Iraq: Six months after the fall of Saddam, Iraq's economy is beginning to move again, Jack Fairweather reports from Baghdad
Officials at the HQ of the US-led Coalition Provisional Authority admit the summer has been bloody, but insist that now the money has begun to flow. "It's the economy which is going to stabilise Iraq," a senior American economic adviser at CPA said. "If people have jobs they're not going to want to attack coalition forces.
The logic appears to be working. In Baghdad the rubble has been cleared away, houses and offices are being built, and shops are packed with goods. But Iraqis are slow to share the CPA's optimism over the economy because few feel they are taking part in its rehabilitation.
"We have two governments here in Iraq," said one Iraqi businessman, who would only give his first name, Mohammed.
"There is the American one which is rebuilding the country, and then there is the one which Iraqis deal with which hands out peanuts. Iraqis are not rebuilding their own country. This will not create long term stability."Many of the ministers of the governing council work in the barely restored offices of the former regime. The dirty floors and missing furniture are a fairer reflection of the real state of the Iraqi economy. Even including USAID money in the budget, CPA is expected to post a billion dollar loss this year.
This is the country Iraqis could one day inherit: impoverished and heavily reliant on foreign aid. Recent figures released by the World Bank suggested that Iraq would need €71 billion over the next four years.
Iraq's oil sales - presented by the Bush administration before the war as capable of covering the cost of reconstruction - are expected to provide less than €10 billion per year.