The Sunday Telegraph has learned that officials from the government have recently held talks with banking and legal advisers in London. City sources said Iraq's minister for industry, Fawzi Hariri, was looking to appoint advisers to draw up a memorandum of understanding to sell off the country's non-oil assets, ranging from petrochemical plants to construction companies, hotels and airlines, as early as this month.
Experts said investor appetite for Iraqi assets was relatively limited and was likely to remain so until the country's security improved considerably. But if attempts to privatise Iraq's non-oil assets went hand in hand with moves to open up the country's oil sector to foreign investment, they would have much greater appeal. The long-awaited passage of the hydrocarbon law is seen as critical to attracting foreign investment.
Smaller, maverick oil companies have already invested in Kurdish-controlled areas of Iraq, but the bulk of the oil is in the south and no oil major would consider investing without a reliable legal regime and a significant improvement in security.
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