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Investment in post-invasion Iraq

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Reconstruction of Iraq is the term used for attempts to make repairs to infrastructure damage in the aftermath of the invasion of Iraq in March 2003. The term is used by the multinational forces who invaded Iraq as well as various western media outlets.

Introduction

After the government collapsed, the United States and the United Kingdom, with the assistance of several other nations (including Poland, the Czech Republic, Italy, Mongolia, Australia, South Korea and Japan) and United Nations authorization, established a provisional authority whose publicly stated goal is to provide for Iraqis' basic needs and help in the creation of a new democratically elected government following the end of the Ba'ath government.

The multinational forces set up the Coalition Provisional Authority. This was followed by the Coalition Provisional Authority's transferring power, on June 28 2004, to the new Iraqi government. The "reconstruction and democratization of Iraq" has been a major stated goal of the Bush administration since declaring the "end of major combat operations" in the 2003 Iraq war. On January 30, 2005. the transitional parliamentary elections took place. See: Iraqi legislative election, 2005.

Some countries have expressed some of the same concerns that the Iraqis themselves have about the country post Saddam: about Iraqi self-determination and ethnic and religious freedoms. Foreign nations have largely focused on the issue of possible American influence, whether sought or unsought, in the future Iraqi governmental process and economy.

Stated aims

During the "transitional period" Iraq is to undergo a regime change from dictatorship to democracy. The Law of Administration for the State of Iraq for the Transitional Period was signed on March 8, 2004, by the Iraq Interim Governing Council. It states: "The people of Iraq, striving to reclaim their freedom, which was usurped by the previous tyrannical regime, rejecting violence and coercion in all their forms, and particularly when used as instruments of governance, have determined that they shall hereafter remain a free people governed under the rule of law."

Further information: [[:Human rights situation in Saddam's Iraq]]

Institutions

Establishing a Civil Society

After years of dictatorship, Iraq has virtually no civil society to serve as a necessary backbone to a democratic process. Any civil society under the Hussein regime was either tightly controlled or eliminated as a threat, or possible threat, to the regime. Some people believe that this part of nation-building is difficult, but essential; examples of the consequences of failure can be seen in Haiti, Afghanistan, Somalia, and other nations around the world. They believe that lack of a civil society generally leads to anarchy or back to dictatorship, viewing either as a failure of nation building that could produce a threat to international security.

One effect of Hussein's ethnic and religious favoritism and oppression is that the various religious and ethnic groups in Iraq are extremely distrustful of each other. There is concern that any new Iraqi government will again begin opressing the rights of one group or another in order to gain political advantage.

Government

Main article: Politics of Iraq

The Iraqi Governing Council consists of 25 member council, and reflects the country's ethnic and religious diversity (see Iraqi Governing Council). On June 28, 2004, Iraqi sovereignty was transferred back into Iraqi hands. A transitional parliamentary election, for an assembly which will draft a new constitution, is slated for January 30, 2005. The Interim Government has been recognized by the United Nations, the Arab League and several other countries as being the sovereign government of Iraq.

The immediate post-Saddam governmental authority in Iraq is the Office for Reconstruction and Humanitarian Assistance (OHRA). This body was initially led by U.S. General Jay Garner; however he was rather quickly replaced by civilian administrator L. Paul Bremer. ORHA shares some authority with the Interim Iraq Governing Council (IIGC), an appointed body. ORHA and the IIGC face many immediate challenges as basic as food, water, and electricity. Iraq is a nation recovering from years of totalitarian rule, economic sanctions, and several wars, including the 2003 invasion itself.

Further information: [[:Coalition Provisional Authority, Iraq Interim Governing Council, Iraqi Interim Government]]

Ba'ath Party/Sunni power

While officially secular, the Ba'ath Party was largely made up of Sunni Muslims, while the majority of Iraqis are Shiite. This category is representative of both those formerly high-ranking Sunnis who are seeking to use violence to regain power and the attacks motivated by revenge for the crimes, or perceived crimes, of former members of the Ba'ath Party. this is the stupidest assignment we have had all semester!!!!!!!!!!!!!!!!!!!!

