Iraq relies on private sector for rebuilding
baghdad — Months after declaring victory over militants, war-battered Iraq hopes to attract billions of dollars from private investors as well as donors to fund its reconstruction.
Baghdad is looking to drum up funds at a reconstruction conference in neighbouring Kuwait from February 12 to 14.
The country is still reeling from the rise of militants and the punishing fightback it took to crush them, with swathes of its territory in ruins and millions of people displaced.
Authorities in the resourcerich nation say there has been a heavy toll on oil, electricity and manufacturing infrastructure, as well as basic services such as water and sanitation.
Iraq needs to raise $100 billion to rebuild, Prime Minister Haider Al Abadi has said, after the fight against militants and decades of sanctions and war.
“It’s a huge amount of money. We know we cannot provide it through our own budget,” he said at the World Economic Forum in Davos, Switzerland last month.
“That’s why we now resorted to investment,” he said.
Iraq sits on some of the world’s largest crude reserves, which Baghdad puts at 153 billion barrels, but the war against militants and a slump in world prices have diminished its oil revenues.
The Kuwait conference’s second day will be devoted to the private sector’s role in rebuilding Iraq, with more than 2,000 companies and businessmen due to attend, according to the Gulf country.
International organisations are to speak on the first day, while attending donor countries are expected to make announcements on the third.
The US State Department has said that rather than “direct contributions”, Washington has “focused on the private sector. It has teamed up with the US Chamber of Commerce to organise a delegation of over 150 American companies to travel to Kuwait” for the conference. Iraq — the second-largest producer within the Opec after Saudi Arabia — has already called for help from investors worldwide, even as it seeks to ramp up output from its largely untapped reserves.
Kuwait is setting aside its past differences with Iraq to host the summit. In August 1990, Iraq invaded Kuwait after accusing its neighbour of “stealing” Iraqi oil from a field straddling the border. That sparked the first Gulf War, which ended after a US-led coalition ousted Iraqi forces from the country.
Iraqis have since weathered international sanctions, a US-led invasion in 2003 and the battle against militants.
Today, some 2.6 million people remain displaced across the country, the International Organisation for Migration has said. Satellite imagery shows some 26,000 houses are destroyed or seriously damaged, including more than 17,000 in the militants’ former bastion of Mosul.
“There is huge destruction and a huge need to mobilise support,” said Erfan Ali, Iraq representative of the UN Human Settlements Programme.
Ali said there are big hopes the private sector will play a major role in rebuilding, offering “innovative solutions” to tackle the country’s problems.
Attracting investors will be no easy task in a country ranked as the world’s tenth most corrupt in Transparency International’s 2016 Corruption Perceptions Index. But Ali said companies and businessmen will have access to a “reconstruction data platform to ensure accountability and transparency”.
Peter Hawkins, representative for the UN children’s fund in Iraq, says reconstruction will be a mammoth task — not just in Mosul, retaken from militants last July after several months of fighting, but also elsewhere. —