The following is an archived copy of a message sent to a Discussion List run by the Campaign Against Sanctions on Iraq.
Views expressed in this archived message are those of the author, not of the Campaign Against Sanctions on Iraq.
[Main archive index/search] [List information] [Campaign Against Sanctions on Iraq Homepage]
News, 9-16/7/03 (1) RESTORATION OF LAW AND ORDER * US troops take over Iraqi swimmers' pool * Equipment vital to Iraq flows out of country Looted machinery smuggled into Iran * Kurds force 7000 Shiite to evacuate * U.S. Troops Step Back In a Tense Iraqi City * Killing of American soldier mars first governing council meeting * US troops appear safe in Shiite southern Iraq * Iraq to form war crimes court * Leader linked to Ansar in custody RESTORING THE ECONOMY * UAE-Iraq trade rises to Dh2b * US administration in Iraq seeks extra 800 mln usd to aid oil sector - official * 'Entrepreneurs' benefiting from lifting of import duties * U.S. May Tap Oil for Iraqi Loans * US invites bids for $1bn worth of Baghdad's oil * Imports inundate Iraq under new U.S. policy Consumers revel, but manufacturers cut jobs, close down * Industries dependent on Iraqi market stop operations in Irbid RESTORATION OF LAW AND ORDER http://iraqsport.com/articles/06/24_5.shtml * US TROOPS TAKE OVER IRAQI SWIMMERS' POOL by Kamal Taha Iraq Sport, 24th June Iraqi swimmers hoping to make a splash at the world championships in Barcelona next month are having to train in the murky Tigris River because the US Army have taken over the only Olympic-sized pool in Baghdad for their troops, team trainer Faisal Sayed Jaffar said Thursday. Infantry Sergeant Billy Thierry, who is in charge of the al-Qadissiya pool, said his orders were that the Iraqi Olympic team were entitled to use the place only from 6:00 to 8:00 am. "This is totally unfair because most of the 12 members of the Iraqi team are university students. In any case, we need two three-hour training sessions, one in the morning and one in the afternoon," Jaffar said. Jaffar appealed to the International Olympic Committee (IOC) and world swimming's governing body FINA to intervene if they are to get their training schedule back on track in time for the championships. He said that when a wave of looting swept the country following the US-led ouster of Saddam Hussein's regime on April 9, team members rushed to the pool complex to salvage what they could. "After three weeks of cleaning and repairing the place, we were kicked out by US officials, who told us not to return," Jaffar said. "All attempts by Iraqi officials to recover the pool were in vain. Hence we have to train in the Tigris even though the conditions are not suitable," he complained. Al-Qadissiya's indoor pool in eastern Baghdad was built by a South Korean firm in 1983 and is the only one with the specifications of sports competitions, in addition to serving as headquarters for the Iraqi Swimming Federation. "Training in a river is very different from training in a swimming pool," Jaffar explained. "There are no walls to turn, the water is too troubled to regulate movements and the pressure of the water on the body is totally different. It will be very difficult to compete with the world's top swimmers." As a result, team members are not always showing up for the training. "US soldiers are using the only suitable pool we have in Iraq for their own entertainment. We have become strangers in our own country," said Omar Faisal, a member of the team. The swimmers meet every afternoon near al-Ima bridge in northern Baghdad wearing ordinary shorts and without swimming goggles since Uday Saddam Hussein, the elder son of the deposed president who headed the Iraqi Olympic Committee, liked only football and gave nothing to the swimmers. Jaffar said that after the orgy of looting that swept Baghdad, he saw on street pavements lots of trunks and goggles that had been tucked away in the cupboards of the Olympic Committee. "I am asking the International Olympic Committee and FINA to contact the US government to obtain the departure of all American soldiers from all Iraqi sports facilities," he added. The Al-Shaab stadium, where soccer tournaments used to take place, and the Saddam basketball hall have also been taken over by the Americans. http://www.sfgate.com/cgi bin/article.cgi?file=/c/a/2003/07/02/MN133485.DTL#sections * EQUIPMENT VITAL TO IRAQ FLOWS OUT OF COUNTRY LOOTED MACHINERY SMUGGLED INTO IRAN by Robert Collier San Francisco Chronicle, 2nd July Haj Umran, Iraq -- This isolated highway crossing on the Iranian border has become a black hole into which Iraq's former wealth is being sucked. The dozens of backhoes, industrial generators, drilling rigs, cement mixers,cranes and heavy factory machines lined up here waiting to cross into Iran are a virtual catalog of the vast amount of equipment stolen from Iraqi government facilities after the fall of Saddam Hussein's regime. The smuggling of looted goods desperately needed to rebuild the country passes without any interference from the local autonomous Iraqi Kurdish government -- nor from the United States, which allows the Kurds to maintain a standing militia and control the border posts. U.S. occupation authorities insist that American and British forces have neither the mandate nor the manpower to halt the trade. U.S. officials have repeatedly blamed the nationwide looting on Hussein loyalists bent on sabotaging reconstruction. But Kurdish officials, truck drivers and the owner of one large smuggling enterprise charge that the trade in stolen goods is an organized criminal activity in which both businessmen and Kurdish leaders take a cut of the action. "It's a mafia, which we can't stop," said an official of the Kurdistan Democratic Party, or KDP, which rules Haj Umran and the northern half of the Kurdish region. "The people who are in charge are the top peshmerga, who have too much influence," he said, referring to the guerrilla commanders who led the Kurds' fight against the Baghdad regime since the early 1970s. By all accounts, the trade is highly profitable. "Bulldozers, everything -- I'm ready to carry anything, even an airplane," boasted one of the busiest smugglers at the Haj Umran border crossing, as he supervised the arrival of a half dozen of his fully laden trucks. The man, who was interviewed Saturday and asked that his name not be published, said the best bargain he was offering that day was a 1983 Komatsu D155A bulldozer. He said he had purchased from a middleman in Irbil, the capital of the Kurdish region, for $10,000 and had arranged to sell to an Iranian merchant for $34,000. The final price, to judge by a quick survey of listings of used construction equipment on the Internet, is about one-third below the average cost in the Middle East for that year and model. Asked whether the bulldozer was looted, the smuggler said, "Of course, but don't ask me where. Everything here was looted." Stroking his ample belly and waving a satellite phone as he talked, he said with a wide grin: "Some people say this makes me a war criminal, but so what? It's good fortune, and it's my work." Asked whether Kurdish or American authorities ever interfered with his trucks, he replied, "No, never. I have no problems." Officials of the U.S.