- - - -- - ...E!\ga.Jl]- - ··- - . Coalition Provisional Authority Ministry of Transp~rtation Finance Briefing 28 January 2004 Office of Ambassador Darrell Trent Senior Advisor to the Iraqi Ministry of Transportation 11111111111 02809 Poge128 Funding Sourees Funding for Iraqi reconstruction and annual government operations is being made available ftom a number of sources--Iraqi-own source revenue particularly oil revenue, US Governments grants, grants from other donor nations, and grants and loans from international development agencies. At present, only Iraqi own-source revenues pass through the Iraqi Government annual budget; however, it is anticipated that over time an increasing proportion of other sources of funding will be reflected in the formal Iraqi budget. 2003 Iraqi Budget' The main source ofnwenue for the Iraqi budget is oU revenue (89%), which wiD be channeled through the Development Fund for Iraq (DFI). (see Appendix D for more information on DFI). Other revenue is derived from taxes. fees and charges and dividends from state-owned enterprises. For the fiscal year ending 31 December 2003, the 2003 Iraqi budget totaled $6,099.6m.2 Funding allocated for operating and capital expenditure was $2,002.lm and S3S2.7m, respectively. Ofthis, the Iraqi Ministry ofTransportation was allocated $10.8m (O.So/o) for operating and S49.7m (13.9%) for capital expenditures (see Appendix A). At 31 December 2003, operating funds had been fully expended and [ ]% 3 of <:apital funding had been completed. Details ofindividual projects are shown in Appendix A. Unspent monies from the '03 budget were allowed to be canied over with specific authorization by the Iraqi Governing Council's Ministry of Finance. Many projects are being completed in 2004. Program Review Board (PRB) Funding .. The PRB has been designated by the CPA Administrator to control the emergency allocation of certain funds under CPA control for the purpose oflmqi reconstruction. The sources of fimds are US Government appropriations, the Development Fund for Iraq (oil sale proceeds) and vested and seized Iraqi assets. Of total fimding of$373.7m approved to date, the Ministry of Transportation has been allocated $20.9m for 20 projects, details of which are shown in Appendix C. FWlding has been completed for 19 of these projeets. For the Baghdad International Ailport Security project. $8.3m has been expended from the allocation of$14.8m. 1 See www.cpa-iraq.oqfbudret and click ou 2003 Budget spreadsheet. 2 AD fiDaDciaJ sums arc stated in millions of US dollars. DFmillion. 3 We arc awaiting this figuR from tho Iraqi MOF. 4 Sec www.epa-lraq.orpfbudpetlprorram-revtew-board.btml 2 Page129 In addition. S 1Om bas been allocated to the Ministry of Oil for the rehabilitation of oil facilities at seaports and bas, therefore, been classified as transportation expenditure. To the present, there has been no use of funds for this project. 1004 Iraqi Budget' Total funding for the Ministry of Transportation (MOT) in the 2004 budget is expected to increase to $84.8m, reflecting the full year funding requirement (funding in 2003 was on a part year basis, following the establishment of the new administration at the end ofhostilities). However, in proportionate terms, Ministry of Transportation allocations will fall from 1.0% of total budget funding in 2003 to 0.62% in 2004. Details of projects which will be funded under tJJe 2004 budget are shown in Appendix A spreadsheets. 2004 Additional Iraqi Budget The relative decline in 2004 funding will be offset by the provision of an additional $187m which is to be made available as a result ofhigher than expected oil revenues. CPA and Iraqi Ministries are at present prioritizing possible allocations of the additional funds. As of January 24, 2004, $2Sm has been eannarked for railroad improvements and $12m for spare parts at the ports, leaving $150m still available for various transportation projects. The Iraqi MOT and CPNMOT are working together to earmark these funds (see Appendix ~). 2003 US Government Supplemental Funding (to be upeuded in 2004) In late 2003, the 1 08th Congress approved President Bush's request for an $87 billion Supplemental spending bill to the fiscal2003 budget. Of this sum, $18.7 billion is for non-military reconstruction purposes. From this figure, $365m of Supplemental funding has been made for Iraqi transport reconstruction work in 2003 (see Appendix B). This represents 44.2% of total funding available to the Iraqi central government sector for transport infrastructure and services in 2004. Up to 135 small to large reconstruction projects in the aviation, rail and maritime sectors are being evaluated for funding under the Supplemental program (see Appendix A). While project planning is well advanced, there bas been no disbursement of Supplemental funding for transport projects to date. s See www.cap-lnq.orrlbudret and click on 2004 budgct. 