Despite billions in oil income, Iraq says it cannot afford to build the infrastructure citizens badly need. A draft law allows Iraq to borrow money to get various jobs done. But the proposal seems to be going
A few days ago Iraqi Prime Minister Nouri al-Maliki threatened to move forward with a draft law on Iraqi infrastructure – with or without parliament’s approval.
The law, which has been in the pipeline for several years already, would allow the government to enter into contracts with international firms on infrastructure projects in Iraq, improving services in areas like water supply, power and education. All of these are things that ordinary Iraqis would very much like to see working properly in their country.
The infrastructure law would allow the Iraqi state to basically take out “loans” with companies tasked with the jobs and then repay them at a later date.
But the law’s political opponents have a different opinion: they believe that the conditions of the law might allow foreign firms that are not paid on time to take control of Iraq’s oil, the country’s major source of income.
Iraqi Prime Minister Nouri al-Maliki has been trying to push the law through for some time. It had previously been rejected by all political parties except for al-Maliki’s own. The law was also added to the 2012 federal budget – however when parliament voted on the draft budget, the related paragraph was removed.
And on September 15, the Prime Minister addressed Parliament to impress upon the 225 gathered MPs the importance of the infrastructure law. Al-Maliki said that the law was so important that if the MPs did not vote for it, then the government would proceed with the law in other ways that didn’t involve them.
Some of those present said the law is badly needed and that it would provide jobs and longed-for services.
Local economist, Kamal al-Basri, recently appeared at a seminar in the capital and said he supported the idea of the law. “The delay in passing the law will further delay bridging the gap between Iraq and other countries and will eventually lead to a failure in important infrastructure like ports, bridges and other construction,” al-Basri argued.
“The infrastructure law is for all Iraqis and not just for the politicians,” MP Abdul Salam al-Maliki, a member of Prime Minister al-Maliki’s State of Law bloc, told NIQASH. “But there are some politicians who don’t want this country to develop.”
Meanwhile critics of the law are united in opposition – almost every political party other than al-Maliki’s own expressed doubts about the bill’s current draft. Even other parties in al-Maliki’s ruling coalition were opposed to the bill in its current state.
“The bill has huge political and economic repercussions,” Mahma Khalil, an MP from the Kurdish Alliance, told NIQASH. “The law violates the Constitution and Iraqi financial management laws which restrict state spending to within the annual federal budget.”
Khalil explains that, in its current draft, the law guarantees any foreign firms payment for their work with interest. Should the country be unable to pay the firms for their work, or payments be delayed, then it is possible that Iraqi oil payments could be forfeit. “This is very dangerous and has serious political and economic repercussions,” Khalil noted, adding that the law doesn’t take into account the possibility that the price of oil falls or that Iraqi oil production could halt for as yet unknown reasons.
Khalil concluded by saying that his bloc - the Kurdish bloc which often holds a balance of power in the almost-evenly-split Iraqi Parliament - wouldn’t be voting for the law without further amendments and information.
“Because of the ambiguity in the legislation with regard to how money will be spent and how it will be managed, this draft law opens the door even wider to financial and administrative corruption,” argued MP Haider al-Mula, a member of the main opposition bloc, Iraqiya.
Another opposition MP, Wael Abdul-Latif, stated that it was important that parliament, not the executive branch, “supervised the implementation of these projects and approved them”.
And behind the scenes, further reasons were given for the antipathy being directed at a legislation the country really seems to need badly: the upcoming elections. Al-Maliki is not a popular man – a large group of MPs have recently tried to oust him from his position. And with upcoming elections, they’re worried that his main motivation with a law like this – which relates to many things that the Iraqi voters need and want – is to increase his own popularity with electors, without concern for consequences.
As of this week, Iraqi politicians appear to have done what they often do when they reach an impasse: formed a committee to investigate and postponed voting until a later date.