Since the defeat of ISIS in Syria in March, Iraq has become an investment opportunity for countries, including Saudi Arabia and the United States, as they seek to counter Iran’s growing influence in the region.
At a joint press conference with German Chancellor Angela Merkel, Iraq’s Prime Minister Adel Abdul Mahdi said, Siemens is well placed to win the bulk of orders flowing from a $14 billion scheme to rebuild Iraq’s electricity infrastructure following years of war.
The announcement is a blow to GE, which has also been in the running to upgrade Iraq’s power grid.
Following the bilateral talks between the two leaders, Abdul-Mahdi stated Siemens had a good chance of being awarded a majority of contracts generated by the project.
In a statement, Siemens said it had already signed three contracts worth a total of $700 million to rebuild Iraq. While the first contract is to build a 500 MW gas-fired power plant, the second is to upgrade 40 gas turbines, the third is to install dozens of substations and transformers across Iraq.
In 2018, Iraqi officials had stated they had come under heavy pressure from the U.S. government to select GE over Siemens.
As part of the deal, Siemens has committed to donating software worth $60 million dollars to Iraq’s universities, building a health clinic, and provide training to 1,000 Iraqis.
“We are also committed to supporting Iraq in arranging financing for the projects, creating attractive jobs and opportunities for small and medium enterprises,” said Siemens Chief Executive Joe Kaeser in a statement.