ARTICLE AD BOX
Nearly $1 billion in international funding for Iraq to implement a massive transportation project.
6/25/2025
The World Bank announced on Wednesday that it had approved $930 million in financing to improve railway performance in Iraq, boost domestic trade, create jobs, and support economic diversification. The bank confirmed that the project will be completed in 2037 and will include eight Iraqi governorates .
The bank stated in a statement received by Shafaq News Agency, "Under this financing, the Iraq Railways Extension and Modernization (IREM) project will modernize the railway infrastructure and services between Umm Qasr Port in southern Iraq and Mosul in northern Iraq, contributing to reducing travel and transportation time, increasing freight volume, as well as improving infrastructure and sustainable transportation services and providing them to users and passengers ."
He added, "The Middle East is witnessing a significant boom in the development of regional railways, which enhances trade routes within the region and with Asia and Europe, and contributes to enhancing connectivity services and driving economic growth in the region. These regional initiatives include the Iraq Development Road , which was announced in May 2023 with the aim of transforming Iraq into a pivotal transportation hub by linking the Gulf region with Iraq, all the way to the Turkish border and from there to Europe ."
The bank also noted that, "Once connectivity to existing ports and infrastructure is enhanced, this route could significantly increase trade flows within Iraq and across the region. Given that Iraq's railway sector suffers from limited connectivity, poor repair and maintenance services, and a lack of funding, investments in the existing railway network are considered an essential first step towards enhancing connectivity at the national and regional levels ."
In this regard, the World Bank's Regional Director for the Middle East, Jean-Christophe Carré, said, according to the statement, "As Iraq transitions from reconstruction to development, enhancing trade and connectivity services can stimulate economic growth, create new job opportunities, and reduce dependence on oil. This project is of great importance in transforming Iraq into a regional transportation hub and achieving the goals of Iraq's development path, which are improving connectivity services, diversifying economic activity, and raising growth rates ."
He stressed that "the project will expand and modernize the railways in Iraq by rehabilitating and modernizing 1,047 kilometers of existing railway lines linking Umm Qasr Port to Mosul via Baghdad, in addition to supporting the modernization of the fleet of locomotives and train cars, renovating the maintenance workshop in Baiji, and purchasing the necessary equipment and spare parts. The project will also work to enhance private sector capital participation in the establishment of dry ports and logistics service centers that provide sustainable, highly skilled job opportunities. The project will also enhance railway safety by implementing a comprehensive safety management system, modernizing infrastructure, improving railway crossings, implementing community awareness campaigns, enhancing emergency preparedness, and training workers ."
The project will also include technical assistance to improve the institutional performance of the Iraqi General Railway Company, develop an action plan for railway sector reform, and identify opportunities for private sector participation. Additionally, the project will provide training programs for Iraqi General Railway Company employees and support women's participation in the sector, according to the statement .
He stressed that "the Iraqi General Railway Company will implement the project under the supervision of the Ministry of Transport. To support successful and rapid implementation, an international company will be contracted within the framework of the project to manage capital expenditures and support the Iraqi General Railway Company in its efforts to build institutional capacity to manage large capital expenditure programs and manage the implementation of project contract packages.
The project will also prioritize active participation by citizens and local communities, and establish a community-led planning and monitoring mechanism that enables citizens to receive regular updates on progress and express their opinions and feedback on implementation ."
He pointed out that "by 2037, the renovated railway line is expected to transport 6.3 million tons of domestic freight, 1.1 million tons of exports/imports, and 2.85 million passengers, including unpackaged primary commodities (such as grains or construction materials) and containerized goods (such as industrial and consumer goods). The railway will cross eight Iraqi governorates, enhancing integration across the federal Republic of Iraq and benefiting nearly 17 million people ."
The World Bank statement noted that "the project will shift freight traffic from trucks to trains, significantly reducing damage to roads and lowering annual maintenance costs. The project will create more than 3,000 full-time construction jobs over seven years. Once railway operations and sector-wide expansion work commence, the project is expected to create 21,900 jobs annually by 2024. " LINK
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