MAN of Germany, one of the world’s largest truck manufacturers, said yesterday that it would build a factory in the country to aid its reconstruction.

The company's decision to set up an operation in Iraq comes despite warnings from both the German Foreign Ministry and the Foreign and Commonwealth Office that their citizens should avoid travelling to the country.

The deal was announced during a tour of Germany and Italy by Nouri al-Maliki, the Iraqi Prime Minister. Al-Maliki is in Europe to urge manufacturers to follow MAN's lead and set up businesses in his country.

The MAN factory will assemble dumper trucks, fuel and water tankers, semitrailer tractors and bus bodies. Many of the vehicles are expected to be used in the construction industry and to help to rebuild Iraq's infrastructure.

However, the agreement between MAN, of Munich, and the Iraq Ministry of Industry does not specify how many vehicles will be produced each year.

Daimler, another vehicle maker, has also expressed interest in establishing a truck factory in Iraq.

Despite the attempt by the Iraqi Prime Minister to encourage European companies to invest in Iraq, the Foreign Ministry of Germany, and other EU countries, retains a travel warning.

BusinessIntelligence Middle East, July 24, 2008