http://www.neworleanspost.com/p/9e/f...tml?id=148a272

Headline:

Thu, 19 Jun 2003 WN Business WN America WN Countries
On whose behalf? Human rights and the economic reconstruction process
in Iraq
Amnesty, Fri 20 Jun 2003




On Whose Behalf?


Human Rights and the Economic Reconstruction
Process in Iraq

In the wake of the recent conflict in Iraq, there is a scramble among
outside interests to secure contracts to rebuild Iraq's shattered
infrastructure and to invest in the reconstruction process. So far the
occupying powers in Iraq - the United States of America (USA) and the
United Kingdom (UK) - other governments and foreign companies involved
in the process have shown insufficient regard to human rights issues.
The process itself should be more transparent and should involve more
consultation with the Iraqi people.

On 22 May 2003 the UN Security Council adopted resolution 1483,
lifting the long-standing sanctions regime and providing an
international framework for the reconstruction process. However, the
resolution places insufficient independent oversight on the occupying
powers and contains inadequate mechanisms of accountability to ensure
that the reconstruction process delivers better protection of human
rights.

There is an obligation on the international community, and in
particular on the USA and UK governments as occupying powers, to
ensure that the reconstruction efforts are carried out for the benefit
of the Iraqi people. The goal of reconstruction should be to ensure
the effective protection and realization of all human rights for all
Iraqis. Iraqis themselves, ideally through representative
institutions, ought to make decisions on rebuilding, on foreign
investment, and on the selling of state assets.

To ensure the protection of human rights, Iraq will need considerable
resources - to reform and reconstruct the justice system, to provide
redress for the victims of war and repression, and to provide health
care and relief supplies until the country is self-sufficient. The
international community should take urgent measures to ensure Iraq
receives the resources it needs to feed its people, to provide social
benefits to those in need, and to initiate reconstruction.

Amnesty International (AI) is concerned that the dynamics of economic
investment in the Iraqi reconstruction process may exacerbate human
rights abuses. The extraction of resources, notably oil, in insecure
environments has contributed to conflict and human rights abuse in
many parts of the world. Experience has shown that the lack of
transparency in the awarding of major reconstruction projects often
leads to corruption. That, in turn could undermine
efforts to build the rule of law in Iraq, as well as diverting
resources that might be used to benefit the Iraqi people. In addition,
specific corporate practices - in employment, for example, or in
relation to security for their operations - may lead to human rights
abuses. The occupying powers, foreign government and companies must do
all in their power to avoid such a scenario in Iraq.

The Iraqi people have suffered for decades under a repressive regime.
Their situation has been made worse by the years of conflict and
sanctions. Many lost their lives in the recent conflict and are at
risk of human rights abuses in the insecure environment which has
followed it. Iraq has been largely closed to outside economic
interests for years. This is now changing, rapidly. Foreign economic
actors will play a powerful role in Iraq - there is a pressing need to
ensure that this is a force that does not further exacerbate human
rights abuses in that country.

With this aim in mind, AI is addressing a number of recommendations to
the occupying powers, the UN and also to companies entering or
investing in Iraq. These recommendations are limited to the human
rights issues emerging from the economic reconstruction process. Other
AI documents have been released, or are in preparation, addressing
other human rights concerns in Iraq.(1)

Security Council resolution 1483


Security Council resolution 1483 (2003) provides the international
framework for the reconstruction process. The human rights provisions
of the resolution are weak and fail to address adequately a number of
key human rights concerns. In particular, the resolution makes no
effective provision to ensure that those responsible for war crimes
and crimes against humanity in Iraq are brought to justice, nor does
it ensure effective human rights monitoring by the UN in the current
situation.(2) There is, nevertheless, a clear basis in the resolution
for maintaining that the protection of all human rights for all Iraqis
ought to be a key purpose of the reconstruction process and for
insisting that the occupying powers in Iraq must respect and protect
human rights.

The resolution obliges the occupying powers to "promote the welfare of
the Iraqi people", and funds for reconstruction are to be disbursed
for purposes "benefiting the people of Iraq". The protection of human
rights ought to be a key part of achieving these purposes.
Paragraph 5 of the resolution "Calls upon all concerned to comply
fully with their obligations under international law including in
particular the Geneva Conventions of 1949 and the Hague regulations of
1907" (emphasis added). The obligations referred to in this paragraph
are clearly not limited to the treaties cited but include other,
though unspecified, international legal obligations. In AI's view, the
obligations of the occupying powers under international law include
their clear duty to respect, protect and fulfil the human rights of
the Iraqi people as long as they continue to exercise effective
control over the territory of Iraq. Such obligations arise for two
reasons. First, because both the USA and UK are parties to several
international human rights treaties, and their obligations under these
treaties extend to territory they occupy. Second, the previous Iraqi
government signed and ratified a number of human rights treaties that
apply to all within Iraqi territory and that remain binding on both a
future Iraqi government and any interim authority, including those
occupying powers exercising effective control in the country.

In relation to the reconstruction process, resolution 1483 includes
some positive aspects. The resolution lifts the UN sanctions on Iraq,
an essential first step for economic reconstruction; the sanctions had
a very negative impact on the human rights situation in Iraq. It also
supports efforts to find a solution to Iraq's enormous external debt.
In addition, there are provisions aimed at transparency in the
reconstruction process, and at making funds available for this
process.

The resolution draws attention to the creation of a Development Fund
for Iraq; this Fund is not established by the Security Council, but
presumably by the occupying powers, referred to in the resolution as
the Authority. All future proceeds from oil sales - and some funds
held by the UN from previous oil sales under the oil-for-food program
- will be paid into the Fund. The Fund will be "audited by independent
public accountants" overseen by an International Advisory and
Monitoring Board (IAMB). Like the Fund, the IAMB is not established by
the Security Council, but presumably by the Authority. The IAMB will
include members from international financial institutions, such as the
World Bank and International Monetary Fund, and the UN, and it is
required to ensure that disbursements from the Fund are used "in a
transparent manner".

It is worrying, however, that neither the Development Fund nor the
IAMB is a proper international body with clear international
accountability. Resolution 1483 does make provision in relation to
some of their purposes, membership and operations, but neither body
need report to the Security Council. Although the UN Secretary-General
is required to report on the work of the IAMB, real power - and the
accountability of the two agencies - rests with the Authority, that
is, with the US and UK governments, whom the resolution merely "...
encourages ... to inform the Council at regular intervals of their
efforts under this resolution." According to resolution 1483, the
funds held "shall be disbursed at the direction of the Authority, in
consultation with the Iraqi interim administration". This provision
would appear to override existing international law which prohibits
occupying powers from selling or transferring the natural resources of
the territory they occupy.(3)

AI believes that disbursements under the Development Fund should be
prioritized to protect and fulfil the human rights of the Iraqi
people. If the UN had effective control and oversight of the Fund,
this would have followed naturally from the UN's own purposes under
the UN Charter. As the occupying powers control the Fund, they ought
to make a commitment to use it in ways that respect, protect and
fulfil human rights in Iraq. Although they may control the process,
they cannot evade the human rights guarantees that would normally be
present were the UN in control.

Similarly, the occupying powers must commit to maximum transparency in
the disbursement of funds. It is regrettable that the Development Fund
and the IAMB are not properly accountable at the international level,
but ultimately subject to the direction of the Authority. Perceptions
of corruption or bias in the reconstruction process will do grave
damage to efforts to establish the rule of law in Iraq, and thereby
undermine efforts to build respect for human rights.

