Depressing picture misleading. Renewal of economic activity, air
of excitement as Iraqis jostle to fill political vacuum. Local
issues of greatest concern. Coalition will be judged on results.
$280 million allocation to over 1300 projects in South. Need to
help Iraqis over transition. 5 preoccupations: security,
employment, utilities, public services and corruption. Iraq's
assets give grounds for guarded optimism.
Detail
1. I have been Coordinator of the Coalition Provisional Authority
for Iraq's Southern Region (CPA South) for 23 days. I offer some
impressions of Southern Iraq and our tasks in the remaining 127
days before we restore sovereignty to the Iraqis on 1 July.
2. Southern Iraq is a wasted landscape: ugly, featureless desert
with few trees and littered with the wreckage of Saddam's follies.
The high water table means that cities are awash with sewage and
rubbish. The infrastructure is crumbling: power stations,
factories and even petrol stations rely on antiquated, inefficient
and barely functioning technology. Punished and neglected under
Saddam, the four Southern governorates have high unemployment
rates, especially in Dhi Qar. 80 per cent of the population
depend on food rations. Without effective border security, the
region is open to smugglers and organised crime as well as malign
Iranian and Wahhabi influences.
3. This depressing picture is misleading. Jobs are being created
in both public and private sectors at an accelerating rate. The
results can be seen in markets full of goods, especially
electrical appliances. The pay of doctors has risen from 3 to 350
dollars a month. Everywhere except in one dreadful town in Dhi Qar
I have been warmly welcomed and thanked for the coalition's
efforts. In Al Amarah I joined a lively debate among tribal
elders about renewal of the local town Councils: I told them that
in 35 years in the Arab world I had never witnessed such free
discussion. There is a palpable feeling of pride and excitement as
Iraqis for the first time accept responsibility at a local level
for deciding the future of their districts instead of carrying out
orders from Baghdad.
4. Understandably the debate about choices is confused. In most
areas there are demands to hold makeshift direct local elections
immediately. The political vacuum is filled with a fermenting
brew of religious and secular parties jostling for power but
uncertain what they want to do with it and without clear
manifestos. Some have an extreme Islamist flavour, a few are
associated with paramilitary militia or are on a criminal fringe.
None, as far as we can see, pursue an overtly foreian or
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5. After 6 months of hard work by my predecessor CPA South now has
almost a full house of specialist experts, working in close
harmony with Multinational Division South East (MND SE), to help
the Iraqi authorities meet these expectations. We have much less
time than previously envisaged. By next week CPA South/MND SE
will have committed $280 million to more than 1300 projects,
targeted to create jobs, make a quick and visible impact and be
completed by 30 June. The programme covers emergency repair of
the infrastructure and support for local authorities. Our
capacity will be stretched to deliver on time: even if we had
more funds and staff I doubt if we could complete many more
projects by 30 June. Our expertise will supervise CPA projects to
completion; advise and support where wanted the new programmes of
other donors - notably the US Project Management Office(PMO)
(with $2.9 billion of Supplemental funds earmarked for the South,
primarily for electricity and water) and Japan ($1.5 billion all
for the South in 2004/5); ease the return of the United Nations
agencies and other donors where possible; and strengthen the
capacity of Iraqi government officials to plan and execute their
own reconstruction programme. This is the greatest - and longer
term - challenge: to convert a public service used to receiving
orders from the centre to a service delivery mechanism responsive
to local needs. So it is essential that some of the experts now
here in key areas should remain to support the difficult
transition, whether under contract in a DFID team or a different
umbrella: the PMO as the biggest spender may be suited for this
and are looking for support for the long haul. Ironically from
my first day my role has been to plan a painless dissolution of
CPA South.
6. After one quick tour of the region and a few meetings with the
emerging local leaders I hesitate to assess prospects or to
forecast how our role will be viewed on 1 July. Instead I suggest
that our concerns over the next 4 months will be in 5 main areas:
security, employment, utilities, public services and corruption.
7. Security. For now the South is generally under control but I
am sure Jeremy Greenstock is right to warn me that success here
depends on success at the Centre despite the relative lack of
interest in national politics. Ayatollah Sistani has impressed on
us the extent of his influence in the streets of Basra. Admirable
tactics by MND(SE) to win hearts and minds are clearly effective
as I have seen on the street but there are parts, especially in
Muthanna and the Cinderella province of Dhi Qar, where they do
not reach. The military are increasingly successful at deterring
and dealing with attacks against coalition targets. The public
looks to us to deal with organised crime, looting, smuggling,
illegal immigration and political assassinations. We are assisting
the military in devising a strategy for separating, without
unnecessary confrontation, political parties from their associated
armed thugs. These difficult tasks require effective Iraqi
security forces: much of the Coalition
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returning exiles in private investment opportunities.
9. Utilities. Sewage, water and electricity are the priority but
one year is not enough to deliver what every Iraqi expects. There
will be short term fixes in the most needy areas and a modest
increase in electricity supply available to central Iraq, provided
that saboteurs do not again bring down transmission lines to
Baghdad. The best guess is that the increase will fall well short
of peak demand this summer: the coalition will get the blame for
the shortfall, victims of our success in stimulating economic
activity and the market for electrical appliances. Massive
investment in these basic services will show results in 2-3 more
years.
10. Public services. Reform is a long term process. The problems
of a supine public service dictated to from the top frustrates us
all in our daily work, Iraqis and foreign advisers alike. It
affects our mission most acutely in the late delivery of budgets
and salaries; inability to pay budgets or stipends to the local
councils we are trying to encourage as the accepted grass roots of
the new Iraq; and strikes affecting key sectors (oil, port and
transport workers) over leapfrogging pay rises in the absence of
any credible trade unions to negotiate with management. Some
Ministries are better than others but much CPA time is spent
fighting fires on these internal matters which are potential
threats to security.
11. Corruption. I highlight this because it pervades everything
here and calls into question the sustainability of what the
Coalition is trying to achieve across the board. It is difficult
to see how ingrained habits can be changed in the short term. Yet
if the security forces are able to get away with corruption there
will be no stopping it after 1 July. Then the institutions of the
new democracy would be at risk of becoming as discredited as they
were when I was in
12. Despite this gloomy reservation I would like to be guardedly
optimistic for Southern Iraq if the coalition can lay a basis for
stability. The Iragis have valuable assets: an abundance of oil
and water of course but also dormant entrepreneurial and technical
skills waiting to be leavened with the wealth of returning exiles.
I hope that I remain as optimistic when I sign off on 30 June.
NIXON
Sent by CPA BASRA on 24-02-2004 07:39
Received by No10 on 24-02-2004 08:09
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