A mega new town construction project in Iraq by South Korea’s Hanwha Engineering & Construction Corp. is expected to pick up pace after the Korean builder has successfully financed project funds from financial institutions in the Middle Eastern country.

Hanwha Engineering & Construction said on Thursday that its CEO Choi Kwang-ho visited Iraq at the end of last year to discuss the Bismayah New City project in the country with Iraqi Prime Minister Haider al-Abadi. After the meeting, the Iraqi prime minister ordered the country’s heads of state-run banks to guarantee stable payment for Hanwha E&C and the Korean builder was immediately paid $170 in construction fee for the project. The Korean builder is expected to receive additional $200 million within the first half of this year.

“The company has succeeded in securing funds for the construction project for Bismayah new city this year,” Hanwha E&C said in a statement. “Following the fund injection, we expect our debt ratio to fall and financial structure to improve.”

The Bismayah New City project worth $10.1 billion is a project to build houses and infrastructure for about 100,000 households in the Bismayah region, southeast of Baghdad. It has granted $3.2 billion worth orders so far and is 32 percent completed since its launch in 2013.

With the pickup in oil price and end of the civil war, Iraq has been aggressively promoting infrastructure projects. An official from Hanwha E&C said the Iraqi government is seeking to construct a new highway connecting the new city to the center of Bagdad and implement policies to promote real estate sales in the city. The company expects that the successful delivery of the new town project would help it win additional construction projects in the country, the official added.

By Park In-hye and Choi Mira

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