U.S. qualifies Arab allies for military contracts in Iraq

Thursday, December 11, 2003

The United States has deemed Arab allies eligible for military and reconstruction contracts in Iraq.

The Defense Department has cited a range of Arab countries as having cooperated with the U.S. effort to reconstruct Iraq. They include countries that have opposed the U.S.-led war against the Saddam regime in March and later refused to recognize the new government in Baghdad.

The Defense Department list of 63 countries eligible to win $18.6 billion worth of contracts from the Coalition Provisional Authority included Bahrain, Egypt, Jordan, Kuwait, Morocco, Oman, Qatar, Saudi Arabia, Turkey and the United Arab Emirates. All of these countries would be eligible to become prime contractors in U.S.-funded projects in Iraq.

Israel has not been included on the list of countries eligible to compete for contracts, Middle East Newsline reported. NATO allies such as Canada, France, Germany and Russia were also not listed.

"It is necessary for the protection of the essential security interests of the United States to limit competition for the prime contracts of these procurements to companies from the United States, Iraq, Coalition partners and force contributing nations," Deputy Defense Secretary Paul Wolfowitz said in a memorandum dated Dec. 5. "Thus, it is clearly in the public interest to limit prime contracts to companies from these countries."

Of all the Middle East states on the list, only Turkey agreed to provide troops to stabilize Iraq. Officials acknowledged that Egypt refused a similar U.S. request.

"The prime contractors, however, can choose their own subcontractors," State Department spokesman Richard Boucher said. "There's very few restrictions on subcontractors. Subcontracting opportunities are available very widely. In addition, it's important to remember this is only part of the money that will be used for reconstruction of Iraq. This is the portion that was appropriated by the U.S. Congress in the supplemental appropriation."

Pentagon spokesman Lawrence Di Rita said nations that are not part of the coalition cannot serve as prime contractors for any of the reconstruction funds provided by Congress as part of the fiscal 2004 defense supplemental spending bill. Di Rita the U.S.-led coalition remains open to new countries.

"There are countries that are considering, for example, the contribution of forces to Iraq," Di Rita said. "If a country decides to contribute forces to Iraq, they would immediately be eligible for consideration."

Kuwait has won a range of contracts to supply U.S. troops in Iraq. Jordan has been awarded a contract for the training of Iraqi police. Egypt has also been vying for a project to train Iraqi intelligence and security forces.

The Pentagon decision to include Arab states as prime contractors come as officials acknowledge difficulties in organizing the new Iraqi military.

They said about a third of Iraqi soldiers who underwent training have resigned. Many of them complained of the low salary of $60 a month and expressed fear of retaliation by Saddam loyalists.

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