First, Kuwait’s Zain Telecom exited Sudan — and now, another Kuwaiti bigwig… the National Real Estate Company (NREC), is streamlining its operations through a sell-off of its Iraqi segment.
The Kuwait-based and publicly-listed company is a MENA-wide investment manager dealing with a real estate portfolio worth over $1.8b across Libya, Lebanon, Jordan, Egypt, the UAE — and, shortly before their announcement yesterday, Iraq.
The company’s decision to sell all of the shares it holds in its Iraq-based subsidiary is reported to bring in $15m of proceeds, which spells good news for the business’ 2021 financial reports. Although NREC released limited information surrounding the rationale behind the sell-off, apart from a one-page disclosure, the decision might be due to Iraq’s recent economic troubles. The country’s Kurdistan Region, where NREC Iraq was based, has had to deal with rising unemployment and corruption, recently, making it a business risk for regional companies.
Why it matters
Whether an industry is hot, or not, geopolitical risks are a thing. With peace in the Middle East constantly going through ups and downs, companies in the region that invest pan-regionally will have to account for this risk.
