Iraq must construct between 2.5 and 3 million new housing units over the next five years to address its growing housing deficit, at an estimated cost of $80 to $100 billion, according to Mudher Mohammed Saleh, Financial Advisor to the Iraqi Government.

In an interview with Zawya Projects, Saleh said the figures were derived from the 2024 national census and data from the Ministry of Planning, adding that the total cost also includes infrastructure such as roads, water, electricity, and sanitation systems.

Population in the OPEC member reached 46.1 million as of February 2025, according to Iraqi Ministry of Planning data.

Saleh said the government has initiated ‘One Million Housing Units Initiative,’ alongside several large-scale residential developments, especially in high population -density governorates like Baghdad, Basra, Najaf, and Nineveh.

These projects are being financed through a mix of government allocations, sovereign wealth funds, real estate lending programmes and public-private partnerships (PPPs).

He pointed out that the housing programme is complemented by major infrastructure initiatives that include:

•Development Road Project: A planned highway and railway multimodal corridor linking the Arabian Gulf to Europe.

•Grand Faw Port: A deep-sea port development designed to expand Iraq’s maritime trade capacity.

To fund its broader infrastructure agenda, Iraq is employing a mix of direct government spending, concessional loans from institutions like the World Bank and JICA, and capital from national entities such as the Iraqi Development Fund.

Saleh noted that project delays and inefficiencies remain a key concern, prompting the government to introduce restructuring measures, alternative financing models, and dedicated monitoring committees to improve accountability.

Target sectors for foreign investment

According to Saleh, Iraq is also ramping up efforts to attract foreign investment in priority sectors including oil, gas, and renewables; logistics and transport; agriculture and food processing; manufacturing; religious and cultural tourism; and information technology.

“To attract investments, the government is offering various incentives such as tax exemptions of up to 10 years, long-term land leases, sovereign guarantees, and capital repatriation rights under Investment Law No. 13 (2006),” he said.