Iraq in deal with South Korean group for 500,000 homes

BAGHDAD (BestGrowthStock) – Iraq’s National Investment Commission said on Sunday it had signed a memorandum of understanding with a South Korean group to build 500,000 housing units all over Iraq.

The deal could have a possible total value of $25 billion, according to previous information from the commission stating that each housing unit was expected to cost $50,000.

The group includes Hyundai, SK and POSCO (005490.KS: ), the media office of the National Investment Commission said.

“The head of the Investment Commission, Sami al-Araji, has signed in Seoul an MOU with the globally known South Korean Trac organization to build 500,000 housing units all over Iraq,” a statement said.

The final deal is expected to be signed in January 2011, Dhiyaa al-Khayoon, a deputy minister of finance, said.

Construction in Iraq has been hampered by red tape and security concerns since the 2003 U.S.-led invasion.

The government hopes a sharp fall in violence in the past two years from the height of sectarian warfare, and a new investment law allowing foreigners to own land for housing projects, will entice foreign investors.

Iraq faces an acute shortage of houses after years of war and sanctions and needs between 2-3 million new homes for its growing population, officials have said.

(Reporting by Aseel Kami; Editing by Erica Billingham)

Iraq in deal with South Korean group for 500,000 homes