Meeting in Baghdad on April 22, Iraqi Prime Minister Mohammed Shia‘ al-Sudani and Turkish President Recep Tayyip Erdoğan, the latter making his first visit to Iraq in 13 years, signed over 24 memoranda of understanding (MOUs). Al-Sudani described the visit as setting “a road map for a strategic and sustainable co-operation in all fields.” Together with his Turkish counterpart, al-Sudani witnessed the signing of a preliminary agreement involving Iraq, Turkey, Qatar, and the United Arab Emirates (UAE) to collaborate on the Development Road project.
Originally conceived in the 1980s — and then known as the “Dry Canal” corridor — the $17 billion Development Road project envisions the construction of approximately 1,200km (745 miles) of two-way rail tracks and a new motorway, stretching from Al Faw in Basra province to the Turkish border in the north. This route traverses Basra, Diwaniyah, Najaf, Karbala, Baghdad, and Mosul, establishing a land corridor that connects Baghdad and Ankara.
Despite sharing a border, Iraq and Turkey have had a history marked by tensions; however, recent developments indicate that the two countries are now entering a new, positive phase in their relationship. Their decision to collaborate on the Development Road project is integral to their larger initiative to enhance bilateral ties. However, the successful implementation of the project, a massive undertaking, hinges not only on Iraq-Turkey cooperation and coordination but also on overcoming numerous other challenges.
Iraq’s “Road” to Development
Iraq has initiated two major projects to cement its role as a vital link between Asia and Europe and to bolster its geopolitical importance: the Grand Faw Port and the Development Road initiative. Construction of the Al Faw Port project in southern Iraq commenced nearly a decade ago. The port’s ambitious masterplan includes extensive container cargo, dry bulk cargo, and oil terminals, along with a dry dock and naval base. If fully developed, Al Faw Port would be one of the largest ports in the world.
Despite facing significant construction delays due to financial constraints and other challenges, Baghdad took a significant step forward in 2020 by signing a $2.6 billion contract with South Korea’s Daewoo Engineering & Construction to commence construction of the first phase of the port, slated for completion within four years. Since then, the Iraqi Ministry of Transport has been collaborating with the private sector to expedite the project’s advancement. The first phase of the port’s development is nearing its final stages, with plans for it to become operational by 2028. The project’s second phase, which has yet to begin, encompasses an industrial area incorporating a refinery, a steel plant, and other industrial amenities. Phase three entails the creation of Al Faw New City, comprising housing, a trade and commercial center, a school, and mosques.
The Development Road constitutes the transportation network aimed at linking the Grand Faw Port to Turkey. As envisaged, the construction of this network of motorways and railways will progress in three stages, with the first stage set to be finished by 2028, followed by the second stage in 2033, and the third stage in 2050. Aside from logistics, the project is designed to foster urban development, with the expectation of new cities and industrial hubs emerging along the corridor.
Iraq-Turkey Relations at a New Crossroads
Amid progress in reducing tensions between Iraq and Turkey, Iraq’s Development Road has taken center stage. President Erdoğan’s long-held ambition to position Turkey as a vital nexus for energy and trade aligns with Prime Minister al-Sudani’s aspiration of leveraging Iraq’s strategic location, rekindling its historical significance as a link between East and West.
Since taking office in October 2022, al-Sudani has been a vigorous champion of the Development Road, regarding it as a pivotal driver for Iraq’s economic progress, for bolstering the nation’s global market linkages, and for generating new sources of revenue and job creation. During the May 2023 Arab League summit in Jeddah and during visits by al-Sudani to the UAE and Turkey, Iraqi officials lobbied for the project. That month, Baghdad hosted a conference to introduce the Development Road to transport ministers and officials from regional countries and seek their backing. Al-Sudani highlighted the project’s significance as a “pillar for a sustainable, non-oil economy, and a link that serves Iraq’s neighbors and the region.”
President Erdoğan too has been actively pushing for the rapid advancement of the Development Road, especially since last September’s G20 summit where India-Middle East-Europe (IMEC) trade corridor was announced — a project which excludes Turkey. Erdoğan reacted strongly over the project’s proposed route, which bypasses Turkey, telling journalists accompanying him to Delhi for the meeting: “We say that there is no corridor without Turkey.” Within days of the summit, Erdoğan announced plans to establish an alternative corridor to IMEC. Foreign Minister Hakan Fidan also confirmed Turkey’s “intensive negotiations” with Iraq, Qatar, and the UAE regarding the Development Road. The setback in IMEC’s plans due to the Gaza conflict and its fallout have likely fueled Ankara’s interest in the Development Road project. During his trip to Iraq in April, President Erdoğan underscored Turkey’s commitment, stating: “The Turkish government intends to continue to offer assistance to Iraq to ensure that the project is completed as soon as possible and that the region has achieved its economic and development objectives.”
More Questions Than Answers
Numerous uncertainties surround the project itself. For one thing, the assumption that China and other major trading partners will seamlessly redirect their trade flows to align with the Development Road appears more rooted in optimism than empirical evidence. For another, maritime transportation between Asia and Europe generally presents a more cost-effective option compared to overland routes. Moreover, there are concerns about financial feasibility, including the government’s ability to secure adequate liquidity for its share and obtain funding from international sources. Lastly, given the track record of post-2003 governments in managing large-scale infrastructure projects, there are valid reasons for skepticism. Indeed, the concern that the project could serve as an opportunity for resource capture among the country’s competing actors is not unfounded, considering the state’s hybrid nature and complex system of Muhassasa, patronage, and clientelism, which often constrain the bureaucratic system’s capacity to sustain long-term projects.
