Team Infidel
Forum Spin Doctor
Wall Street Journal
March 27, 2008
Pg. 10
By Gina Chon
FALLUJA, Iraq -- U.S. forces claimed a much-needed victory in Iraq when they managed to pacify this former insurgent stronghold, but winning over investors to fund crucial reconstruction projects here is turning into another tough struggle.
For several years after the U.S. invasion of Iraq, Falluja's surrounding Anbar province represented the epicenter of the Sunni-led insurgency. But starting in earnest last year, Sunni tribal members -- many of whom were former insurgents -- joined American troops in the fight against extremist groups such as al Qaeda in Iraq. Since this so-called Sunni awakening, the area has seen a decline in violence.
Now, U.S. and Iraqi officials are bringing investors through to drum up reconstruction dollars. The effort here reflects a wider one across the country, in which American officials are trying to take advantage of the relative lull in violence to push economic and political gains.
Even so, Iraqi ambitions here are lofty. Officials plan to create a special economic zone later this year in Anbar that would allow investors to lease land from the government and enjoy reduced tariffs. Also, more than $1.2 million in microfinance loans from USAID, a U.S. State Department agency, have been given out so far to small-business owners. The loan programs typically are set up in developing countries to help small-business owners who couldn't otherwise fund businesses.
"Employing people is a priority," says Marine Lt. Col. William Vivian, who heads civil military operations in the area.
But getting businessmen to invest in Anbar is a hard sell. The western province, like much of Iraq, suffers from inadequate supplies of electricity, clean water and fuel. And government red tape is thwarting some of the region's entrepreneurialism, as locals search for ways to revive the economy.
These factors have local officials seeking American help. The slow progress has Anbar officials worried the place could be ripe again for attracting insurgents and al Qaeda.
"The central government is not seriously working with us, and services keep getting worse and worse, so we need help from the Americans," says Falluja City Council Chairman Sheikh Hamid Ahmad al-Alwan. "If people continue to not have jobs, we could lose security in the future."
Iraqi central-government officials concede that they need to better provide basic services in the provinces, and they say they are pumping more money into regional governments for reconstruction. Prime Minister Nouri al-Maliki said recently the government would work to provide jobs for former insurgents who have switched sides.
And the U.S. military is doing what it can as a middleman. Last week, American officers arranged for a group of expatriate Iraqi businessmen from Amman, Jordan -- who have personal ties to Anbar -- to visit factories in the Falluja area in hopes of luring their investment dollars. At a state-owned cement factory, the investors heard from managers that the factory has operated only two times in three years, partly because of infrequent power. It has been waiting for months for a generator promised by the central government in Baghdad.
The investors offered to ship generators from Jordan, but factory officials balked, saying Baghdad has to approve those sorts of decisions. A frustrated Sheikh Ghazi Sami al-Abed -- one of the expatriate investors, who still has a home here and is known as one of the richest men in Iraq -- said no other investors could succeed if they themselves can't.
"We are from here, so if we fail, how can anyone else do it?" he asks. "The U.S. has to put pressure on the central government to fix this."
At a meeting between the investors and the Falluja city council, both sides asked attending U.S. officials to get the military forces in Iraq to become investors in economic projects in Anbar. Navy Capt. John Dal Santo, who once worked on Wall Street, told the Iraqis at the meeting that it wasn't the military's role, but coalition forces would continue to act as facilitators. Capt. Dal Santo spearheads economic programs for a U.S.-led reconstruction team in the area.
"It's a painful process because they are used to having the U.S. provide everything to them," said Marine Lt. Col. Sean Riordan, who helps train Iraqi security forces. "But we have to show that it's up to them. It's not up to us."
Central-government efforts at reconstruction here are often criticized as half-hearted. The Iraqi army, along with local residents of a rural village outside of Falluja, recently built a school for elementary and middle-school students. But the Education Ministry in Baghdad has provided funding for only three teachers for 265 students, so the town is relying on local volunteers to help teach the classes.
And it still remains to be seen whether the security improvements in Anbar, which makes up about a third of Iraq, are sustainable. Increasing political tensions between Sunni tribal leaders and provincial officials -- who are aligned with the Iraqi Islamic Party, the main Sunni party -- are threatening stability.
Turf wars between Iraqi and American security forces and the Sunni "awakening" groups can also be problematic, partly because suspicions often arise between the official and informal Iraqi security forces. Earlier this month, a small group of "awakening" forces engaged in a short firefight with U.S. forces a day after the U.S. military arrested a relative of "awakening" tribal leader Sheikh Esmet Ali Markab al-Fahaddawi. No one was injured, and officials said the problem was resolved.