Recommendations to the Occupying Powers, other governments, any future
interim Iraqi administration and the UN


Human rights should be at the centre of reconstruction efforts; indeed
the protection and realization of all human rights for all Iraqis
ought to be the primary purpose of the process. AI urges the occupying
powers, any future interim Iraqi administration, other governments
with influence, and the UN Special Representative for Iraq(4) to
implement the following recommendations.

· Make human rights paramount in the reconstruction process All
parties involved in the reconstruction process should prioritize
projects that relate directly to the protection or realization of
human rights, concentrating in particular on projects related to
enhancing personal security and ensuring access to food, health,
education, and housing, and reform of the justice system.The IAMB
should state publicly that it believes that the protection of human
rights in Iraq is clearly a purpose "benefiting the people of Iraq"
and therefore a proper priority to received financial support from the
Development Fund.

The IAMB should further make clear that reconstruction projects must
be carried out in a manner that strengthens respect for human rights.
Clear guidelines should be adopted to ensure projects financed by the
Development Fund do not lead or contribute to human rights abuses.
· Involve Iraqis in decision-makingIraqis have a right to participate
in decisions that affect them, and this will include most aspects of
the reconstruction process. The active participation of Iraqis in this
process is, moreover, an essential condition for its success. This
process of participation must be inclusive and non-discriminatory.

The occupying powers should make an explicit commitment to involve
Iraqis in decision-making related to reconstruction and should include
in reports to the Security Council detailed information on steps they
are taking to fulfill this commitment.
· Involve women in the reconstruction process and protect women's
rights The particular needs of women must be fully integrated into the
process of change. Their full participation is a necessary condition
for the successful and peaceful rebuilding of Iraq, and is the best
guarantee that the reconstruction process will achieve better
protection for women's rights in Iraq.(5)
· Award contracts in a transparent manner and through open
biddingClosed or secretive tendering or bidding processes for
reconstruction projects may encourage corruption, and undermine the
establishment of the rule of law in Iraq. Fair and transparent
procedures for the awarding of large infrastructure contracts are
always desirable as a matter of good business practice. They are
essential when such contracts relate to matters that affect human
rights - not least to ensure that the right of Iraqis to participate
is not undermined.(6)
· Manage oil revenues in a transparent and accountable manner
Experience from several countries shows the risk of oil revenues being
misused, and how such misuse can impact negatively on the protection
of human rights.(7) Decisions regarding the most appropriate way to
exploit Iraq's oil resources should be made with a view to achieving
the protection and fulfilment of the rights of the Iraqi people.
Iraq's oil revenue must be managed in a transparent and accountable
manner for the benefit of the Iraqi people.(8)

Resolution 1483 does put in place some mechanisms of accountability,
and includes a commitment to transparency in relation to the
disbursement of funds from the sale of oil.
Greater transparency and clearer accountability would be achieved if
the IAMB's reports and those of the auditors it approves are made
public, and if the occupying powers include in reports to the Security
Council information on how disbursements made by the Development Fund
contribute to the protection and fulfilment of human rights in Iraq.
(9)
Recommendations to companies


Foreign companies entering or investing in Iraq will have enormous
influence. It is vital that they do not undermine efforts to establish
the rule of law and a truly accountable government in Iraq, pursue
policies that contribute to human rights abuses, or carry out such
abuses themselves. AI is asking companies, therefore, to commit
themselves to respect for the following principles if they intend to
do business in Iraq.

1. Observe UN human rights rules
Companies should commit themselves to observe the UN's draft Norms on
Responsibilities of Transnational Corporations and Other Business
Enterprises with Regard to Human Rights. The draft Norms pull together
a range of existing UN human rights standards relevant to business.
Though not yet formally agreed, they provide a very useful benchmark
for company practice in relation to human rights.(10)
Companies should make clear to all their managers and employees
working in Iraq that they must respect fundamental human rights, as
set out in the draft Norms, within the firm's operations and in
relation to surrounding communities and broader Iraqi society.

In particular AI calls on companies to take steps to avoid the
following abuses in accordance with the draft Norms.· Arbitrary
displacement
Large infrastructure projects often lead to the displacement of
people. The reconstruction of Iraq will involve such large projects.
Companies should refuse to participate in projects where such
displacement is forced and arbitrary, (for example where clear rules
are not in place allowing the views of those affected to be heard),
where it is discriminatory, or where there is no provision for
adequate compensation.

· Discrimination in employment
Iraq is made up of diverse religious and ethnic groups which have
faced discriminatory practices under the former government. Women too
have faced discrimination in law and practice. In their employment
practices, companies must not discriminate on any grounds, including
religion, ethnic origin, race, or gender.

· Acquiring arbitrarily expropriated property
Companies must, as far as possible, ensure that they do not exacerbate
past abuses by purchasing or occupying property that was unlawfully or
arbitrarily expropriated in the past.

2. Observe internationally recognized security norms
In their security arrangements, and in particular in employment of
security personnel (for example, to guard their installations),
companies should ensure adherence to the UN Code of
Conduct for Law Enforcement Officials and the Basic Principles on the
Use of Force and Firearms by Law Enforcement Officials.(11)

Mining and oil companies should follow the Voluntary Principles for
Security and Human Rights, developed by the US and UK governments, in
conjunction with several companies.(12) Companies should make their
security arrangements consistent with human rights standards,
including by ensuring that security personnel are properly trained
and, where feasible, make these arrangements publicly available.

Companies should avoid appointing suspected perpetrators of human
rights abuses to posts related to the security of their operations.

3. Consult local communities and solicit women's views
Companies must consult with the local community where they operate and
others affected by their operations or investments. Such consultations
should ensure that the views of women are heard, as well as those of
marginalized communities or groups facing discrimination.(13)

4. Provide essential services in a non-discriminatory manner
Where companies take over the provision of essential services (for
example, in relation to health, education, or access to water) whether
through a formal privatization process, or because of the temporary
inability of the state to meet its obligations, they must accept the
obligation to ensure provision of such services on a
non-discriminatory basis. In any privatisation process involving
essential services, provision must be made so that the poor have
access to such services.

5. Do not profiteer
There should be no profiteering from war-time scarcities. Essential
products or services should be priced in a manner that takes into
account the exceptional circumstances surrounding civilians in a
post-conflict environment.

6. Respect the environment
Environmental damage and pollution can have a serious impact on human
rights (including rights to life and health). Companies should carry
out their activities in accordance with international environmental
and public health standards, and provide full and public information
on the environmental impact of their operations.

7. Do not perpetuate social divisions
Companies involved in the provision of relief goods, or goods
indispensable to the survival of civilians, such as food, water, basic
health care or shelter, must ensure that in providing these services
they do not contribute to the perpetuation of social divisions,
long-standing animosities or entrench inequalities.(14)

8. Do not offer bribes or encourage corruption
Corruption undermines the rule of law and hampers the establishment of
an accountable government. Companies should therefore commit to
countering bribery, and to making a positive contribution to improving
standards of integrity, transparency and accountability in business.

In their operations in Iraq, companies must make clear to their staff
that they prohibit bribery in any form, whether direct or indirect.
The company must not allow direct or indirect contributions to
political parties, organizations or individuals engaged in politics to
be used as a way of obtaining advantage in business transactions.