Questions also surround the relationship between Iraq and Turkey, the central players in this equation. Lingering sources of tension between the parties persist. Despite recent constructive efforts to address the water-sharing issue, it remains a flashpoint. The Iraq-Turkey oil pipeline has been offline since March 2023, when Ankara halted flows following an arbitration ruling by the International Chamber of Commerce (ICC). Talks on resuming exports have stalled.
Additionally, whereas Iraq prioritizes enhancing connectivity and promoting trade, Ankara’s interest in improving relations with Iraq largely revolves around reducing the operational capabilities of the Kurdistan Workers’ Party (PKK). Recently, the central government in Baghdad has made efforts to accommodate Turkey. Following the visit to Baghdad in March by Turkish Foreign Minister Hakan Fidan, accompanied by Director of National Intelligence Ibrahim Kalin, Iraq and Turkey issued a joint statement declaring the PKK a “banned” organization and a mutual “security threat.” However, this gesture remains largely symbolic given Baghdad’s limited authority in the Kurdistan Region of Iraq (KRI), particularly within areas governed by the Patriotic Union of Kurdistan (PUK) where the PKK operates. Adding to the complexity is Turkey’s strained relationship with the Sulaymaniyah-based PUK, which Ankara has publicly branded as a “national threat,” in contrast to its positive ties with the Kurdistan Democratic Party (KDP) in Erbil.
The successful execution of the Development Road requires not only securing allies to combat the PKK but also involving the Kurdistan Region, groups aligned with Iran, and Iran itself in the project. Initially designed to bypass major cities in the Kurdistan Region ostensibly due to technical difficulties, increased costs, and prolonged project timelines, this decision has sparked controversy. Echoing President Erdoğan’s response to Turkey’s exclusion from IMEC, KRG Minister of Transport Ano Jawhar exclaimed in a post on X (formerly Twitter) last May, “there will be no road to development without Kurdistan.” The KRG subsequently announced plans to revive longstanding efforts to build a railway that would connect neighboring Iran and Turkey through territory it controls. Discussions followed between KRG and Baghdad officials, but the extent of Kurdistan’s integration into the Development Road initiative remains unclear.
Furthermore, major commercial undertakings in Iraq are unlikely to proceed without at least the acquiescence of powerful local actors backed by Iran. However, considering that the planned Development Road excludes Iran, Tehran’s potential economic benefits from the project in its current layout are limited. Foreign minister Fidan has explicitly stated that Turkey wishes to involve Iran, but the exact nature of this ‘involvement’ remains unclear.
Just as important to the project’s prospects as those who are excluded are those who might eventually be enlisted to participate. President Erdoğan and Prime Minister al-Sudani have both approached potential stakeholders to secure project financing — Erdoğan to Qatar and the UAE, and al-Sudani to the International Finance Corporation (IFC) and China.
Over the past couple of years, there has been a noticeable upswing in Gulf investments in Iraq, especially in the energy and real estate sectors. This trend underscores the Gulf States’ recognition of the benefits of economic reintegration with Iraq and the role of cooperation with Iraq in promoting regional stability, amid improving Saudi-Iran relations. The Development Road project itself has generated a certain level of interest. In April, for example, the AD Ports Group finalized a preliminary joint venture agreement with the General Company for Ports of Iraq to develop the al-Faw Grand Port and its associated economic zone. Nevertheless, this agreement might indicate a more restricted involvement in the project, centered primarily on the port infrastructure rather than the broader overland route.
At a high-level meeting in Baghdad during the same month, Igor Levitin, an aide to Russian President Vladimir Putin, conveyed Moscow’s resolute commitment to participate in the project. However, given the existing sanctions against Russia related to the ongoing Ukraine conflict, the exact nature of this ‘involvement’ remains ambiguous.
Iraqi officials expect China to be a “major participant” in the project, which is understandable given China’s substantial oil purchases from Iraq and its status as a key trading partner, as well as Iraq’s emergence as a major beneficiary of Belt and Road Initiative (BRI)-related contracts. However, it is important to recognize that China’s expanding footprint in Iraq has primarily been concentrated in the energy sector and has sparked political controversies. Consequently, the level of China’s involvement in project implementation or investment, and its reception by Iraq’s rivalrous political factions, is uncertain.
Lastly, there is the question of whether the successful realization of the Development Road project would conflict with or complement other similar transit route projects such as the International North-South Transport Corridor (INSTC), spearheaded by Russia and Iran, and IMEC, which has strong backing from the U.S., India, and Saudi Arabia. However, this question is premature, as it will be years before the Development Road or any of the other trade connectivity projects are executed.
Conclusion
The Development Road project is an ambitious undertaking comprising an integrated road and railway network connecting the oil-rich Basra area to the Turkish border, hailed by Prime Minister al-Sudani for its potential to establish Iraq as a central economic and transit hub and heralded by President Erdoğan for presenting substantial economic opportunities for Turkey, both during its construction phase and in the long term.
However, in the near term, numerous uncertainties overshadow the economic and political feasibility of the project. Over the coming months, the viability of the project will hinge significantly on the state of Ankara’s relations with Baghdad. Turkey’s military campaign against the PKK intensified in April, and reports suggest a major operation targeting the PKK in northern Iraq is planned for this summer, aiming to “permanently” eliminate the threat it poses.
The establishment of a security corridor controlled by the Turkish armed forces along the Turkish-Iraqi border could pave the way for the envisioned economic corridor. Yet, Baghdad has not specified the level of cooperation its forces are prepared to provide to their Turkish counterparts. Additionally, there is no guarantee that the Turkish military will accomplish in four months what it has struggled to achieve over the past three decades. Furthermore, there is no assurance that the operation will not provoke resistance from Iran-aligned militias or Iran itself, potentially disrupting Iraqi politics in ways that could jeopardize the Development Road project.
