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Update No: 084 - (27/03/10)

The moment of truth
Although at the time of writing the definitive results of the Iraqi parliamentary elections were not yet known, the trends emerging from the count were pretty clear with about 90% of the votes already counted. Maliki’s State of Law Coalition and Allawi’s Iraqi National Movement were neck-to-neck, both at around 25.5% of the votes. Whether Maliki would come on top or not has some symbolic importance, as the outgoing Prime Minister would certainly have expected to win a plurality and his party started crying foul as soon as this seemed in doubt. However, the lacklustre performance of Maliki and his coalition and the rise of Allawi are not much of a surprise to most observers. Even if Maliki was to emerge from the final count with a slight lead, his chances of leading the next government coalition might now be slim. Allawi has emerged as the real winner of the contest, because as a Shia, he managed to get the votes of a majority of Sunnis and in so doing, position himself as one of the key players on the Iraqi political scene, after his humiliating defeat in 2005. Most other participants in the vote all have some reasons to be disappointed. The Iraqi National Alliance, which regroups the Shia religious factions opposed to Maliki, obtained a satisfying result overall, but within it the lion’s share has been taken by the Sadrists, with at least 40 seats out of 70 or so. With their performance well above expectations, the Sadrists emerge therefore as the alternative winners of these elections, seeing that other religious factions are reduced to a relatively marginal role. The Kurdistani alliance suffered from the emergence of a serious challenge among Kurdish voters and from the impressive mobilisation of Arab Sunni voters in areas of mixed population and lost an estimated 13 seats. With the 40 remaining seats it might however still emerge as kingmaker in the near future. The old Iraqi Accord front, a Sunni religious leaning coalition, has been crushed by Allawi’s success and lost 36 of it 44 seats.

The difficult part is to come
The task to form a viable coalition will not be an easy one: Allawi had in the past good relations with the Kurds, but since he allied with the Sunni Arab nationalists he no longer represents their favourite option. The Kurds and the Iraqi National Alliance are not likely allies either: the Islamic Supreme Council of Iraq and the Kurds have some sympathy for each other by virtue of a shared interest in federalism, but the Sadrists are in favour of a strong central government and flirt with Arab nationalism. However much the Kurds might have disliked Maliki, it seems that they might have no option but to back him again. Even then a third party will be necessary to give the alliance a majority in parliament.

The horse trading that will characterise the formation of the future government will probably elevate the budget approval just before the elections, as an example of strategic thinking. The US$72 billion budget includes investments for US$20 billion and operational expenses for US$52 billion, of which US$19.6 billion will be funded through a deficit. The government hopes that oil prices will rise in 2010, so that the deficit will end up lower than currently estimated. To appease the demand of the oil and gas producing regions, they will receive US$1 per barrel of oil, or per 150 cubic metres of natural gas. Even the provinces bordering the oil producers will receive some cash benefits, as stated by the government in order to help them deal with the environmental consequences of oil production. It would seem that Maliki meant to prepare the ground for negotiations after the elections, but with these results he might have to have to offer more in order to secure sufficient coalition partners.

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