City update: Baghdad

Iraq's capital shows signs of ambition as projects get started

Construction funding needs stability.
Construction funding needs stability.

With Iraq’s government in even greater upheaval than normal, amid the legal wrangles of the election, it would have taken a lot for construction and development in the capital to retain the headlines.

But three major announcements and sizeable numbers clawed back both domestic and international attention.

Firstly, the General Secretariat approved the referral of the Al Raheed residential complex last week to an unnamed UAE company at a cost of more than US $20 billion (AED 73.4 billion) – heralding one of the largest investment projects in its history.

The decision was reached following protracted meetings of the Council of Ministers, according to Ali Al Alaak, UN Secretary-General of the Cabinet, with the Emirates company the pick of three shortlisted.

The infrastructure project is to be presented to the next cabinet, he added, with the final signings expected within the next few weeks after modifications and resubmission by the Investment Authority.

This came soon after an announcement by the Investment Commission that it had awarded eight investment permits to projects in the capital.

In a statement to Aswat Al-Iraq news agency, the Commission said it had prioritised housing, of which it aims to build over 1 million in the next three years in the country as a whole, a total investment of $50 billion (AED183.4 billion.

Among the eight permits is a $238 million (AED 874 million) housing project that includes 1824 units at the Muthanna Airport. It continues the momentum spurred by the laying of a cornerstone in the ThiQar capital Nassiriya, 380km south of Baghdad in mid-March.

The announcements tempered concerns following the views of Baghdad governor Salah Abdul two weeks ago that construction funding might be stunted if the country did not grapple efficiently with its financial budget.

In between these two events, the electricity and transport ministries announced last week a joint railroad project to deliver fuel to the Dora Power Station, in southern Baghdad.

The last few weeks also saw upheavals for US contractors. Following the establishment of the general Status of Forces Agreement in January between the US and Iraq – which attempted to implement a legal backbone to the accountability of the US military’s occupation – the Ministry of Interior has aimed to simplify the process for US contractors to enter and exit the country and make their legal presence a statutory requirement.

The new scheme involves an approval memo, an entry-exit spreadsheet of travellers to airports in Baghdad, Erbil and Basrah as well as, for the US Embassy, a copy of the government contract and that contractor’s Certificate of Registration from the Ministry of Trade.

Biggest projects

US $20 billion
Al Raheed: residential complex

US $50 billion
combined eight projects awarded by Investment Commission

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