9. Be transparent
Companies should operate in a transparent manner, revealing any
financial or other resources they provide to the government or
authorities in Iraq, including in particular revenue-sharing and
royalty payments arising from oil exploration or production
contracts.(15)

10. Support the rule of law and the establishment of a fair justice
system
Companies should support the establishment of a fair and effective
justice system in line with international human rights standards in
Iraq as soon as practicable. The building of such a system is
essential to the long-term protection of human rights in Iraq. In the
absence of such a system companies will face uncertainties regarding
the legality and security of their investments. Iraq has suffered
widespread and serious human rights violations for many years. No
society could hope to rebuild itself without addressing such abuses
and ensuring justice for the victims. It is in the interest of
companies to make clear their support for the early establishment of a
UN commission of experts that would, in close contact with Iraqi civil
society, make recommendations for a fair, independent and effective
means of ensuring accountability for past human rights abuses in
Iraq.(16)

11. Support the deployment of human rights monitors
As a means of ensuring that human rights are respected throughout
Iraq, companies should support the rapid deployment of UN human rights
monitors.(17)

Background


The recommendations made above are based on AI's past experience of
monitoring human rights abuses in Iraq and on its assessment of the
current human rights situation in that country. The recommendations
draw additionally on experience in other countries in relation to the
links between oil extraction, corruption and human rights abuses, and
on AI's work examining the responsibilities of companies for human
rights abuses. The following sections provide some of this background,
and also describe some of the context for the reconstruction process.

1. Legacy of past human rights abuses in Iraq
The history of human rights abuses in Iraq provides an essential
reference point for foreign companies entering the country. Over the
years, AI's reports have noted widespread violations of human rights
in Iraq. Tens of thousands of people "disappeared", and only now are
bodies being found in mass graves. Thousands of people were executed
for their opposition to the regime. Thousands of others were detained
and imprisoned after unfair trials. Torture and ill-treatment of
political prisoners and detainees has been systematic.

In 2001, the UN Commission on Human Rights adopted a resolution
strongly condemning "the systematic, widespread and extremely grave
violations of human rights and of international humanitarian law by
the Government of Iraq, resulting in an all-pervasive repression and
oppression sustained by broad-based discrimination and widespread
terror."(18)

Political, ethnic and religious persecution
Within Iraq there are ethnic, religious, and cultural differences,
which, according to a recent report, could become "fault-lines".(19)

Between 75 per cent and 80 per cent of Iraq's population of 25 million
people are ethnic Arabs. Kurds make up some 15-20 per cent of the
population. The remaining five percent are from Turkmen, Assyrian or
other ethnic groups. Approximately 97 per cent of Iraqis are Muslims
of whom, some 60-65 per cent are Shi'a; the rest are Sunni. The
Kurdish population lives mainly in the north of the country, while the
Shi'a population lives largely in Baghdad and the south.
Under the Ba'athist government widespread human rights violations were
committed against the Kurd and Shi'a Muslim communities. Shi'a
Muslims, including Feily Kurds, were targeted for forcible expulsion
to Iran and "disappearances" after the start of the Iran-Iraq war
(1980-1988). In the 1980s the Iraqi authorities expelled tens of
thousands of Iraqi families, whom they considered to be of Iranian
descent, to Iran and confiscated their properties. Confiscation of
property or house destruction has also been used as a punishment
against political opponents.

Over a 100,000 Kurds "disappeared" in 1988 (in Operation Anfal) and
5,000 civilians were killed when chemical weapons were used in an
attack on the Kurdish town of Halabja. In 1991, after the Gulf War
(Operation Desert Storm) ended, Shi'a Muslims and Kurds were the
victims of killings and "disappearances" as the government put down
the uprisings in northern and southern Iraq. Following these
uprisings, hundreds, probably thousands, of people "disappeared" or
were extrajudicially executed.(20)

Forced displacements and 'Arabization'
Since mid-1997 many non-Arab people, including Kurds, Turkmen and
Assyrians, have been forcibly expelled from Khanaqin and the oil-rich
Kirkuk region. They were sent to the Kurdish provinces in the north
controlled by the two Kurdish groups, the Kurdistan Democratic Party
(KDP) and the Patriotic Union of Kurdistan (PUK), and replaced by Arab
families from southern Iraq. In the expulsion process property, ration
cards provided under the UN oil-for-food program, and membership cards
to government agencies were confiscated. The majority of those
expelled were resettled in camps. The policy of forcible expulsion
continued until the onset of the US-led military action against Iraq
in March 2003. As of May 1999 at least 15,000 families comprising at
least 91,000 people had reportedly been deported to the northern
provinces. Today, this number may well have exceeded 100,000 people.

This policy of "Arabization" has also included discriminatory
measures, such as mechanisms and policies that effectively forced
people to use Arab names or to misrepresent their ethnic identity in
official documents.

Marsh Arabs in the south have had to relocate frequently and often
forcibly, as their plains were drained in order to divert resources to
the regions favourably disposed towards the former President, Saddam
Hussein.

The issue of mass movement of people is far from over. In the
aftermath of the recent war, the International Organization for
Migration (IOM) in an initial assessment based on findings from some
of its partner non-governmental organizations (NGOs), reported on 13
May 2003 that at least 280,000 people had been internally displaced;
some were living in abandoned public buildings, others were living
with host families, in tents or even in the open.

Human rights violations against women
Women have for many years been subjected to serious human rights
violations including torture and extrajudicial execution. Methods of
torture included beatings on the soles of the feet and rape. In one
well-documented case the rape of a woman was videotaped and sent to a
relative abroad in order to put pressure on him to cease all
anti-government activities. In October 2002 dozens of women suspected
of prostitution were beheaded without any judicial process in Baghdad
and other cities. Members of the paramilitary group Feda'iyye Saddam
used swords to carry out the executions in public. Some women were
also beheaded for political reasons.

During the 1980s, and particularly as a result of Operation Anfal of
1988 against the Kurdish population in northern Iraq, tens of
thousands of Kurdish women were left widowed or without any male
relative in a male-dominated society. Many others had suffered the
loss of a husband, son or brother during the Iran-Iraq war or as a
result of political persecution by the authorities.

Over many years economic difficulties, including a decrease in
available employment, changed the roles of women in Iraq. Many who had
previously worked outside the home have taken on an increasingly
domestic role, or menial jobs that do not use their skills and
education. Some reports indicate a large increase in the number of
women in prostitution, during this period. Women and children have
formed the majority of refugees and the internally displaced. Such
changes and the breakdown of many local support networks and
initiatives left many women isolated and vulnerable to violence,
including domestic violence. Rising divorce rates and the effect of
wars have led to an increase in the number of female-headed
households.

Women have also been the victims of family killings, known as "honour"
killings. The UN Special Rapporteur on violence against women reported
in 2002 that more than 4,000 women had been victims of such killings
in Iraq, since 1991.(21)

This legacy of abuse will be a major factor in post-conflict Iraq.
There is an urgent need to address past violations, investigate and
bring to justice those found responsible for committing crimes against
humanity, genocide and war crimes, and provide compensation and
restitution to victims.(22)
In the current post-conflict situation in Iraq there is concern that
women are not being consulted or taking part fully in the debate on
the future of their country.

