Iraq Receives $145 Million For Reconstruction And Development From World Bank Trust Fund

07/12/2004 | World Bank

The World Bank today signed three grant agreements with representatives from the interim Iraqi government

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Sereen Juma (202) 473-7199
AMMAN, December 6, 2004 — The World Bank today signed three grant agreements with representatives from the interim Iraqi government for reconstruction and development projects in Iraq totaling $145 million. 
Financed by the World Bank’s Iraq Trust Fund, $90 million will be channeled to emergency projects in health, water supply and sanitation, and reconstruction in urban centers.  The remaining $55 million will be used to strengthen the financial and private sectors, of which $40 million will finance the building of a modern telecommunications network across the country.
"Today’s agreements reflect the international community’s valuable support to the reconstruction process of my country in vital areas that entail significant economic impact” says Dr. Mehdi Hafedh, Iraq’s Minister of Planning and Development Cooperation.  “We appreciate the cooperation and continuous efforts of the World Bank in this regard."

The proposed Emergency Baghdad Water and Sanitation Project ($65 million) will help restore basic water supply and sanitation services in Baghdad through reconstruction and upgrading existing networks and treatment facilities.

Prior to the 1991 Gulf war, the population of Iraq enjoyed a relatively high level of water supply and sanitation services. A decade of sanctions followed by direct damage from the 2003 war, looting, lack of maintenance and power outages led to a deterioration in the water treatment and supply systems.  In Baghdad today, water supplies reach one-third of consumers, compared with 1990 levels.  In addition, about 30 percent of Baghdad’s population is not connected to a sewage collection and treatment system, posing serious environmental and health concerns.

The Emergency Health Rehabilitation Project ($25 million) responds to the urgent health needs of the Iraqi people by improving emergency services in select hospitals.  Once considered among the best in the region, the Iraqi health system suffered the consequences of three major wars, weak policies, poor management and limited funding.  This project will equip hospitals with basic medical and laboratory equipment and provide a 3 to 6 month supply of up to 40 essential emergency drugs. It will also provide support for better planning and management in public health agencies at the central and governorate level.
The Emergency Private Sector Development Project ($55 million) will help address unemployment—estimated at 50 percent or more—by focusing on four building blocks for private sector growth. The project will create or strengthen institutions that would support the private sector, and improve Iraqi firms’ access to finance and foreign markets.  It will also boost the telecommunications infrastructure and build a national network to improve delivery of communications services to the government and to the people of Iraq.

“With the launch of the three emergency projects today, the majority of donors’ fund administered by the World Bank will be spent—all of them in high-impact sectors catering to the Iraqi people’s day to day needs,” says Joseph Saba, World Bank Country Director for Iraq.
A fourth grant agreement for the Emergency Water Supply and Sanitation and Urban Development Project ($90 million) is expected to be signed this week.  The project will help restore basic water supply and sanitation services in nine governorates outside of Baghdad.  In addition, the project will undertake reconstruction of roads, sidewalks, and community centers in poor cities outside of Baghdad.
To date, international donors have pledged approximately $400 million in the Iraq Trust Fund— the World Bank arm of the Joint UN-World Bank International Reconstruction Fund Facility for Iraq—to finance a program of emergency projects and technical assistance based on an interim strategy. The Iraq Trust Fund is already financing two emergency projects in education as well as training and technical assistance.  Reconstruction in connection with the signed projects is expected to begin within the next few weeks.

All World Bank-financed reconstruction projects are implemented by the Iraqi ministries and institutions.  This includes overall project management, procurement of goods and services, and financial reporting.  The Bank has already provided several training sessions in these areas through workshops and on-the-job training. 

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