For current reports go to EASY FINDER



Books on Iraq

Update No: 051 - (25/07/07)

Oil law still hanging in the balance
At the beginning of July the Iraqi Cabinet finally approved the new oil law, which has now been passed on to the parliament for ratification. An oil workers strike in June highlighted how the government might be vulnerable to the requests of the Unions, which want to be consulted on the draft law. They oppose in particular the involvement of foreign companies and are threatening new and longer strikes (or even a 'mutiny'). Prime Minister Maliki is trying to appease the oil workers with a two-fold pay rise, but observers believe that the Union leaders are politically motivated and maintain links with ethnic and sectarian groups. Therefore, pay rises might not resolve the problem. Unions, moreover, are not the only source of opposition to the current draft of the oil law. Most Iraqi experts oppose the revised law, including those who helped draft the original version, mainly because of the compromise which gives some role in the management of the industry to the regional governments without appropriate check and balances, which leave the road open to massive corruption. The experts are appealing to parliament for a more accurate and detailed discussion of the oil law, regardless of the deadline set by the Americans for its approval. At present, it is not even clear how much oil Iraq is producing daily. According to the US State Department production is stagnant at around 2 million bpd, but according to the US Energy Department production levels could well be 100-300,000 bpd below that figure. In any case, it appears very unlikely that the oil law will be approved before the August parliamentary recess, as demanded by the Bush Administration. 

Maliki defies all odds
Prime Minister Maliki's main strength seems to be the absence of a strong alternative to his name. Deputy Prime Minister Abdul Mahdi offered his resignation from his post in June, the most prominent of a series of officials to quit in recent months. The bombing of the Samarra shrine on 13 June has been a turning point for Maliki's popularity among his own Shiites, not least because of allegations of complicity from within the ranks of the corrupt police force. The same bombing prompted yet another boycott of the parliament by the Sadrist group. As Maliki maintains control over the Dawa party, any determined attempt to push him out would likely break the Shiite alliance. This gives Maliki sufficient confidence to rebuff his critics, be they the Bush Administration or fellow Iraqi politicians. In mid-July, somewhat provoked and clearly near the end of his tether, he even told the Americans that their troops are not needed and that Iraqi security forces would manage on their own. Having insisted on establishing a democratic regime in Iraq and having hoped that democratic elections would have resolved all the problems, the Bush Administration is now finding major difficulties in managing its Iraqi counterparts. 

Economy badly in needs to be jump-started
Insufficient electricity supply is the main hurdle which keeps the economy down. In July the government was only able to satisfy 50% of the country's demand for electricity, the lowest level from January 2004. One of the causes of the further deterioration is that the staff of the Ministry of Electricity is not sufficiently trained or motivated to handle the repairs and improvements done by the Americans of the generators, some of which have suffered serious damage, to the extent that the US Army was forced to bring them back under its control. Another cause of the paralysis are fuel shortages. Fuel prices have risen 50% over the last year as the Saddam-era subsidies are being phased out, but supply remains insufficient. The long queues are driving many towards the black market, where prices are three times as high. 

 « Top  

« Back


Published by 
Newnations (a not-for-profit company)
PO Box 12 Monmouth 
United Kingdom NP25 3UW 
Fax: UK +44 (0)1600 890774