US critical of Iraq holding onto rebuilding funds

Washington, Mar 28: Iraq's government is sitting on about 12.5 billion dollars in rebuilding funds from its own 2006 budget because it lacks the tools and expertise to spend the money, a senior US official said.

With growing pressure in the US Congress to reduce US funding for Iraq, the State Department's Iraq coordinator, David Satterfield, told lawmakers he too was concerned an oil-rich nation such as Iraq had not spent 12.5 billion dollars of its own funds earmarked for rebuilding.

He said Iraq had held onto the funds because it lacked the ''capacity'' to execute its budget, but he argued that a recent request to the US Congress for an additional 4 billion dollars would help address this problem.

Lawmakers from the House of Representatives Foreign Affairs subcommittee rejected Satterfield's suggestion the Iraqis did not have the know-how to execute their own budget.

''That's the soft prejudice of low expectations,'' said New York Democrat Gary Ackerman. ''I just can't believe some of the things that we're hearing. Iraqis are very resourceful people.'' The United States has spent more than 21 billion dollars in US taxpayer money on rebuilding projects in Iraq so far in a program that has come under heavy criticism from Congress.

Several Republican and Democratic lawmakers pushed for Iraq to be granted loans rather than grants for rebuilding and said Baghdad needed to do more to subsidize its own reconstruction.

But Satterfield countered the United States must continue its support, adding that the 4 billion dollar would focus on stabilization and building projects rather than actual rebuilding work.

''Iraqis need to have the ability to spend their money because they must, in the end, spend their money, not ours,'' he said.

Wolfowitz Predictions

Stuart Bowen, the US special inspector general for Iraq reconstruction whose office has uncovered abuse of both Iraqi and US funds, was also critical of Baghdad's apparent inability to dispense funds. ''That is an untenable position and that money must move forward,'' he said.

Exactly four years ago, then Deputy Defense Secretary Paul Wolfowitz, who now heads the World Bank, predicted to Congress that Iraq would ''soon'' be able to pay for its own reconstruction via oil funds.

''Well, four years and 21 billion dollars into US assistance later, reality seems more like not relatively soon but relatively never,'' said Ackerman. ''The government of Iraq is apparently either unable or unwilling to assume the burden of its own reconstruction.'' Pressed whether he thought Iraq would ever be able to rely on money solely from oil revenues to pay for its reconstruction, Satterfield said he did not believe this was the case and that it would need a lot more help.

Republican Rep Dana Rohrabacher also referred to Wolfowitz's predictions, saying they had been ''wildly off the mark''. The California lawmaker said he had asked from the very beginning for loans rather than grants for Iraq rebuilding.

''And now, he's (Wolfowitz) at a job where being wildly off the mark won't hurt anybody, I guess, except the entire world economy, seeing that he's the chairman of the bank, the World Bank, is he not?,'' he said.

Reuters