BAGHDAD Jan 10 Japan has agreed to lend Iraq up
to 27.2 billion yen ($235 million) to rebuild damaged
electricity infrastructure, especially in areas recaptured from
Islamic State, its Baghdad embassy said on Tuesday.
Tokyo also intends to sign off on another loan worth 21.5
billion yen for a project to repair a thermal power station in
the southern province of Basra.
Iraq's economy has been hit by the plunge in world oil
prices since mid-2014 and the country is expected to have a
financing gap of 21 trillion dinar ($17.8 billion) this year
unless it can secure more funding, an IMF document obtained by
Reuters last year showed.
The cost of fighting Islamic State militants is another
burden on the budget.
The loan was signed during a visit to Iraq by Japanese State
Minister for Foreign Affairs Kentaro Sonoura.
An embassy statement said Japan intended to make additional
contributions of approximately $100 million for "humanitarian
assistance and support for the stabilization of liberated areas
through international organizations."
Iraq is fighting with the help of a U.S.-led coalition to
drive Islamic State militants from the north of the country.
($1 = 1,181.0000 Iraqi dinars)
(Reporting by Saif Hameed; Editing by Mark Trevelyan)