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IRAQ


 

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Area (sq.km)
437,072

Population
24,001,816 (July 2002 est.)

Capital
Baghdad

Currency
Iraqi dinar (IQD)

President

Update No: 018 - (26/10/04)

Doubts grow about feasibility of elections
The Iraqi parliamentary elections, scheduled for January 2005, were the object of much activity during October. The Election Commission is preparing voter lists, while logistical planning is also going ahead. The real issue will however be security. Even if the southern part of the country remains quiet, which also cannot be taken for granted, there is about a quarter of the country where daily terrorist attacks seem to rule out an orderly and successful voting process. Opinion is divided with regard whether elections should go ahead, leaving behind a quarter of eligible voters. Shiite parties and individuals, in particular the grand Ayatollah Al- Sistani, are strongly opposed to postponing the elections, but there are growing concerns in other quarters that such a solution would only increase the divide between the different communities. Political parties are in any case getting ready for the elections, forming alliances and trying to put together joint lists. For what they are worth, opinion polls suggest that only a couple of Shiite Islamist parties and the two main Kurdish ones would gather a significant share of the vote, with the rest being split among a myriad of groups, hence the need to form alliances. In early October pro-government groups were proposing to form a joint list, which would include the aforementioned 4 parties as well as two pro-US coalitions, the communists and another (Sunni) Islamist party. Such a wide coalition would likely sweep the board, but it would also be very heterogeneous. As the end of October approached, the Shiite Islamist parties chose to take a different path and reached a preliminary agreement on a joint list, which does not seem to rule out the participation of secular Shiite groups, but would effectively marginalise them and force them to split from fellow secularists belonging to other religious sects. Although the US Embassy did not appear too pleased by the development, the endorsement of Al-Sistani for the Shiite alliance made it impossible to take any action against it. On the other hand, the Allawi government, which still enjoyed a 62% support among the population in the late summer, was down to 43% in early October, as Iraqis started to think that it could not deliver. 

A blanket too short
The difficult situation in Iraq continued to cause international tension during October. The French government took an open stand against the Bush Administration's call for 90-95% debt forgiveness to Iraq and claimed to have put together an alliance of creditors in favour of forgiving just 50% of the debt. The French left a door open for further forgiveness after a three-year period. With the backing of Russia, Germany, Italy and probably all the remaining euro area countries, the French succeeded therefore to isolate the US. Not even Britain fully supported the US position, proposing instead a compromise on an 80% debt forgiveness. Despite its isolation, the Bush administration showed little sign of being ready to compromise. The relationship between Turkey and the US is also being tested by the Iraqi mess. Ankara is complaining about the plight of the Iraqi Turkmen population, not only at the hand of the Iraqi Kurds, but also of US troops, who have been carrying out military operations in their home areas. 

Reconstruction under increasing scrutiny
With just over US$1.5 billion out of an authorised US$18 billion spent so far by the US on reconstruction, it is hardly surprising that ordinary Iraqis failed to perceive much of an improvement. Work has begun on just 442 projects of the planned 2,800. The fact that the cost of construction material is spiralling also mean that whatever money is spent, its impact is much less than what it would have been before the war. There are talks of costs having doubled or trebled and of course the cost of maintaining security has to be added too. The Center for Strategic and International Studies estimated that only 27% of the money spent by the US is reaching the Iraqi population, the rest being taken by security, waste and overheads. It also appears that local suppliers have artificially increased prices of construction material to maintain stocks in view of what they expect to be an imminent take in reconstruction activity before the elections. 

Ambitious plans, grim realities
The Iraqi Oil Ministry revised upwards its estimate of losses due to sabotage of oil facilities, claiming now that US$7 billion have been lost from March 2003. The Oil Ministry now claims that production has reached 2.8 million bpd and that it hopes to bring production to 3 million during 2005, a rather modest target which would allow the export of 1.8 million bpd. If the government manages to attract foreign investment for an estimated US$7 billion, the plan is to boost production to 6 million bpd by 2010. Independent observers, however, are far less optimistic and think that US$6 billion will be required just to bring the oil industry back to its pre-war levels, with another US$35-40 billion needed over a period of 10 years to increase production beyond that. 

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