3 f'89a130 ___ •• _ Otber Fundmg' In 2003 and 2004, USAID fandiDg of $119.9m is being made available for transport infrastructure work. To provide management senices at Baghdad International Airport and the port ofUmm Qasr, respectively, SkyLink bas received a cont:ract totaling $17.Sm and Stevedoring Services of America has received a contract totaling $14.3m. USAID also provided $59.7 million to Bechtel to rebuild the port ofUmm Qasr, and rebuild the Baghdad and Basrah airports. Rec:onstruction of the Umm Qasr-Sbouaiba railroad junction bas been undertaken at a cost of $18. 7m, and crash/fire equipment totaling $2.2m was provided to tbe Baghdad International Airport authorities. Additional funding totaling $7 .Sm wilt be allocated to aviation reconstruction projects. Department of Defense funding of transportation projects also takes place under the Commanders Emergency Response Program and is disbursed by the military authorities for urgent projects identified by military commanders. Fwuting of$0. 7m is being provided in 2004 for eighteen small-to-medium railroad rehabilitation and reconstruction projects. Following the Madrid Donon' Confenn"' the ItaUaa Government bas promised $2m for upgrading of meteorological services in 2004. Discussions will continue with other donor nations on transportation projects which they may be prepared to fund in 2004. In particular, negotiations are well advanced with the Government of Japu on a substantial contribution to Iraqi reconstruction (expected to be well in excess of$lb). CPA Ministry of Transportation January 2004 Ambassador Darren Trent, Senior Advisor to the Iraqi Mhlistry of Transportatiou 6 Por c:omprehe.asive budget line-items. see Appendix A. 4 APPENDIX A Ministry of Transportation Comprehensive Budget 03 Iraqi Progmm CAPITAL EXeENDOVRES Budget Rayfew Boarcl AVIATION Basrah International Airport 2,200,000 Mosul Airport 2, 700,000 Mosul Airport Infrastructure Mosul Airport Air Navigation S~tem (Comm. & Security) BIAP Securtty Contract BIAP ClearHJp BIAP Infrastructure SlAP Air Navigation System, Initial 11,200,000 BIAP /IJr Navigation System (Comm. & Security) Basrah, Mosul Atr Navigation Sys. Other Locations, Air Navigation S~. Air Navigation Department Italian Meteorological Donation Remaining Procurement Items Gates and Doors for Passenger Terminal Bechtel Contract for BIAP & Basrah SlcyUnk Contract for Airport Admin. BIAP crash/fire rescue Unallocated USAJO funds 14,840,000 ' 11,200 l 198,400 TOTAL AVIATION 18,100,000 CAPITAL EXPENPITURES RAILRQAPS VHF Line of Sight Radios Bal~osul Railway Hllla-Samawa Railway BaghdadHBaijiRaOWay Railroad Security Iraqi Railroad Security Contract (1 month) Railroad Radio System RaU and Telecom Op. Cost Funding Iraqi Republican Railroad Wall Repair Iraqi Republcan Railroad-Startup Costs Iraqi RepubUcan Raltroad Repair Railroad Passenger Car Rapalr Operations S1art·Up-Shelsla Railroad Locomotive Parts Railroad Crane Repair Parts Railroad Water Pump Computer-Basad Train Contro1 System Locomotive Repair Parts Ganger Trolle)'S Flaahbutt Welders Rail CUps Rolling Stock Rehabilitation Track laying Machines Spare Valves and Hoses LPG Tank Wagons Container Handling Equipment Container Wagons Shalschla Shop Rehabilitation and Repair APPENDIX A Ministry of Transportation Comprehensive Budget 03 lraal BUdaf!l Proararn Review Board 2,000,000 1,000,000 800,000 700,000 57,692 36,600 3 956 000 • '1-......... J> ... ~ · ·· ·:.r -· • • . t"·~'t ;.t';r''"" !ll'"'·,f ·" 416 000 ,-NI!':i(:;,.., · ~· ;IL .'-. ... 101 t A· ~~ .:~. • • .c".;. .i.:af . .r:.!' f:~ol 245,200 181,830 131,280 131,280 32,300 .~ ""-' ' <;,.:; ~ 3,770 990 600 l ~ Baghdad StaUon and Office Rehabilitation Headquarters, Local Area Network (LAN) Other Repair Shop locations Akashat Bridge Reconstruction Umm Qasr.Shou81ba Jet Reconstruc:tton Aber Optics Communication System Other Track Maintenance Turnouts Local Points Signals Rehabilitation of Other Stations SabonJa.Rabla'a Truck Reconstruction Bayjt.Mosul Track Reconstruction Baghdad-Bayjl Reeonstructlon Coaches TOTAL RAILROADS 4,500,000 APPENDIX A Ministry of Transportation Comprehensive Budget ·· ':"'1:7~;i!'r· .. l -.,c• '-'"%'!"""" • -~·· .. ,. - •• ._ . - lh =,~. ·t{'~ · ;~ : ' ' . ; _~: ~-:~ . :-A . J+:.)~-~~~!!0 _ _ .. , ._ ·~·.,....'· - • · - ~· - ~·.,...,,.... ,,, ~~ ~'(1 ~~;; .t : ~ : k ~--. 1lj'i·9P_CJA • ~:. ~ . ~ ,. . · ~. 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