The relocation of Faruk Group Holding ( FGH) to its new building (Faruk Building) in Sulaimani/ Kurdistan Iraq is an important move not from management level but also it is an indication for a new management structure and a new vision for investment in Kurdistan, Iraq and the region. The group which does hold investment and companies owned by the businessman Mr Faruk Mustafa Rasool, which has a diversified activities in Telecommunications, Hotels, Medical services, Buildings, Construction, Car Agencies, IT Technologies and Offshore Companies. FGH has prepared itself with a new road map which will lead to many success in addition to the successes stories of the founder (Mr Rasool ) whom started with a small financial way but his big stamina & delegation for the last 35 years made him to reached his goals. Taking calculated risk with revolutionary approach but with a smile, believing in democratically approach all the way, companied with strait forwards, humanity, quality, and efficiency in performing which are the five pallor for success of any company. Adding to that Mr Rasool vision that with education, knowledge, and openness are important elements in his view for the development of any nation and communities. He is recommending company's managers to be kind away from ostentation and trust their employees even if they make mistakes (as we will learn from their mistakes) and see that proper management with proper follow up, do equal a proper planning to reach the goals and the growth needed. Mr Rasool do not belief in retirement as the pleasure of success is the reward specially if that will reflect in the development and growth of his countrymen.
Al-Aktissad Wal Aamal has met the chairman of FGH Mr Faruk Mustafa Rasool and made this interview with him to reflect on his starting life and his projects and investments and his future vision for his group and related companies.
FGH – Kurdistan
Expanding on all angles: FGH - Kurdistan Mr Rasool did state that "As soon as I was graduated from Baghdad University College of Economy and Trade in 1964, I was employed in the Iraqi Trading Bank but I left to join the Kurdish Democratic Movement in north of Iraq (I still belief in this movement and what is stand for as I practice the democratic approach in all my life)".
FGH – Kurdistan
In 1975 he started his first business adventure as he started a building block factory in partnership with a friend whom provided the financial support as he did not have one dinar with him then. From this project he established a capital to start a poultry processing unit in Sulimani with one million dinar capital in 1987, and then he went in to trading and importing goods from Turkey to Iraq and Iran.
FGH – Kurdistan
Mr Rasool's major change came in 1995 as he bought with 15,000USD an Inmarsat portfolio for starting a small communication mobile network in Kurdistan which change to Asiacell in 1995 (Asiacell is the only network which covers the whole of Iraq with its 18 provinces with 7 million subscribers ). Delegation for the development: Mr Rasool view is to create leading companies in their fields with an added value to their employees and customers and to the benefit of the whole country and communities. His belief is that his group, Kurdistan, and even Iraq are just in the beginning of building these infrastructures and start of the development. And for the action of previous dictator regime which engaged Iraq in many wars and also brought the economical blockade to the country for many years, and that in turn brought a number of deficiencies in all economical aspects of the country. When the Iraqi Central government withdrew from Kurdistan in 1991 (after Kuwait occupation and liberation), Mr Rasool has tried to play an important role to speed the progress of Kurdish area through establishing new projects to cover some of the deficiencies as the blockade was still on and the economical clement was bad and the Central government has withdrawn from the area leaving the area in turmoil and no real revenue was available for the local regional government except some customs, simple taxes and one cement factory in Tasluja which was barely covering the salaries of their employees.
This situation was on until 2003 (when the old regime was brought down) as from then the development and progress has started which still going to date. In 2003 the newly Iraqi government has announced three licences for operating mobiles in all Iraq (South, Middle and North of Iraq Zones). Asiacell gained the licence for northern Iraq after a big competition with more than 100 companies applied for the licence. The reason for the success was purely for professional reasons due to the technical, financial, operational capabilities which was presented through the feasible studies as Inmarsat was developed into an only company which is providing GSM services in northern Iraq and had 70 thousand subscriber then in addition for the partnership of a capable foreign company with them namely the National company of Kuwait for Telecommunication as the Iraqi government has conditioned the grant of the licence with presentation of foreign operators which owns the technical and financial expertise. We continued till 2007 as then we paired our self with Qatar Qtel when the renewal of the licence which we gained for another 15 years. It is important to state that we are in good relation with our Qatar partner whom holding 30% stake in Asiacell and hoping this relation will develop in to more prosperous relation and progress. Towards 10 Million subscribers: As regard to Asiacell to attract more subscribers in the compatible Iraqian telecom.
