'Iraq needs US$100 billion to rebuild infrastructure'

Iraq needs around US$100 billion over the next four to five years to rebuild its shattered infrastructure, a government spokesman said yesterday.

"The situation in Iraq surpasses Iraq's ability to finance development projects," Ali al-Dabbagh told a news conference in Kuwait during a meeting of officials from donor nations and the United Nations on Iraqi reconstruction and economic reform.

Iraq's infrastructure was ravaged by decades of sanctions and war during the rule of deposed President Saddam Hussein, and by the US-led invasion in 2003 and the violence that followed.

Reconstruction has been hampered by insurgent attacks which forced many projects to be halted and diverted funds away from rebuilding and into increased security.

The oil industry has been hit by frequent sabotage. "The Iraqi economy is a one-crop economy built on oil only and there are no other revenue sources... therefore oil exports are being spent on operational expenditure," Dabbagh said.

"Until the oil sector can rise and assume its full role ... we need this sum for the infrastructure and for investment expenditure."

The meeting in Kuwait is the last set of discussions on the International Compact for Iraq, a roadmap for economic reform.

Ashraf Qazi, the UN secretary general's special representative for Iraq, told the meeting that in coming weeks the United Nations will consult with countries and institutions which had shown interest in helping Iraq.

Iraq's goals include winning relief on some US$40 billion in debt owed to Gulf Arab states. Western states have already forgiven Iraq much of its debt but Saudi Arabia and Kuwait, the biggest Gulf creditors, have made no firm commitments.

Kuwaiti Foreign Minister Sheikh Mohammad al-Salem al-Sabah hinted that there was little movement on the issue of some US$16 billion that Iraq owes it, reiterating that debt forgiveness is a matter for the Gulf country's parliament to decide on.

Source: China Daily