The international community got together in Kuwait this week, at the initiative of the Amir of Kuwait, Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, to pledge loans, funds and investments worth $30 billion for the reconstruction of Iraq. The three-day “Kuwait International Conference for Reconstruction of Iraq” organised by the state of Kuwait, saw participation from 76 countries, including India. These countries came together in their pledge to help Iraqis rebuild their lives post the “defeat of ISIS” and ensure that the terrorist group, also called Daesh, did not rear its head once again. As the Amir of Kuwait said at the official inauguration of the conference, the magnitude of the destruction inflicted on Iraq by the terrorists was such that the international community needed to come together and help that country embark on an inclusive process of reconstruction. The Amir promised that Kuwait would give Iraq $1 billion in loans and $1 billion in investments, as part of this process.

According to the list released by the organisers, apart from Kuwait’s pledge, Turkey pledged $5 billion, US $3 billion, Saudi Arabia $1.5 billion, the Arab Fund for Economic and Social Development $1.5 billion, Qatar $1 billion, and Great Britain $1 billion over the next 10 years. Substantial amounts were also pledged by Germany ($617 million), United Arab Emirates ($500 million), Islamic Development Bank ($500 million), European Union ($494 million), Finland ($10 million) and Malaysia ($100,000).

India promised to get involved in “project specific proposals” by playing “a substantive role in major projects in petrochemicals, health, education, infrastructure and other sectors”. India has already contributed US$20 million as assistance to Iraq through different programmes, and an additional US$10 million towards the International Reconstruction Fund Facility for Iraq. India, through Minister of State for External Affairs, M.J. Akbar also promised to “look at any specific requests for rehabilitation projects and essential supplies like medicines, equipment, etc., as required for internally displaced persons”.

The conference also saw participation from 107 international and regional NGOs, 51 development funds and institutions, and around 2,000 entities from the private sector. Also present were UN Secretary General António Guterres; High Representative for Foreign and Security Policy of the European Union, Federica Mogherini; World Bank president Jim Yong Kim; and US Secretary of State Rex Tillerson, among a host of other dignitaries.

NEED FOR RECONSTRUCTION

According to the Iraqi government, Iraq is in dire need of reconstruction, three months after having declared that it, with the help of an international coalition, has defeated the ISIS and liberated swathes of territory, including some of its most important cities such as Mosul, Fallujah, Tikrit and Ramadi that the terror group controlled and destroyed over a period of three years.

The numbers given out by the Iraqis are something like this: over 18,000 people died in these three years, while over 36,000 have been injured or maimed for life; additionally, the violence has led to the forcible displacement of over five million people, while 11 million are in need of humanitarian assistance. Sexual abuse, enslavement and human trafficking of women and children by ISIS terrorists have led to a situation where reconstruction is not just the physical re-building of roads, bridges, industry and houses, but has acquired the dimension of repairing whole communities, especially in the northern and western parts of the country. The Iraqis have identified seven of the country’s 19 governorates/provinces as requiring maximum attention: Baghdad, Nineveh, Saladin, Al Anbar, Kirkuk, Diyala and Babil. The rest of Iraq has been relatively peaceful.

OIL WEALTH

The Iraqi government estimates that it needs $88 billion in the next five years to help the country get back on its feet. The $30 billion pledged at the conference is expected to go a long way in this process. While the figure falls far short of the $88 billion-mark, but as Iraqi Prime Minister Haider al-Abadi pointed out at a press conference to mark the end of the event on Thursday, “Iraq is a rich country. It (now) needs its friends to stand by it. The economy of Iraq will soon be back on its feet.” In fact, Iraq has the world’s fifth largest oil reserve. At the investors’ summit organised as part of the conference, the Central Bank of Iraq presented a report on the country’s “damage and needs assessment”, based on Iraqi, World Bank and International Monetary Fund estimates. According to this, in the period between 2018 and 2023, of the $88 billion needed, the Iraqi government needs to finance $77 billion, of which $50 billion can come from oil revenue, “under current oil price outlook and assuming a floor of $50 billion for gross official foreign exchange reserves”.

In this context, it must be mentioned that in April 2017, Iraq became India’s top crude supplier, by replacing Saudi Arabia. According to agency reports, in April 2017, India was importing 1 million barrels of crude per day from Iraq. This trend continues.