Funding for Iraq Reconstruction

Funding of reconstruction efforts began with the creation of the Iraq Relief and Reconstruction Fund (IRRF) in April 2003. The IRRF is administered and funded by the United States. An initial allocation of $2.5 billion was made for immediate food, medicine and water relief.

The “Madrid Conference on Reconstruction” held in Spain October 23-24, 2003 was organized by the United States to solicit donor pledges from the international community. About $33 billion in grants and loans were pledged. Of this, $18.4 billion was from the U.S. with another $5 billion from Japan, $812 million from the EU, $500 million from Kuwait and offers of loans from World Bank and the IMF amounting from $5.5 to $9.25 billion. Some countries pledged to reduce the debt that Iraq owed to them and to provide direct donations in forms such as food and fuel. The pledge by the United States was fulfilled in November 2003 by adding $18.4 billion to the IRRF.

Much of the non-U.S. pledged money is managed through two additional funds that have been created under the facilitation of the International Reconstruction Fund Facility for Iraq [1]. The funds are managed by the United Nations Development Group (UNDG) and by the World Bank. Twenty-six donor nations participate in this effort with total pledges, as of June, 30 2006, of $1.4 billion. The United States donates a small amount to these funds but does not control their disbursement.

As of December 30, 2005 the UNDG and World Bank Funds had expended about $0.51 billion and $0.39 billion, respectively. The United States managed IRRF had expended about $11.4 billion as of March 2006.


Assessing Reconstruction Needs

In preparation for the October 2003 Madrid Donor Conference, the joint United Nations/World Bank team conducted an assessment of funding needs for reconstruction in Iraq during the period 2004-2007. The resulting report [[2]] identified 14 sectors and associated funding needs as shown in the Table below.

Sector Needs (US$billion)
Government Institutions 0.39
Education 4.81
Health 1.60
Employment Creation 0.79
Transport and Telecommunications 3.41
Water, Sanitation, Solid Waste 6.84
Electricity 12.12
Urban Management 0.41
Housing and Land Management 1.42
Agriculture and Water Resources 3.03
State-Owned Enterprises 0.36
Financial Sector 0.081
Investment Climate 0.34
Mine Action 0.23

Social services

Main article: Economy of Iraq

Electricity

After overthrowing the previous Iraqi government, the coalition forces have sent aid to restore electric service knocked out during combat. The Associated Press says that electrical power generation and distribution, curtailed due to combat operations and sabotage, has been restored to above prewar levels. German firm Elbe Maschinenbau has signed an agreement to build three new power plants in Iraq, and three new ones have already been completed in the Anbar region. Despite this reported improvements there are frequent disruptions to the electric grid in the country including incidents like the one on September 13, 2004 where nearly all power in the country was lost after an attack by insurgents.

Food

The World Food Program says that almost all Iraqis have been receiving enough food since June 2003, since the Coalition took over the oil for food program from the United Nations. The coalition is slated to reduce support in June 2004.

Water

Although the water supply has reached prewar levels in some provinces, aging and poorly maintained equipment combined with looting and vandalism leaves the drinking water system substandard. 157 wells are being constructed in Arbeel, Kirkuk, Al-Sulaymaniyah and Dhouk governorates, and several dams are being constructed across the country, including in Al-Sulaymaniyah governorate and the Western Desert. According to a U.N. survey taken in 2004, about 54% of Iraq has access to drinking water.[3]

However, conditions look to be improved. A new water canal has been constructed to supply clean water to Basrah and Thi Qar in April of 2006. [4]

Sewage

Untreated waste is polluting the Euphrates River, and many treatment plants require repair. More than 45 pipelines have exploded.

Garbage

The first modern landfill in Iraqi history is currently being developed in southwest Baghdad, with the capacity to handle 2,230 cubic meters of waste per day. USAID is helping to build a second landfill north of Baghdad, which will handle 3,000 cubic yards (2,300 m³) of waste per day. Both landfills will be built to international environmental standards.

