US offers Iraq $3 billion credit line

US Secretary of State Rex Tillerson in Kuwait City. (Reuters)
Updated 13 February 2018
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US offers Iraq $3 billion credit line

KUWAIT CITY:  The US will lend Iraq $3 billion to help rebuild the country, Secretary of State Rex Tillerson said on Tuesday as international companies and governments were invited to invest in projects in a nation decimated by the war with Daesh.

Speaking at a conference hosted by Kuwait, Tillerson called on members of the international coalition fighting the extremist group to contribute to reconstruction costs to help stop its return. 

Cities and towns in the north and west of Iraq suffered severe damage after they were stormed in a Daesh offensive in 2014 and then liberated by Iraqi forces supported by the coalition. Victory was declared in December. 

Rebuilding the country will cost more than $88 billion, Iraqi officials told the conference, with  $22.9 billion needed in the short term.

“Doing business in Iraq can be complicated, but the market has potential,” Tillerson told hundreds of businessmen and officials. “Investment opportunities presented today are just a fraction of what is possible.”

Tillerson said the government-run Export-Import Bank of the United States signed a $3 billion memorandum of understanding with Iraq’s Finance Ministry “that will set a stage for future cooperation.”

US businesses have already been “successfully” operating in Iraq in the past few months, and several commercial agreements have been signed to supply the country with $2 billion worth of agricultural products, electricity equipment and renewable energy technologies, he added.

Iraqi Prime Minister Haider Abadi called the conference “a genuine invitation to invest” in his country.

Iraq is fertile soil for investments following Daesh’s defeat, said Oil Minister Jabbar Al-Luaibi. Iraq says it needs $7 billion to repair its oil and gas fields. 

Al-Luaibi called for investment in the energy sector, and said Iraq has begun a new stage of rebuilding a state on a “solid, civilized basis.”

He added: “The doors are open. If you are Iraqi, you are welcome… I myself give priority to Iraqis, not only investors but also contractors.”

Iraq is working to relaunch the Baiji oil refinery, which was destroyed by Daesh. There are 73 discovered oil fields, 30 percent of them under development, Al-Luaibi said.

Ali Al-Ghanim, chairman of the Kuwait Chamber of Commerce and Industry (KCCI), which organized the event, said it signals the “beginning of a phase of security and stability in the region.”

He added: “Iraq is fertile soil for investments. The environment is more receptive than anywhere in the world… Iraq has potential. It has natural and human resources.”

Hafeth Ghanem, vice president of the World Bank for the Middle East and North Africa, said Iraq’s reconstruction is a goal for the international community, and will contribute to regional stability and security. 

Kuwait is also interested in contributing to the Iraqi market with its private sector. Ghanem said several meetings took place with representatives of Kuwaiti private firms to discuss the contribution. 

The US is hoping other Arab Gulf countries will invest in Iraq, particularly after relations between Riyadh and Baghdad improved last year with a series of high-level meetings.

Ghanem said the World Bank’s work in Iraq will involve financial and social projects, and rebuilding hospitals and schools in areas liberated from Daesh.

There was much emphasis on the importance of involving the private sector in Iraq’s reconstruction.

The oil minister said the government wants to involve the private sector in producing petrol and building gas stations.

The International Finance Corp. (IFC), the private lending arm of the World Bank Group, is working with the government to push the Iraqi private sector to invest and manage some aspects of the oil and gas sector. 

According to the Central Bank of Iraq (CBI), 64 of the banks operating in the country are private, 17 are foreign and seven are public.

International non-governmental organizations pledged $330.1 million on the first day of the three-day conference.


Yemen’s divisions were never fully healed

Yemen has entered its third year of war between the Iran-backed Houthi militia and the national army, supported by the Saudi-led Arab coalition. (AFP)
Updated 52 min 2 sec ago
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Yemen’s divisions were never fully healed

  • 28 years after the north and south merged, the challenges of bringing the country under one govt remain as great
  • It’s unity on paper only, but not in the hearts and minds of people, says Fatima Abo Al-Asrar, a senior analyst at the Arabia Foundation in Washington.

