The Iraq ministry of industry and minerals has awarded a contract to expand a large cement factory to a UK private equity firm, a small step on the road to securing foreign investment in the country.
An upgrade to the factory, in the southern province of Kerala, represents an AED734m 15-year contract and was awarded to MerchantBridge, a direct-investment group focused on the Middle East that targets oil and gas services, financial services and light and medium industries.
The National on the weekend reported that funding for the project would derive from debt, company cash, international backers and cash flow from the factory. It has teamed up with French group Lafarge, which already controls two plants in the country. It is one of many big contracts expected across the spectrum of industries as the political and social situation in the war-troubled country eases and infrastructure projects move from drawing board to reality.
Last week, in a conference in Dubai focused on doing business in Iraq, Adnin Blebil, director general of the Iraqi Civil Aviation Authority, announced that the ICAA would build three additional terminals to Baghdad International Airport in line with an expectation that passenger number s would double over the next few years to 15 million a year, up from around 7 million today.
A similar issue of supply and demand is at work with the cement factory, according to Abdullah Lahoud. The partner told The National that demand for cement in the country was twice the 7Mt the country currently produces. “We expect the new government to focus very much on reconstruction and the economy. It wasn’t a priority before.”