Schools

Almost all schools have reopened, including all 22 universities.

Media

Main article: Communications in Iraq

Iraqis now enjoy freedom of speech, with the one stipulation that there be no direct attempt to incite insurrection against the new government. This freedom is currently being exercised by the several hundred new newspapers that have sprung up since the fall of Saddam in April 2003. Television stations, both satellite (Al Fayhaa, etc.) and terrestrial (Al Sharqiya, Alhurra, etc.), and radio stations (Radio Dijla, etc.) broadcast freely, and no longer have their content dictated by the government. On April 3, 2003, Al Jazeera withdrew its journalists from the country, citing unreasonable interference by the Iraqi government (Al Jazeera).

Jobs

Many Iraqis were left jobless by the collapse of the old government and by the war. An estimated 500,000 Iraqis were laid off by the CPA.[5] An American public works program was created to provide new jobs, and there are projects to attract foreign investment and to encourage local business development. According to the Gulf Daily News, the Iraq Project and Contracting Office employed 80,000 Iraqis each day in the early weeks of August 2004. 100 job sites have opened across Iraq, and 900 more are expected to open in late 2004.

Oil

Oil production still lags behind prewar levels, due in large part to continuing warfare and political instability. The US has started to rebuild oil refineries that had been destroyed by Saddam Hussein's regime before its downfall.

Repair contracts have been awarded to a Halliburton subsidiary, Kellogg, Brown and Root, a global engineering, technology, and services company. The US "is counting on oil revenues to help pay for reconstruction of the country." (AP) Some in the international community have expressed frustration of the Pentagon's refusal to award contracts to nations that opposed the war.[6]

In mid-2004, the Iraqi Oil Ministry announced plans to dig 2,000 new oil wells in 2005, and to build four new oil refineries in central and southern Iraq. Average oil exports from Iraq in July, 2004 were estimated at 1.5 million barrels per day, a number which was expected to rise sharply by the end of 2004.

In mid-2006, it was announced that oil production in Iraq had risen to 2.5 million barrels per day, with an estimated production of 2.7 million by the end of 2006. Hussain al-Shahristani, the Iraqi oil minister, said that "he expected output to rise to approximately 4m barrels per day by 2010, increasing to 6m bpd by 2012."[7]

Military

The arms embargo against Iraq was lifted with the fall of Saddam's government. One newly formed Iraqi battalion is on duty, with 27 scheduled for activation by summer 2004. Eligibility is denied to men over 40 or who served as colonels or generals under Saddam. According to DefenseLink, "As of July 28, 2004, Iraqi army, coastal defense, air, and National Guard forces had received more than 2,500 vehicles, 600 radios, 55,000 weapons and 25,000 pieces of body armor. Interior ministry forces, including police, border enforcement and facilities protection services, had received more than 6,800 vehicles, 14,000 radios, 101,000 weapons, and nearly 46,000 pieces of body armor. Equipment totals for all forces eventually reach nearly 290,000 weapons, 24,000 vehicles, 75,000 radios, and more than 190,000 pieces of body armor, officials said."

The Iraqi people are becoming to increasingly trust the new Iraqi army and Police force [8], and the Iraqi army is beginning to take control of more battlespace. [9] The Iraqi Air Force has begun to grow. [10] [11]

In July 2006, Britain handed over responsibility for the security of Al Muthanna Governorate to local Iraqi forces, making it the first of the governorates of Iraq to be controlled by the new Iraqi military. [12]

Further information: [[:Multinational force in Iraq]]

Economy and commerce

Main article: [[:Economy of Iraq and Transportation in Iraq]]

Iraq's bond market opened in mid-June, 2004. Interest rates are being set by the free market, as opposed to government control, for the first time. The Iraq Stock Exchange also opened in June, and 500 million shares were traded on the first day, which is more shares than the previous stock exchange, the Baghdad Stock Market, had ever traded. As of August, 2004, it has 27 listed companies, with about 100 more due to go public through September and October.