-British coalition ruling Iraq say they do not have enough troops to stop the smuggling, even though they agree that it is seriously weakening their efforts to stabilize the country. "There's been an evolution to more criminal looting, finding more high- value items for trafficking and export," said L. Paul Bremer, the U.S. administrator of Iraq, when asked about the issue Tuesday. "We obviously need to improve security of the borders, and we will take steps to do that. We know we have a problem." The smuggler and others in the trade said the stolen goods had been flowing unimpeded since April, when Baghdad and other major cities were rent asunder by a spasm of looting that has not yet fully abated. None of those interviewed seemed to have moral qualms about their work. "It's all Saddam's property, and he was a bad man, so it's fair to take it," said one man as a crowd of Kurdish truckers gathered around. "Saddam was a thief!" shouted another. "Yes, this is a fair business!" said someone else. U.S. officials initially played down the looting, saying it was merely exuberant public reaction to liberation from dictatorship. But in recent weeks, they have begun to acknowledge that it is causing much more damage to Iraq's economy than the war itself. As American firms such as Bechtel and Halliburton rebuild power plants and water purifying stations, criminals steal the new equipment almost as fast as it is installed. High tension electrical lines are melted into copper bars, and generators, water filters and other machines weighing many tons disappear in the dead of night. The rampant thievery has caused repeated blackouts in Baghdad and southern cities, often lasting several days. In southern Iraq, recently restarted oil refineries reportedly are already working with smugglers to ship diesel fuel to Iran, just as they did for years under U.N. sanctions. "The people who do this are big companies, people who have been in the business," said the smuggler, who said he had been a legitimate trader of construction and industrial equipment for 10 years before the war, based in Irbil. He said he had long done deals with many of the current looters and middlemen. On Monday, the smuggler showed his "legitimate" face, meeting with a Chronicle reporter in his office at his family business in Baghdad's wealthy Jadriyah district. The firm is a medium-sized company involved in a wide range of import-export trade; the smuggler asked that its name be withheld. He then invited the reporter to lunch at the White Castle, a restaurant catering to Baghdad's business elite. After effusively greeting friends and relatives -- what seemed like half the people in the restaurant -- he sat down to vent anger at the corruption that he said stained the whole contraband trade. He denounced the KDP, saying it charges extortionate bribes to let his goods pass. He noted that the Americans had decreed the elimination of all Iraqi import and export taxes -- an order that Osman Surchi, chief of the Haj Umran border post, had told The Chronicle on Saturday was being strictly adhered to. But the smuggler said Surchi charged huge fees under the table. For example,he said, he had to pay Surchi $19,500 on the Komatsu bulldozer that he had bought for $10,000, leaving only a slim profit before selling it in Iran for $34,000. Everyone gets into the act, he complained. KDP commanders in Irbil collect their own bribes from the middlemen who bring the looted goods from Baghdad and other cities, and Iranian border authorities charge additional fees on the Iranian purchasers. The smuggler and others interviewed for this article said it was unclear whether the web of corruption included the two best-known Kurdish politicians, the KDP's Massoud Barzani and Jalal Talabani of the Patriotic Union of Kurdistan (PUK). It is widely believed that the smuggling is taking place on all of Iraq's borders, with stolen goods also making their way to Syria and Turkey. But the Kurds appear to play the dominant role in cross-border trafficking. Only on smaller items can smugglers avoid paying bribes, sources said. At all border points, items such as computers and televisions are taken by mule or four-wheel-drive vehicle around the official crossings, out of view of greedy border officials. On larger items, the two major Kurdish political factions seem to practice a de facto division of labor. While the KDP specializes in heavy industrial and construction equipment, the PUK specializes in spare parts, scrap metal and weapons. At the main PUK-controlled border post, Bashmakh, 100 miles southeast of Haj Umran, the main business appears to be cannibalized parts of industrial machines and construction materials. "The trucks come full of machines that have been stolen and taken apart," a U.N. official who works in the PUK region said Sunday. Across the border, at Mariwan, Iran, one could see a several-acre area laden with piles of metal bars and siding. In Sulaymaniyah, the PUK capital, Shalow Askari, the group's acting foreign minister, said his group tolerated the trade in scrap metal, much of which he said was Iraqi weapons from the recently concluded war. "But whenever we find materials that have been clearly looted, we stop it," he insisted. KDP officials at Haj Umran showed a mix of brazen denial and extreme nervousness about their role in allowing the smuggling to pass. When a Chronicle reporter arrived Saturday morning, Surchi immediately ordered his officials to stop the trucks, the drivers said later. "There is no looted merchandise here," Surchi said. "It's all imported from Holland or Germany via Turkey." Told that it certainly seemed looted, he switched tack immediately. "None of these trucks will pass," he said. "We never let them go through. They always have to turn around." Surchi blamed the smuggling on the Kurdistan Workers Party, or PKK, a Turkish rebel group that has no presence in the immediate region, and a previously unknown group he said was called Red Fire. Out of earshot of the reporter, he berated The Chronicle's Kurdish translator, saying: "Get the American out of here. We've shut the border because we don't want him to see any trucks crossing." But when the reporter insisted on nosing around and found several smugglers willing to talk, Surchi repeatedly interrupted the interviews or sent aides to do so. "Don't say anything. As long as he's here, none of your trucks will cross," they said in Kurdish. Finally, an aide to Surchi approached the translator and said, "We're going to complain about you to the prime minister's office," referring to the Kurdistan regional government. "We'll tell them you're doing intelligence work for the Americans. Watch out." http://www.arabicnews.com/ansub/Daily/Day/030710/2003071016.html * KURDS FORCE 7000 SHIITE TO EVACUATE Arabic News, 10th July Several Bashmarka Kurds who returned back to Khanqin in the downtown of Iraq after the collapse of the Iraqi regime three months ago expelled thousands of Shiite families who settled