March 27, 2008
Pg. 10
By Gina Chon
FALLUJA, Iraq -- U.S. forces claimed a much-needed victory in Iraq when they managed to pacify this former insurgent stronghold, but winning over investors to fund crucial reconstruction projects here is turning into another tough struggle.
For several years after the U.S. invasion of Iraq, Falluja's surrounding Anbar province represented the epicenter of the Sunni-led insurgency. But starting in earnest last year, Sunni tribal members -- many of whom were former insurgents -- joined American troops in the fight against extremist groups such as al Qaeda in Iraq. Since this so-called Sunni awakening, the area has seen a decline in violence.
Now, U.S. and Iraqi officials are bringing investors through to drum up reconstruction dollars. The effort here reflects a wider one across the country, in which American officials are trying to take advantage of the relative lull in violence to push economic and political gains.
Even so, Iraqi ambitions here are lofty. Officials plan to create a special economic zone later this year in Anbar that would allow investors to lease land from the government and enjoy reduced tariffs. Also, more than $1.2 million in microfinance loans from USAID, a U.S. State Department agency, have been given out so far to small-business owners. The loan programs typically are set up in developing countries to help small-business owners who couldn't otherwise fund businesses.
"Employing people is a priority," says Marine Lt. Col. William Vivian, who heads civil military operations in the area.
But getting businessmen to invest in Anbar is a hard sell. The western province, like much of Iraq, suffers from inadequate supplies of electricity, clean water and fuel. And government red tape is thwarting some of the region's entrepreneurialism, as locals search for ways to revive the economy.
These factors have local officials seeking American help. The slow progress has Anbar officials worried the place could be ripe again for attracting insurgents and al Qaeda.
"The central government is not seriously working with us, and services keep getting worse and worse, so we need help from the Americans," says Falluja City Council Chairman Sheikh Hamid Ahmad al-Alwan. "If people continue to not have jobs, we could lose security in the future."
Iraqi central-government officials concede that they need to better provide basic services in the provinces, and they say they are pumping more money into regional governments for reconstruction. Prime Minister Nouri al-Maliki said recently the government would work to provide jobs for former insurgents who have switched sides.
And the U.S. military is doing what it can as a middleman. Last week, American officers arranged for a group of expatriate Iraqi businessmen from Amman, Jordan -- who have personal ties to Anbar -- to visit factories in the Falluja area in hopes of luring their investment dollars. At a state-owned cement factory, the investors heard from managers that the factory has operated only two times in three years, partly because of infrequent power. It has been waiting for months for a generator promised by the central government in Baghdad.
The investors offered to ship generators from Jordan, but factory officials balked, saying Baghdad has to approve those sorts of decisions. A frustrated Sheikh Ghazi Sami al-Abed -- one of the expatriate investors, who still has a home here and is known as one of the richest men in Iraq -- said no other investors could succeed if they themselves can't.
"We are from here, so if we fail, how can anyone else do it?" he asks. "The U.S. has to put pressure on the central government to fix this."
At a meeting between the investors and the Falluja city council, both sides asked attending U.S. officials to get the military forces in Iraq to become investors in economic projects in Anbar. Navy Capt. John Dal Santo, who once worked on Wall Street, told the Iraqis at the meeting that it wasn't the military's role, but coalition forces would continue to act as facilitators. Capt. Dal Santo spearheads economic programs for a U.S.-led reconstruction team in the area.
"It's a painful process because they are used to having the U.S. provide everything to them," said Marine Lt. Col. Sean Riordan, who helps train Iraqi security forces. "But we have to show that it's up to them. It's not up to us."
Central-government efforts at reconstruction here are often criticized as half-hearted. The Iraqi army, along with local residents of a rural village outside of Falluja, recently built a school for elementary and middle-school students. But the Education Ministry in Baghdad has provided funding for only three teachers for 265 students, so the town is relying on local volunteers to help teach the classes.
And it still remains to be seen whether the security improvements in Anbar, which makes up about a third of Iraq, are sustainable. Increasing political tensions between Sunni tribal leaders and provincial officials -- who are aligned with the Iraqi Islamic Party, the main Sunni party -- are threatening stability.
Turf wars between Iraqi and American security forces and the Sunni "awakening" groups can also be problematic, partly because suspicions often arise between the official and informal Iraqi security forces. Earlier this month, a small group of "awakening" forces engaged in a short firefight with U.S. forces a day after the U.S. military arrested a relative of "awakening" tribal leader Sheikh Esmet Ali Markab al-Fahaddawi. No one was injured, and officials said the problem was resolved.