The war in Iran has dominated news throughout 2026, but with no end to the conflict in sight, life and business as usual has been moving ahead in other parts of the region.<\/p>\n
One such example is neighbouring Iraq, which was a longstanding centre of conflict-related news throughout the 2000s. Despite its proximity to the centre of the war in Iran, this country is slowly emerging as a potential new manufacturing centre, receiving attention even from major brands such as PepsiCo.<\/p>\n
On the surface, the draw of this market is clear, due to its geographical advantages, large young population, and high access to locally produced food ingredients \u2014 according to the United Nations Food and Agriculture Organisation (FAO), these include many staple crops as well as dates, fruits, tomatoes, potatoes and animal protein.<\/p>\n
\u201cAs one of the region\u2019s historic farming heartlands, we want to support Iraq\u2019s agricultural potential and industrial capacity to become a hub for food exports,\u201d PepsiCo CEO of Foods, Middle East, North Africa and Pakistan Ahmed Elsheikh said during the recent US-Iraq High Level Business Summit.<\/p>\n
\u201cThis MOU provides a basis for exploring opportunities to grow Iraq\u2019s food manufacturing sector and strengthen the country\u2019s farming sector [as] strong food manufacturing begins with strong agriculture. By working across the value chain, we hope to create opportunities that benefit farmers and local industry while supporting products proudly made in Iraq.\u201d<\/p>\n
This is not the firm\u2019s only project in Iraq this year, as it also signed an MoU with the Baghdad Soft Drinks Co. (BSDC) that aims to boost local production capacity to go beyond 250 million cases annually.<\/p>\n
According to PepsiCo, this MOU builds on a partnership that has been in place since 1984, for over four decades. <\/p>\n
\u201cThis MOU reflects PepsiCo\u2019s confidence in Iraq\u2019s industrial future, and supports employment and local manufacturing,\u201d said the firm.<\/p>\n
Iraq\u2019s beverage manufacturing <\/p>\n
A big part of the MOU is the aim to support modernisation for the local manufacturing sector, an important area that needs rapid improvement if the country really hopes to upgrade its role in the region.<\/p>\n
\u201cThe main goal is threefold: advanced manufacturing, skilled employment, and continued investment in Iraq\u2019s local industry,\u201d PepsiCo declared after the MOU was signed.<\/p>\n
This was further bolstered by PepsiCo SVP and CEO, Middle East and Africa Beverage FOBO (franchise-owned bottling operations) Mohamed Shelbaya, who confirmed the company views Iraq as a major beverage manufacturing player in the region.<\/p>\n
\u201c[The MOU] with BSDC outlines a shared ambition to explore potential opportunities related to manufacturing capacity expansion, strengthening Iraq\u2019s role as a leading beverage production hub in the Middle East, and further developing the people and capabilities that drive our business forward,\u201d he said via social media.<\/p>\n
\u201cI\u2019ve always believed that the strongest partnerships are built over time. Our relationship with BSDC spans more than four decades, and this next step reflects the trust we\u2019ve built together and our shared belief in Iraq\u2019s long-term potential.\u201d<\/p>\n
What is standing in the way?<\/p>\n
Investment and assistance from international names such as PepsiCo are crucial to deciding whether Iraq will be able to take off as the region\u2019s next modern manufacturing hub. <\/p>\n