Rebuild efforts lagging in Iraq

WASHINGTON – Iraq’s central government has failed to accept responsibility for more than 2,300 completed reconstruction projects financed with billions of U.S. taxpayer dollars, according to the latest quarterly report by the U.S. agency that oversees the rebuilding effort.

As a result, many projects either are being turned over to local entities that cannot adequately support them or are being run with continued U.S. funding, the report by the special inspector general for Iraq reconstruction, Stuart Bowen Jr., found.

Theft, fraud, skimming and other corruption amount to a “second insurgency,” Bowen wrote in his quarterly report. Reconstruction efforts are also hampered by security issues and attacks on contractors.

The report, to be released today, said the U.S. government had overseen completion of 2,797 projects, at a cost of $5.8 billion. The central government has taken over only 435 of them, worth $501 million.

No project has been turned over to the central government since July 2006, two months after Prime Minister Nouri al-Maliki’s government was installed and the Ministry of Finance “changed the … conditions on the asset transfer process,” the report said.

But even the Iraqi government’s acceptance of projects does not mean they will be adequately funded or maintained, said the report, citing problems with the Dora power station.

The Iraqi power plant rebuilt with tens of millions of U.S. dollars fell into disrepair once transferred to the Baghdad government. The 320-megawatt Dora plant is considered an important source of power for electricity-starved Baghdad.

The U.S. Army Corps of Engineers has taken over the repair and hopes to have both units operational in August.

Because of changes in requirements, unanticipated costs and unexpected delays, among other things, about half the projects have failed to meet their objectives, the report found.

In addition, the U.S. government hindered Bechtel’s work by failing to supply enough personnel to oversee the contract, and projects required large numbers of subcontractors, weakening quality control.

Bowen said there were signs of progress, such as Iraq’s production of 2.1 million barrels of oil a day in the latest quarter, compared with 1.9 million the previous quarter and 1.8 million barrels before that. He noted that Iraq was producing more than 2.4 million barrels a day before the U.S.-led invasion in 2003.

Despite the setbacks with the power plant, Bowen said Iraq’s electricity supply still rose to 4,230 megawatts, compared with 3,900 megawatts during the previous quarter and 3,800 before that. But that is still below the prewar level of 4,500 megawatts, he said. Just two years ago, Iraq’s electricity supply was more than 5,000 megawatts.

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