The World Bank Group is currently preparing a new Country Partnership Framework for Iraq. The CPF aims to offer solutions to support Iraq’s transition to a more resilient and inclusive economy and will also support engagement to help de-risk the private sector, mobilize finance for development, and create markets through innovative financing tools and public-private partnerships. The framework is aligned with Iraq’s five-year National Development Plan, and is organized around two focus areas:
i) Improving service delivery through better governance, and ii) Creating an enabling environment for private-sector led growth and diversification. A draft of the proposal will be made available online, in addition to the timeline for consultations across Iraq.
The following have been the main areas of the Bank’s engagement in Iraq since 2015:
The World Bank approved in December 2015, a US$1.2 billion and in December 2016, a US$1.44 billion Development Policy Financing loan (DPF) to help Iraq weather the fiscal crisis and advance reforms in three areas: improving the management of public finances; securing a more stable and sustainable supply of energy; and supporting more efficient and transparent state-owned enterprises.
- Emergency Operations for Development (EODP):
In July 2015, a US$350 million financial package was approved by the Bank to support the reconstruction of damaged infrastructure and the restoration of public services in targeted municipal areas recaptured from ISIS, including health, electricity, water, transport, education, and agriculture. As an urgent response to the enormous reconstruction needs in Mosul, the Bank’s Board of Directors approved additional financing to the EODP of US$400 million in 2017.
- Social Fund for Development:
A US$300 million Community Driven Development project to improve access to basic services and increase short-term employment opportunities has seen good progress in the first three targeted governorates of Salahuddin, Muthanna, and Duhok. The project is targeting communities in the 18 governorates of Iraq over 5 years.
- Iraq Emergency Social Stabilization and Resilience Project:
A US$200 million loan aims to increase livelihood opportunities in liberated areas; increase access to psychosocial services; and strengthen the systems to expand the provision of social safety nets. The project includes cash for work, social support, and livelihood opportunities; and resilient social safety nets.
- Transport Corridors Project:
A US$355 million project to improve road transport connectivity and safety on selected road sections along Expressway 1 and the North–South transport corridor in Iraq.
- Baghdad Water and Sewerage Improvement:
A US$210 million project to improve the quality of drinking water and wastewater services in Baghdad, with the objectives of improving utility management and creating an enabling environment.
- Modernization of Public Financial Management Systems:
Financed by an IBRD loan of US$41.5 million and implemented over 2017–2021 in the federal Ministry of Finance and Ministry of Planning and the KRG Ministry of Planning. The project aims to improve financial information management and transparency, cash management, public investment management, and public procurement modernization at selected federal and governorate agencies.
- Electricity Services Reconstruction and Enhancement Project:
A sub-national project of US$200 million to improve the reliability and enhance the operational efficiency of electrical services in Basra Governorate, including operations efficiency that could foster increased private sector participation in the medium-term and support two broader government objectives of decentralizing services. The project agreement was signed in July 2019.
- Iraq EITI Implementation Support:
A recipient-executed grant through which the Bank supports the government in using Extractive Industries Transparency Initiative as a tool to enhance transparency in Iraq's extractives sector through the government.
- Promoting the Inclusion of Conflict-Affected Iraqi Youth:
A recipient-executed grant to promote the social and economic inclusion of at least 3,000 conflict-affected Iraqi youth (ages 15-29) through engagement in entrepreneurship and youth-led community development activities.
- Mashreq Gender Facility:
The main objective of the facility, the first of its kind designed specifically for the Mashreq region, is to enhance women’s economic empowerment as a catalyst toward more inclusive, sustainable, and peaceful societies, where economic growth benefits all. The 2019–2024 facility provides technical support and funding for strategic regional activities and country-level priorities organized under three, interconnected pillars: (i) Dialogue & Participation (ii) Data and Knowledge (iii) Innovating for results.
- Iraq Reconstruction, Reform and Recovery Fund (I3RF):
In partnership with the government, the World Bank has launched I3RF to improve the effectiveness and sustainability of public investments in recovery and reconstruction, and to promote targeted economic and financial reforms. Its work is aimed at complementing the UN’s Recovery and Reconstruction Fund. A multi-donor platform, with the United Kingdom and Germany as founding partners, the I3RF enables coordinated financing, strategic dialogue, and catalytic support to reform, reconstruction, and development in Iraq. Its activities will be executed by both the Government of Iraq and the World Bank under three priority areas: (i) Socio-economic recovery and reconstruction, (ii) economic diversification and private sector-led growth, and (iii) strengthening coordination, institutional arrangements, and monitoring of reform and reconstruction agenda.
International Finance Corporation (IFC)
IFC's committed portfolio in Iraq has grown considerably over the last five years to exceed US$1.5 billion diversified both geographically and across sectors, in power, telecoms, manufacturing, agribusiness, logistics, and services. In FY16, it committed US$375 million to MGES Power, the leading, local, private investor in power. In FY18, IFC committed US$269 million to Zain Iraq, the leading mobile operator, to support the rehabilitation of their network in territory newly secured by the government. In FY19, IFC committed another US$6 million to a new mall and entertainment complex in northern Iraq. IFC’s investment pipeline consists of potential investments in healthcare (hospital), ports, digital financing, and power.
IFC is closely collaborating with World Bank teams to apply Maximizing Finance for Development (MFD) principles across strategic areas. Besides infrastructure and energy, transport and water have been identified as potential sectors. The Financial sector has been selected as another critical sector that would require support.
IFC has also contributed towards food security through its investment in Al-Safi Danone (US$18 million). The project increases the manufacturing and distribution of high-quality dairy products and supports job creation through supply chain linkages with MSMEs. Additionally, IFC’s special focus in the power sector is helping address an electricity gap caused by influxes of refugees/IDPs. In the banking sector, through its global trade financing program, IFC is supporting trade and market access for Iraqi SMEs and private banks. Lastly, it is using its Business Edge program to provide direct training to IDPs, in partnership with local NGOs.
Multilateral Investment Guarantee Agency (MIGA)
MIGA’s outstanding gross exposure in Iraq stood at US$8 million. MIGA signed its first contract in Iraq in FY11 for a project that supported a Turkish investment in a water bottling plant in Baghdad. In FY14, MIGA provided a guarantee for a project in the telecom sector in the Kurdistan autonomous region of Iraq; and in FY2015 it supported a port logistics project in Umm Qasr.
Last Updated: Oct 01, 2019