IRAQ: Local authorities promise to solve the housing crisis in Baghdad's impoverished suburb of Sadr City

Record ID: 783724

  • Title: IRAQ: Local authorities promise to solve the housing crisis in Baghdad's impoverished suburb of Sadr City
  • Date: 12th January 2011
  • Summary: BAGHDAD, IRAQ (RECENT) (REUTERS) VARIOUS OF STREET SCENE IN NEIGHBOURHOOD HOUSING DISPLACED FAMILIES AND SQUATTERS IN BAGHDAD'S NORTH-EASTERN SLUM OF SADR CITY VARIOUS OF CHILDREN IN SLUM PLAYING OUTSIDE MAKESHIFT SHACKS CLOTHES HANGING ON WALL / OLD CAR PARKED NEAR WALL BICYCLES OUTSIDE SHACK
  • Embargoed: 27th January 2011 12:00
  • Keywords:
  • Location: Iraq, Iraq
  • Country: Iraq
  • Topics: Economic News,Domestic Politics
  • Reuters ID: LVACR9XTOB1X8LR2MEZPU2PHZCR2
  • Story Text: After another sleepless night drenched by winter rains, Nahla Khadum spent the morning scooping water off the floor of her two-room shack in the Iraqi capital's north-eastern slum of Sadr City.
    The makeshift hovel is made of bricks and cinder blocks, topped with a piece of corrugated metal. A tangle of electricity wires hangs from the ceiling while the windows have no glass and the kitchen has no door. The shack has no running water or a sewage system.
    Khadum, her husband and their 10 children are squatters. They are among two million Iraqis who were displaced during the peak of Iraq's deadly sectarian strife in 2006 and 2007.
    Around 600,000 people were driven out of their homes by violence or fear in Baghdad alone, the United Nations said.
    Some of those displaced found shelter with relatives while wealthier ones rented or bought new homes.
    But Khadum's Shi'ite family had little money when they fled from a Sunni area just north of Baghdad to the sprawling Baghdad slum. In the absence of affordable public housing, they squatted on public land and built their ramshackle house.
    "I swear, last night we had to sleep standing up because the floors were so wet," she said.
    The city of Baghdad hopes to spend USD10 billion over 10 years on 150,000 new homes in Sadr City, where untold millions live, many in squalor. The plan has been labelled the "10 by 10" project.
    It has received bids from three consortia, one of which is composed of Iran's Kayson company and affiliate Dasht Shayan Tosee, city officials said.
    "I have no hope we will get a house in the new Sadr City, which the government will build. Frankly, I have no hope. Maybe they will expel us because we are squatters -- we are not landowners, we are just squatters," Khadum added.
    According to a five-year housing plan implemented by the Iraqi government, two million new homes are necessary to meet housing shortages. Experts put the shortfall at three million.
    The exact number of displaced people who ended up as squatters in someone else's home or on public lands is hard to gauge but Iraq hoped for a tide of foreign investment as the bloodshed subsided in the last two years, but bureaucracy, red tape and outdated land ownership laws have deterred investors.
    But continuing violence as a stubborn Sunni Islamist insurgency keeps up a steady stream of bombings and shootings has been a deterrent to foreign investors.
    Istabraq al-Shouk, deputy Minister of Construction and Housing, said Iraq's housing problem began in the 1980s, when the last new housing compound was built.
    Plans for further construction between 1980 and 2000 had to be shelved because of years of war with Iran, the invasion of Kuwait and the economic sanctions that followed.
    "Iraq is in need of nearly two million housing units from now until 2015. This is in accordance with the five-year plan established by the Ministry of Planning. Housing projects currently carried out by the Ministry of Housing and Construction do not exceed 35 housing projects across the Iraqi provinces -- this comes to approximately two housing projects per province," al-Shouk said.
    The massive internal displacement due to sectarian violence has exacerbated the housing crunch as certain areas became off-limits to residents of other religious groups.
    "The housing sector was totally neglected in that period (during heightened sectarian violence), so the problem escalated until it reached the level we have today. We don't expect to resolve the housing crisis overnight," he added.
    The Ministry of Housing and Construction has started about 40 housing compounds since 2003. Some of them have been finished. The total number of housing units in the projects is around 20,000, which al-Shouk said amounts to "no more than one percent" of the actual needs.
    The deputy minister said the government allocates around 270 billion Iraqi dinars annually (around USD230 million) for housing projects, a figure he said was clearly insufficient.
    In addition to funding for these projects, he said 15,000 new homes had been built with the help of the state Housing Fund Office, which was set up in 2005 and provides soft loans for the construction of new homes or expansion of old ones.
    But it's still not enough to meet the growing housing needs.
    "The private sector and investors must co-operate with the state to provide housing units. Even in a 2006 study by the Ministry of Housing and Construction, we allocated between 10 to 15 percent of new housing projects to the government sector while leaving between 85 to 90 percent to be achieved through the private sector and investors," al-Shouk said.
    The Iraqi government has offered many projects up for investment.
    The National Investment Commission (NIC) in early 2010 said it was looking for bidders to build one million new housing units, valued at an average of USD50,000 each, for a total value of USD50 billion. It then considered raising its target to two million houses due to what it said was a high level of interest from foreign companies.
    But despite much public fanfare and grandiose aspirations, progress on the ground has been slow.
    The Iraqi-run group Amwaj International unveiled a USD238 million housing and hotel project in the heart of Baghdad last May during a high-profile ceremony attended by Prime Minister Nuri al-Maliki. Construction has yet to start on that project.
    In November, the NIC said it signed a memorandum of understanding with a South Korean group to build 500,000 housing units. The Korean companies, however, said they had done nothing of the sort.
    Meanwhile, Emirati companies have won contracts to build homes in Baghdad and in southern provinces.
    Iraq awarded a USD30 billion housing project to Abu Dhabi-based Bloom company to build a whole new city near the city of Kerbala in southern Iraq. The project has been on the drawing board since 2009.
    The companies say legal snags are the problem.
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