Economic and social rights - discrimination and the impact of
sanctions
Contributing to this legacy of abuse of civil and political rights,
Iraqis have also suffered violations of their economic, social and
cultural rights. In 1997, the official UN body monitoring these rights
noted its concern at discriminatory measures in relation to these
rights particularly in regard to women, Kurds and the Marsh Arabs, and
expressed concern too about the prohibition on independent trade
unions, the use of child labour, and forced evictions, including of
squatters. It also expressed concern over "... the non-availability of
food, medicines and safe drinking water in many rural areas, and the
increasing illiteracy rate and the right to primary education in
general terms."(23) The Committee for Economic and Social Rights, like
many other observers, also noted the negative impact of UN sanctions
on the enjoyment of economic, social and cultural rights. In 2002,
citing the "disastrous situation" caused by the embargo on Iraqi
population over the last 12 years, the UN Sub-Commission on the
Promotion and Protection of Human Rights decided that the embargo
should be lifted "even if the objectives of the measures have not yet
been attained."(24)

According to the Office of the High Commissioner of Human Rights,(25)
the impact of sanctions included an increase in maternal mortality
between 1989 and 1997 from 50 to 117 deaths for every 100,000 live
births. Between 1990 and 1995 infant mortality rose from 64 to 129 for
every 1,000 births.(26) In addition hospitals and healthcare
institutions were without maintenance; there were widespread shortages
of water; communicable diseases had returned; adult and female
literacy figures had regressed to mid-1980 levels; and primary school
enrolment had fallen.

But the Office of the High Commissioner also noted other factors which
contributed to Iraq's inability to meet its obligations. These
included the Iran-Iraq war; the invasion of Kuwait; Iraqi dependence
on the export of oil; delay by the Iraqi government in accepting the
oil-for-food program;(27) the failure of the government to make full
use of what was permissible under
the program; inefficiency in distributing medical supplies; and denial
of access to impartial observers to monitor the situation in Iraq. The
UN Special Rapporteur on the human rights situation in Iraq has
similarly drawn attention to the Iraqi government's responsibility for
violations of economic and social rights arising as a result of the
sanctions regime.(28)

Iraq has ratified seven of the eight core conventions of the
International Labour Organisation. The one it has not ratified is
Convention 87, regarding freedom of association and protection of the
right to organize. Both the International Confederation of Free Trade
Unions (ICFTU)(29) and the ILO were critical of the previous
government's trade union and employment practices.(30)

2. Post-conflict human rights issues
During the recent conflict hundreds of civilians were killed. Some
were victims of cluster bombs, others were killed in attacks in
disputed circumstances. Unexploded bomblets from cluster bombs used
during the conflict continue to pose a threat to civilians, especially
to children. Iraqi forces used unlawful tactics that endangered
civilians. These reportedly included the citing of military forces and
weaponry in close proximity to civilians and the wearing of civilian
clothing by combatants in order to launch surprise attacks.

Although large scale fighting appears to have ended in Iraq, the
immediate "post-conflict" phase remains turbulent. There has been a
general break-down of security, widespread looting of public and
private buildings, high crime rates and sporadic clashes between armed
individuals and US/UK forces. Security remains the main issue of
concern for the Iraqi population because of the lack of appropriate
policing and the wide availability of weapons


Since 23 April, AI has conducted field research in Basra and the
surrounding areas, Nassiriya, al-'Amara and Baghdad. In Basra,
testimonies were collected from Iraqi former detainees alleging that
they had been tortured or ill-treated by British soldiers(31). In some
cases the use of excessive force has led to the killing of unarmed
individuals including young boys. One issue of major concern is the
targeting of former Ba'ath Party members or anyone associated with the
previous government. These "revenge killings" have been reported
throughout Iraq and hundreds are said to have taken place in the Shi'a
dominated district of al-Sadr City (formerly Saddam City) of Baghdad.


In northern Iraq, particularly in the cities of Mosul and Kirkuk,
clashes have been reported between the Kurdish, Arab and Turkmen
ethnic groups. Arab families in some surrounding villages were said to
have been forcibly removed from their homes in retaliation for the
policy of forcible expulsion of Kurds and other non-Arabs by the
previous government. Women have been targeted for serious violations,
including kidnapping, murder and rape. The perpetrators are believed
to be members of criminal gangs. However, threats and intimidation
against women by radical Islamist groups have also been reported.

The transition to peace will not be simple or swift, as the
international community has learned through experiences in the former
Yugoslavia, East Timor and Afghanistan, to name just a few.(32)
Political, ethnic and religious disputes are already apparent, and it
will take time to establish the institutions and laws in which these
can be peacefully mediated.

Some foreign companies may be tempted to take advantage of the
current, unstable situation, before the setting up of a representative
Iraqi government that is able to establish and maintain the rule of
law. Others will be left trying to resolve numerous difficult
situations in the absence of a clear national legal framework. If
there is internal resentment against the US and UK presence in Iraq,
companies associated with these occupying powers might well find
themselves targets of attack. In an unstable or "lawless" environment
or where conflict persists, companies will take steps to ensure the
safety of their personnel and the security of their installations,
goods and other property. In similar situations in other countries,
security forces guarding companies have sometimes resorted to using
arms in a disproportionate manner, for example against peaceful
demonstrators.

Justice - accounting for past human rights abuses
Another issue that will arise quickly is the need to deal with the
past, grim record of human rights abuse in Iraq. Ensuring
accountability for these abuses, that may amount in many cases to
crimes against humanity, war crimes or genocide, is essential if
future abuses are to be prevented. Companies may have to confront this
issue, as they could, intentionally or not, end up employing or
contracting people associated with the previous government who are
implicated in such crimes. Companies too, therefore, have a strong
interest in seeing the early establishment of a satisfactory means of
identifying, investigating and bringing to justice the individuals and
groups who may have acted with impunity in the past.

A large majority of companies say they have an interest in stability,
peace and the rule of law. They ought to do everything they can to
ensure their investments in a post-conflict environment promote these
ends. Research from multilateral development banks shows that foreign
and domestic investment can boost confidence in an economy and assist
in the intricate reconstruction process, but only if the investment
responds to local needs.(33) Adhering to international standards for
the protection of human rights is a necessary condition in this
regard.

3. Resource extraction and human rights abuses
Recent research at the World Bank(34) and elsewhere demonstrates that
there is a strong link between natural resources and conflict. The
World Bank study found that countries with economies heavily dependent
on primary commodity exports are at a greater risk of war than
countries that are not. This is especially the case when countries
lack transparent, legitimate, and capable institutions to regulate the
large amounts of revenue flows generated in a short time by states or
corporations. Under such conditions state officials, politicians, and
military personnel have unusually high incentives and opportunities to
control revenues for personal profit or to translate them into
political and military gain, and low incentives to channel revenues
towards sustainable and equitable development. This kind of
corruption, of course, directly undermines the rule of law.

Reports, surveys and academic research suggest numerous problems
related to the extractive industries: the extraction of the resource
can result in armed conflict over issues related to control of the
resource; communities are often not consulted and face enormous
problems as a result of social and environmental impacts; human rights
abuses arise from the means used by the company to secure its assets
and personnel. The extractive sector may, intentionally or not,
finance armed conflict, benefit from such conflict, be targeted, or be
a supplier to those who wage or benefit from conflict.(35)

4. Iraqi dependence on oil - cash-cow or curse?
The Iraqi economy is overwhelmingly dependent on oil.(36) In 1989, the
last full year prior to Iraq's invasion of Kuwait, Iraqi oil revenues
totalled US$14.5 billion and constituted 99 per cent of export
earnings. The UN sanctions on Iraq changed this dynamic, and in 1996,
oil exports (US$269 million) accounted for only a third of Iraq's
exports of US$950 million. By 2001, with the effect of the
oil-for-food program in full swing, oil exports once again dominated
Iraqi exports, accounting for US$15.14 billion out of total exports of
US$15.94 billion, revealing a decline in the export earning potential
of other industries.(37)

Iraq's oil reserves have already contributed to human rights abuses.
The former Iraqi President, Saddam Hussein, controlled the industry
and allocated and distributed the proceeds. As the state sector was
dominant in Iraq's economy, the President was in a position to garner
a broad base of support for his government. By the early 1980s, a
quarter of all those employed in Iraq worked for the state
bureaucracy, and a new class of entrepreneurs, contractors and
managers of state-owned enterprises reaped much of the benefits from
Iraq's oil wealth. This alternate power centre helped the President
consolidate his rule, which was increasingly arbitrary and repressive.

