Iraq’s cabinet has approved an agreement between the Construction and Housing Ministry and South Korea’s Hanwha Company to resume work on the country’s largest housing project after a pause of nearly 3 years.

Hanwha halted work on “Bismaya City” near the capital Baghdad after Iraq failed to pay outstanding dues to the firm.

The company, which has built nearly 30,000 houses, agreed to resume work on the project in early 2023 after negotiations with the National Investment Commission (NIC) produced a deal on payment.

“The agreement with Hanwha has been approved…we will now try to determine local and foreign funding sources so we can complete this project,” NIC Chairman Haydar Makkia said, quoted by the official Iraqi news agency.

Makkia spoke after meeting Hanwha representatives in Baghdad to discuss resumption of payments for the firm, the agency said.

Bismaya, with costs of more than $7 billion, will accommodate 600,000 people and is one of several residential cities planned by Iraq to resolve a post-war housing crisis.

(Writing by Nadim Kawach; Editing by Anoop Menon)

(anoop.menon@lseg.com)

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