World Bank approves over $1 billion for projects in Lebanon, Syria and Iraq

The World Bank said on Wednesday that it has approved over $1 billion for infrastructure and reconstruction projects in Iraq, Syria, and Lebanon.

The biggest amount went to Iraq, where the World Bank approved $930 million to help improve the country's railway infrastructure, boost domestic trade, create jobs and diversify the economy.

The World Bank stated that the Iraq Railways Extension and Modernisation Project will enhance services and increase freight capacity between the Umm Qasr Port on the Persian Gulf in southern Iraq and the northern city of Mosul.

"As Iraq shifts from reconstruction to development, enhanced trade and connectivity can stimulate growth, create jobs, and reduce oil dependency," said Jean-Christophe Carret, director of the World Bank's Middle East division.

Lebanon

The World Bank also announced on Wednesday that it had approved $250 million to support Lebanon's post-war reconstruction and a $146 million grant to rehabilitate Syria's neighbouring electricity sector.

Lebanon is reeling from last year's devastating war, while Syria faces massive needs after rebels toppled longtime ruler Bashar al-Assad in December, capping a 14-year civil war.

"The World Bank Board of Executive Directors approved yesterday a US $250 million financing to Lebanon to support the most urgent repair and reconstruction of damaged critical public infrastructure and lifeline services, and the sustainable management of rubble in conflict-affected areas," it said in a statement.

The bank had previously estimated the costs of post-war reconstruction and recovery in Lebanon at around $11 billion.

Jean-Christophe Carret, the World Bank Middle East Department's division director, said that "given Lebanon's large reconstruction needs, the (project) is structured as a $1 billion scalable framework with an initial $250 million contribution from the World Bank".

Lebanese Prime Minister Nawaf Salam welcomed the decision, calling the project "a key step in reconstruction by responding to damage to critical infrastructure and essential services in war-affected areas".

"This support strengthens recovery efforts within the state-led implementation framework and leverages much-needed additional financing," he said.

More than a year of Israel's war on Lebanon, including a full-blown assault that began in September, ended with a ceasefire agreement in late November.

The conflict caused massive destruction across Lebanon, particularly in Hezbollah strongholds in the country's south and east and Beirut's southern suburbs, and further exacerbated economic woes caused by an economic crisis that started in 2019.

Reconstruction remains one of the greatest challenges facing Lebanon's government, with Beirut seeking foreign aid to finance the post-war recovery.

Syria

In a separate statement, the World Bank said it had approved a $146 million grant to Syria from the International Development Association "to help restore reliable, affordable electricity and support the country's economic recovery".

The grant will finance the rehabilitation of high-voltage transmission lines and transformer substations damaged during the civil war, as well as the acquisition of spare parts and maintenance equipment, according to the statement.

"Among Syria's urgent reconstruction needs, rehabilitating the electricity sector has emerged as a critical, no-regret investment that can improve the living conditions of the Syrian people," Carret said.

It would also "support the return of refugees and the internally displaced, enable resumption of other services such as water services and healthcare for the population, and help kickstart economic recovery", he added.

"This project represents the first step in a planned increase in World Bank support to Syria on its path to recovery and development."

Syria's war since 2011 has devastated the country's infrastructure, with daily power cuts lasting hours.

The grant comes after Saudi Arabia and Qatar announced they would pay off Syria's World Bank debt, and as the country's new rulers press ahead with reconstruction efforts following the lifting of Western sanctions.

The UN estimates Syria's reconstruction to cost over $400 billion.