BAGHDAD / Aswat al-Iraq: International Finance Coporation (IFC), a member of the World Bank Group, is providing a $70m loan to help renovate a cement factory in Iraq, part of an effort to support the local building sector and aid in the country's reconstruction.
The financing will allow Kerbala Cement Manufacturing (KCML), a subsidiary of France's Lafarge, to rehabilitate a state-owned plant near the city of Kerbala.
KCML will undertake the work under a concession agreement with the government of Iraq.
The financing is expected to help bolster Iraq's construction sector, a key source of jobs, and support rebuilding efforts in the country, which is in dire need of infrastructure following years of conflict.
"This financing will help address the cement shortage that Iraq is facing and help the country meet supply gaps in its infrastructure," said Guy Ellena, IFC Director for Manufacturing, Agribusiness and Services in Eastern and Southern Europe, Central Asia, the Middle East, and North Africa.
"It will also play a catalytic role in attracting other foreign investors to Iraq."
KCML is a joint venture between Lafarge and Merchant Bridge, a London-based private equity group.
The financing is being supplemented by a $20m loan from Proparco, a development financial institution funded by the French Development Agency and private shareholders.
IFC and Proparco will work with KCML to implement an environmental and social strategy, helping align the company with international standards for sustainability.
The initiative is part of IFC's efforts to support the development of Iraq's private sector.
Over the past two years IFC committed about $500m in the country, including $245m in mobilization.