Only $2 billion left to spend in Iraq

Hillary Wicai Aug 2, 2006

KAI RYSSDAL: The Special Inspector General for Iraq was on Capitol Hill today talking to lawmakers. Here’s the executive summary: It’s bad. Really, really bad. One of the more pressing matters: There are only $2 billion left for reconstruction. And 500 projects left on the short list. So how’s that gonna work? Marketplace’s Hillary Wicai reports that part’s still kind of up in the air.

HILLARY WICAI: Slowly the US is turning over the work of rebuilding Iraq to the Iraqis themselves. Still, 58 percent of the oil and gas projects aren’t finished; 30 percent of the electricity projects haven’t even been started.

US taxpayer money that should have gone to building things like new power plants has been spent elsewhere. But where?

Jim Mitchell is a spokesman with the Special Inspector General for Iraq Reconstruction, an office created by Congress.

JIM MITCHELL: Money was diverted to fund security for the reconstruction program and to fund the training of troops and police in Iraq.

Now the Sept. 30 deadline for contracting the last of the rebuilding program is fast-approaching. It’s the job of the US embassy in Baghdad to decide which projects will be funded. Then what?

Joseph Christoff is with the Government Accountability Office. He says Iraqis can’t really pick up the reconstruction where the US will leave off. He says the presumption was that the country’s oil money would fund such an effort, but it turns out those dollars are already spoken for.

JOSEPH CHRISTOFF: They’ve got growing costs for government salaries and pensions. They’re paying for this burgeoning security force that costs more money. And they still have this outstanding debt. They may not have the resources to actually make a contribution to their own reconstruction efforts.

When the Special Inspector General for Iraq Reconstruction presented his report to the Senate today, he said the conculsion is obvious: More money is needed.

So far the international community has pledged $13.7 billion but has only come up with about $3.5 billion. And most of that is in the form of loans.

In Washington, I’m Hillary Wicai for Marketplace.

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