in the area, at the directives of the former regime, 30 years ago. The committee in charge of evacuees rights which takes al-Miqdadeyah as a headquarters ( 80 Km north east Baghdad) indicated that 7,000 families were forced to evacuate walking on foot or by cars and headed to the south and resorted to deserted buildings. Adnan, a fighter from the Bashmarka who returned back to the region after he was forced to leave it, 30 years ago said "I left together with my family to Babel ( 100 Km to the south of Baghdad ) in 1975. After ten years I joined my father in Iraq where I joined the Kurdistani democratic party and I returned back in 1991 and settled in al-Suleimaneyah in Kurdistan of the self- rule. Today I have returned back home." Adnan, who is a member in the new police which was formed after the collapse of the Iraqi regime, said that hundreds of the Kurdish families which evacuated along years to the south or Baghdad or al-Ramadi "returned back to their houses and restored back their lands taken from them." He said "the Kurds used to represent 90% of the population of Khanqin and we do (want) to relink the region with Kurdistan and not Baqouba, the center of Deyala " Shiite province. Khanqin which is inhabited by 500,000 is 145 Km to the north east of Baghdad and just 10 Km from Iran. This area was exposed to a campaign of forced "Arabization" carried out by Saddam Hussein through transferring the Kurdish families from it. The population said that the Arabs who were expelled were used to deal with the former regime and they were expelled because they are responsible for liquidating large number of Kurds. http://www.washingtonpost.com/wp-dyn/articles/A45457 2003Jul11.html?nav=hptop_ts * U.S. TROOPS STEP BACK IN A TENSE IRAQI CITY by Rajiv Chandrasekaran Washington Post, 12th July FALLUJAH, Iraq, July 11 -- U.S. forces have begun vacating encampments in this violent city west of Baghdad, including a municipal office that has become a flash point for anti American tensions. The move accompanies a bid to quell armed resistance by giving new local police officers more responsibility for targeting gunmen and guarding key installations. [.....] The pullout of troops from fixed positions in Fallujah began last week and likely will be completed by next week, said Lt. Col. Eric Wesley, executive officer of the 2nd Brigade of U.S. Army's 3rd Infantry Division, which controls the Fallujah area. The process started with the removal of soldiers from electrical substations and schools, people in the city said. On Thursday afternoon, the brigade conducted its most symbolically significant withdrawal, moving out troops who had been guarding the mayor's office and driving away two M2 Bradley Fighting Vehicles parked next to the building. Wesley said the brigade will remove soldiers from 22 locations in and around the city. The soldiers will be replaced by newly trained Iraqi police officers as well as an armed Iraqi quick-reaction force that Wesley said would be "a cross between meter maids and a SWAT team." "We want Iraqis to take on greater and greater responsibility" for the city's security, he said. Wesley said that despite the withdrawals from fixed positions, the brigade would not abandon the city. Soldiers will continue to patrol at all hours of the day, he said, and a fast response unit will be ready to swoop in should local police need backup. "We're still committed to Fallujah," he said. But brigade commanders said they believe that having a less visible presence in the city and ceding more authority to Iraqi police could help to address widespread anti-American sentiments in the city, the scene of repeated attacks over the past several weeks. The withdrawals have drawn a mixed reaction in the city, with ordinary residents welcoming the move, the mayor's office urging caution and police officers calling for the pullout to proceed faster. "We're happy to see them go," said Mohsen Kubaisi, a cigarette vendor. "They shouldn't have been here in the first place." At the mayor's office, municipal employees took a different view, saying they wanted to make sure the local police were sufficiently trained and armed before U.S. troops left key installations. "We support the idea of the soldiers leaving, but we want to be certain our policemen are 100 percent ready," said Karim Aftan, spokesman for the mayor, Taha Bedawi. "The Americans should not leave too soon." Over at the police station, the few officers on duty said they wanted the 20 Americans who have been guarding the building around the clock to go immediately. On Thursday, about 30 policemen held a protest in front of the mayor's office, threatening to quit if U.S. forces did not leave and allow them to patrol alone. On Wednesday night, three rocket-propelled grenades were fired at the police station, officers said. And last Saturday, seven police cadets in Ramadi were killed after a bomb planted next to a utility pole exploded during graduation ceremonies. Policemen here said both incidents indicated to them that working with U.S. forces has become increasingly dangerous. "When they are here, it makes our job worse," said 1st Lt. Nisan Mohammed. "We can do it better without them. If they are not here, nobody will shoot at us." Mohammed said that if the U.S. soldiers guarding the station, who spent the afternoon in Humvees in the parking lot, did not leave by Saturday, "we will quit working and go home. . . . We will leave the building for the Americans." A U.S. military officer in Fallujah said he viewed the demand as a negotiating tactic, and he doubted that many officers would quit. The official said the brigade's commanders had planned before the protest to pull most soldiers from the station and keep only a few liaison officers there. The commanders also had planned to stop having U.S. military police accompany Iraqi police on patrols, the officer said. Wesley called the protest "a very positive sign." "We need the people of Iraq, the citizens and the leadership, to step up to the plate and assume a leadership role in the transition process," he said, pledging that by the middle of next week the police "will be completely independent in terms of their activity." http://news.independent.co.uk/world/middle_east/story.jsp?story=424243 * KILLING OF AMERICAN SOLDIER MARS FIRST GOVERNING COUNCIL MEETING by Patrick Cockburn The Independent, 14th July A governing council of Iraqis was inaugurated yesterday in Baghdad in an American effort to gain local support in controlling Iraq. The 25 members of the body were drawn from different communities. The United States, whose soldiers have come under increasing guerrilla attack, hopes that the council will be able to re-establish law and order. An American soldier was killed and four wounded in a rocket attack on their convoy in Baghdad early today. There was also a car bomb yesterday outside a police station in a Baghdad suburb sometimes visited by US soldiers, killing at least one, as the council met. Shortly afterwards, a group claiming to be an al-Qa'ida wing said in an audio tape aired on an Arab television station that it, and not the followers