DUBAI, 28 February 2004 — Representatives of donor countries and international agencies meeting today in Abu Dhabi on Iraq’s reconstruction are hoping to accelerate the disbursement of $33 billion pledged last year for the war-torn country.
The two-day meeting in Abu Dhabi, which will group delegates from about 40 countries, including the United States, the European Union and Japan, as well as the World Bank, the International Monetary Fund (IMF) and the United Nations, will study proposed donor plans and mechanisms for their financing, organizers said.
Iraq is hoping $3.5 billion will be allocated this year for reconstruction, the country’s interim minister of planning and development cooperation, Mehdi Al-Hafidh, said in Baghdad. To this end, Iraqi officials and the US-led coalition occupying Iraq have compiled a wish list of some 700 to 1,000 projects to rebuild the country, which will be presented at the donor meeting, a source familiar with the requests told AFP in Baghdad yesterday.
The source, requesting anonymity, said the projects cover a broad range of subjects both urban and rural, from rebuilding schools and supplying power to tackling pesticide on farmland.
A senior World Bank official visiting Dubai has said Iraq will only receive about $500 million out of the $33 billion promised by donors up to the June 30 deadline for the transfer of power to Iraqis.
“The total package we are trying to commit by June 30, which is our target, is over half a billion dollars which is a reasonable chunk of money,” John Speakman, the bank’s senior private sector development specialist for the Middle East and North Africa, told AFP.
The money will come from a trust fund jointly administered by the bank and the United Nations Development Group (UNDG) and is expected to be approved by the so-called Facility Donor Committee when it meets in Abu Dhabi tomorrow following today’s presentations by Hafidh and international agencies.
Speakman said that security problems, the fact Iraq is still occupied and the need to ensure the huge sums were not misspent meant the disbursement had to be limited. “Insecurity in Iraq does not encourage direct investment” in the country, said Saudi economist Bashir Bakheet, adding that it was “difficult to envisage reconstruction before restoring security.”
Consequently, he said, “all aid should be for the fundamental needs of Iraqis and to stabilize Iraq, because the country doesn’t need aid from anyone for its development since it has the world’s second largest oil reserves.”
Aware of the problems posed by the country’s insecurity, the interim Governing Council also knows that international assistance will help resolve that insecurity.
“This assistance is crucial to satisfy the Iraqis’ immediate needs and allows us to transform the economy,” interim Iraqi Finance Minister Kamal Al-Kilani said earlier this month. Kilani was speaking at a finance ministers meeting of the Group of Seven major industrialiZed countries in Boca Raton, Florida, where he urged donors to speed up the payment of pledged funds.
At the Madrid donor conference last October, Iraq secured pledges of $33 billion in loans and grants, which included $18.6 billion promised previously by the United States. But the amount fell short of an estimated $56 billion that Iraq needs through 2007.
