Korean firm Hanwha Engineering and Construction said work on the ambitious Bismayah City in Iraq was progressing well with about 30 per cent of the project already completed.

A 18.3-million-sq-m development located 10 km southeast of capital Baghdad, Bismayah will boast of 100,000 houses and about 300 institutions, including schools, hospitals and public facilities, reported Iraq Business News.

The new city will consist of eight towns. So far, about 5,000 households have moved into the first town, said the Korean company, which had clinched a $8-billion contract from the Iraqi government in 2012.

The two parties later agreed an additional deal to build social infrastructure for $2.1 billion in April 2015, taking the value of the total contract to $10.1 billion.