NEED FOR FAIRNESS AND ACCOUNTABILITY

However, questions were raised about Iraq’s ability to repay its loans, considering, by the end of this year, Iraq’s debts are likely to be in the region of $130 billion, according to IMF estimates. And this despite Iraq witnessing a huge rise in revenues from increasing oil production. Iraq’s GDP was in the range of $170-odd billion in 2016.

Questions were also raised about the timeframe of the loans and funding materialising, and their equitable disbursement—without any discrimination shown towards any groups. To the first issue, the Iraqi government said that it would discuss with UN, EU, etc., to devise a follow-up mechanism to ensure that the countries honour their pledges and that the maximum money materialises this year itself.

As for the disbursement, the Iraqi government is putting in place what it calls “institutional mechanisms for coordination and oversight”. As part of this, it also said that it would give a special push to a “digital monitoring platform”, where donors can track and monitor the utilisation of their funds, right down to the municipal level.

One of the recurrent themes resonating in the conference was the need for fair treatment of all ethnic groups, building trust and social cohesion. “No one can be left behind” is the fundamental principle that must be followed. The oblique references were to the Shia-Sunni divide, which, to a large extent contributed to the rise of ISIS, as the newly empowered Shias after the fall of Saddam Hussein—a Sunni—exerted their control over the levers of power. As Neven Mimica, European Commissioner for International Cooperation and Development pointed out, citizens must be put at the heart of the reconstruction process, and it must be ensured that “there are no gaps and that no one falls through the gaps—the root cause of the earlier uprising.”

References were also made to the issue of “discrimination” against the Kurds in the northern parts of Iraq.

SECTOR-WISE DAMAGES

The conference also listed the damages sustained by Iraq, sector-wise—social sectors including housing, health, education, social protection, etc; infrastructure sectors including power, oil and gas, transport, municipal services, etc; and the “cross-cutting sectors” of governance and environment. Of all this, the maximum damage has been to housing, accounting for 19.8% of the total damages, followed by power at 10.3%, and oil and gas at 8.2%.

A once-bustling city like Mosul in northern Iraq’s Nineveh province has been reduced to rubble. Mechtild Rössler of UNESCO World Heritage Centre puts the damage to Mosul at 60%-80%, which now requires skilled labour for rubble removal. She talked about the need to rebuild Mosul “block by block, quarter by quarter” and to reactivate the city’s plural identity. According to Lise Grande, Deputy Special Representative of the United Nations Assistance Mission for Iraq, “Mosul remains the largest challenge today”, with 10 million tonnes of hazardous rubble choking the city. She also pointed out how the eastern part of Mosul “is working”, but certain areas in the western part of Mosul still need stabilisation to ensure that ISIS does not re-emerge from there.

However, three months after the ISIS’ “defeat”, Iraq’s IDPs (internally displaced peoples) have started returning home. Of the over 5 million people displaced, around 3.3 million have been able to return home, even though 2.5 million are still displaced. Iraq also has the largest number of missing people, running into hundreds of thousands or more. According to Patrick Hamilton, Deputy Regional Director of International Committee of the Red Cross, it’s a situation where mothers have become bread-winners and children have become heads of households.

The five broad areas, or “recovery pillars” that the Iraqi government said it was working on are: 1. governance; 2. reconciliation and peace-building; 3. human and social development; 4. infrastructure; and 5. economic development.

“Iraq is open for business,” was the message that the Iraqi government tried to send out through the conference.

THREAT OF ISIS

There was all-round recognition that participation by government and private entities in Iraq’s reconstruction process will depend on whether or not ISIS resurfaces there again. A meeting of “Foreign Ministers and principals” of the Global Coalition to Defeat ISIS/Daesh was held on this, and was attended by US Secretary of State Rex Tillerson. According to the participants, while ISIS “stands undeniably degraded”, it still poses a serious threat to the stability of the region and to the security of all concerned. The Global Coalition promised to assist the Iraqi government’s efforts to secure the military gains against ISIS and “prevent new violence in liberated areas by supporting the transition from stabilisation to sustainable reconstruction”. Iraq’s, and even the region’s, future hinges on this, was the common consensus.

KUWAIT’S ROLE

Amid all this, Kuwait’s role in hosting the conference came in for high praise, especially the initiative taken by Kuwait’s Amir personally to help Iraq’s reconstruction process. The UN chief described the Amir as a “bridge builder”. The Iraqi Prime Minister expressed his deep gratitude to Kuwait for organising the conference.

 

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