Donors to Meet Again Over Reconstruction

On the streets outside the U.S.-protected Green Zone several dozen demonstrators loudly demand jobs.

“We want to work,” said Abdul Razzaq Saddoun, 22, an aspiring policeman who added that he hadn’t found work even though he had spent weeks in training. “They still didn’t give us jobs,” he said.

Unemployment, budget limitations and a shattered infrastructure are among the most dire problems Iraq faces as rebuilding efforts move haltingly in the face of a raging insurgency.

What affects “people is the lack of services -- the lack of electricity, power and transportation,” said Ashraf Jehangir Qazi, head of the United Nations mission in Iraq.

Iraqi and international officials will try to address such bread-and-butter issues at a two-day conference in Jordan on Monday and Tuesday intended to solidify and focus worldwide commitments for Iraqi reconstruction.

Representatives from more than 60 countries and international organizations, including the U.N., have agreed to attend the conference, the fourth since Saddam Hussein was toppled in the 2003 U.S.-led invasion. It is the first such conference since the government of Prime Minister Ibrahim Jafari was elected this year.

For wealthy countries and international lending organizations such as the World Bank, the conference is a semiannual meeting to monitor the direction of pledges for Iraq’s economic and political transition.

“The meeting is a chance for the Iraqi government to follow up ... and articulate its specific reconstruction priorities, as well as to urge acceleration in the disbursement of funds that the international community has already pledged,” U.S. Embassy spokesman Adam Hobson said.

For Jafari’s government, the conference will be a chance to reassure donors that money given to Iraq won’t be lost to corruption and waste.

“It’s an opportunity for the interim government to present its vision of economic development,” said Qazi, who served as Pakistan’s ambassador to the U.S. before taking up the U.N. post here a year ago.

A Western diplomat, who spoke on condition of anonymity, said he didn’t expect many new projects to be announced. “What we’re hoping,” he said, “is to see international support for Iraq’s reconstruction galvanized and Iraqi officials to deepen their contacts with Western aid agencies and identify places where Western donors can help.”

Despite diplomatic niceties and polite promises, many rich countries and lenders have doubts about Iraq’s ability to absorb and keep tabs on donor money. So far Iraq has received only $1 billion of the $32 billion in loans and grants committed since an October 2003 donors conference in Madrid.

Aid agencies and donor countries have been dismayed by the apparent freewheeling accounting standards and lack of fiscal controls that they say have thus far characterized Iraqi reconstruction. Multimillion-dollar transactions have been conducted in cash and there are allegations of rampant corruption.

Several countries, including Germany and Canada, have opted to contribute millions of dollars for training Iraqi soldiers and police in Jordan and the United Arab Emirates, not Iraq.

French President Jacques Chirac, who opposed the Iraq war, recently had 330 Iraqi professionals, including lawyers and judges, flown to France for additional training.

Diplomats say they worry they won’t be able to monitor funds sent directly to Baghdad.

“Of course we’re concerned about where the money goes and corruption,” said a Western diplomat, who spoke on condition of anonymity. “That’s why we don’t give anything directly to the Iraqi state. We prefer giving to Iraqis indirectly through our own organizations.”

Already, billions in U.S. taxpayer dollars, Iraqi oil revenues and international donations have been poured into Iraq with little tangible signs of improvement in the quality of life.

The U.S. Army’s 1st Cavalry Division and 3rd Infantry Division, for example, have disbursed $2 billion on projects in Baghdad in the last 18 months, yet, in part due to insurgent sabotage, there are few if any signs that the capital’s crumbling electricity, water and sewage systems have improved.

Electrical power is on only about one-third of the day, running water frequently stops, and raw sewage overflows onto the streets and into homes in many areas of Baghdad.

Iraq’s dire security situation and insurgent attacks on water and electricity networks have led to a skyrocketing price tag on construction projects.

“The things that go below the ground and make things run -- to provide water, sewage, electricity -- are extremely expensive,” said Maj. Gen. William G. Webster, commander of U.S. forces in Baghdad.

Security concerns also have hampered reconstruction efforts and discouraged international organizations from stepping foot in Iraq. An Aug. 19, 2003, truck bomb that destroyed the U.N.’s Baghdad headquarters and killed then-U.N. envoy Sergio Vieira de Mello sent most groups scurrying to Amman, the Jordanian capital, or the shelter of Baghdad’s fortified Green Zone.

A smattering of international aid agencies continue to operate, albeit discreetly. The U.N. mission now has 700 Iraqi and non-Iraqi employees in offices in northern Iraq; Basra, in the south; Kuwait; and Amman as well as in the Green Zone.

“Our national staff continues to be here,” Qazi said. “Now the international staff has also come back.”

Insurgents have engaged in a campaign of kidnappings, assassinations and bombings of foreign contractors and their Iraqi employees, increasing security and insurance costs for public works projects as well as scaring off potential foreign investors. Even wealthy Iraqis have begun moving their riches abroad, especially to Jordan and the United Arab Emirates.

Security restrictions have made it a challenge to come up with ways to spend money in Iraq without putting employees in jeopardy. Allocated funds often sit unused. The U.N., for example, has been able to spend only 35% of the $500 million it has pledged for projects, Qazi said.

Such trends have disheartened U.S. military commanders, who say insurgent leaders have an easy time recruiting poor, disaffected young men.

“If we could decrease unemployment and make some of the infrastructure problems disappear, it would certainly help,” said Army Maj. Gen. David Rodriguez, commander of U.S. forces in Mosul, in the north.

Facing a growing and resilient rebellion, the Bush administration last year shifted billions of dollars originally slated for Iraq reconstruction toward security and counter-insurgency operations. Some Iraqis have called this a mistake, arguing that jobs for unemployed men could stanch the insurgency more effectively than bombs and raids.

“If the United States spent one quarter of what they spend on the army here and on the war, if they spent it on people and on reconstruction, they would have gained the heart of the people,” said Saleh Mutlak, a Sunni Arab politician who serves on the committee drafting a new Iraqi constitution.