Wednesday, August 17, 2011

The State of Iraq

Iraq re-emerged in the news recently, as terror attacks left scores dead in Baghdad, Kut and other areas of the country. Though the sudden spark of violence certainly presents reason for concern, all indications seem to suggest a that the country has turned a corner, and that while the security situation may not return to pre-invasion status for some time, there is reason to be optimistic. It is vital to get a grip on the overall picture in Iraq as we approach the December 2011 deadline for the final wihdrawal of US forces from the country.

Business, and business as usual

Recently, Hassan Hadifh of the Wall Street Journal reported that Royal Dutch Shell reached an agreement with the Iraqi Oil Minitry that would yield 2 billion cubic feet/day of natural gas. Some of this quantity would be used for export in a liquified form, while some would be piped for local and regional use. The Ministry estimates that the project expects to generate 31 billion dollars in government revenues over the 25 year lifespan of the project. This is just one of many large scale foreign investment projects taking hold throughout Iraq at the moment. According to an article on "The National" website, total foreign investment is expected to reach around 90 billion dollars this year, with Turkish interests leading the way, and with investment taking place not only in the energy sector, but also in housing and urban infrastructure development.

Of course, oil and natural gas still dominate. As Josie Esnor reports in the Telegraph, "Look outside the oil sector, however, and high operational risk continues to discourage all but the most daring investor." Moreover, a greater proportion of investment inquiries remain focused on the areas in and around the Kurdish regions, like Arbil, where the security situation differs dramatically from both the Sunni heartland and the Shi'a dominated south.

Investors remain optimistic about Iraq, at least for the moment. With this in mind, it is difficult to dismiss the sense that cries of collusion weren't entirely correct; that one positive outcome in invading a country and laying waste to a great many parts of it, is the opportunity to go back in and rebuild it and thus reap the spoils of destruction. However, let's lay the most cynical readings aside for the moment. Instead, let's try and examine how the current state of things affects the average Iraqi.

Keep the Lights on

Acording the most recent "Iraq Index" produced by the Saban Institute/Brookings Institution, by virtually any measure, life in Iraq is improving. In regards the economic and investment activity discussed above, The Saban report indicates an estimated 2011 GDP growth of above 9%, with an IMF estimate that 2012 may show as much as 12.5%. From about 2008 until now, there has been steady increases in electrical kilowatt hours generated and delivered. Cellphone subscriptions are up, internet access is on the climb, and while the overall unemployment picture remains discouraging, jobs are being created in certain sectors and in certain municipalities.


Furthermore, despite the most recent spate of attacks, Iraqi civilian deaths are at an all time low per annum. through July '11, the total amounted to around 800, less than one-half from 2010, and less than one-third from 2009. In addition, US military fatalities also attain to significantly lower levels than at any time during the invasion and occupation. Despite small spikes in the period from March to June of this year, US fatalities are on track to be equal or less than last years total of 60, which remains to date the lowest per annum of the war. The number of wounded will likely end up at less than half of last years total number of 389.

While the issue of refugees and Internally Displaced Persons remains significant, most of the indicators in the Saban report Index paint the piture of a ountry on the right track.

So why is Seymour Hersh so worried?

During a June 11th interview on Democracy Now, Investigative Journalist Seymour Hersh said the following:

Whatever you are hearing, Iraq is going bad. Sunnis killing Shi'as, it's sectarian war.

Hersh goes on to state that certain Baathist Sunni groups, with potential operators in the UK, are planning on declaring a provisional government, perhaps something like a shadow government, with the aim of casting the Shi'a dominated government of overtly tied to Iran. Hersh doesn't get any further into it, but there are definitely hints of the ongoing structure of support by Saudi Arabia for Sunni groups to be propped up as proxies against "Iranian Influence." Furthermore, Hersh's claim that the situation in Iraq may be used to put more pressure on the Iranians seems to correspond with recent comments made by Adm. Mike Mullen. As quoted in the Telegraph on 7/7/11, Mullen indicates that "Iran is very directly supporting extremist Shi'a groups which are killing our troops." The Admiral goes on to say that any final decision on US troops remaining in country past the December deadline "has to be done with control of Iran in that regard." Mullen doesn't provide any evidence for the claim of Iranian support, and the most recent attacks suggest that the most active groups are in fact Sunni extremists, not Shi'a groups. However, in general, this seems to point to a coming moment that will decide the immediate future stability of the country.

Hersh believes that Iraq will prove a thorn in Obama's side next year. Human Rights Watch, in its most recent report on Iraq details continued human rights abuses, including targeting Women's rights advocates and female politicians, forced female genital mutilation in the Kurdish regions, torture and severe disruptions of due process for prisoners, and severe curbs to freedom of expression. Clearly, things aren't better for everyone.

Time will tell.

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