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Area (


24,001,816 (July 2002 est.)


Iraqi dinar (IQD)


Update No: 038 - (27/06/06)

A complete cabinet, finally
On 9 June Prime Minister Al Maliki finally managed to complete his cabinet with the appointment of the three missing ministers. The Ministry of Interior was given to Jawad Polani, an independent Shia, while Defense went to Al Obeidi, an independent Sunni. The Ministry of Oil was given to Hussein Shahristani, a high profile member of the Shiite alliance (but not of any of the Shiite parties) who had previously been considered for the post of Prime Minister. Obeidi was criticised by some Sunnis because of his participation in the assault on Falluja, as an army officer, but all three candidates were smoothly approved by Parliament. The Sunni-nationalist Iraqi Front for National Dialogue remains however outside the government and complains that the Shiite alliance demanded that it change its platform in order to be given a 'fair' share of cabinet posts. Also, Allawi has made openly sceptical statements about the chances of this government to succeed, despite taking part in it. The current line-up of the cabinet is 18 ministers of the Shiite alliance plus one independent Shia, one Shiite Turkoman and one Shiite Kurd, 7 Sunni Kurds (including 1 Islamist), 7 Sunni Arabs (of the Islamic Sunni alliance), 6 secular followers of Allawi and 1 independent Christian.

Bones of contention
In the current political debate, the main bone of contention is the fate of the factional militias, which the Shiite alliance is planning to incorporate into the security agencies, a move opposed mainly by the Sunnis. Ethnic animosity is also set to increase, as the new Oil Minister has made clear that he will want to handle all oil contracts in Baghdad, a clear challenge to the Kurdish regional government, which is signing oil contracts directly. Within the Oil Ministry there is widespread support for this move, not only for political or ideological reasons, but also on technical grounds. In order to maintain and develop production, investment in new explorations has to be carefully planned and this can be done best from the centre, not least because of the lack of experienced personnel in the regions. 
Apart from ethnic animosity, however, one more threat to stability is emerging in the form of the decreasing internal solidity of the main political blocks. The Shiite alliance is ever more divided, with the Al Fadhila party, which is strong in Basra province, toying with ideas of local autonomy after failing to receive much in terms of cabinet posts at the national level, where it had eyed the position of Oil Minister. The Fadhila party controls the oil protection militias in the south and has been issuing threats to stop production if its demands are not met and some violence has already occurred. Already at present at least 6,000 barrels of oil are siphoned off each day from the southern oil fields. Finally, Allawi's alliance is also seeing increasing internal debate, stimulated by the unhappiness of some of the component groups about the distribution of the ministerial posts. 

Oil plans
Although the appointment of an oil minister is seen by some as a cause for optimism, the Bush Administration seems increasingly worried by ongoing developments. Bush himself suggested in June that the Iraqi government set up a trust to share oil revenue with the whole population. The current ministerial plans are to approve a new law, which will facilitate foreign investment in the sector. Oil production shows some signs of increasing, but with significant fluctuations month on month. In April production reached 2.14 million bpd, but in May it was back to 1.9 million bpd, of which 1.5 million were exported. 

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