IFC, a member of the World Bank Group, has arranged a $375 million financing package for a leading private Iraqi power company, Mass Global Energy Sulimaniya.

The project will provide electricity to millions of people across the country—particularly in the Kurdistan Region of Iraq, where a migrant crisis has strained power infrastructure, a statement said.

The financing package is part of a larger effort by IFC to support infrastructure development in Iraq, which needs to increase its power generating capacity by an estimated 70 percent just to meet current demand. It is also part of an emphasis by IFC to scale up support for fragile and conflict-affected states, where private sector investment is essential to rebuild infrastructure, create jobs, and spur growth.

The debt and equity package includes $250 million from IFC’s own account and $125 million from Bank Audi, which includes IFC’s first Islamic syndicated loan. Mass Global Energy Sulimaniya will use the funds to add 500 megawatts of capacity to a 1,000-megawatt power plant in the Kurdistan Region of Iraq—providing power to 3 million people—and to help complete a new power plant near Baghdad that will supply about half of the Iraqi capital’s electricity needs.

“These investments are critically important in a country where years of war and neglect have hobbled the energy infrastructure, leading to daily blackouts and stifling economic growth,” said IFC CEO Philippe Le Houérou.

“Pressure is especially acute in the Kurdistan Region of Iraq as a result of a recent influx of more than 1 million internally displaced Iraqis and 250,000 Syrian refugees. We expect this project will open the door to greater private sector investment in Iraq, enhance the potential for long-term development, and demonstrate how private solutions can help solve infrastructure gaps in challenging regions.”

Over the past five years, IFC has invested $2 billion in infrastructure projects in fragile and conflict-affected countries, including funds IFC mobilized from other investors. - TradeArabia News Service