Where did the $20 billion go?

Susan Webb

The US occupation and its corporate cronies have ripped off 
Iraq's oil wealth and ravaged the country's infrastructure, 
several new reports show. Coalition Provisional Authority (CPA) 
boss L Paul Bremer slinked out of Iraq on June 28 after turning 
nominal power over to an Iraqi interim government. But Iraq has 
been left to pick up the pieces after a year of inept and often 
corrupt US rule, driven by the Bush administration's aim of 
turning Iraq's wealth over to US corporate control. The new 
reports show the US occupation has left Iraq worse off than 
before the war in many basic areas of life, and has tried to 
hamstring Iraqi efforts for real economic and political 
sovereignty.

The Open Society Institute's Iraq Revenue Watch program charged 
that the CPA "launched a last-minute spending spree using Iraq's 
oil money — committing billions of dollars to hastily conceived 
projects" just before the authority was due to close up shop.

On May 15, the CPA's spending arm, the Program Review Board, 
approved nearly US$2 billion in expenditures for "a host of 
poorly planned projects" without consulting the relevant Iraqi 
ministries, the Iraq Revenue Watch report said. The report, 
titled Iraqi Fire Sale, criticises the CPA's "rush to commit 
Iraqi oil funds to projects already funded by the US Government, 
instead of waiting for the interim Iraqi Government to make these 
budgetary decisions when it assumes power."

Meanwhile, the British humanitarian group Christian Aid assailed 
"the US-controlled coalition in Baghdad" for "handing over power 
without having properly accounted for what it has done with some 
US$20 billion of Iraq's own money."

In May 2003 the United Nations Security Council established the 
Development Fund for Iraq (DFI) to collect Iraq's oil revenues, 
repatriated funds previously held by Saddam Hussein, and 
transfers from the UN Oil-for-Food program, which ended in 
November 2003. This money was to be spent in the interests of the 
Iraqi people, and be independently audited.

Since its inception, the DFI has received US$19.3 billion. As of 
June 9, US$10.1 billion was left. The US has spent half of the 
DFI money and used up almost all of approximately US$2.7 billion 
in assets the US confiscated from the Saddam Hussein regime, 
according to a June report by the General Accounting Office.

In fact, the US occupation spent far more of Iraq's money than 
its own, the Accounting Office report shows. As of the end of 
April, the CPA signed contract commitments for only US$8 billion 
— about one-third — of the US$24 billion allocated by the US 
Congress for Iraq's reconstruction and humanitarian needs. But it 
signed contracts committing about US$15.5 billion — more than 
two-thirds — of the US$21 billion in available Iraqi funds.

Furthermore, the Accounting Office said, "Transactions worth 
billions of dollars in Iraqi funds have not been independently 
reviewed or the results reported."

Christian Aid noted, "It took until April 2004 to appoint an 
auditor — leaving only a matter of weeks to go through the 
books. Early reports of the audit indicate strong criticisms of 
the CPA's handling of Iraq's money. But the CPA is not going to 
be around to be held accountable."

"Astonishing"

In October 2003 Christian Aid revealed that an "astonishing" US$4 
billion of Iraq's oil revenues and other funds were unaccounted 
for.

Today, the group charges, "We still do not know exactly how 
Iraq's money has been earned, which companies have won the 
contracts that it has been spent on, or whether this spending was 
in the interests of the Iraqi people".

Iraqi Communist Party spokesperson Salam Ali said an independent 
auditing commission should be set up to go through all the 
accounts and contracts set up by the CPA, with authority to 
revoke or modify these as needed to serve the interests of the 
Iraqi people.

But more important, "real economic control must be transferred to 
the Iraqi government", Ali told the People's Weekly World. While 
achieving security is the top issue for the Iraqi people, he 
said, it is closely intertwined with the country's economic 
situation. Noting the waste, inefficiency and corruption of the 
US occupation, Ali said, "If a strong Iraqi government can 
utilise fully the oil revenues, we can do far better than what US 
companies and the CPA have done so far."

"Political initiative must be taken back from the Americans", Ali 
said. "It's about time."

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People's Weekly World