Foreigners can own 100% of Iraqi companies, must pay only a 15% flat tax on profits, and may take 100% of those profits home when and how they please.

The expected announcement of Iraq’s new government marks the culmination of a remarkable process. The former bully-boy of the Arab neighborhood has become its only functional democracy. What may be the world’s richest resource economy, once the closed shop of a murderous clique, is today wide open for business.

Driven by what many geologists consider the world’s largest oil reserves, Iraq will probably be the world’s biggest crude oil producer within a decade. The country currently ranks second to Saudi Arabia in official reserves, with 143 billion barrels. With much of Iraq’s exploration still to come after a three-decade hiatus, …

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* Three branches outside Iraq next year

* Bank sees 25 percent profit boost this year

The Trade Bank of Iraq plans to expand abroad and almost double of the number of its branches in Iraq next year to benefit from an anticipated oil boom, its chairman told Reuters.

The state-run bank is also eyeing financing deals in the energy sector as OPEC member Iraq moves ahead with plans to boost oil production through a series of deals with oil majors and rebuilds its battered economy, Hussein al-Uzri said.

“Business is picking up,” he said in an interview on Thursday on the sidelines of an oil and gas conference in the southern oil hub of Basra.

“We expect that by end of next year we should cover all of Iraq plus we will have three branches outside of Iraq,” he said.

The bank, which has 15 branches in Iraq now, plans to open another eight or nine branches next year and to have a foothold in Beirut, London and Istanbul to feed the appetite of investors eyeing Iraq.

Baghdad has signed a series of deals with international oil companies in the past year to boost its crude output capacity to Saudi Arabia’s levels of 12 million barrels per day from around 2.5 million bpd now.

The electricity-starved country also plans to increase its power generation capacity by building new plants and adding new turbines to existing plants.

Iraq has major plans to build oil export infrastructure to meet the anticipated hike in crude production but lacks sufficient funding after years of war, sanctions and decline that left its economy shattered.

The Trade Bank of Iraq will help the government in financing some of its oil and power infrastructure projects, Uzri said.

“As we see in Basra, security didn’t stop (investors) from coming here,” he said at the bank’s booth, surrounded by other exhibitors including companies such as Weatherford, Schlumberger , Turkey’s TPAO and Malaysia’s Petronas, which have won deals in Iraq’s oil sector.

“The drive was initiated by the oil companies. Now we see service companies are also coming, and this will attract hotels, restaurants, housing and office complexes. It’s already started.”

The bank sees net profit increasing by about 25 percent in 2010, driven mainly by corporate and private banking, Uzri said.

It made $305 million in net profit last year.

“In 2010, we were targeting a 20 percent increase (in net profit), I would imagine it would be more, about 25 percent, which is good,” he said.

“We started this year the investment banking, the corporate banking. We expect revenues to expand,” he said.

It also plans to boost its capital to $1 billion from $427 million, he said.