of Saddam Hussein, were behind attacks on US forces in Iraq. An unidentified voice on the tape said: "I swear by God no one from his [Saddam Hussein] followers carried out any jihad operations like he claims ... they [the attacks] are a result of our brothers in jihad." The tape also warned of an imminent attack on the US, which would "divide the back of America completely". Washington had wanted to limit the governing council to an advisory role until about three weeks ago when it became clear that armed resistance to the occupation was increasing, looting had not ended and the economy was largely paralysed. It hopes that the council will be able to re-establish the police force and government ministries, something that the Coalition Provisional Authority has been unable to do. The first act of the council was to declare 9 April, the day that Saddam was officially overthrown, as a national holiday. It will elect a leadership of the council today. [.....] http://www.jordantimes.com/Tue/news/news4.htm * US TROOPS APPEAR SAFE IN SHIITE SOUTHERN IRAQ Jordan Times, 15th July NASSIRIYA, Iraq (AP) ‹ While American troops in the centre of Iraq face daily attacks, US soldiers in this southern city say they feel safe and even welcome here. Saddam Hussein's persecution of the predominantly Shiite Muslim region during his 23-year rule may be why coalition forces have been welcomed south of Baghdad, where Shiites live in greatest numbers. Shiites make up 64 per cent of Iraq's 24 million people. "Here, it's pretty safe, but we have to be cautious," said Marine Cpl. Ayoade Ojikute, a 31 year-old from New York City, as he sat in the scorching sun in Nassiriya. "We hear all the news from Baghdad and we don't know what's going on." Unlike cities in the so-called "Sunni Triangle" ‹ Baghdad, Fallujah, Tikrit or Ramadi ‹ southern Iraq has proven remarkably peaceful since Saddam's ouster April 9. "Our relations with the Shiites in our area are very, very good. We work with them everyday and they work with us," said Maj. Gen. Keith Stadler, the commander of the Marine Expeditionary Brigade in Hilla. "I think they clearly see promise in this temporary partnership." Stadler said the last Marine to be killed in action in the area was April 12, while in Baghdad a US soldier was killed in fighting Monday. Since US President George W. Bush declared major combat operations had ended May 1, at least 31 US troops have been killed by hostile fire in Iraq. Since it has been quiet in southern Iraq, infrastructure repair has been able to move forward and the population can see life improving. Most of southern Iraq is getting more electricity today than in prewar periods. The same goes for water supplies. Few cars wait to get gas unlike in the capital where lines at pumps stretch for hundreds of yards. People are also making more money than under the Saddam regime. "We don't think that the process is going to take a generation here. We think that the process is in motion," said Maj. Ralf Dengler, Marine executive officer in Dhi Qar Province, of which Nassiriya is the provincial capital. Police officer Mohammad Saheb said he made about $10 a month before the war. He's now taking home $60. "People here are reacting positively to and with the Marines," he said. Still, locals complain about lack of security and unemployment. Capt. Ray Lopes, aviation officer in Nassiriya, said unemployment among the 750,000 people of Dhi Qar is 65 per cent, but the hope is businesses and factories closed by the war will reopen soon. Officials connected to the Marine Expeditionary Forces said the unit had built eight bridges and repaired 47 schools, three hospitals, nine utility systems and eight public buildings. It added that 71 projects are in progress. In the Shiite Muslim holy cities of Karbala and Najaf, Marines could be seen going about without flak jackets. Lt. Col. Christopher C. Conlin, the Marines top commander in Najaf, told a reporter the city was safe round the clock. At midnight streets still were crowded. Najaf's interim mayor, Haidar Mahdi Mattar, said "we are seriously working with the brothers in the coalition forces to improve services." But although soldiers here have not faced daily guerrilla-style attacks like those in central Iraq, coalition troops have suffered causalities in Karbala and Najaf. Late last month, protesters in the southern city of Majar Al Kabir stormed a police station after British troops fired on protesters. Four British soldiers died in the attack on the station, and two others were killed in a clash near the mayor's office. Two days later, gunmen killed an American soldier who was investigating a car theft in Najaf. Conlin said the Najaf killing was criminal not political. On Thursday, a mortar attack targeted one of the Marines bases in Karbala, but no one was wounded, the region's commander Lt. Col. Mathew Lopez said. http://www.reuters.co.uk/newsPackageArticle.jhtml?type=worldNews&storyID=340 327 * IRAQ TO FORM WAR CRIMES COURT by Nadim Ladki Reuters, 15th July [.....] As the number of American combat deaths neared the 1991 Gulf War total, the U.S. military announced a new nationwide crackdown -- Operation Soda Mountain -- to eliminate armed Iraqi resistance and said its forces had killed five Iraqi fighters. [.....] As U.S forces try to crush growing armed resistance, the military said troops had conducted 53 raids across Iraq, detaining 316 people and confiscating arms, ammunition and explosives in Operation Soda Mountain launched on Saturday. Another operation, Ivy Serpent, is part of the crackdown. U.S. forces killed five Iraqis and captured another after they came under ambush while driving out of an ammunition depot, the commander of the unit involved said. There were no U.S. casualties in the ambush between the cities of Ramadi and Habbaniyah, about 100 km (60 miles) west of Baghdad in particularly hostile territory for U.S. troops. Thirty-two U.S. soldiers have been killed in Iraq since President George W. Bush declared major combat over on May 1. In an abrupt about-turn, the U.S. military said on Monday thousands of troops from its 3rd Infantry Division would stay in Iraq until further notice instead of returning by September in line with an announcement made only last week. U.S. Senate Democrats blasted President George W. Bush over the spiralling costs of the war and for not seeking more international help in the reconstruction of Iraq in the face of skyrocketing U.S. budge deficits. The charges came as the White House tried to deflect accusations that it exaggerated intelligence on Iraq's weapons of mass destruction and as it announced the federal deficit will balloon to a record $455 billion (286 billion pounds) this fiscal year. http://www.gulf-news.com/Articles/news.asp?ArticleID=92730 * LEADER LINKED TO ANSAR IN CUSTODY by Patrick J. McDonnell and Jeffrey Fleishman Gulf News, from Los Angeles Times-Washington Post News Service, 16th July Suleimaniya: Nearly four months after bombing his compound and killing 43 of his armed followers, U.S. forces acknowledged Monday that they had arrested one of northern Iraq's most colourful and