Rising security costs curtail Iraq reconstruction

Team Infidel

Forum Spin Doctor
by Jim Mannion

WASHINGTON, Oct 31 (AFP) - Many US-financed reconstruction projects in Iraq
are unlikely to get off the drawing board because of soaring security costs
related to the insurgency, a report to Congress released Monday said.

The report by the special inspector general for Iraq reconstruction, Stuart
Bowen, said American contractors account for 120 of the 147 US civilians
killed in Iraq since March 2003.

Security costs now represent 25 percent of the nearly 30 billion dollars
appropriated by the United States for reconstruction projects in Iraq, said
the report, which covers the three-month period ending September 30.

The dramatic increase in spending on security "has proportionately reduced
funds for other reconstruction projects," the report said.

Bowen warned that there is a growing gap between the number of projects the
United States originally proposed building in Iraq and those it will
ultimately complete.

Besides rising security costs, projects have been plagued by increased costs
of materials, project delays, cost overruns, and multiple changes in
reconstruction priorities, he found.

Bowen said hundreds of millions of dollars more also will have to be spent
training Iraqis to take over and maintain projects once they have been

"When the US-led portion of Iraq's reconstruction concludes, many planned
projects will remain on the drawing board for execution by other funding
sources," his report said.

The report highlighted the difficulties besetting a massive reconstruction
program in the midst of a fierce insurgency.

It quoted from incident reports detailing the impact of kidnappings,
ambushes, telephoned threats and insurgent attacks on projects around the

The report said the number of insurance death-claims filed during the
quarter by contractors from all countries rose by 82, or 70 percent, from
the previous quarter.

It put the total number of non-Iraqi contractor deaths at 412 from March 11,
2003 to September 30, 2005.

The number of death and injury claims filed with the US Department of Labor
was up 24 percent from the previous quarter, the report said. Those claims
have totalled 4,208 since April 2003, it said.

Of 147 US civilians killed since the war began, 117 lost their lives as a
result of "terrorist action," it said, citing State Department statistics.
Three other deaths were homicides and the remainder were caused either by
vehicle accidents or natural causes.

At least 25,000 non-Iraqis currently work as private security contractors in
Iraq, the report said, citing Defense Department estimates. Other studies
have concluded that 6,000 of them serve in armed tactical roles, it added.

"During the last two reporting quarters, 66 percent of the US contractors
killed in Iraq were working for private security companies," the report

Direct spending on training Iraqi security forces and security related
construction has risen sharply since September 2004, according to the

Funds allocated for projects in the areas of security and law enforcement
rose from 3.24 billion dollars to 5.045 billion dollars in December 2004,
the report said. Those in the area of justice, public safety and civil
society went up from 1.038 billion dollars to 2.129 billion dollars, it

Meanwhile, the number of Iraqis employed on US government projects has
declined from a peak of 170,000 in mid-March, hitting a low of 116,361
during the week of September 7, 2005, the report said.

Oil production has continued to fall short of the 2.5 million barrel a day
target set by the Iraqi Ministry of Oil, while oil exports have been
disrupted by insurgent attacks on pipelines.

"These attacks have cost Iraq billions of dollars in lost revenue and repair
costs," the report said.

Smuggling of refined oil products out of the country -- estimated at nearly
two million liters a day -- also have contributed to domestic fuel
shortages, it said.

The report said more than two billion dollars worth of gasoline and diesel
fuel supplies are stolen a year.

"Corruption was endemic in the prior regime, and its legacy of corruption
still burdens the country," the report said.

An Iraqi audit of government contracts between the end of June 2004 and the
end of February 2005 found that between 500 million dollars and 1.27 billion
dollars in Iraqi funds were lost because of irregularities of various kinds,
the report noted.