DUBAI: When Yemen’s national army marked the anniversary of north and south becoming one country, it was a reminder of the growing danger of the country once again fragmenting.

On May 22, 1990, the Republic of Yemen was formed when the two existing countries agreed on a unity constitution.

On Tuesday, President Abed Rabbo Mansour Hadi, who leads the internationally recognized government, which is fighting Houthi militias, said the unification of north and south Yemen remained the most popular situation and one that “reflected the civilization of an ancient people.”

As it stands, the Houthis control the capital Sanaa and the north, while the government, backed by the Saudi-led Arab coalition, controls the south and much of the rest of the country. Twenty-eight years after the north and south merged, the challenges of bringing the country under the control of a single government remain as great.

“When it happened in 1990, Yemen’s unification was nearly universally viewed as a historical achievement,” Adam Baron, co-founder of the Sanaa Center For Strategic Studies, told Arab News. He said current tensions are a result of how the unification was carried out.

“Until they’re dealt with — and until serious dialogue occurs — these fissures are only likely to deepen,” Baron said.

Yemen’s divides were exacerbated by colonialism. Britain had been present in the south from 1874 in agreement with the Ottomans, while the north was part of the Ottoman Empire. After the collapse of the empire in 1918, the north became an independent state and the south became a British colony in 1937.

Following civil wars in the north and the south and weak economies, the governments of the two states agreed to renew discussions about unification.

In 1990, Ali Abdullah Saleh of North Yemen and leader of the south Ali Salim Al-Beidh agreed on a unity constitution.

However, conflicts within the coalition resulted in the self-imposed exile of Al-Beidh, who had become vice president of the transitional government, to Aden in 1993. After clashes intensified, civil war broke out in May 1994.

In the aftermath of the war, in October 1994 Saleh was elected by Parliament to a five-year term. He remained in power until he was overthrown by the 2011 uprising that forced his resignation in 2012.

Six years later and Yemen has entered its third year of war between the Iran-backed Houthi militia against the national army and the Popular Resistance supported by the Saudi-led Arab Coalition.

Yemeni political analyst Baraa Shiban said that after 2011 the people aspiring for change and building a new country strongly believed in the outcomes of the National Dialogue, a 10-month consultation process that would form the basis of a new constitution. Many believed a new federal system of government would be the best outcome. 

“The Yemeni people didn’t have the chance to vote for this new vision due to the coup led by the Houthis,” Shiban said.

“The regime that ruled after 1990 failed in meeting the dreams and hopes of the Yemeni people, who struggled for many years to reach unification.”

He added that Hadi’s administration needs to find a new form of governance that meets the demands of the people.

Amid the conflict between the Houthis and the internationally recognized government, other battles have erupted with Al-Qaeda and Daesh insurgents, as well as the Southern Transitional Council, who are calling for the south to secede.

Tensions escalated earlier this year when army forces clashed with southern separatist fighters.

Fatima Abo Al-Asrar, senior analyst at the Arabia Foundation think tank in Washington, said there is no indication that the government of Yemen is working to improve relations or solve the southern crisis.

“So far, the government of Yemen has directly clashed with southern leadership that called for secession,” she said. “The government fails to understand the pulse of the street and fails to realize that it is the only culprit standing in the face of prosperity.”

Yemen’s Prime Minister Ahmed bin Dagher accused southern separatists of attempting a coup in the interim capital of Aden after they took over the government headquarters in January.

At least 15 people were killed, among them three civilians, medical sources in four hospitals in Aden said.

The clashes led Saudi Arabia and the UAE to send envoys in a bid to end the standoff.

The Saudi and Emirati envoys “met with all concerned parties, stressing the need to abide by the cease-fire ... and refocus efforts on the front lines against the Houthis,” the UAE’s official WAM news agency reported.

However, Al-Asrar says that the country is already divided. “There is no one unified Yemen anymore. Northerners find it difficult to step foot in the south. It’s unity on paper only, but not in the hearts and minds of people.”