enigmatic Muslim leaders, a move likely to inflame tensions in a mountainous corridor along the Iranian border. Handcuffed and blindfolded, Ali Bapir and three members of his Komaly Islami party were whisked away in a U.S. helicopter. The arrest was part of a trap and occurred Thursday after Bapir and his men had accepted a U.S. invitation to a meeting at a nearby resort. American soldiers stopped Bapir's vehicle on the way to the hotel and took Bapir and his entourage into custody. Bapir is one of the most charismatic fringe leaders in northern Iraq. In many ways, he represents the challenge U.S. forces face in coaxing radical clerics away from militantism. Bapir has long said he desires a relationship with the West, but his suspected links to Ansar Al Islam - a radical group with ties to Al Qaida - often have made his overtures suspect. Bapir and 3,000 to 5,000 of his followers lived in the village of Khurmal in northeastern Iraq. About 200 Ansar families lived in Khurmal, and many of Ansar's guerrillas would appear nightly in the village to take refuge from battles with the Washington-backed militia controlled by the Patriotic Union of Kurdistan. Bapir repeatedly denied that his band of armed men supported Ansar. But the PUK - which gave Bapir hundreds of thousands of dollars a year in hopes that his group would abandon its radical tendencies - determined before the U.S. invasion that Komaly Islami was too closely aligned with Ansar. U.S. forces widened the scope of its cruise-missile attacks to include several of Bapir's compounds in the foothills near Khurmal. Bapir surrendered, and days later he and his surviving followers were taken to the town of Ranya. Bapir said: "I don't know if the U.S. hit us because we are Islamic. If we have done anything wrong, the U.S. must tell us. ... If there is no reason, the U.S. must apologise." RESTORING THE ECONOMY http://www.gulf-news.com/Articles/news.asp?ArticleID=92190 * UAE-IRAQ TRADE RISES TO DH2B by Saifur Rahman Gulf News, 10th July Dubai, 09-07-2003: Trade between the UAE and Iraq rose to Dh2 billion in 2002 from around Dh1 billion in 2001. This is set to rise much higher this year due to the changing political and economic scene in the country, according to a senior Dubai government official. Besides aid cargo, consumer goods have also begun to arrive via Jordan, Kuwait, Saudi Arabia and now via Umm Qasr. Meanwhile, a high-ranking Kurdish delegation visiting the UAE has sought technical expertise from Dubai to help Kurdistan revamp its agro-based economy. The delegation met officials of the Dubai Chamber of Commerce and Industry (DCCI). "We are seeking technical expertise of the UAE, especially from Dubai to help the people of Kurdistan," said Nasreen Siddiq, Kurdish minister for reconstruction and development. The Kurds grow 1.5 million tonnes of wheat per annum. The Kurdish region is also rich in minerals. Most of Iraq's oil reserves, estimated at 320 billion barrels, are located in the Kurdish-populated northern region. DCCI officials said they are doing their best to promote trade. The DCCI recently set up an Iraqi business council to enable them participate in reconstruction. Ahmed Al Banna, DCCI's Deputy Director General, said, "Shipping links between the ports of the UAE and Iraq have been established and several vessels are carrying commodities to Iraq. This will increase trade between the UAE and Iraq this year. "Trade crossed Dh1 billion in 2001 and Dh2 billion last year. Now that the economic sanctions are over and Iraq is going to enter into free trade, we expect a steep rise in commercial activities." http://www.iii.co.uk/uknews/?format=raw&articleid=4695106&action=article * US ADMINISTRATION IN IRAQ SEEKS EXTRA 800 MLN USD TO AID OIL SECTOR - OFFICIAL (AFX-Focus) 2003-07-11 00:17 GMT BAGHDAD (AFX-ASIA) - The US civil administration in Iraq is requesting an additional 800 mln usd from Congress to aid the recovery of the nation's oil industry, taking the total cost to 1.2 bln, a senior coalition official said. The official said the administration is requesting the money to repair the country's oil fields, considered the cornerstone for its revival. Congress had already earmarked 400 mln usd to repair the fields, but faced with blown up pipelines, looting, and refineries and equipment in worse shape than previously thought, the US civilian administrator for Iraq Paul Bremer is asking an additional 800 mln, the official said on condition of anonymity. The official added that the coalition aimed to pump out 1.2 mln barrels per day (bpd) by the end of the year and to more than double the figure to 3.0 mln bpd by next spring or early summer. Oil is crucial to the coalition's plans for the country as Bremer is banking on Iraqi petroleum sales to generate 3.4 bln usd in the state coffers this year, which would pay for half of Iraq's 6 bln usd 2003 budget. The official said plans are underway to collaborate on the 2004 budget with the Iraqi governing council, to be unveiled later this month, as the US-led occupation tries to make Iraq into democracy after years of Saddam's authoritarian rule. Meanwhile, the coalition's military commanders are mulling the creation of an indigenous paramilitary force in Iraq to help shoulder the growing security burden. Lieutenant General Ricardo Sanchez said he is considering using tribal forces to help protect infrastructure which is under relentless threat of sabotage from Saddam loyalists. "The key here is to close the gap between the police and the army, and we believe that we can in fact stand up very rapidly some force that is in between those two ends of the spectrum that will allow us to get Iraqis beginning to assume some of the responsibility for bringing security and stability." Sanchez gave no timeframe for the creation of such a militia or indication of how large it would be. Iraqi citizens, particularly in the capital Baghdad, have expressed outrage at the coalition's failure to provide a sense of security in the country in the three months since Saddam's regime tumbled. RADIO FREE EUROPE/RADIO LIBERTY, PRAGUE, CZECH REPUBLIC RFE/RL IRAQ REPORT Vol. 6, No. 30, 11 July 2003 * 'ENTREPRENEURS' BENEFITING FROM LIFTING OF IMPORT DUTIES Many Iraqi businessmen and "freelancers" are benefiting from the CPA's lifting of import tariffs, according to international press reports. The tariffs were lifted by CPA administrator L. Paul Bremer in June through the end of the year. The decision has spurred hundreds of Iraqis to apply for import licenses, Bloomberg reported on 4 July. Officials at the Baghdad Chamber of Commerce have said that they issue about 400 cross-border import licenses per day, a 50 percent increase from the prewar figure. The licenses cost up to $8. Chamber General Manager Abd al-Malik Husayn cited the lifting of tariffs as the "principal reason" for the surge. "Before, it wasn't easy to trade," trademark manager Sohad Ahmad told Bloomberg, adding, "This is a golden opportunity for merchants." For those Iraqis willing to lug items ranging from cars to televisions across Iraq's borders, the work remains dangerous, however. One Iraqi, who