The World Bank expects a pickup in Iraqi business activity buoyed by higher oil prices to lead to an economic recovery in 2005, a senior bank official said. "Assuming we have a reasonable security situation and some political stability next year Iraq would be set for a very strong recovery," said Joseph Saba, the aid bank's director for the Middle East and North Africa Region.
In contrast to US expectations of a post Saddam Hussien boom, Saba told Reuters in an interview on Monday the Iraqi economy has just now reached pre-war output levels.
Saba was speaking after signing three agreements with Iraq's interim government in the Jordanian capital.
The three agreements are worth a total of $145 million, by far the largest sum the bank has given to Iraq, and come after earlier funding to enhance government capacity and education.
"We foresee the realistic possibility of doubling per capita income levels helped by a combination of oil, significant trade and the commencement of these reconstruction contracts," he added, saying per capita income was currently under $800. "Infrastructure projects which were chosen on the basis of immediate priority are just beginning now."
Under the new agreements, funds worth $65 million have been given to emergency water and sanitation projects for Baghdad's 6 million residents and $25 million to repair hospitals.
A $55 million private sector development project mainly upgrades telecommunications infrastructure by helping rebuild a national network still to recover from US bombing in 2003.
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