World Economy

Despite Recession, Wealthy Iraqi Kurds Purchase Luxury Watches

Despite Recession, Wealthy Iraqi Kurds Purchase Luxury WatchesDespite Recession, Wealthy Iraqi Kurds Purchase Luxury Watches

Expensive watches have not lost their appeal to wealthy Kurdish customers despite a year-long economic recession in the region that cut the annual sale of ordinary watches in half, according to area’s largest retailers.

“Our total sales have dropped by nearly 40% due to the financial crisis but still there are wealthy customers who ask for luxury watches,” said Rashid Nihad, manager of the Romasson Company in Erbil that sells more than 120,000 watches each year, reported.

“But, so far this year, we are not even close to half of what we sold in an ordinary year before the crisis,” Nihad added.

Multiple financial crises have hit the Kurdish economy since early last year with the Baghdad government withholding Erbil’s share of the national budget and a dramatic decline of global oil prices.

There has also been the influx of some 1.7 million refugees into the Kurdistan region due to the Islamic State’s rampage across Iraq and Syria.

Sabah Omar owns a Rolex watch shop in Erbil and displays luxury timepieces that cost as much as $50,000, including by Hublot and Patek Philippe. Omar said there are still customers willing to pay large amounts for high-end watches.

“I used to sell at least 10 brand watches a month with prices over $10,000 before, but now we sell almost half of that,” Sabah added.

He said most clients are local businessmen who often order their luxury watches in Dubai and Beirut through his company.

With a GDP per capita of $4,400, the Kurdistan region has in the past decade stood out as the most flourishing part of Iraq. The region has a smaller portion of its population living under the poverty line compared to the rest of the country.

Tax-free holidays, investment-friendly regulations and the 45 billion barrels of estimated oil reserves have attracted hundreds of foreign companies, including giants like French Total and American Exxon with long-term oil bonds.

Kurdish Prime Minister Nechirvan Barzani said Thursday that oil exports from Kurdish-controlled fields had reached 600,000 barrels per day and could give Kurdistan the much needed $800 million per month to offset the deficit and pay salaries of civil servants in the region.

“Since last year we have been selling watches on credit because wholesalers don’t have enough cash to pay us on time,” said Nihad, who in the past year sold other retailers watches worth $400,000.

Hozan Fareed, who runs a luxury watch shop in Erbil’s fashionable Family Mall, said he had clients who would pay $150,000 for a watch.