Companies seek new opportunities in Iraq
( 2003-10-24 09:02) (Agencies)
The violence and disarray in Iraq aren't stopping global businesses from sniffing out opportunities in Iraq.
"The timing is almost perfect," John Disharoon, of construction king Caterpillar Inc., said Thursday. "Things are starting to move forward."
As governments gathered to drum up public money for Iraq's reconstruction at a donors' conference Thursday, more than 300 executives from corporate giants General Motors, Motorola, Coca-Cola and others showed up for a parallel gathering of private investors a few hundreds yards away.
Many expressed enthusiasm after hearing from Iraqi officials about the country's potential, even as they confessed their fears about security.
L. Paul Bremer, the U.S. administrator in Iraq, told reporters attacks, carried out mostly by members of Iraq's former ruling Baath Party, "pose no strategic threat to our forces."
But he added that terrorism did pose a "serious threat."
Ali Allawi, trade minister on the U.S.-appointed Iraqi Governing Council, conceded security was in a "state of flux," but insisted it was "not intolerable," compared with some countries in Latin America or Asia.
Some business leaders felt the same.
"Of course we have concerns, but it's our business," said Hans Kraus of Intecsa-Uhde, a joint venture of Germany's Thyssen Group and Spanish construction company Dragados.
"We're not building chemical plants in Paris or London," he said. "We tend to work in countries that aren't all that pleasant — Iran, Algeria, and now maybe Iraq."
DaimlerChrysler vice president Timothy McBride cited a training program already under way in Afghanistan to teach former soldiers "basic auto-repair skills." The automaker recently delivered 20 semitrailers filled with relief supplies and training equipment for the Afghan workers.
"We have a tradition of establishing a strong presence in difficult markets," he said.
In Iraq, DaimlerChrysler is already selling some cars and trucks as it re-establishes its distribution network.
"We're in the process of trying to reconnect with customers there," McBride said.
Iraqi officials sought to paint the same rosy outlook even as they delivered a list of basic needs at the donors' conference, from clean water and housing, to health care and even pesticides to restart agriculture.
More than two-thirds of Iraqis depend on food rations, less than half have access to regular drinking water, 20 percent of children under the age of 5 are malnourished, maternal mortality has quadrupled and diseases such as malaria are coming back, officials said.
"We inherited Iraq in a deplorable state," said Mouwaffek al-Rubaie, another council member.
He and others pressed for an economic "kick start" to combat a crippling 60 percent unemployment rate.
Free-market reforms, responsible government and Iraq's central location in an oil-rich region should give investors incentives "equal to or better than any that they would face in any other parts of the world," Allawi said.
"Our intention is to build a new Japan in the Middle East," al-Rubaie added.
The Ministry of Industry and Minerals unveiled plans to open 13 state-owned companies — including those making clothing, vegetable oil, dairy and chemicals — to leasing by private firms. That attracted the interest of U.S. and New Zealand agricultural groups, said Fred Schwien, representing the U.S. Commerce Department.
"The dairy folks are excited," he said, without identifying the companies.
Not everyone was convinced.
Jean-Louis Salas, managing director of energy, exports and projects in Iraq at the French bank BNP Paribas, said there were two big problems: Iraq's crushing debt, which makes new lending difficult, and the fact that it remains an occupied country.
"You can't do an investment until there is a legitimate government in Iraq," he said. "So far, it's not at all a government, but just a governing council."
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