transports car parts and clothing from Jordan, reported narrowly escaping a hooded gang armed with Kalashnikov rifles that tried to commandeer his vehicle. Storeowners have also reported that they remain under threat from robbers. But along with the surge of entrepreneurship come complaints of too much competition and a lack of regulation. A Baghdad appliance storeowner complained that he has had to lower the prices of his televisions to compete with newly licensed businesses. "I'd prefer laws," Nabil Abu Rivan said, adding, "At the moment, anybody can sell, import or buy." Most product prices have seen substantial increases, however. A 12-pound block of ice that once sold for around 40 cents now commands about $3. Power generators have increased from a prewar price of $500 to $1,100. According to a 3 July AP report, some Baghdadis are transporting large generators around neighborhoods, selling amps of electricity door-to-door. These "entrepreneurs" park their truck-sized generators on a block and run lines to each customer, charging each customer individually for usage, effectively creating temporary minipower stations, AP noted. Meanwhile, in other parts of Baghdad, bootleggers sell fuel -- despite a ban by the CPA -- on the side of the road at triple the price of gas stations, to Iraqis unwilling to wait in half-mile long lines at the pumps. According to AP, if there is a shortage of something in Iraq, there is someone aiming to make a profit from it. (Kathleen Ridolfo) http://www.latimes.com/la-fg-iraqoil11jul11,0,6478466.story * U.S. MAY TAP OIL FOR IRAQI LOANS by Warren Vieth Los Angeles Times, 11th July WASHINGTON ‹ The Bush administration is considering a provocative idea to pledge some of Iraq's future oil and gas revenue to secure long-term reconstruction loans before a new Iraqi government is in place to sign off on the proposal. The plan, endorsed by the Export-Import Bank of the United States and some of America's biggest companies, would help avert a looming cash crunch that has the potential to stall the postwar rebuilding effort. One U.S. official rated the proposal's prospects at 50-50. But the plan is drawing fire from some administration officials, lawmakers, policy analysts and prominent Iraqis who say it would mortgage the Persian Gulf nation's most treasured resource, prevent future leaders from deciding how to spend their oil money and put U.S. taxpayers at risk. "Iraqis believe their oil should not be touched by foreigners, that it should remain in the hands of the Iraqi government and that no one has a right to do anything before an elected government is in place," said Fadhil Chalabi, executive director of the Center for Global Energy Studies in London and a former Iraqi Oil Ministry official. "As an economist, I believe in what they are proposing. You couldn't come up with a better formula," Chalabi said. "But Iraqi politics and the way they look at these things are not encouraging. It could create problems later on. Better to wait until a government is formed." That may be too late, in the view of the plan's supporters. The Export-Import Bank and an industry coalition that includes Halliburton Co., Bechtel Group Inc. and other major companies that are interested in winning contracts in Iraq are warning that unless steps are taken soon to secure new funds, the reconstruction well could run dry. "Common sense says get Iraq running. How do you get the country running? By using its own oil revenue 100% for the benefit of the Iraqi people," said Export-Import Bank Chairman Philip Merrill. "If you want to wait three or four years, be my guest. But that means the country is going to be running on the dole of the United States." Many experts agree that Iraq is headed for a possible cash flow crisis as reconstruction costs escalate, initial funds are depleted and the resumption of oil exports is delayed due to damage caused by looting and sabotage. But they part company over whether the U.S.-led occupation administration in Baghdad has the legal or moral authority to pledge future oil revenue as loan collateral before the issue can be debated by elected Iraqis. "Unless a reconstituted Iraqi government or the U.N. Security Council authorizes the plan, it appears to violate international law," said Rep. Henry A. Waxman (D-Los Angeles). "We do not have the right, without additional authority, to impose financial obligations on the future government of Iraq." Waxman, the ranking Democrat on the House Government Reform Committee, has asked the Export-Import Bank, the Pentagon and the U.S. Army Corps of Engineers to disclose more information about the proposal and the role played by Halliburton and other companies in crafting it. Opponents of the plan warn that if a future Iraqi government chose to stop making payments on the obligations, U.S. taxpayers could wind up holding the bag. "We're going to be on the hook, just like U.S. banks were on the hook to Mexico in the early 1980s and U.S. lenders were on the hook to South America in 1990," said independent energy economist Philip K. Verleger Jr. Although the proposal is under consideration in Washington and Baghdad, the State Department has expressed concern about the preemption of Iraqi decision-making authority and the possibility that a future government might choose to default on the debt. The Treasury Department has voiced similar reservations, warning that the creation of a new class of debt could complicate U.S. efforts to persuade other countries to write off or restructure Iraq's massive prewar debt burden. Still, a Treasury official who requested anonymity said the plan has merit and might well win approval. "It's a 50-50 proposition right now," the official said. Experts estimate that rebuilding Iraq could cost anywhere from $20 billion to $100 billion over several years. Oil exports are expected to net about $3.5 billion this year and $14 billion in 2004. But some of that money will be needed for other purposes, and coalition officials continue to scale back their export targets as pipeline explosions and power outages constrain production. The administration has been financing reconstruction from a $7-billion pool of congressional appropriations, international contributions and seized Iraqi assets. But concern is growing that the rising costs could consume all of the money set aside so far and that initial oil sales will not make up the difference. "Existing revenues for reconstruction are not adequate to sustain the effort much beyond the end of this year," said Edmund Rice, president of a business group called the Coalition for Employment Through Exports. "The crunch could come in late autumn or after the first of the year. But roughly six months is when they're going to hit the wall on resources." The oil loan proposal is designed to bridge the funding gap. Under the plan, a portion of Iraq's future oil and gas revenue would be pledged as collateral to repay loans or bonds issued to finance infrastructure improvements. An Iraq Reconstruction Finance Authority would be established to review projects and arrange the financing. The industry coalition has