Iraq Infrastructure Report Q2 2016
BMI View: The dire security situation and weak government spending capabilities will deter investmentinto Iraq's construction sector in the medium term. On a positive note, the country is actively seeking FDIinto its hydrocarbons industry and gas pipeline infrastructure. Meanwhile, the project pipeline remainsswollen with large developments, but the investment and operating environment make it challenging toconduct business.
Latest Updates And Structural Trends
Security and macroeconomic headwinds facing the industry are still firmly in play. Our short-term viewremains unchanged, with growth in 2016 forecast of 3.3%, after several years of severe contraction.
Long-term growth of a forecast 4.7% annually to 2025 is far below the country's potential, given the needfor major reconstruction after years of war.
If Iraq can secure FDI for oil projects in the southern fields and for regional pipelines, then much-neededoil production gains and increased exports could be achieved in the medium term.
Iraq has at least USD90bn of construction and infrastructure projects either in planning or in developmentin our Key Projects Database, allocated to more than 100 projects across all sectors - transport, socialinfrastructure, residential and non-residential building, and power.
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