US$900 million planned over the next four years to help lay foundation for long-term sustainable growth
WASHINGTON, December 18, 2012 – World Bank Group support for Iraq over the next four years will focus on job creation, social inclusion and building stronger institutions. The Country Partnership Strategy which was discussed today by the World Bank Board of Executive Directors is a four-year engagement framework with a planned US$900 million in support to Iraq.
The strategy will assist Iraq in managing its own resources more efficiently and effectively and will promote the diversification of the economy and private sector growth, for the benefit of all citizens.
“Iraq is opening a new chapter in its long and deep history,” said Ferid Belhaj, World Bank Country Director for Iraq, Syria, Iran, Lebanon and Jordan. “This is a chapter where the people come first and where the immense human potential of the country, its vast natural resources and its strategic location will be central to its socio-economic recovery."
The strategy was designed with the Government of Iraq, based on consultations with various stakeholders, including local and regional governments, private sector, civil society groups, academics and the donor community. Key messages emerging from the discussion pointed to the need to diversify the economy, strengthen institutions and improve delivery of basic services for the population.
“This is the first ever full country partnership strategy between the World Bank and the Iraqi Government,” said Belhaj. “It will allow the World Bank to align its program of support over the next four years with the government’s National Development Plan.”
As a conflict-affected state, Iraq remains fragile, and its economy is dominated by a large public sector due to a legacy of centralization. Proper management of Iraq’s vast oil wealth and human resources, coupled with a conducive and efficient investment climate, will be key to inclusive growth and job creation. The Bank strategy focuses on improving governance and social inclusion and supporting economic diversification for broadly shared prosperity with a particular focus on the inclusion of women.
“This is an excellent opportunity for the Government of Iraq to lay the foundation for a modern, prosperous Iraq, where all citizens can share in the prosperity brought by the country’s abundant oil wealth and a strong and diversified economy,” said Marie-Hélène Bricknell, World Bank Special Representative in Iraq.
The strategy was prepared jointly by the International Bank for Reconstruction and Development, the International Development Association, the International Finance Corporation (IFC), the private sector arm of the World Bank Group and the Multilateral Investment Guarantee Agency (MIGA), the political risk insurance arm of the World Bank Group. The strategy, with its built-in flexibility and adaptability to changing realities on the ground, will guide the World Bank Group’s business in Iraq through 2016.
“Supporting Iraq’s diversification efforts through increased private sector participation will be critical to place the country on a sustained growth trajectory and create jobs,” said Mouayed Makhlouf, IFC’s Regional Director for the Middle East and North Africa region. “The IFC has a growing program of investment and advisory services in Iraq, and we see great potential for doing more business in the country, especially if the security situation continues to improve.” The IFC opened an office in Baghdad in September 2011 and is planning to increase its field presence over the coming four years.
Izumi Kobayashi, MIGA Executive Vice President recently visited Iraq to discuss how MIGA can help attract foreign technical partners and expertise to the manufacturing, banking, and services sectors. “MIGA has an important role to play in helping conflict-affected countries attract foreign direct investment,” said Kobayashi. “While Iraq faces many near-term challenges, the country offers considerable potential for investors seeking opportunities in frontier markets.”