The Iraq war may be far from over, but already European countries
and companies are desperately jostling for position so as not to
miss out on the peace.
A vast reconstruction program - the biggest since the 1945
Marshall Plan for Europe - is being planned for postwar Iraq, and
contracts worth tens of billions of dollars will theoretically be up
for grabs once the guns fall silent.
But governments and businesses in Europe are increasingly alarmed
that President Bush's administration will argue that, since
Washington paid for the war with its dollars and its soldiers, so
its businesses should prosper from the peace.
Perceptions that the war has a secondary motive - to secure plump
deals for Bush cronies - grew last week, when the Houston energy
services firm Halliburton, once headed by Vice President Dick
Cheney, showed up at the top of the list of potential contractors.
Yesterday Halliburton declined to bid for a primary contract,
although the firm remains interested in subcontracts. Officials
there declined to say whether their decision was related to
questions of favoritism.
The stakes in rebuilding Iraq are high. With its vast oil
reserves and richly talented, 2 million strong exile community, the
country has huge potential. But after years of sanctions and decades
of mismanagement, the economy is a shambles. Estimates have put the
cost of rebuilding roads, schools, hospitals, the transport system,
oil wells, airports, and government at more than $100 billion.
Britain and its EU partners want the US to put together a much
broader alliance for rebuilding Iraq than the narrow "coalition of
the willing" assembled to fight the war.
Leaders in London, Paris, and Brussels are adamant that the UN
play a preeminent role in helping form a new government in Baghdad
so that aid and development money can be released from multiple
channels, not just from US coffers.
But the early signals have not been encouraging. An initial $900
million package of contracts tendered through USAID has put US
companies in the driver's seat for the first awards. Already a US
stevedoring company has beaten a British rival to a deal to manage
the Iraqi port of Umm Qasr.
Britain is perhaps in the most peculiar position. Because its
soldiers are dying in Iraq, business here is leery of "ambulance
Still, the big concern - which Foreign Secretary Jack Straw is
expected to raise with Secretary of State Colin Powell during a
meeting today with EU officials in Brussels - is that despite
fighting the war, Britain will miss out on the peace, just as it did
in Kuwait 12 years ago.
Trade Secretary Patricia Hewitt has urged USAID not to overlook
British firms, and a trade group has set up a meeting next week with
the government to thrash out how best to win work.
"We feel our companies have strengths there - many of them were
working in Iraq until 1991," says Nigel Peters, deputy executive
director of the British Consultants and Construction Bureau, a trade
group of some 300 firms, 80 of which have voiced an interest in
securing work in Iraq.
The problem is that USAID money is the only reconstruction cash
available at the moment, and it is usually tied to US companies or
at the very least, companies with US security clearance. British
firms like Balfour Beatty, a construction company; Costain, a
construction contractor; and utility service provider Thames Water
may not thus get in at the ground floor, but they are confident of
securing subcontracting work in this first round of aid money - and
that could be enough to gain a head start over others. …