Market, Mr Rasool said that his goal is to expand geographically and parallel with a better services provided to reach every meter of Iraqian habituated areas through providing whatever are new in services and technical availability in telecommunication fields. Geographically we have a good capability in progress in Erbil and Dohok (in Kurdistan) after we were allowed in to these areas a year and half ago in order to provide the services there (we had problems with local government which have been resolved now). Also we have a good opportunities to expand in to Baghdad, South and Anbar provinces as we completed our network infrastructure there and can rely on our advance services and compatible prices in addition to our good relation with our customers to gain more territories from other provider namely Zein (Zien is a new merger of Ather and Iraqona) whom had the control of these area and we hope to bring our subscribers to 10 million by the end of 2010 taking into account that our company has spent more than USD 500 million in expanding and improving our network and even we did not pay any dividend for our shareholders from the start of the company as we reinvest our profits back in the group and addition finance with the help of the financial institute to finance our expansions. As regard to the challenges, Mr Rasool stated that many terrorist activities do get in to our operations and towers in addition to the government and security forces are jamming of the network to prevent terrorist using mobiles.
The dilemma of Telecommunications laws: Although the telecommunications laws have not been issued yet, Mr Rasool does not expect a good outcome as from his knowledge of the drafts and various meetings he and other operators had with the telecommunication ministry which reach the indication that the Ministry do not understand the core requirements of telecommunications fields as their view on the mobile telecommunication sector (which is one of the most successful example in Iraq) is limited on their understanding of the working aspect of performance and attracting new foreign investors. He stated that their views are not fair and distractive as they want to put their failure on the others. As the ministry has promised the public since 2003 to provide them with a proper land lines and systems but it could not be delivered until now stating that the reasons for its failure due to constant change in the Ministry personnel in addition to the routine systems which covers the ministry's activities, although the prime minister Mr Nori Al Maliki does understand the situation but the ministry has its own agenda and they have to understand that Iraq is starting from zero and its countrymen are the ones whom building it and they should be encouraged not to be discouraged. Also Mr Rasool added that the ministry present view is not realistic and contrary to the overall government plan and its openness as the ministry want to control the entrance to the International Gateways as they want all communication be through a controlled Ministry switchboards which take us back to the previous methods of government controls. Also, they want to control all communications and information output which will be disaster situation for the country.
Wide activities for Faruk Group Holding: In communication field FGH has 12% of Kurdel for land communication, which Mr Rasool contributed to transfer it from an single switchboard with limited services to a join company between local Kurdish government and private sector to provide advance services to more than 100 thousand subscriber. Mr Rasool is in negotiation with this sector to rent out in full the full network. Also the group has an active involvement in Information Technology sector through Goran Net for Internet and Iraq Com Technologies for systems, services and technologies salutations. Also FGH covers construction through its associate company Zarya and Car Dealer agencies through NIVA as they have the agencies for Ford, Lincoln, Mercury, Volvo, Land Rover and Jaguar in north of Iraq, and Mr Rasool sees that the agencies success will depend on him to be the sole agent for all Iraq and he is already negotiating on this front. The group properties sector concentrate on project Ghoiza City under construction at a cost of USD100 Million including 1200 accommodation units spread on 25 buildings and Beharan Residential project which will be at the cost of USD 26.5Million including 114 prime residency accommodation units spread on 215 buildings and at the same time Azady for construction of Electrical and Communication Towers and Columns shows a good progress and qualities of workmanship in all Iraq.