proposed using the financing mechanism to raise $3 billion to $4 billion a year for reconstruction work on a project-by-project basis. The Ex-Im Bank envisions raising $25 billion to $30 billion to boost Iraq's oil production to as much as 5 million barrels a day from its current level of less than 1 million barrels. Depending on how much money was raised, the plan could wind up claiming anywhere from a small fraction to the lion's share of Iraq's oil revenue over a decade or longer. The Iraqi reconstruction authority would use the borrowed money to pay contractors for large-scale improvements such as renovating oil wells or building power plants. The loans would be guaranteed by a consortium of export credit agencies, including the Ex-Im Bank and its foreign counterparts. The financing would be reserved for new projects and would be subject to competitive bidding open to companies from all countries. "Bechtel and Halliburton would have to rebid on a level playing field with everybody else," said Rice, whose coalition represents 28 companies and two trade groups. Members include such California-based giants as ChevronTexaco Corp., Fluor Corp., Hewlett-Packard Co., Northrop Grumman Corp. and Oracle Corp. Ex-Im Bank officials believe the U.S.-led occupation already has adequate legal authority to launch the oil loan program. In May, the U.N. Security Council authorized allied officials to disburse Iraqi oil revenue for humanitarian purposes, economic reconstruction, disarmament and "other purposes benefiting the Iraqi people." It did not address the use of future revenue. Bank officials say there is a precedent for such a plan in the region. In 1948, a similar money-raising authority was established in behalf of the new state of Israel before an elected government was in place to endorse taking on the financial obligation. Supporters of the oil loan idea insist that Iraqis should be included in the decision-making process from the start. But until some form of elected government is in place, the only Iraqi officials in a position to participate are those appointed by allied authorities to staff the various government ministries. "We're better off to have the Iraqis involved," said Merrill of the Ex-Im Bank. "Should they have control from Day 1? Probably not. Will they have control at the end of the decade? For certain. Where on the curve do they get control? I don't know. "But they're likely to get there a lot quicker if they've got the money than if they don't." http://www.dailystar.com.lb/11_07_03/art18.asp * US INVITES BIDS FOR $1BN WORTH OF BAGHDAD'S OIL Lebanon Daily Star, 11th July The US Army invited bids on Thursday for two new contracts worth up to $1 billion to rebuild Iraq's oil industry, opening up the lucrative business to foreign firms previously excluded from such deals. The US-led Coalition Provisional Authority (CPA) is also working on plans for a new cell phone network. The oil contracts one for southern Iraq and the other for northern Iraq replace a no competition contract awarded in March to Kellogg Brown & Root (KBR), a unit of Halliburton, the Texas oil firm run by US Vice-President Dick Cheney from 1995 to 2000. A planned cell phone tender would offer network operators and equipment manufacturers a chance to win one of the most potentially lucrative contracts in Iraq, although administrators have not decided which of two rival technologies to use, an Iraqi official said Thursday. That original oil contract was met with a barrage of criticism, with Democratic lawmakers complaining one company with links to Cheney was getting too much business out of the Iraq war. The White House has rejected any favoritism. "The formal bidding process for these two contracts can now begin," said US Army Corps of Engineers spokesman Lieutenant Colonel Gene Pawlik. "Foreign companies can apply," he added. KBR has indicated it will bid on the new contracts and other companies such as Fluor Corp, which recently set up a joint venture with British engineering group AMEC Plc, has also expressed interest. The minimum amount of the proposed contracts will be $500,000 each and the maximum $500 million each. The initial phase will cover 24 months, followed by three one-year options. Companies have until Aug. 14 to bid and Pawlik said no formal start-date had been set for the jobs. A pre bid conference has been set for July 14 in Texas. The KBR oil contract in Iraq was worth nearly $283 million by July 2 and Pawlik estimated the final figure could reach about $600 million, far less than the original $7 billion worst-case scenario ceiling. KBR has received task orders for Iraq worth more than half a billion dollars under a 2001 contract called the Logistics Civil Augmentation Program. So far, money under the March oil contract has been spent on emergency repairs to oil fields, delivering fuel to Iraqis and building base camp facilities for workers. The new contracts include extinguishing oil fires, environmental assessments and clean-up at oil sites, the distribution of oil products, maintaining oil fields and the sale of Iraqi crude oil and refined products. An official at Iraq's Ministry of Transportation and Communications said the CPA had put together proposals on how to put up for tender licenses to build mobile phone networks. "Nothing has been started yet, but there are some ideas for it," the official told Reuters, asking that his name not be used. His statement conflicted with that of a senior CPA official, who told Reuters on June 16 that a tender had been issued and Iraq would adopt the global system for mobile communications (GSM) standard used in Europe and the Middle East. A decision to use GSM would be a blow to US firms hoping to build a wireless network based on the code division multiple access standard developed by US-based Qualcomm Inc, but would allow customers to travel the region using one phone. One US lawmaker urged US Defense Secretary Donald Rumsfeld to ensure that US-backed technology is deployed to safeguard US jobs and profits. US civilian administrator in Iraq Paul Bremer said a soon-to-be appointed governing council would have to consider any decision to build a cell phone network since it entailed a change in Iraqi investment law. http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/07/10/MN302842.DTL * IMPORTS INUNDATE IRAQ UNDER NEW U.S. POLICY CONSUMERS REVEL, BUT MANUFACTURERS CUT JOBS, CLOSE DOWN by Robert Collier San Francisco Chronicle, 10th July Baghdad -- Along the streets of this city, sidewalks are crowded with huge boxes containing televisions, kitchen appliances, air conditioners and stereos. Almost overnight, it seems, Baghdad has been turned into a vast emporium of imported goods. It's part of a bold yet risky economic strategy by the U.S. occupation authorities, who have eliminated all import taxes for goods coming to Iraq at the same time they are pumping hundreds of millions of dollars into the economy through cash payments to government workers. As a result, many Iraqis are getting their first taste of the consumer- oriented good life in many years, and they are snapping up imported goods