Southern Kurdistan: A Tale Of Two Cities

Iraqi Kurdistan: A tale of two cities

By Luke Baker

ARBIL, Iraq, Aug 12 (Reuters) - Compared with the rest of Iraq, where violence and death stalk the land, the northern Kurdish region can seem an oasis of calm -- a vision of what the whole of Iraq might someday become.

But there are tensions too between the forces that run Kurdistan, a semi-autonomous area stretching across northern Iraq that is home to nearly five million people, mostly Kurds.

Their rivalry came to a head in the 1990s, when the Kurdistan Democratic Party in Arbil and the Patriotic Union of Kurdistan in Sulaimaniya fought an inconclusive civil war, and has become entrenched since Saddam Hussein's fall in 2003.

Now their competing visions threaten to handicap, or at least severely complicate, the region's ability to move forward, just when business is booming and a brighter future beckons.

"The success of our region depends on the honesty of the two administrations and how they behave," Faruk Mustafa Rasool, chairman of mobile phone company Asiacell and one of Kurdistan's top entrepreneurs, said recently at his office in Sulaimaniya.

"If they are not honest with one another, then it will hinder the development process. Neither can do it alone."

In many respects Rasool's words were a not-so-coded warning to his rivals in Arbil, since telecommunications is the subject of a major dispute between the two parties and symbolic of other problems between them.

Rasool's Asiacell, the fastest growing network in Iraq, has a licence to operate in PUK areas of Kurdistan -- essentially around Sulaimaniya -- but not in KDP territory.

In Arbil, Dohuk and other cities overseen by the KDP, a company called Korek runs the mobile network. But Korek subscribers cannot call Asiacell phones and vice versa. It is as if they were on opposite sides of an Iraqi Berlin Wall.

While another telecoms company authorised by the KDP has been allowed to roam onto Asiacell territory, the KDP has not reciprocated by allowing Asiacell into the KDP zone.

DIVIDED BY COMMON CAUSE

The telecoms wrangle is an offshoot of the political rivalry between the KDP and the PUK.

After their low-level conflict in the mid-1990s, the two parties united to run together in Iraq's first post-Saddam elections in January, but they remain at odds within Kurdistan.

The region has a united parliament -- based in the Kurdish capital Arbil -- but there are two prime ministers and two sets of ministries, one based in Arbil, the other in Sulaimaniya. The cities are just 2-1/2 hours' drive apart.

Kurdistan's president is KDP leader Massoud Barzani, while PUK head Jalal Talabani is president of Iraq.

It is a confusing structure that is made more complex by the fact that each party has its own militia. At the dividing line between PUK and KDP territory in the mountains east of Arbil, each side has put up roadblocks.

At the same time, each party is pushing to make its city the main hub for business in the region, which is booming.

Sulaimaniya has a new airport, while Arbil is building an extension to its existing landing strip. Sulaimaniya has set up an agency for reconstruction and development, linked to the PUK, while Arbil has set up a similar organisation, the Kurdistan Development Corporation, which focuses on KDP areas.

"I can only tell you what we are doing in our area," says Sheelan Kanaka, a spokeswoman for the Kurdish Regional Government based in Sulaimaniya, as she lays out plans for around $1 billion of infrastructure development in the city.

The lack of coordination means the two sides are competing for the same funds and run the risk of wasteful doubling up on projects. For instance, Kurdistan needs cement factories, but there seems little point in building several in each area.

Sulaimaniya currently feels confident as it forges ahead with projects, while Arbil, where there has been slightly more insecurity, is perhaps a few steps behind. But as the capital, it also has a sense of superiority.

"They do need to sort out the rivalries," says an American adviser to the KDP who also talks to the PUK. "Otherwise it could get messy, and foreign investors don't like messy."