Baghdad – The German Government, via KfW Development Bank, and the International Organization for Migration (IOM) have signed a new agreement to provide crucial funding for the national COVID-19 response in Iraq. KfW, on behalf of the German government, will support IOM Iraq’s ongoing efforts to help communities prepare for and respond to COVID-19, and increase support to livelihoods and job creation. This contribution builds on the existing KfW-IOM partnership in Iraq, focused on economic recovery and sustainable job creation, which began in 2018.
The contribution was made available by the German Federal Ministry for Economic Cooperation and Development (BMZ) with financing provided through KfW. Since 2018, BMZ through KfW has committed EUR 36 million in support of IOM Iraq’s activities to contribute to economic recovery by supporting job creation and the rehabilitation of key community infrastructure such as markets and industrial areas.
Access to economic opportunity in Iraq was a key challenge prior to the COVID-19 pandemic. Small and medium enterprises (SMEs), which employ a majority of Iraq’s workers, were severely impacted by the conflict against ISIL. They were gradually recovering when the pandemic struck, further exacerbating vulnerabilities and increasing economic challenges for Iraqi businesses and their workers. These factors, combined with the global public health crisis and related economic challenges, have dramatically increased the need for support to Iraqi workers and small businesses.
A recent joint study by IOM, the International Trade Centre (ITC) and the Food and Agriculture Organization (FAO) showed that as of September 2020, Iraqi SMEs had suffered a nearly 53 per cent decline in production. Employment numbers at the time of the survey had also reduced, on average, by 27 per cent, including both terminated and furloughed employees.
“The COVID-19 pandemic has created a severe public health crisis as well as economic hardship, in a country already trying to recover from the conflict against ISIL,” said IOM Iraq Chief of Mission Gerard Waite. “IOM has had a long-term partnership with the Government and is pleased to expand its support for the Iraqi population in light of these new challenges. IOM is also very grateful for Germany’s continued support through KfW, and for the collaboration that has already yielded positive results.”
The new agreement between KfW and IOM Iraq will provide supplementary financing to support SMEs and microenterprises that have been impacted by the COVID-19 pandemic, principally through the Enterprise Development Fund (EDF) mechanism. IOM will also support individuals with trainings to enhance their employment potential and develop skills needed for the COVID-19 response. Additionally, the funding will allow IOM to implement cash-for-work (CfW) activities to contain the spread of COVID-19 at the local level and provide rapid cash assistance to individuals in need. Finally, IOM will rehabilitate key community infrastructure and services such as water, sanitation and primary health care centres.
“On behalf of the German government, KfW is pleased to support Iraq in its efforts of coping with the social and economic challenges exacerbated through the pandemic in the immediate as well as the medium-term,” said Dr. Anna Janke, Country Director of KfW Office in Iraq. “The additional financing provided through KfW under this partnership will supplement current activities and aim at reducing the negative economic effects and supporting the overall response to COVID-19.”
Since December 2018, Germany and IOM Iraq have supported a total of 199 SMEs through EDF, leading to the creation of 1,037 jobs. A further 886 individuals received microenterprise support packages or vocational training, and 665 individuals have taken part in CfW activities aimed at improving their financial security.
Source: Reliefweb, December 3, 2020.