Iraq Smartphone App Market Expanding

Ahmed Subhi from Baghdad is riding high on his smartphone app called Wajbety (My Meal), a service similar to Iran’s Reyhoon and ZoodFood which uses a smartphone application to place an order for food.  

“When we were mulling business ideas to be introduced in Iraq, mobile apps came first to our minds, given the wide access to Internet and smartphones by Iraqis and the absence of such business,” Subhi said in an interview with AP in his office in Baghdad.

Iraq’s young, tech-savvy entrepreneurs are finding business opportunities in mobile apps at a time when the government is strapped for cash and looking to the private sector to create jobs.

Oil revenue makes up nearly 95% of Iraq’s budget, but the country has been reeling under an economic crisis since 2014, when prices began falling from a high of above $100 a barrel.

Iraq has one of the most youthful populations in the world, with about 60% of its 2015 estimate of 37 million under the age of 25, according to the UN.

 Creating New Jobs

In a bid to create up to 250,000 private sector jobs for the youth, the Iraqi government last year started a $5 billion initiative for small, medium and large projects called ‘Tamwil,’ or Finance, which is run by the Central Bank. The loans run for five years with interest rate of 4.5%.

The Wajbety app was created in April 2014. At first, it drew only a lukewarm response from the public and faced some unexpected problems: Motorcycles carrying food orders were sometimes confiscated by authorities in Baghdad neighborhoods where they were not allowed for security reasons.

Many Iraqis do not have email. Some restaurant owners refused to pay the 5% fee per bill that Subhi requested. There were fake orders.

But the company found solutions, like using cars as well as motorcycles, taking orders via phone or social media, and using a verification process for big orders.

Now, his business is worth more than $100,000, has eight employees and averages 50 orders per day.

A fellow Baghdad entrepreneur, Ali al-Khateeb, also turned to a successful foreign business model, the ride-hailing company Uber. In February, al-Khateeb launched an app called Ujra, or Fare.

The company has nine employees and deals with 250 drivers who pay it a percentage of the fare from each trip. He plans to hire another 50 employees or so by the end of this year and expand beyond Baghdad.

Al-Khateeb, a 32-year-old father of two, promises to make Iraqis’ taxi experience simple, safe and enjoyable.

Due to the ongoing conflict in Iraq’s western province of Mosul, as well as international investors’ hesitance to enter the market, what could be a booming smartphone app sector has suffered immensely over the past few years.