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US Urges American Firms to Conduct Business in Iraq Despite Security Threats - 2004-05-08

In spite of continuing security problems in Iraq, U.S. contractors continue to operate there and many report progress in the effort to rebuild the country. That effort is being supported by more than 18 billion dollars in U.S. government contracts targetting everything from health care and transportation to oil field services.

Speaking to oil service company representatives at the Offshore Technology Conference here in Houston, U.S. Assistant Secretary of Commerce William Lash said there is money to be made in Iraq and he urged U.S. companies to get involved.

"Our competitors, our trading partners and coalition partners are visible in Iraq and when you see the that the Poles and the Danes and the Czechs and the Japanese and the Chinese and the Russians are there, you know that you want to be there as well," he said.

Some foreign contractors and workers have been leaving Iraq because of safety concerns following numerous attacks and kidnapings.

Mr. Lash, who serves as head of the Commerce Department's Iraq and Afghanistan Reconstruction Task Force, said security is not as much of a problem for business representatives going there. He says much of the country's business dealings are conducted in a normal atmosphere.

"Six weeks ago when I was in Iraq, I was dressed exactly as I am today, with no flack jacket. When you walk into a room and meet someone to do business, you meet them face-to-face on even ground. The bottom line is-we were safe," he said.

Of course, U.S. officials visiting Iraq have protection provided by U.S. forces and security personnel. This has also proved necessary for many private business representatives visiting the country.

In March the Inspector General for the U.S.-led interim authority in Iraq, Stuart W. Bowen Junior, said that security problems were adding significant costs to operations there. His report indicated that around ten to 15 percent of contract funds go to providing security. Many private security firms have entered Iraq to provide protection to contractors and work sites.

In his report submitted to the U.S. Congress Mr. Bowen said continuing threats to human life in Iraq and the inability to predict security costs, including insurance, raised questions about the need for more funding to accomplish the reconstruction mission.

But spokesmen for some of the large firms already operating under contract in Iraq say security problems have not caused significant delays in their projects. The San Francisco-based Bechtel company, for example, reported last month that security threats had affected only about ten percent of its current work sites in Iraq.