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The 14 October Financial Times carried the noteworthy article Nicolas Pelham, "Contractors in Iraq accused of importing labour and exporting profit", Financial Times, 14 October 2003. The lead paragraph states "US sub-contractors are importing cheap migrant labour 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." The full text appears above the below footnotes. According to the October joint UN/World Bank needs assessment, "Exact unemployment is not known, but estimates are that 50 percent of the labor force is either unemployed or underemployed." (1) This follows 13 years during which the 1991 Gulf War's infrastructural damage, UN Security Council economic sanctions, Government of Iraq's (GoI) continued military spending prioritization, and GoI's use of economic measures to repress specific Iraqi groups, all (especially Security Council economic sanctions) contributed to cyclical unemployment, entrenched poverty, and low household purchasing power. As the Donald Rumsfeld/Paul Bremer-commissioned, joint Center for Strategic and International Studies (CSIS), Council on Foreign Relations, and UN Foundation assessment team rightly stated on 17 July, "The immediate needs will be providing short-term employment opportunities to keep people off the streets and refurbishing basic services such as electricity, water, and sanitation, to avoid exacerbating political and security problems." (2) Given both the economic and related security implications, it seems noteworthy that the US failed/is failing to contractually require contracted parties to employ Iraqis/contract with Iraqi entities, excluding those instances where contracted entities reasonably demonstrate there are entirely insufficient Iraqi capabilities to perform the tasks for which the contracted have been contracted. It seems the pressing need for employment ought to trump all other considerations, except when employing/contracting Iraqis will seriously undermine "refurbishing basic services", especially electricity, water, and sanitation . Source: Nicolas Pelham, "Contractors in Iraq accused of importing labour and exporting profit", Financial Times, 14 October 2003 [begin] US sub-contractors are importing cheap migrant labour 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 labour to implement contracts, from prison-building to catering for US troops. 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 programme, 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 Dollars 680m (Euros 577m, Pounds 408m) reconstruction programme for USAid, has meanwhile held open days for Iraqi contractors and intends to spend Dollars 215m of Dollars 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 labour. "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, organise 180,000 meals a day for US troops and administrators. A Tamimi manager says the company pays an average salary of one Saudi riyal (Dollars 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 Dollars 2bn", according to officials of the Defence 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 labour 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 labour patterns from Gulf states, whose economies are dependent on Arab and Asian migrants. [end] 1. United Nations and World Bank, "Joint Iraq Needs Assessment", October 2003, footnote 15, pg. 8, http://lnweb18.worldbank.org/mna/mena.nsf/Attachments/Iraq+Joint+Needs+Assessment/$File/Joint+Needs+Assessment.pdf 2. John Hamre, Frederick Barton, Bathsheba Crocker, Johanna Mendelson-Forman, Robert Orr, "Iraq's Post-Conflict Reconstruction: A Field Review And Recommendations", 17 July 2003, pg. 5, http://www.csis.org/isp/pcr/IraqTrip.pdf Nathaniel Hurd Consultant on Iraq policy Tel. (Mobile): 917-407-3389 Fax: 718-504-4224 E-mail: email@example.com 777 1st Avenue (E. 44th St./1st Ave.) Suite 7A New York, NY 10017 _________________________________________________________________ Send instant messages to anyone on your contact list with MSN Messenger 6.0. Try it now FREE! http://msnmessenger-download.com _______________________________________________ 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