Iraq - Wadi Tharthar Flood Control Project

A.S. 20 RESTRICTED Th's report is restricted to use within the Bank. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT FIRST LOAN ADMINISTRATION REPORT ON THE LOAN TO IRAQ OF June 15, 1950 June 3, 1954 Departmert of Operations AsD U&& a 2 a.UU& ]East  CURRENCY EWUIVALENTS UNIT iraqi dinar U.S. cents per currency unit 280.00 Currency units per U.S. dollar .357 143  FIRST LOAN _ADaNISTRATION REPORT VOTJ rrxV `C)AW Tr) TPAnl IN1TRODUCTION 1. This report deals with the loan to Iraa cn the 11adi Tharthar Project, Loan No. 26-1cn^ signed June rl, 1950r -It covers the period from that date to April 30, 1954. 20 Following the Vice-President:s visit to the Middle East in l7arch 1949, a Bank mission went to Iraq in Nay of the same year to study the cuun-ry's economic situation, the possiDblitles ior the establish- ment of a development agency, and the e:dsting plans for flood control projects. After studying the mission!s recommendations, Bank represen- tatives went to London in August 1949 to discuss with British and !raqi officials the f-inancing of flood control measures, and the capital needs of the Iraqi Railways. Shortly thereafter the Export Credits Guarantee Department of thae United hLingdom made a T 3 milaion railway development loan to Iraq. After further discussions with the Iraqi Government, the i-adi Tharthar flood control project was considered for Bank assistance. Negotiations were started in jondon in April 1950 and culminated in the signing of the Loan Agreement and two supplementary agreements (an Indenture of Assignment and a Project Funds Agreement) in Iiashington on June 15, 1950. 3. later that year various additional development schemes, invol- ving irrigation projects, the purchase of agricultural machinery, and the erection of grain storage facilities, were brought to the Bank's atten- tion. A Bank mission examined the proposals, and in Februarx 1951 the Bank expressed its willingness to negotiate loans to aid Iraq wfith these projects. Iraq, however, felt that her imDroved financial oosition warranted financing them from her owqn resources. An oil refinery proe ect was also discussed with a view to Bank assistance but, when the Bank and Iraqi representatives disagreed on its technical justification, the latter made their own financing arrangements. At the request of the Iraqi Government, a General Sur-vey 1Mission from the Bank visited the coun- try in the spring of 1951. Its report was oresented to the Goverunent in February 1952. 4. In I4arch 1953, in the course of a tour of Middle Eastern member countries, the President of the Bank visited Iraq.  - 9- A M tnD T n A T Al it aI [lir LlV2t.LI 5. Te L,oanl was uiaue onl U1Ue 15, 1950V aLU Ut,.V cti-f1eJJV on July 12, 1951. It is a 15-year loan for 112.8 million and carries an interest rate of 3-3f47, incl-uding 1, sbLaUUU-Y QoIfMllss