U.S. Team Poised to Aid Iraq’s Economy

Among the first American civilians landing in Iraq after the war ends will be a team of about a dozen Treasury Department economists.

Their mission: help stabilize the country’s currency, create a functioning central bank and lay the groundwork for an economy that can produce the jobs and prosperity promised the Iraqi people by President Bush.

Bush said his goal is nothing short of the creation of a new Iraqi economy that would be a model for the region after the removal of President Saddam Hussein.

Battered by years of economic sanctions, corruption and mismanagement, the country’s $59-billion economy is a third smaller than it was at the start of 1991’s Persian Gulf War.

Running the mission will be the Treasury’s Office of Technical Assistance. Established in the early 1990s, the office provides guidance on how developing and war-torn countries should run modern economies.

Its objective in Iraq is to reengage the nation’s economy in the international financial and trading system, said a Treasury official familiar with the plan.

“The advisors are available to provide not just advice, but to mobilize resources from sources in the government and financial sector,” said Daniel Zelikow, who founded the office and now is a managing director at J.P. Morgan Securities Inc.

Treasury officials said they would focus first on overhauling Iraq’s central bank and finance ministry.

That would set the stage for later efforts to encourage privatization of state-run enterprises and introduce property rights and other laws necessary to attract international investors.