Donors Pledge $30 Billion to Iraq, Falling Short of Expectations

Donors Pledge $30 Billion to Iraq, Falling Short of Expectations

Wednesday, 14 February, 2018 - 19:45
Donors met in Kuwait to pledge 30 billion dollars to help reconstruction in Iraq. (Reuters)
Asharq Al-Awsat
Iraq’s allies pledged on Wednesday $30 billion towards efforts to reconstruct the country following three years of war against the ISIS terrorist group.

The sum fell short of the $88.2 billion that Baghdad said was needed to rebuild the country ravaged by the war.

“If we compare what we got today to what we need, it is no secret, it is of course much lower than what Iraq needs,” Iraqi Foreign Minister Ibrahim al-Jaafari told a news conference following the donors and investors meeting held in Kuwait.

“But we know that we will not get everything we want.”

"The commitment of the international community at the conference was clear," said Kuwaiti Foreign Minister Sheikh Sabah al-Khaled Al-Sabah, adding that 76 countries, numerous international funds and global organizations and hundreds of investors had made pledges.

The United States and United Nations say that failure to help Iraq rebuild could unravel its gains against ISIS since economic and social problems that bred sectarian conflict, creating political space for extremists, would persist.

For his part, UN Secretary-General Antonio Guterres called the conference “an enormous success”.

Although the United States said on Tuesday it was extending a $3 billion credit line to Iraq, it has not provided any direct government assistance. It instead hoped it could count largely on Gulf allies to shoulder the burden of rebuilding Iraq.

Saudi Arabia will provide $1 billion through its Saudi Fund for Development and $500 million in export credit, Foreign Minister Adel al-Jubeir told the conference, which ended Wednesday.

“Kuwait will earmark $1 billion in loans to Iraq and will commit to another $1 billion as investments,” Emir Sheikh Sabah al-Ahmad al-Jaber al-Sabah said at the gathering.

Turkey will give Iraq $5 billion in credit lines, Foreign Minister Mevlut Cavusoglu said, and other allies made smaller pledges.

Officials say almost $23 billion is needed for short-term reconstruction and over $65 billion in the medium term.

The World Bank on Wednesday said the private sector should play a leading role for a "successful" reconstruction of Iraq.

"Many businesses from around the world have gathered here to discuss how they can invest in Iraq's future and create the jobs that will help bring stability to the country. Their presence in such numbers shows that Iraq is open for business," World Bank president Jim Yong Kim said, echoing comments by the head of Iraq's National Investment Commission.

Kim said the bank's financial commitments to Iraq now top 4.7 billion dollars, up from $600 million in 2014 -- though just two new projects worth $510 million were announced Wednesday.

On Wednesday, Iraqi Prime Minister Haidar al-Abadi sought to allay fears that funds would be lost to corruption, for which the country is notorious.

"We will not stop fighting corruption, which is not less than terrorism. In fact, it was one of the reasons for the rise of terrorism," he told the potential donors.

"Last week, we launched a string of measures to simplify procedures for investments," Abadi said, adding his cabinet had ratified international covenants aimed at protecting investments.

Baghdad has put forward hundreds of projects, from oil refineries to massive housing and transport ventures, pointing to an investment law that offers ownership, unlimited cash transfers and tax breaks, among other benefits.

National Investment Commission chairman Sami al-Araji said investors in Iraq would find "high risks, but high returns".

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