Iraq unveils $17bn transport project linking Europe and Mideast

Iraqi Prime Minister Mohamed Shia Al-Sudani attends a meeting with Transport Ministry representatives in Baghdad on Saturday. (AFP)
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Updated 27 May 2023
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Iraq unveils $17bn transport project linking Europe and Mideast

  • Once completed, the $17 billion project known as the ‘Route of Development’ would span the length of the country, stretching 1,200 km from the northern border with Turkiye to the Gulf in the south

BAGHDAD: Iraq on Saturday presented an ambitious plan to turn itself into a regional transportation hub by developing its road and rail infrastructure, linking Europe with the Middle East.
Once completed, the $17 billion project known as the “Route of Development” would span the length of the country, stretching 1,200 km  from the northern border with Turkiye to the Gulf in the south.
Prime Minister Mohamed Shia Al-Sudani announced the project during a conference with Transport Ministry representatives from Iran, Jordan, Kuwait, Oman, Qatar, Saudi Arabia, Syria, Turkiye and the United Arab Emirates.
“We see this project as a pillar of a sustainable non-oil economy, a link that serves Iraq’s neighbors and the region, and a contribution to economic integration efforts,” Al-Sudani said. While further discussions are required, any country that wishes “will be able to carry out part of the project,” the Iraqi parliament’s transport committee said, adding the project could be completed in “three to five years.”
“The Route of Development will boost interdependence between the countries of the region,” Turkiye’s ambassador to Baghdad Ali Riza Guney said, without elaborating on what role his country would play in the project.
War-ravaged and beset by rampant corruption, oil-rich Iraq suffers from dilapidated infrastructure.
Its roads, riddled with potholes and poorly maintained, are in terrible condition.
Those connecting Baghdad to the north cross areas where sporadic attacks are still carried out by remnants of the Daesh group.
Al-Sudani has prioritized the reconstruction of the country’s road network, along with upgrading its failing electricity infrastructure.
Developing the road and rail corridor would allow Iraq to capitalize on its geographical position, with the aim of making the country a transportation hub for goods and people moving between the Gulf, Turkiye and Europe.
Work has already started to increase capacity at the commercial Port of Al-Faw, on the shores of the Gulf, where cargo is to be unloaded before it embarks on the new road and rail links.
The project also includes the construction of around 15 train stations along the route, including in the major cities of Basra, Baghdad and Mosul, and up to the Turkish border. The Gulf, largely bordered by Iran and Saudi Arabia, is a major shipping zone, especially for the transportation of hydrocarbons extracted by countries of the region.
Zyad Al-Hashemi, an Iraqi consultant on international transport, cast doubt on the plan to develop the country into a transportation hub, saying it lacks “fluidity.”
“Customers prefer to transport their goods directly from Asia to Europe, without going through a loading and unloading process,” that would see containers moved between ships and road or rail, he said.
Transport is a key sector in the global economy and Iraq’s announcement is the latest in other planned international megaprojects, including China’s “Belt and Road Initiative” announced in 2013 by its President Xi Jinping.
The planned works in that project would see 130 countries across Asia, Europe and Africa connected through land and sea infrastructure providing greater access to China.

 


‘Speed over scale’: Saudi Arabia positioned to shape future of industry, say experts

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‘Speed over scale’: Saudi Arabia positioned to shape future of industry, say experts

  • WEF p anelists also discussed how global industrial forces are evolving

DAVOS: Saudi Arabia is primed to position itself at the forefront of the global industrial transformation, leveraging its scale, strategic vision, and competitive energy infrastructure to become a leader in sectors such as clean industries and advanced technologies, experts said on Tuesday.
Speaking at a panel at the World Economic Forum in Davos, Rayan Fayez, deputy CEO at NEOM, highlighted how the Kingdom’s industrial city, Oxagon, is driving diversification and clean manufacturing.
The city is already home to several key sectors, including green hydrogen, renewable manufacturing and AI data centers.
The world’s largest green hydrogen project, a collaboration with ACWA Power and Air Products, is 90 percent complete and expected to be operational by 2027, Fayez said.
Renewable manufacturing partnerships are also taking off, with Chinese companies establishing solar and wind production outside China for the first time.
Fayez highlighted that NEOM’s success rests on four core competitive advantages: digital infrastructure, abundant renewable energy, ready-to-use land and strategic location.
“The location is not only strategic for the Kingdom, but also in connection to the rest of the world through the port of NEOM,” he said, adding that the city is poised to serve as a hub for both domestic and export-oriented industries.
Panelists also discussed how global industrial forces are evolving.
Frederico Torti from the WEF highlighted the structural volatility in supply chains, driven by geopolitics, technological change, natural disasters, cybersecurity risks and talent shortages.
He highlighted the importance of agility, collaboration and holistic operational transformation.
“The only way to make this happen is through collaboration, dialogue, and cooperation across public and private sectors,” he said.
Saudi Arabia’s strategic position, combined with its low-cost energy and infrastructure readiness, make it a magnet for industrial investment, Torti said.
“Countries that invest in the right factors will attract manufacturing investments and create value for the next decade,” he said, pointing to NEOM as a prime example of this approach.
ACWA Power CEO Marco Arcelli highlighted why Saudi Arabia is a compelling market for gigascale renewable energy and water desalination projects.
“In a world of uncertainty, Saudi Arabia is a country where you can really smell the hope,” he said.
“It speaks with China and the US, with Russia and Ukraine, with Europe and Southeast Asia and Africa, and looks to partner to solve problems and to develop domestically but also abroad.”
ACWA Power is now the largest water desalination company in the world, with operations across the Middle East and new projects in Azerbaijan, Senegal and China, he added.
Arcelli highlighted the water-energy nexus, where low-cost renewable power enables large-scale, sustainable desalination.
“Countries that are moving faster in these sectors are typically countries that will enjoy higher economic growth,” he said.
Looking ahead, panelists highlighted that the future of competitiveness will rely less on scale and more on speed and collaboration.
“You cannot be good at everything,” Arcelli said. “It’s going to be more about cooperation. It’s an economy of speed, not economy of scale anymore to thrive and be the best around.”
Torti reiterated the need for cross-border partnerships and dialogue, adding: “Open up, connect and make best use of forums like this to get different perspectives on solving problems. Collaboration is invaluable.”
Fayez added that investing in talent remains a critical element to drive industrial transformation in the Kingdom as well as globally, alongside infrastructure and technology.