right and left. But the boom has come at a high price because it has accelerated the closure of hundreds of factories. After 12 years of economic crisis and strict import regulations under U.N. sanctions, Iraqi manufacturers cannot begin to compete with the price and quality of foreign goods. The closures, in turn, have thrown large numbers of people out of work, increasing social tensions at a time when public dissatisfaction with the U.S. occupation is growing to dangerous levels. Nevertheless, some Iraqis welcome the change. Tarik Assad seemed the paragon of prosperity Tuesday as he lugged a new kitchen stove into the trunk of his car in Baghdad's Kerradeh district. The four-burner, Chinese-made model had cost only $90 -- a great bargain, he said. Under Saddam Hussein, the same model cost about $150, more than a month's salary in Assad's job as an accountant for the national oil ministry. Now, the $90 is less than half his new monthly salary of $200. "Thank God," he said. "My wife will be happy." Like many of Iraq's 1 million state employees, Assad was recently given a two-month, lump sum payment by the U.S. occupation authorities, who are trying to dampen public anger with a flood of cash. Salaries for lower and midlevel positions were increased -- in some cases dramatically -- while pay for top- level officials was cut. With so much new cash in the economy, shopkeepers are busy trying to keep up with the buying frenzy. "Most of my customers are state workers who recently were paid," said store owner Mohammed Basem. "For many people, this is the first time they've bought an appliance in many years." Basem said his store is now grossing $7,000 to $12,000 per day. Under Hussein, it was bringing in only $2,000 to $7,000 per month. The losers in the new economy, however, are complaining loudly. Textile plants and clothing factories have been devastated by the influx of cheap clothing, much of it made in China. Other homegrown operations have also been damaged by the open-door import policy. Under Hussein's regime, for example, imported beer and sodas were subject to 150 percent customs duties. After the war, local bottling plants were shut down and imported beverages -- now free of tariffs -- have taken over the market. Streets and highways throughout the nation are festooned with pyramids of brightly colored Saudi and Syrian soda cans, stacked up by vendors to advertise their wares. "Without customs duties, the domestic producers cannot sell," said Khamis Al-Abed, head of a large consortium that includes one of Iraq's largest soft- drink distributors. "It's not a very good economic policy." Even before the war, Iraq was in severe recession. Last year, the gross domestic product was $25 billion, according to U.S. estimates, one-fifth of its 1979 level. This year, it is expected to fall to about $15 billion. The nation's farmers are also being jolted by the elimination of most agricultural subsidies, which were generous under Hussein. Mohammed Juad Hussein, whose Al-Helli Chicken Co. has been dormant since March 30, used to be one of the nation's largest chicken butchers. Now, he says he simply can't compete against containers full of American Tyson chicken legs, which are shipped to the Middle East at bargain-basement prices because Americans prefer white meat to dark. Hussein says domestic Iraqi chicken costs $1.30 per kilo (2.2 pounds) to produce, while it retails for only $1.25. Before the war, heavy government subsidies cut his costs, and most production was sold back to the government at a guaranteed profit that worked out to about 13 cents per kilo. He has laid off all but 20 of the firm's 140 workers. The fate of the rest, he says, "is in the hands of Allah." Iraq's new economy is largely the work of L. Paul Bremer, the U.S. administrator of Iraq, who has argued forcefully in favor of a free-market system, including rapid privatization of state-owned industries. "We have succeeded in opening Iraq's borders and bringing modern free-trade policies here," he said last week. But he acknowledged that his policies are running into heavy opposition from Iraqis. "I certainly believe that privatization is the way to go for Iraq, to put its obsolete state-run Stalinist industry system back into productive use," he said. "But I recognize that it's a sensitive subject, and I don't see any consensus among the Iraqis on it. So it will be a subject for the (soon-to-be- named) Iraqi governing council to discuss." The debate may be repeated throughout the Middle East. In early May, President Bush proposed a U.S.-Middle East free trade area to cover the region's 22 nations. He called the proposal "an expanding circle of opportunity, to provide hope for the people who live in the region." Many Iraqis say the U.S. economic shakeup in Iraq is ill-advised. "We need a free trade system, but only within an institutional basis, as part of a comprehensive package," said Hamid Al-Jumaily, a professor at Al-Nahrein University in Baghdad and one of the country's leading economists. "At present, there is no economic policy as such, either by (private) business enterprise or by government. Just opening the borders and eliminating tariffs isn't free trade." http://www.jordantimes.com/Tue/economy/economy1.htm * INDUSTRIES DEPENDENT ON IRAQI MARKET STOP OPERATIONS IN IRBID Jordan Times, 15th July AMMAN (Petra) ‹ Despite a 19 per cent rise in revenues from Al Hassan Industrial Estate exports during the first half of this year, the exports' volume has declined with the exception of those of textiles and garments. Revenues went up to around $153 million from January through June 2003 compared to $129 million during the same period of last year. The increase resulted from higher textiles and garments sales which accounted for 94 per cent of the total exports as they were valued at $143.5 million compared to $107. 5 million Exports from the engineering industries plunged by 57 per cent to $5.5 million compared to $12.5 million. Those of veterinary medicines, fertilisers and agricultural industries also dropped by 26 per cent to $2.7 from $3.7 million, according to the estate's biannual report. Electronic industries' exports went down by 20 per cent to $766,000 from $955,000. Bags and leather products dived by 83 per cent to $310,000 from $1.5 million. The largest dip was posted by exports from plastic industries which fell by 89 per cent to $210,000 from $1.9 million, the report revealed. President of the Irbid Chamber of Industry Maher Nasser said the war against Iraq was largely behind the decline in the estate's exports that relied heavily on the Iraqi market. According to Nasser, industries manufacturing bags and leather products stopped completely while that of other products depending solely on the Iraqi market were halted for the meantime. _______________________________________________ Sent via the discussion list of the Campaign Against Sanctions on Iraq. To unsubscribe, visit http://lists.casi.org.uk/mailman/listinfo/casi-discuss To contact the list manager, email firstname.lastname@example.org All postings are archived on CASI's website: http://www.casi.org.uk