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Iraqis arrive in London to drum up British investment

But UK firms may already be missing out on a market that is forecast to reach £69bn this year because other countries have jumped in sooner

Some of Britain's most prestigious firms are lining up to cash in on the end of military action in Iraq as delegates from the new Baghdad administration arrive in London this week to declare the region "open for business". Firms such as Mothercare, Debenhams, GSK and Rolls-Royce are already in talks to sell to the Iraqis, tapping into a market expected to be worth tens of billions by the end of this year.

Almost a decade after the war that ended Saddam Hussein's regime, hundreds of representatives from UK firms are expected to attend a conference at the Dorchester Hotel in London on Tuesday. Building, healthcare, water and education are key sectors, besides oil and gas, that the Iraqis want British companies to become involved in.

But there are fears that countries untainted by the Iraq war, including Germany, China, India and Turkey, have already stolen a march on their British rivals in exploiting investment opportunities.

The stakes are high, with British exports to Iraq worth almost £200m – but the country could see its gross domestic product reach $108bn (£69bn) by the end of 2011.

Baghdad is working hard to attract British investment. Hussain al-Shahristani, Iraq's deputy prime minister for energy, will be speaking at the conference – called Iraq: Untapped Opportunities – as will ministers from the Foreign Office and the Trade and Investments department, promoting British exports.

Mothercare will base its Iraq operations in Arbil, the capital of Kurdistan, a region in the north of the country that is deemed more secure than the south. Harlow International, a British building company, cut the ribbon on the re-opened $65m al-Rasheed Hotel in Baghdad's Green Zone earlier this year.

Businesses need to be more confident, warned Daniel Tain, partner at Pinson Mason, a British law firm, yesterday. "Britain forgets that it is still incredibly well-respected among Iraqi people, and the fact that it has stood back for so long has been observed positively," he said. "This is not a poor country. Places like Arbil in Kurdistan are growing at a rate that is reminiscent of Dubai a decade ago. But British businesses have been slow on the uptake and now stand to lose out."

His point was echoed by Robin Ord-Smith, Iraq director of UK Trade and Investment's, the government department. He says he is contacted by 10 to 15 British companies every week looking to move into Iraq.

"We reached the point where British businesses need to enter the Iraqi market now if we are not to lose out to competitors."

The Iraqis insist that the mood towards outside investment has changed markedly since the allied invasion in 2003. "Unlike America, Britain has a rich, historical tie to Iraq that remains despite the recent war," said Saad Saraf, an Iraqi marketing director living in London. "The vast majority of people want to modernise the country after Saddam Hussein's regime."