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Signing of a Loan Agreement for financing Building Modern Schools in Baghdad and the States Project in the Republic of Iraq
A Loan Agreement was signed in Kuwait today between the Republic of Iraq and Kuwait Fund for Arab Economic Development whereby the Fund will extend a loan of Kuwaiti Dinars twenty three million five hundred thousand (KD. 23,500,000/-), equivalent to about US$ 80 million, to contribute in financing of Building Modern Schools in Baghdad and the States Project in the Republic of Iraq. It is worth mentioning that the Fund is a Kuwaiti Public Corporation, which relies entirely on its own resources for making loans and providing other kinds of development assistance. It is also worth mentioning that the Loan Agreement would contribute in achieving the fourth goal of the Sustainable Development Goals (SDGs) in respect of good education that guarantees comprehensive education for all and to enhance opportunities for durable education.
The Loan Agreement was signed on behalf of the Republic of Iraq by Dr. Salahuddin Hamed AL-HADEETHY, Director-General of the Department of Public Debt, Ministry of Finance, and on behalf of the Fund by Mr. Abdulwahab Ahmed Al-Bader, Director-General of the Kuwait Fund for Arab Economic Development.
The Project shall participate in the economic and social development in the Republic of Iraq. Through elevating the educational and vocational levels of pupils in the primary and secondary levels by availing, more educational opportunities through provision of additional educational seats and building new schools that will participate in reducing overcrowding in double, triple teaching shifts, and reduce student's dropouts.
The Project includes the construction of about 73 schools of either 18 or 12 classrooms over 15 Iraqi governorates. Works include civil, electrical and sanitary works for administration, classrooms and labs in addition to provision of sanitary facilities and utilities. The Project also includes provision of engineering consultancy services for design and supervision.
The total cost of the Project is estimated at about Iraqi Dinars 125.507 Million, equivalent of about KD. 48.3 million, of which the foreign currency is equivalent to about KD. 31.23 million, of which about 87.774 Million Iraqi Dinars, which about 21.84 Million Kuwaiti Dinar in foreign currency, it represents about 70% of the total cost of the Project. The project will be implemented within three years.
The Loan will be for a period of 20 years including 4 years grace period, and will be amortized in 40 semi-annual installments, the first of which will be due on 1st date on which any interest or other charge on the Loan shall fall due after the elapse of the above mentioned grace period. The interest at the rate of one and one-half of one percent (1.5%) per annum. An additional charge of one-half of one per cent (0.5%) per annum on the amounts withdrawn from the Loan and outstanding from time to time shall be paid to meet the administrative expenses and the expenses of implementing this Agreement
Upon signature of this Loan Agreement, this Loan will be the 3rd loan extended by the Fund to the Republic of Iraq, considering that the Fund has already extended 2 loans to Iraq in 1970 and 1971, totaling about KD 5.7 Million fully withdrawn. In addition, the Fund is currently administering 4 Grants on behalf of the State of Kuwait amounting to about 85 million Kuwaiti Dinars (equivalent to US$ 290 million).