China National Building Material Co Ltd started work on a US$250m project to build a cement factory in Iraq, as the war-torn country looks set to start rebuilding, which could lead to a construction boom.

The Chinese company has an Amman-based Iraqi partner, the al-Doh company, which would provide the investment funds while the Chinese firm built the plant, Adel al-Yasiri, head of the Muthana province Investment Commission said on Monday.

The factory, to be built near the city of Samawa in the southern Iraqi province of Muthana, will start producing cement in a year-and-a-half, with an initial production target of 1Mt a year, growing to 2Mt in three years.

"It is the first factory of its kind to be established in Muthana for this amount of money," said Yasiri.
Iraq imports about 10 million tonnes of cement each year and consumes around 15Mt. Demand is expected to soar once rebuilding gets into gear after years of war and under-investment, which has left a housing shortage that could be as high as three million homes.