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[casi] Deny Iraqis, Import Slave Labour, Export Dosh

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Published on Tuesday, October 14, 2003 by the Financial Times/UK
Contractors in Iraq Accused of Importing Labor and Exporting Profit
by Nicolas Pelham

US sub-contractors are importing cheap migrant labor from south Asia to
Iraq, despite high local unemployment and complaints from Iraqi contractors
that they are being overlooked by the US-led administration in Baghdad.
US officials in the Iraqi capital say that six months into their occupation
of Iraq, security conditions have forced companies to turn to south Asian
lab our to implement contracts, from prison-building to catering for US
Recent weeks have seen unrest in several major cities, including the capital
Baghdad, amid rising anger at Iraq's high unemployment rate.
"We don't want to overlook Iraqis, but we want to protect ourselves," says
Colonel Damon Walsh, head of the Coalition Provisional Authority's
procurement office. "From a force protection standpoint, Iraqis are more
vulnerable to a bad guy influence."
US troops and some companies under contract to the US government
nevertheless seem prepared to take the "risk".
Iraqis form the bulk of the workforce for reconstructing Iraq's prisons.
General Janis Karpinski, who is overseeing the prison program, says she has
had "no single security incident" involving Iraqi contractors.
"You find other [non-Iraq] nationalities in out-of-the-way corners taking 15
minute naps," she says. "Iraqis see work as a way of getting the country on
its feet."
Bechtel, which is handling a $680m (&euro577m, 408m) reconstruction program
for USAid, has meanwhile held open days for Iraqi contractors and intends to
spend $215m of $300m on Iraqi sub-contracts.
"If the work can be done by an Iraqi firm at a competitive price that's
who's going to do it," says Francis Caravan, Bechtel spokesman in Baghdad.
But a number of businesses based in Saudi Arabia and other Gulf states that
have contracts to supply the US army are wary of employing indigenous labor.
"Iraqis are a security threat," says a Pakistani manager in Baghdad for the
Tamimi Company, based in the Saudi city of Dammam, which is contracted to
cater for 60,000 soldiers in Iraq. "We cannot depend on them."
The company, which has 12 years' experience feeding US troops in the Gulf,
employs 1,800 Pakistanis, Indians, Bangladeshis and Nepalese in its
kitchens. It uses only a few dozen Iraqis for cleaning.
In the dusty backyard of the US administrators' Baghdad palace, south
Asians, housed 12 to a Saudi-made temporary cabin, organize 180,000 meals a
day for US troops and administrators.
A Tamimi manager says the company pays an average salary of one Saudi riyal
($3) a day and grants leave once every two years. The contracts are awarded
by Kellogg Brown and Root (KBR), a subsidiary of Halliburton, which in 2001
won its second Logistics Civil Augmentation Program, or Logcap, contract to
sub-contract the supply of US military provisions. The Logcap is open-ended
and its Iraqi share is worth "in excess of $2bn", according to officials of
the Defense Contract Management Agency in Baghdad.
"The US military have never outsourced resources on this scale," says the
DCMA's Colonel Damon Walsh. "If it weren't for this service support we would
have needed at least 20,000 more troops." KBR officials in Baghdad declined
to provide details of their employment policy in Iraq, or the size of their
Asian workforce.
However, Patrice Mingo, a KBR spokesman in Houston, says: "We buy as much as
can locally and if we are unable to buy locally we go the Middle East. We
look at Iraqis first, but we don't track our employees by ethnicity."
The potential for ill-feeling nevertheless remains. "US contractors are
importing labor. and expatriating the benefits," says Hakim Awad, an Iraqi
construction manager who queues for contracts outside Baghdad Airport every
day. "Where's the benefit accruing to Iraq?"
Under a new Iraqi investment law, foreigners can own companies in full and
export all the profits. US officials say they encourage firms to employ
Iraqis but do not stipulate a minimum percentage for Iraqi employees.
The recourse to an Urdu-and Bengali-speaking workforce has historical echoes
for Iraqis, who recall the south Asian workers the India Office imported to
maintain the British army following their invasion of Iraq during the first
world war.
Some also fear the replication of labor patterns from Gulf states, whose
economies are dependent on Arab and Asian migrants.
 Copyright The Financial Times Ltd 2003

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