Iraq's proven oil reserves are about 112 billion barrels, giving it
the world's second largest known reservoir of oil. Before Iraq's
invasion of Kuwait in 1990, Iraq produced about 3 million barrels of
oil daily, of which it exported 2.8 million barrels through pipelines
via Turkey to the Mediterranean and via Saudi Arabia to the Red
Sea.(38) Production then declined because of the damage caused during
Operation Desert Storm and the sanctions that followed. The sanctions
prohibited export of Iraqi oil, until April 1995 when the UN Security
Council passed resolution 986 which permitted limited exports of Iraqi
crude to finance humanitarian aid and war reparations, the so-called
oil-for-food program. Sanctions have now been lifted, and oil exports
will resume free of any constraints; the oil-for-food program will end
in November 2003.
Iraq's oil potential is enormous. Of its 74 discovered and evaluated
oil fields, only 15 have been developed, according to oil industry
analysts. Iraq's western desert is considered to be highly prospective
but has yet to be explored. However, the perception that Iraq's oil
wealth will be enough in the short term to cover its post-conflict
needs is misplaced. Even developed and operational oil fields will
need a good deal of investment and repair before full production can
resume. It may take Iraq between 18 months and three years to return
to its pre-1990 production level of 3.5 million barrels per day. It
will cost an estimated US$5 billion to repair and restore previously
used facilities, in addition to an estimated US$3 billion in annual
operating expenses. (39)

5. Oil-for-good? The Development Fund
Iraq is fortunate to have the possibility to build a self-sustaining
economy. Though it will need assistance in the short term, the
country's proven oil reserves give it the chance to return quickly to
the ranks of middle-income countries. Security Council Resolution 1483
provides that oil revenues (as well as money held by the UN in the
oil-for-food program) should be paid into a Development Fund, and that
this fund should be used to pay for reconstruction. The resolution
sets down a number of worthwhile objectives for the fund, including to
"... meet the humanitarian needs of the Iraqi people, for the economic
reconstruction and repair of Iraq's infrastructure, for the continued
disarmament of Iraq, and for the costs of Iraqi civilian
administration, and for other purposes benefiting the Iraqi people."
As indicated above, there are a number of reasons for asserting that
such purposes also include the protection and fulfilment of the human
rights of the Iraqi people. Indeed, the reconstruction process - and
therefore disbursements from the Fund - should prioritize projects
that relate directly to the protection or realization of human rights.

The Development Fund will be overseen by an International Advisory and
Monitoring Board (IAMB), which will include representatives of the
international financial institutions and the UN. The IAMB should state
publicly that it believes that the protection of human rights in Iraq
is clearly a purpose "benefiting the people of Iraq" and therefore a
proper priority consideration for disbursements under the Development
Fund. The IAMB should further make clear that reconstruction projects
must be carried out in a manner that strengthens respect for human
rights. Clear guidelines should be adopted to ensure projects financed
by the Fund do not lead or contribute to human rights abuses.
Resolution 1483 provides that the Development Fund should operate in a
transparent manner. As noted earlier, transparent and accountable
management of oil revenues is relatively rare, and it will be crucial
in the Iraqi context to avoid corruption and for the credibility of
any transitional administration and future Iraqi government.

It is unclear at this point whether the Iraqi managers of the Iraqi
National Oil Co. will have sufficient autonomy to manage the country's
oil production. The occupying powers - including the USA, the world's
leading oil importer - are going to have considerable influence over
Iraq's oil industry, even if day-to-day operations remain with the
Iraqi National Oil Co. Irrespective of who manages oil production and
revenues, from the perspective of human rights, transparency in the
administration of Iraq's resources remains a matter of paramount
concern. Whatever solution is found to the management of oil
production and revenues, AI believes that it is essential that all
efforts be made to ensure that such management is in accordance with
the highest possible standards of transparency and rigorous
accounting. Revenues from oil should be used for the public good, and
efforts must be made to guard against their diversion for improper
uses.

6. Reconstruction contracts
In recent weeks the US Agency for International Development (USAID)
awarded contracts to US consortia for projects worth US$1.7 billion.
The projects range from building schools and roads, to managing the
oil sector and advising the Iraqi central bank. Energy industry
analysts are openly speculating that some oil companies would like the
occupying powers to tear up existing contracts between Iraq and other
companies so that they can explore in one of the world's largest oil
reservoirs.(40) The process of awarding initial contracts has been
criticized as arbitrary, and there is no guarantee that due process
will be followed in awarding oil concessions.

Disbursements from the Development Fund are controlled by the
occupying powers, and Resolution 1483 directs that the needs of Iraqi
people ought to guide such decisions. There is no provision made,
however, to allow a complaint mechanism or some such procedure so that
Iraqis might contest particular projects or how contracts are awarded.
The former head of the US-affiliate of the Anglo-Dutch Shell Group has
been appointed to run the Iraqi National Oil Co.,(41) with an advisory
board made up of Iraqis and foreigner nationals, assisting him. A
senior Iraqi professional has been named as the equivalent of a chief
executive officer.

Since the announcement of the USAID contracts, companies from the UK
have lobbied their government to represent their business interests.
In late May, Bechtel Corporation, a US company which won the main
reconstruction contract, organized meetings in the USA, the UK and the
Middle East with potential subcontracting bidders from a number of
countries.
Given the devastation in Iraq - as a result of war, as well as the
lack of investment owing to sanctions - there is much work to be done
to rebuild the country. The US government has drawn up an agenda that
includes ambitious targets to be achieved within a year of the war's
end. In addition to large infrastructure projects, such as opening
ports, building roads and power plants, other targets include ensuring
100 per cent school enrollment, providing maternity care to all who
need it, ensuring hospital care in all 21 major cities, and building
20,000 homes.(42) These projects, of course, impact directly on the
economic and social rights of the Iraqi people.
The USAID has awarded its initial contracts. The US Defence Department
has set up the Office of Reconstruction and Humanitarian Assistance,
and initial contracts awarded include projects to cover local
government,(43) health care,(44) economy,(45) oil facilities,(46)
education,(47) shipping,(48) food(49) and logistical support.(50)
Concern has been expressed that the competition for the contract to
rebuild the infrastructure was restricted to a few U.S. companies(51)
(some of which have secured contracts, others may
bid for future contracts). Other countries have protested, arguing
that, for example, French, Russian or other European firms should not
be left out of the process. Concern has been expressed too that major
beneficiaries of the contracts have close ties with officials of the
current US administration, although the companies have a history of
performing in difficult environments. There have been criticisms
expressed about some of the companies who have been awarded contracts,
including in relation to their human rights record.(52) There will,
inevitably, be questions raised about the awarding of contracts by
occupying powers to their own national companies.

The process of reconstruction should have as a central purpose to
respect, protect and fulfil the human rights of Iraqi people. The
Iraqi people, furthermore, have the right to full participation in the
reconstruction process - they must be consulted in a meaningful manner
about their legitimate needs. Contracts that are awarded through
non-transparent bidding procedures, and so do not conform to
internationally agreed best practice, will inevitably lead to
disputes, which will be further exacerbated by political tensions if
these contracts go to companies associated with the occupying
power(s). This in turn could undermine the reconstruction process, or
support for the establishment of the rule of law in Iraq.

