Resumption of Iraq Bismaya Project Opens Door to "Over 800 Investment Opportunities"

Korea-Iraq Joint Committee Resumes After 6 Years
Both Countries: "Bismaya Project Delay Issue to Be Resolved Soon"
Iraq: "Plans to Order Larger Residential Complex Project"

The resumption of the Iraq Bismayah New City project has been set in motion, triggered by the reopening of the Korea-Iraq Joint Committee after six years.

Won Hee-ryong, Minister of Land, Infrastructure and Transport (left), and Dawood Al-Ghurairee, Minister of Trade of Iraq, are answering reporters' questions after concluding the Korea-Iraq Joint Committee at the Grand Hyatt Hotel in Yongsan-gu, Seoul on the 21st. / Photo by Noh Kyung-jo

On the 21st, Dawood Al-Ghurairee, Iraq's Minister of Trade, stated at the 9th Korea-Iraq Joint Committee held at the Grand Hyatt Hotel in Yongsan-gu, Seoul, "The delay issue in the Bismayah project will be resolved within a few days, allowing it to restart along with other projects," adding, "More opportunities will be provided to Korean companies."

The Bismayah New City project is a development plan to build approximately 100,000 housing units and social overhead capital (SOC) facilities in the southeastern area of Baghdad, Iraq’s capital, with a total project cost reaching 14 trillion KRW. Hanwha’s construction division secured contracts for housing construction in 2012 and SOC construction in 2015 and proceeded with the work; however, the project has been halted since October last year due to delayed payments from the client, the Iraqi National Investment Commission (NIC).

Minister Al-Ghurairee mentioned, "There are plans to order even larger residential complexes and new city projects than Bismayah," and added, "We will continue cooperation based on the achievements of the Joint Committee." A Hanwha construction division official also expressed a positive response, stating, "We are in close consultation with the Iraqi side."

The Korea-Iraq Joint Committee, first held in 1984, was suspended from 2017 due to instability in Iraq’s political situation but resumed this year after six years. The initiative came from Minister Won proposing to Iraq to establish a regularized cooperation platform between the two countries through the One Team Korea bidding activities.

On this day, the two countries discussed not only the resumption of the Bismayah New City project but also △ signing a memorandum of understanding (MOU) on transportation and infrastructure △ signing a policy cooperation MOU between Baghdad and Seoul △ investment protection agreement △ double taxation avoidance agreement △ strengthening cooperation in energy and petrochemical industries △ signing MOUs in various fields such as diplomacy, legal affairs, education, and culture and arts.

In particular, the Iraqi government introduced over 800 new investment projects and requested participation from Korean companies. They emphasized that the issue of unstable payment has been resolved by finalizing a three-year budget along with development plans. Minister Al-Ghurairee referred to the smart city sector, saying, "I understand that Korean companies keep their promises regarding project speed, etc.," and added, "I hope they will further establish their presence in Iraq."

Minister Won Hee-ryong of the Ministry of Land, Infrastructure and Transport also explained, "The Iraqi government proposed reviewing projects in a new atmosphere," and said, "The government will enhance creditworthiness through financial support and share risks." He further added, "I hope companies will actively enter Iraq by practically considering feasibility and business viability."

Currently, Korean companies are participating in Iraq’s national projects such as the Karbala Refinery (Hyundai Engineering & Construction) and Al Faw Port construction (Daewoo Engineering & Construction). Hyundai E&C is aiming for additional orders in the Baghdad Light Rail Transit project worth 3.3 trillion KRW, and Daewoo E&C is targeting further contracts in the Al Faw New Port project, which involves a total investment of 53 trillion KRW.

Regarding the achievement of overseas construction orders, Minister Won called for a macro perspective, stating, "There will be no difficulty in achieving this year’s overseas construction order target of 35 billion USD," and added, "There is no need to rush to evaluate performance within the limited period of the first half. Large-scale order news from countries like Saudi Arabia will also be coming one after another."