More Travel, Consumer Goods Seen : Iraqis Looking Hopefully to Life Without Gulf War

“We Iraqis are very happy that the war is over,” a Baghdad shopkeeper said, flipping through a local newspaper. “We hope that things will be better now. I would like to travel overseas.”

While the governments of Iran and Iraq wrangle over the details of a cease-fire in the Persian Gulf War, many Iraqis have begun to think about how they will adjust to life in a country no longer caught up in total war.

A large number of Iraqi men have been drafted to bolster the armed forces since the war started in 1980. Many have had almost eight years of combat, and some as old as 50 have been called up.

The long-service draftees and the older men are expected to be released as soon as it becomes clear that there is to be a lasting peace. However, for the short term, at least, Iraq is expected to keep a powerful standing army.

Diplomats in Baghdad believe that the government of President Saddam Hussein will feel obliged to relax the domestic situation in a number of ways. At the very least, they expect the government to start letting Iraqis travel abroad. Foreign travel has been banned during the war, except in rare cases.

“Hussein will have to distribute some rewards to the people to compensate them for eight years of suffering and forbearance,” a Western diplomat said.

In addition to lifting or at least relaxing the travel ban, the government is expected to extend a series of economic benefits, such as allowing desirable consumer goods to be imported.

Luxury items such as automobiles, color television sets and air conditioners have been in extremely short supply since the war began. With Iran blocking Iraq’s seaborne oil exports, foreign exchange earnings have been crippled for several years, and the resulting parsimony is felt in many sectors of the economy.

For example, a color television set retails for the equivalent of $1,200, or three months’ pay for the average Iraqi. An air conditioner can cost up to $5,000.

Restrictions Eased

Even before Iran agreed Monday to the terms of a U.N. cease-fire resolution, the Iraqi government had begun easing the most stringent restrictions. According to diplomats, the government had freed about $600 million in foreign exchange to private importers, and more of this type of action is expected.

“There is a feeling of buoyancy in the retail markets,” one diplomat said.

Many believe that Iraq will focus much of its immediate attention on reconstruction. Iraq has come through the war with less damage than Iran, but there are a number of areas in need of major assistance.

An example is the Shatt al Arab, the waterway that links the southern port of Basra with the Persian Gulf. It has been blocked for eight years, making it necessary to truck in imports overland and to export oil by pipeline.

It will take a major effort to clear the Shatt al Arab. About 75 ships have been bottled up there, and the channel will have to be dredged along its entire length.

The heaviest destruction in Iraq has been in Basra, which before the war was Iraq’s second most populous city. Entire neighborhoods have been ruined by Iranian shelling, and great numbers of people have fled.

One diplomat said the Iraqis realized too late that Basra, with its proximity to longtime enemy Iran, was not a suitable site for major infrastructure projects; a power plant was among the significant war losses in that city. The diplomat predicted that the Iraqis, mindful that hostilities with Iran might erupt again, will make no attempt to repair Basra’s wrecked infrastructure but will abandon it and put up new facilities inland, away from the border.

Oil Is Key to Growth

The Iraqis’ ability to provide consumer goods and at the same time take on major reconstruction projects will depend to a large extent on their oil revenue. Iraq ranks second only to Saudi Arabia in estimated petroleum reserves, but its oil income, like that of most other oil producers, has declined sharply in recent years.

Furthermore, because of the dislocation caused by the war, Iraq has incurred an enormous foreign debt--some put the figure as high as $60 billion--owed primarily to Japan, France and Turkey. Diplomats believe that the $30 billion Iraq has received from such Arab supporters as Kuwait and Saudi Arabia during the war will be written off. If it is, Iraq’s foreign debt will be reduced by half, but interest payments on even $30 billion are staggering.

Some analysts believe that Saudi Arabia and Kuwait will keep the aid to Iraq flowing even after a cease-fire, to ensure that there is a strong Arab counter to a resurgent Iran, a non-Arab nation. But by the same token, Iraq may have to keep military spending at or near current levels.

In the past year, the Iraqi government has embarked on a major restructuring of the economy that some economists have likened to the Soviet Union’s program of perestroika .

Dramatic Farm Progress

The Iraqi program has emphasized agriculture, a sector neglected in the oil boom years, and the results have been dramatic. Since last year, virtually all the farmland in the country has been placed in private hands, and most businesses related to farming have been privatized.

The results are visible throughout the country: shops and stalls bulging with produce. Only two years ago there was virtually no fresh food for sale here.

Diplomats said they expect the economic reform to accelerate when a cease-fire goes into effect.

Although the economic lot of the average Iraqi is expected to improve rapidly with the end of the war, few are predicting any significant change in the way the country is governed.

Iraq’s government is one of the most authoritarian in the region. No criticism is tolerated, and dissent is ruthlessly suppressed. The intelligentsia has been chafing under the effects of the travel ban, but even these people do not foresee any fundamental change in the country’s one-party system.

“Iraq has been ruled for 5,000 years by authoritarian figures,” a diplomat said. “That’s probably not going to change in the next 5,000.”