7. The costs of reconstruction
The US government has asked the Congress for US$2 billion for
reconstruction efforts in Iraq. The US administration would also like
to complete the reconstruction work in a year. This is an unrealistic
deadline for such an ambitious agenda, and the amount sought is
grossly
insufficient.(53) The UNDP estimates initial costs of reconstruction
to be at least US$10 billion. Other experts reckon total
reconstruction costs will amount to anything between US$25 billion and
US$100 billion.(54) Other states may hesitate to support US and UK
efforts to rebuild, as they fear doing so might legitimize a war that
was initiated without UN support.

In spite of projected oil revenues of between US$10 billion and US$14
billion a year, the country will require significant financial support
from the international community. It will take time to invest in and
get back on stream Iraqi oil production. If Iraq is to attain a per
capita gross domestic product equal to Egypt or Iran, and if one half
of the capital stock requires rebuilding, this would imply
reconstruction needs of about US$800 per capita, or a total of US$20
billion.(55) Figures from the Balkans in the 1990s indicate that
humanitarian assistance could well cost approximately US$500 per
person per year.(56)

A plausible estimate would be that between one and five million people
in Iraq would require assistance in the post-war environment. If the
time required for assistance was between one and four years, then the
total cost of humanitarian assistance alone would range from US$1
billion to US$10 billion.(57)

The need for resources is further apparent when one considers Iraq's
overall debt burden, which adds up to an estimated US$383 billion, if
war reparation claims and commercial debt are added to official
foreign debt. Under the previous government, Iraq amassed US$62
billion to US$130 billion in foreign debt, about half of it in
short-term loans from commercial banks but including some long-term
debts owed to foreign governments. Iraq did not pay its debt
throughout the period UN sanctions were in force. Iraq's debt also
includes monies owed for arms purchases, including some US$9 billion
reportedly owed to the Russian Federation. Other components of the
debt include commercial loans and war reparation demands. Adding up
this debt, Iraq's debt-to-export ratio would place it in the World
Bank's most burdened category, far surpassing the debt-servicing ratio
of 3:1 considered unsustainable and forcing countries into the
category of highly indebted poor countries (HIPC).

********

(1) See Amnesty International's Iraq: Ensuring Justice for Human
Rights Abuses, AI INDEX: MDE 14/080/2003; AI's Iraq: Responsibilities
of the Occupying Powers, AI INDEX: MDE 14/089/2003; AI's 10 point
appeal to Occupying Powers, People Come First, AI INDEX: MDE
14/093/2003. Also see AI's Iraq: Justice and Security, soon to be
released.

(2) See AI's Iraq: Security Council misses opportunity, must focus on
human rights now, AI INDEX: MDE 14/123/2003

(3) Article 55 of the Hague Regulations state that occupying powers
"shall be regarded only as administrator[s]" of publicly owned
buildings and of natural resources, meaning that they cannot
appropriate or dispose of such resources.

(4) Resolution 1483 establishes a UN Special Representative for Iraq
and assigns to the post a number of functions related to the
reconstruction process, including promoting the protection of human
rights.

(5) This has been called for by the UN Security Council in resolution
1325, which deals with the role of women in conflict and post-conflict
situations. The resolution calls for the adoption of a gender
perspective that takes into account "(t)he special needs of women and
girls during repatriation and resettlement and for rehabilitation,
reintegration and post-conflict reconstruction." Similarly the UN
Secretary General, in his report on women, peace and security, calls
for the incorporation of gender perspectives in rehabilitation and
reconstruction programs.

(6) See, for example, the World Bank's concerns covering international
and national competitive bidding, as well as principles governing
limited international bidding, in times of urgency and disaster
relief. These can be found at . These include:

· Ensuring that the project is carried out with economy and
efficiency;

· Ensuring that the project is necessary for the needs of the people;

· Providing all qualified bidders and equal opportunity to compete for
the project;

· Encouraging and developing local businesses, contractors and
manufacturers, as appropriate; and,

· Ensuring that the process is transparent.

(7) See, for example, AI's report, Sudan: The human price of oil, AI
Index: AFR 54/001/2000 ERR which reveals the role played by oil
exploration in contributing to a climate of human rights violations in
Sudan.

(8) See Considerations For the Management Of Oil In Iraq: A Background
Briefing Human Rights Watch, 18 April 2003.

(9) A governance model exists in Norway, where the State Petroleum
Fund, established in 1990, was set up to help "avoid excessive
spending of petroleum revenues and promote a gradual transformation of
oil wealth into foreign financial assets." While Norway's aim is
macroeconomic stability and sustainable returns, and post-conflict
Iraq has different immediate priorities, the IAMB can be structured
along such transparent lines guaranteeing accountability.

(10) The draft Norms on Responsibilities of Transnational Corporations
and Other Business Enterprises with Regard to Human Rights
(E/CN.4/Sub.2/2002/13) are being developed at the UN Sub-Commission on
the Promotion and Protection of Human Rights, and which are likely to
be adopted in the near future. An electronic version can be found at
www1.umn.edu/humanrts/links/NormsApril2003.html

(11) 1 See the UN Code of Conduct for Law Enforcement Officials and
the Basic Principles on the Use of Force and Firearms by Law
Enforcement Officials. These specify that security personnel must
respect the fundamental rights of individuals, and may use force only
when strictly necessary and only to an extent proportional to the
threat. See and

(12) 2 See the Voluntary Principles for Security and Human Rights,
available at . The principles apply to companies in the extractive
sector from the USA, the UK, the Netherlands and Norway. These
principles require investigation of allegations of human rights
abuses, greater dialogue with local communities, and standards for the
use of private security firms. While the principles are not legally
binding, they provide a basis for monitoring corporate action, and
some companies have incorporated the principles in their investment
agreements, giving them quasi-legal authority. While the principles
apply to companies that have endorsed the principles and are from the
four countries named, nothing prevents other companies from these or
other countries from accepting them and AI encourages such companies
to do so. A number of non-governmental organizations, including AI,
participated in the process leading to the adoption of the principles.

(13) For a detailed explanation on gender-sensitive consultation and
development, see Learning and Information Pack produced by the Gender
in Development Program of the UN Development Program, Vol. 1 (October
2001) offers the overview, and Vol. 2 (January 2001) offers gender
analysis tools.

(14) See Mary Anderson, Do No Harm: How Aid can Support Peace - or
War, Lynne Rienner Publishers, USA, 1999.

(15) The Publish What You Pay (www.publishwhatyoupay.org) campaign,
launched by international non-governmental organizations, asks oil
companies to make public the revenues they are providing to host
governments, through royalty payments, production sharing agreements,
taxes, or other means. The campaign has been endorsed, and expanded,
by an initiative from the UK government, called the Extractive
Industries Transparency Initiative. Several companies and industry
associations have supported that initiative, though with
qualifications, such as including host governments, and requiring host
governments to be transparent about how they spend these revenues.
Please see .

(16) For further details see AI's Iraq: Justice not impunity, AI
Index: MDE 14/007/2003.

(17) See AI's Iraq: The need to deploy human rights monitors, AI Index
MDE 14/012/2003; Iraq: People come first - protect human rights during
the current unrest first, Amnesty International's 10-point appeal, AI
Index: MDE 14/093/2003.