The Iraqi insurgency

Main article: Iraqi insurgency

There has been violence and instability continually in Iraq since the fall of the Hussein government. Much of this violence has been directed against foreign troops serving in the part of the nation called the "Sunni Triangle"; however there have also been attacks in other parts of the country and against Iraqis seen as assisting the western military forces. The majority of these attacks seem to be by members of the Sunni branch of Islam who were granted special privileges in the Ba'ath Party and may wish to regain a central role in Iraqi politics. However, there have been a number of violent groups at work in Iraq, and it is not immediately clear whether and to what extent the resistance is organized or united.

Some forces have resisted the reconstruction efforts notably the Iraqi insurgency. To maintain these efforts, coalition forces have, among other measures, encircled a number of cities and villages with troops, arrested thousands of Iraqis and killed numerous insurgents. Fallujah and parts of "Sadr City" have been sites of frequent battles causing destruction of buildings and security concerns that cause reconstruction to be difficult.

On repeated days following the invasion suicide bombings similar to those in Israel from 2001-2004 occurred, resulting in heavy injuries and deaths of both US soldiers and Iraqi civilians. Security concerns have analogously increased the cost of reconstruction substantially, leading critics to questions whether progress could be made at all. Elections are scheduled for January of 2005 but were controversial due to lack of needed security, and strong divisions among civilian populations.

There have been frequent claims made, by both U.S. government officials and others, that Saddam Hussein had contacts with officials in al-Qaeda, the organization considered by many to be responsible for the September 11, 2001 attacks on the United States. This has since been largely rebuked by US and other intelligence sources. Historically Saddam did support Palestinian causes; however, this seems to have largely been in the form financial support for the families of suicide bombers. This was part of Hussein's attempts to become a pan-Arab leader.

Western military officials also frequently identify Iraqi militants as "terrorists," although others may consider them to be freedom fighters. As always, the application and use of this label depends on one's point of view and specific circumstances - defining these terms in a neutral way is difficult.

Corruption

It has been alleged that large amounts of American tax dollars and seized Iraqi revenues were lost by the CPA. One audit put the total number as high as $8.8 billion.[13] Fradulent contractors such as Philip Bloom often bribed CPA officials in exhange for contracts that were never performed. An article in the NY Times describes "irregularities including millions of reconstruction dollars stuffed casually into footlockers and filing cabinets, an American soldier in the Philippines who gambled away cash belonging to Iraq, and three Iraqis who plunged to their deaths in a rebuilt hospital elevator that had been improperly certified as safe."[14] While the US government has begun the process of prosecuting contractors that stole American tax dollars, the Iraqi government currently has no means of reacquiring Iraqi assets that were stolen by US contractors. This is partially due to a decree passed by the CPA that gives civilian contractors in Iraq immunity from all Iraqi jurisdiction.[15]

There was also much controversy surrounding the granting of no-bid contracts to large American corporations like Halliburton and Bechtel, both of which have made generous donations to President Bush and the Republican Party.[16] Halliburton in particular has been singled out for receiving what is perceived to be government favoritism for doing a shoddy job of rebuilding Iraq's oil infrastructure.[17] When the Pentagon's own auditors determined that about $263 million of a Halliburton subsidiary's costs were potentially excessive, the Army still paid the company all but $10.1 million of the disputed costs.[18]

Some say that the reconstruction would have been both much more efficient and inexpensive if more contracts were granted to local Iraqi firms, many of whom were shut out of the process due to that fact that they were state-owned.[19] Congressman Henry Waxman was once told by members of the Iraqi governing council that paying Iraqi companies to rebuild Iraq instead of American ones would save American tax payers 90 percent of the costs.[20]

According to a recent report released by CSIS in April 2003, Iraq's infrastructure is producing much less water, electricity, and oil than it was while Saddam was in power. The report lays much of the blame for this on corruption in the American occupation rather than insurgent sabotage.[21][22]

See also

External articles and references

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