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| October 14, 2004 |
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| Iraq Donors Focus On Trust Fund And Violence |
WASHINGTON - October 14, 2004. International donors held a second day of discussions on Iraq's
reconstruction behind closed doors on Thursday as concerns persisted about
the violence that has frightened donors from making good on funding
promises, reports Reuters.
Iraqi delegates at the Tokyo meeting have urged donors to live up to
promises of funding for reconstruction, saying some parts of the country are secure enough to start work and that doing so is the best way to fight terrorism and extremism. Talks on Thursday focused on how to make use of funds held in trust by the United Nations and the World Bank totaling about $1 billion, nearly half from host nation Japan. An additional $10 million was pledged by Iran on Wednesday.
The World Bank's top official for the Middle East, Christiaan Poortman,
acknowledged that disbursements had been limited up to now, but he said he
expected this to change soon. "I think one of the things one has to keep
in mind is that clearly the process is more complicated in the case of
Iraq because of the security situation," Poortman told Reuters. He said progress was being made on setting up projects and he expected
disbursement to "accelerate pretty quickly now." "I would be very
disappointed if, after the first quarter of the new calendar year, we
wouldn't start disbursing something like $40 to $50 million," he added.
The portion of the fund controlled by the World Bank is about $400
million. "I am pretty confident that...the results will be there in a
couple of months to demonstrate that we have been able to make good use of
the funding and that it's translating into action on the ground," Poortman
said.
Reuters adds in a separate piece that creditor countries were urged to
forgive loans made to the fallen government of Saddam Hussein. "We simply ask that these debts should not compromise the ability of our people to
escape from the former regime's long dark shadow," Iraq's deputy prime
minister Barham Salih said. Debt forgiveness is being discussed by the
Paris Club of creditor nations and is not formally on the agenda in Tokyo,
but the World Bank's top official for the Middle East said it was vital
for the reconstruction of Iraq. Poortman told reporters after Wednesday's meeting: "I think there was general agreement that unless this issue is brought to a satisfactory conclusion, Iraq has no possibility of economic sustainability.”
The Financial Times further reports that Richard Armitage, US deputy
secretary of state, defended comments by Dick Cheney, US vice-president,
saying Iraq's creditors had forgiven $80 billion in debt, an estimate
bigger than any publicly announced figure. He said creditors had promised
"significant" reduction, though he conceded this might not mean the 95
percent that Washington had in mind. But if even half of the total was
forgiven, that would imply more than $60 billion, he said.
The Japan Times notes Salih noted that health care, water and sanitation,
education and housing are the priorities in the social sector in need of urgent assistance from the international society. Iraq is suffering from a shortage of doctors and other health-care professionals, with many having fled the country. Iraq's literacy rate is declining, and there is a shortage of 1.5 million basic housing units, he said. The deputy prime minister said Iraq will concentrate its capital on the oil sector, which comprises 94 percent of its revenue.
Agence France Presse meanwhile reports the World Bank said Wednesday it
had granted Iraq $60 million to build and repair schools. The deal, signed
on the sidelines of a donors' conference in Tokyo, provided the grant to build 100 schools and repair another 140, the Bank said in a statement received here. "Iraq boasted one of the best school systems in the region but the decline in the education sector since the 1980s and the need for construction and repairs has placed great strains on an already fragile learning environment," the statement said. "The backlog in constructions has resulted in nearly one-third of schools having to operate double or triple sessions per day."
In other news, Xinhua writes United Nations Secretary-General Kofi Annan
has decided to finance an independent investigation into alleged
corruption in the now-defunct Iraqi oil- for-food program with $30 million
in oil revenues generated under the program. In a letter sent to the
Security Council on Wednesday, Annan said the investigation panel led by
former US Federal Reserve Board Chairman Paul Volcker could be financed
from funds left over in the account established by the council to cover
the UN-run program operational and administrative costs. The
Secretary-General said he "is informing the interim government of Iraq of his decision."
The Financial Times finally notes Iraq's interim government has formally
applied to join the World Trade Organization, much sooner than WTO members expected when they granted the country observer status last February. The application for full membership has to be approved by the WTO's ruling
general council before entry negotiations can begin but no date for any decision has been set. Even if the application is accepted, accession
talks typically take five to 10 years to complete. Iraq's accession bid is
particularly sensitive because the US has been blocking a similar request
by Iran, lodged in 1996, to join the 148-member body.
Source: The World Bank |
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