(18) See Resolution L.19, The Situation of Human Rights in Iraq,
passed by the UN Commission on Human Rights, 18 April 2001.

(19) See What Lies Beneath, the International Crisis Group, Brussels,
October 2002.

(20) See AI reports, Iraq: "Disappearances": unresolved cases since
the early 1980s, AI Index: MDE 14/005/1997; Iraq: Human rights
violations since the uprising, a summary of Amnesty International's
concerns, AI Index: MDE 14/005/1991; Iraq: Victims of systematic
repression, AI Index: MDE 14/010/1999.

(21) Integration of the human rights of women and the gender
perspective, Violence against women, Report of the Special Rapporteur
on violence against women, its causes and consequences, Ms. Radhika
Coomaraswamy, submitted in accordance with Commission on Human Rights
resolution 2001/49 (E/CN.4/2002/83), 31 January 2002.

(22) See AI's Iraq: Ensuring Justice for Human Rights Abuses, AI
Index: MDE 14/080/2003.

(23) The Committee for Economic and Social Rights specifically pointed
out Iraq's poor performance in eliminating discrimination against
women in general and specifically regarding education. The Committee
also expressed its displeasure over Iraq's performance regarding
preserving cultural monuments and providing access to minority
languages in radio broadcasts. See the report of the 17th session of
the Committee on Economic, Social and Cultural Rights, November to
December 1997.

(24) See E/CN.4/Sub.2/Dec/2002/109, Commission on Human Rights,
Economic and Social Council, the United Nations. Also see Decision
2000/112, regarding the "Humanitarian situation of the Iraqi
population," passed on 18 August 2000 at the Sub-Commission on Human
Rights.

(25) See: Report of the Second Panel established pursuant to the note
by the President of the Security Council of 30 January 1999
(S/1999/100), concerning the current humanitarian situation in Iraq
(S/1999/356, Annexe II).

(26) See: "Iraq Child and Maternal Mortality Surveys", UNICEF, 1999.

(27) Under that program, due to end in November, 72 per cent of Iraqi
oil export proceeds must fund the humanitarian program. Of this
amount, 59 per cent is designated for the contracting and supplies of
equipment by the government for 15 central and southern governorates.
The remaining 13 per cent is designated for three northern
governorates. The balance of funds is designated as follows: 25 per
cent for the Compensation Fund for war reparation payments (the UN
Compensation Commission); 2.2 per cent for UN administrative and
operational costs of the program; and 0.8 per cent for the weapons
inspection program.

(28) The former Special Rapporteur on the human rights situation in
Iraq, established by the

Commission on Human Rights, has stressed that if the government of
Iraq had not waited five years

before accepting the oil-for-food agreement, millions "of innocent
people would have avoided serious and prolonged suffering." He further
reported that, while the it had failed to use its

existing resources well or to cooperate fully to take advantage of
other available resources, the government of Iraq had used some
resources to enrich itself. The Special Rapporteur also reported

that the Iraqi government had ignored the recommendations of both the
UN Office of the Iraq

Program and UNICEF to give priority to child nutrition and maternal
health programs. It had been slow to distribute medicines and medical
supplies to warehouses and its system of distribution of foodstuffs
and medicaments was allegedly susceptible to manipulation against
opponents.

(29) A 1987 law establishes the General Federation of Trade Unions
(GFTU) as the sole trade union organization. It was closely linked to
the Ba'ath Party and was used to promote party policy among workers.
The ICFTU has stated "Public sector workers and workers in state
enterprises cannot form or join trade unions or bargain collectively.
The state sets their wages. There is no collective bargaining in the
private sector. The law does not protect workers against anti-union
discrimination. Striking can be punished by imprisonment including
compulsory prison labour. There are no reports of strikes taking
place. In September 2002 it was reported that hundreds of members of
the Iraqi Union of Journalists were fired because they had not praised
Saddam Hussein and his regime as much or as frequently as they should
have done."

(30) The ICFTU has, in particular, noted the restrictions Iraq imposes
on employees wishing to leave service. Some can be punished with
imprisonment.

(31) AI has submitted these allegations to the UK authorities, who
have indicated they will investigate them.

(32) Frederick D. Barton and Bathsheba N. Crocker , A Wiser Peace: An
Action Strategy for a Post-Conflict Iraq, "Winning peace is harder
than fighting a war", the Center for Strategic and International
Studies, Washington DC, January 2003.

(33) See J-P. Azam, D. Bevan, P. Collier, S. Dercon, J. Gunning, and
S. Pradhan, Some Economic Consequences of Transition from Civil War to
Peace, World Bank, 1994. Also see subsequent research from the World
Bank's Development Research Group, notably the work of Paul Collier.

(34) See Paul Collier, Breaking the Conflict Trap: Civil War and
Development Policy, World Bank, June 2003. The full text is accessible
at . There is more material available at in The Conflict Prevention
and Reconstruction Unit of the World Bank. Also see Paul Collier and
Anke Hoeffler, Greed and Grievance in Civil Wars, World Bank's
Development Research Group. The revised version of the paper is
available at the following website: .

(35) For a detailed discussion, see Jason Switzer, Armed Conflict and
Natural Resources: The Case of the Minerals Sector, the International
Institute for Sustainable Development (IISD), August 2001.

(36) States that depend on natural resources are considered
particularly vulnerable to conflict because for their survival they do
not need to create strong institutions through taxation. See Macartan
Humphreys, Economics and Violent Conflict, Harvard University,
February 2003.

(37) World Bank's fact-sheet on Iraq. Available at www.worldbank.org.

(38) See Edward D. Porter, U.S. Energy policy, economic sanctions, and
world oil supply, the American Petroleum Institute, June 2001.

(39) For a detailed description of Iraq's oil potential, see Iraq: The
Day After, the report of an Independent Task Force on Post-Conflict
Iraq sponsored by the Council on Foreign Relations, New York.

(40) The former government of Saddam Hussein had existing contracts
and memoranda of understanding regarding exploration of oil in Iraq
with companies from France, the Russian Federation, the People's
Republic of China, the Republic of Korea, Malaysia, Canada, Viet Nam,
India, Indonesia, Algeria, and Tunisia. In addition, companies from
Italy, Spain, Australia, Turkey, the UK and the Netherlands held
preliminary discussions with the former Iraqi government.

(41) The Wall Street Journal, 25 April 2003.

(42) The full list of targets is to open the port of Umm Qasr; repair
and reopen all major roads; rebuild 10 power plants; restore
electricity to 75 per cent of pre-1991 levels, with repairs to 15 per
cent of the high-voltage electricity grid and the supply of 550
emergency generators within two months; restore commercial air links;
referral hospitals to be functioning in 21 major cities; maternity
care available to 100 per cent of Iraq's population; 100 per cent
school enrolment; 25,000 functioning schools; school supplies
distributed to 4.2 million children; fully-operative central bank and
ministry of finance; establish a legal framework "hospitable to
private business"; and rebuild 20,000 houses. Bechtel Inc. has been
selected by USAID through its Iraq Infrastructure Reconstruction
Program to participate in the design, rehabilitation, upgrading,
reconstruction, and construction of Iraq's infrastructure, initially
including: one seaport, five airports, miscellaneous electric power
systems, road networks, rail systems, municipal water and sanitation
services, school and health facilities, select government buildings,
and irrigation systems. Information about Bechtel's contracting
process can be found at .

(43) The Research Triangle Institute has secured a one-year contract
worth US$7.9 million to help restore local governments in Iraq. The
Institute is an independent, non-profit making organization which will
create programs to educate local officials on specifics of managing
water supplies, health care, and public sanitation. Bechtel, under the
infrastructure contract, will lead repairs for government buildings,
at a cost yet to be determined.

