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Iraq and UK sign $15bn deal to strengthen trade ties

Britain’s prime minister Keir Starmer meets with Iraqi prime minister Mohammed Al-Sudani at 10 Downing Street in London Reuters/Kin Cheung
Britain’s prime minister Keir Starmer meets with Iraqi prime minister Mohammed Al-Sudani at 10 Downing Street in London

Iraq has signed a set of agreements with the UK worth £12.3 billion ($14.98 billion) as the two countries aim to bolster their growing trade relationship.

The package, more than 10 times last year’s total UK-Iraq bilateral trade, was disclosed following a meeting between British Prime Minister Keir Starmer and his Iraqi counterpart Mohammed Shia Al-Sudani in London.

The deal includes a £1.2 billion scheme allowing the use of UK-made power transmission systems for the grid interconnection project between Iraq and Saudi Arabia and exports worth £5.3 billion for a water infrastructure project led by a UK-led consortium, the leaders said in a joint statement.

Another project includes the appointment of a UK company to build large-scale infrastructure for desalination and water processing plants for three million Iraqis in the Basra province. The project will generate £3.3 billion in exports.

In addition, a British company will work on the Hilla phase 2 project, providing sewage and water processing solutions for three million Iraqis. The project will generate exports of £260 million.

Telecom major Vodafone will design the new 5G network planned in Iraq worth £410 million over 20 years.

UK companies will also provide £66.5 million worth of border security equipment to the Iraqi interior ministry, to make the country’s crossings, checkpoints and airports safer.

The UK will help set up the Iraq Fund for Development, a strategic investment fund that will support socio-economic infrastructure development projects in Iraq and attract private investment. 

In their meeting, Starmer and Al-Sudani underlined the importance of working together to tackle climate and environmental issues, welcoming Iraq’s commitment to end the flaring of associated gas by 2028.

In December 2024, British oil major BP finalised the technical terms with the Iraqi government for redeveloping the Kirkuk oil and gas fields.

London-listed UK contractor John Wood Group won a $46 million contract from French oil major TotalEnergies in June 2024 to build a gas development project in southern Iraq.