shiite-dominated south, with massive religious tourism projects and infrastructure construction.
Iran's PapsIran company is building a massive waste water treatment plant on the outskirts of Karbala, the holy city that has some of the most important Shiite shrines.
Costs are estimated at around $100 million and the project's Iranian director says he believes there will be good investments in Iraq in the near future.
Investments, no doubt, for both Iran and Turkey - struggling for pole position in Iraq, a country with big oil wealth and a dire need for reconstruction.
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