(44) The USAID has awarded a one-year grant worth US$10 million to the
World Health Organization (WHO) to strengthen the overall health
system in Iraq. This grant will build upon the WHO's efforts in the
country. A separate USAID contract designed to restore public-health
services has yet to be costed or awarded. The International Committee
of the Red Cross, as well as the Spanish and Jordanian government,
have contributed medical supplies recently. Bechtel, operating under
the infrastructure contract, will be involved in repairing and
rebuilding hospitals.

(45) The Wall Street Journal reported on 2 May 2003 that the US
administration's draft plans include tax reform and privatization.
"Execution of the plan will fall largely to private American
contractors working with a smaller team of U.S. officials," the
newspaper said. Consultancy fees could add up to US$70 million. The
USAID plans to award part of the work to BearingPoint, a firm formerly
known as KPMG Consulting. Other likely bidders for similar projects
include Booz Allen Hamilton, Deloitte Touche Tohmatsu and
PriceWaterhouseCoopers, a unit of the IBM group.

(46) Kellogg Brown & Root, a subsidiary of the Halliburton Group holds
a pre-war contract to fight oil-well fires in Iraq. It could be worth
US$7 billion, but only a small fraction - US$50 million - has been
spent, because US and UK forces seized oil wells before they could be
set on fire. A new contract, to restore and rebuild the oil
infrastructure is likely to attract bids from Halliburton, Fluor and
Bechtel corporations.

(47) A one-year contract worth US$62 million to rehabilitate Iraqi
schools was awarded to Creative Associates International, a small,
privately held company. Creative Associates, which has done similar
projects over the last 25 years, will work with the new Iraqi
government to plan new coursework and request appropriate textbooks.
In addition, the country needs at least 5,000 new primary schools,
while 8,000 existing ones need substantial rehabilitation, according
to UNICEF. Building them, at a cost yet to be determined, will
probably be handled by Bechtel, winner of the overall infrastructure
contract.

(48) A US$4.8-million contract to operate the southern port of Umm
Qasr for a year has gone to Stevedoring Services of America, a
terminal operator from Seattle. The port will be dredged and upgraded
by Bechtel under its infrastructure contract. A separate contract to
assess the nation's airports and return them to service has yet to be
awarded. No cost estimate has been made.

(49) In recent years, Australian farmers working through a UN
food-for-oil program sold wheat worth US$500 million annually to Iraq.
Resumption of US grain shipments to Iraq would benefit grain exporters
such as Cargill and Archer-Daniels-Midland which sell crops to the UN
food program and the USAID's food aid program.

(50) International Resources Group, a privately-held government
contractor will operate a 90-day contract worth US$7 million to help
USAID plan and manage reconstruction. A contract for logistical
support, to arrange warehousing, customs clearance, routing, trucking
and provision of bottled water, has yet to be priced and awarded.

(51) These companies, some of which have secured contracts, and some
of which are considered likely to secure contracts in future, include:

Bechtel Inc. an international engineering and construction firm. It is
one of the largest infrastructure development companies in the world.
Its past performance includes extinguishing Kuwait's burning oil
wells. The firm has some 47,000 employees. Its 2001 revenue was about
US$13 billion. Bechtel board member George Shultz has been a Secretary
of State during Republican administrations.
Bechtel, as noted above, has won the lead contract from USAID. It has
already awarded its first sub-contract, to Al-Bunnia Trading Company,
a 93-year-old Baghdad-based Iraqi construction firm, which will work
with Bechtel supervisors to provide field engineering services and
construct the bypass on Highway 10 near the war-damaged Al Mat Bridge
which is located about 300 km west of Baghdad and 180 km from the
Jordanian border.
Some of its projects have been controversial. Bechtel was the lead
developer in a privatisation contract in Cochabamba (pop.800,000),
Bolivia, where its subsidiary privatised the water supply and
subsequently raised prices. The resulting unrest in what was called la
Guerra del agua (the water war) turned violent (one protestor died),
and the Bolivian authorities were forced to cancel the contract.
Bechtel and the partners in the consortium are now suing the Bolivian
authorities for non-performance of contract, asking for at least $25
million as compensation.

Fluor Corp. is a construction and engineering firm that specializes in
power plants and the oil and gas industry. Its 2002 revenues were
US$9.96 billion, and it has 21,140 employees.

Parsons Corp. is a planning, engineering, and construction services
firm. It has operated in the rebuilding of the former Yugoslavia and
it has dismantled outmoded weapons in the Russian Federation. It is
privately-held, and its revenues for 2002 were US$1.5 billion. It has
9,000 employees.

Louis Berger Inc. is an engineering and construction services firm,
whose speciality is building highways, airports, and tunnels. It has
3,000 employees.

Halliburton Corp. is regarded as world leader in oil well services and
equipment supply, and its subsidiary, Kellogg, Brown and Root, is a
major contractor for the US Department of Defence. The group's 2002
turnover was US$12.57 billion and it had 85,000 employees. The group's
former Chief Executive Officer, Dick Cheney, is now the US
Vice-President.

(52) See Human Rights Watch Letter to Gen. Jay Garner on Human Rights
Priorities During Iraqi Reconstruction, where concern was expressed
that a contract for providing civilian law advisers had been awarded
to DynCorp. "In a November 2002 report on trafficking in Bosnia and
Herzegovina, Human Rights Watch found that DynCorp's personnel had
participated in human rights violations and the company has not done
enough to ensure that adequate safeguards are in place to prevent such
activities." Available at . Also see AI's A Catalogue of Failures: G8
Arms Exports and Human Rights Violations, AI Index: IOR 30/003/2003,
in particular paragraph 2.3.1.

(53) The US spent US$13.3 billion (US$97 billon in today's terms)
after World War II under the Marshall Plan to rebuild Europe, and
similar amounts after the Korean War. That sort of munificence is in
decline. The US contribution for reconstruction in former Yugoslavia
was US$1.01 billion.

(54) For comparison, World Bank figures indicate that in the West Bank
and Gaza, with a population of less than 2 million, a total of US$3
billion of reconstruction assistance was proposed in the first two
years. In Lebanon, with a population of 4 million, reconstruction
assistance was in the range of US$400 million per year for 10 years.
In Bosnia, with a population of 5 million, total pledges for
humanitarian relief and reconstruction were US$5.4 billion between
1995 and 1999. East Timor, with a population of less than half a
million, is receiving US$350 million of reconstruction aid over a
three-year period.

(55) The figures are based on the World Bank's estimates of
post-conflict rebuilding for Lebanon, East Timor, and
Bosnia-Herzegovina - each of which required about US$1,000 per person.
See Afghanistan: World Bank Approach Paper, World Bank, November 2001.

(56) Zarko Papic, Normal Social Policy and International Humanitarian
Assistance in Conflict Context, the Independent Bureau for
Humanitarian Issues, Sarajevo, October 2000.

(57) See Steven Kosiak, The Cost of War and Occupation, the Center for
Strategic Budget Estimates, Washington DC. For a more detailed
description of military and non-military costs, see Carl Kaysen, et
al, War with Iraq: Cost, Consequences and Alternatives, American
Academy of Arts and Sciences, 2002. In particular, see the analysis of
William D. Nordhaus of Yale University, Iraq: The Economic
Consequences of War, published in The New York Review of Books, 5
December 2002.


AI INDEX: MDE 14/128/2003 20 June 2003