More giants projects: Asiacell, Bazian and Tasluja Cement factories are the source of positive cash flows for the group. As the funds created from Asiacell is funding the expended project but the profits from the two cement factories and profit from other projects are invested in the following projects: First, Faruk Medical Centre at a cost of USD100 Million with a capacity of 130 beds and a number of VIP suites as Mr Rasool is aiming to make this facility with its equipments, labs, and medical expertise as high medical resources as he is planning to negotiate with international medical companies to manage it in addition to bring in all the latest technologies and best Iraqi doctors whom gained their experience for the West at the same time train Iraqi local doctors through established surgeries which compromise of 41 Medical surgeries. Also near the medical centre will be a 4 star hotel to accommodate the families of the patients (who are coming from outside Sulimania) and accommodation of the re-habitation of patients after their operations. And in connection with the medical sector, his second project is to build an IV factory which will be the start of entering the pharmaceutical sector from its wide doors. This project will be completed in 2010 with a cost of USD30 Million. Regarding his third project which is a 5 Star hotel named Shary Jwan (The beautiful City in Kurdish language) which has a tower of 38 stories and at a height of 150 Meters with a capacity of 196 rooms and 57 suites and on its top will have a rotating restaurant. This project will be one of the land mark of city of Sulaimani and the plan to complete this project by end of 2010 with an estimated cost of USd100Million although he expect the cost to top up that. Mr Rasool has contracted with Millennium International to manage this hotel which will be called "The Grand Millennium“ Sulaimani ) . Returning to the two cement factories, which have an investment value of more than USD750 Million in partnership with Lafarge France which shows another success of the group operations as Bazian factory has been established completely by the group and start producing in middle of 2008 with a capacity of 2.5Million Tonnes annually. As for Tasloja cement factory which was inherited from the government which was built in 1983 and was handed over to Mr Rasool in 2005 on 25 years contract and its production lines have been renovated to reach 2.3 Million tonnes annually. Expansion towards Oil, Banking and
Insurance sectors: As for Mr Rasool vision on his expansion regionally and entering new sectors is that this approach is on its beginning to enter the oil sector with Gulf partners in order to versified the income resources and benefit from their experiences in this field for the benefit of Iraq. Also he is in negotiation with sectors from Abu Dhabi, Dubai and Qatar to establish a commercial bank and Insurance company with International dimension for Sulaimani as Iraq is in need for the quality services in these sectors. Also he is eagerly waiting to enter the mining sector as Kurdistan has a number of metals re-sources like Cooper, Steel and other metals. Mr Rasool presently is helping financially a number of scientists to renew the studies of geological sectors in northern Iraq. Also he has a historical interest in developing the education sector as he financed the American University in Sulaimani with USD6 Million and provide an annual sponsorship of 40 seats at the cost of USD400,000 for the exceptional students. Mr Rasool will suggest with some of his businessmen friends to the local government to establish an Air Free Zone in Sulaimani to be a air bridge between East Asia and Europe and be the first stone built for the opening the area with the rest of the world and develop the city to one of the important trading city in the area.
Establishing the Holding Group: On the other hand Mr Rasool stated that he is planning to put some of his companies within the group into public ownership as one example is Asiacell which by law he has within two years to put some of his share for public ownership. Also he is planning to do the same for some of his other project i.e. hotels and factories. Mr Rasool sees that making a wider ownership will be a good wall to protect his companies and provide the continuity for them as he also one of the ten founders of Erbil Stock Exchange which is a partnership between the government and private sectors. Mr Rasool ended his interview by stating that creating holding companies will help the management of its related companies to reduce its costs and time with a better planning and transparent with allowing the managers to have their independency and giving the authorities to take the right and speedy decisions as he belief strongly on the democratic approach with normal liberties and responsibilities since his childhood although a number of companies managers and owners in Arab World are afraid of this approach as opposite democratic comes dictator and bureaucrat which depress the freedom, personal achievements and creativities. He has suffered from lack of democracy and freedom in his youth which push him to provide that to the new generation on the political, cconomical and culture sectors as the direction for all nation is only toward the front and development. Mr Rasool stated that what he believes in will give him the courage to go ahead.
Sunday / October 18 / 2009