Iraq has signed a landmark $2 billion agreement with China’s Shang Chen Steel Co. Ltd. to construct a major industrial city in the southern province of Basra, Minister of Industry Khaled Battal Al-Najm announced on Saturday.
The deal, which is part of a broader initiative to revitalize Iraq’s strategic industries sector, includes the development of a sponge iron production plant with a projected annual output of one million tons, alongside a wider industrial complex focused on heavy industry.
“This agreement is a key step toward building Iraq’s industrial capabilities,” Al-Najm stated during a press conference, adding that the scale and importance of the projects required lengthy and detailed negotiations.
Under the terms of the deal, the industrial city will be overseen by a state-owned corporation but operated by a private investment company in line with the country’s Industrial Cities Law.
Al-Najm emphasized that the project faced complex legal and logistical hurdles, but received essential backing from Prime Minister Mohammed Shia Al-Sudani, whose intervention helped advance the initiative.
The minister also addressed skepticism regarding the Ministry of Industry’s ability to handle such large-scale industrial undertakings, asserting that the ministry is now well-positioned to execute and manage transformative economic projects.
The new industrial city is expected to significantly boost Iraq’s industrial output and job market, while strengthening its economic ties with China.
