BABIL REFORMERS CREATE PROTO-INVESTMENT COMMISSION

C O N F I D E N T I A L HILLAH 000047 SIPDIS SIPDIS E.O. 12958: DECL: 3/28/2017 TAGS: ECON EFIN ETRD PGOV IZ SUBJECT: BABIL REFORMERS CREATE PROTO-INVESTMENT COMMISSION CLASSIFIED BY: Charles F. Hunter, Babil PRT Leader, REO Al-Hillah, Department of State. REASON: 1.4 (b),(d) ¶1. (U) This is a PRT Babil Cable. ¶2. (SBU) Summary: In the wake of the CoR's passage of the investment law, Babil business and political reformers recently formed a "preparatory" provincial investment commission awaiting the creation of the National Commission for Investment. Despite its unofficial status, the Babil body presents itself as a commission-in-waiting and has already begun inserting itself into the provincial decision-making process. Driven by energetic PC Planning Committee Chair Qusay Nadi Ali -- who despite belonging to the Iraqi Communist Party is arguably the strongest free-market advocate among elected officials in Babil -- the group seeks to establish ties with the PC's economic, project, planning, and legal committees. Upon the creation of the National Commission for Investment, the unofficial Babil investment group will seek formal blessing from the Provincial Council (PC) to morph into the official body called for by the investment law. End summary. ¶3. (U) Thus far, membership in the shadow commission is six members (two members of the PC, one from the chamber of commerce, two from the economic development center, and the governor's administrative assistant). Qusay hopes to organize a consensus for investment projects from among the PC economic, project, planning, and legal committees, following which the planning committee would funnel the accepted proposals to the investment commission for its consideration. ¶4. (C) Qusay conceded that while there was "general acceptance" of the investment law within the Babil PC, he lamented that the creation of the investment commission had yet to reach its legislative agenda. He cited opposition by the SCIRI-leaning Economic Committee Chair Saad Yehia as the main obstacle to the formalization of the commission's status. Qusay attributed Saad's opposition to the latter's vague socialist leanings and utter lack of knowledge about economics but believes that Saad's opposition can be overcome (NFI). The incipient commission already plans to publicize its existence through local centers for economics and trade as well as by hosting an investment conference. For Qusay, two key issues remain: security and support from the provincial government. He specifically cited the SCIRI governor's efforts to forge stronger trade and investment ties with Iran as indicative of the provincial leadership's sentiments. ¶5. (C) Comment: Qusay implied to visiting Embassy EconOff on March 5 that the formal appointment of Babil's investment commission had been completed, but apparently the process is not as far along as hoped. While the establishment of this provincial investment commission-in-waiting signifies the desire of the province's more progressive political and business elements to forge ahead with free-market reforms, the current political situation may delay its transformation into an officially recognized body. End Comment. HUNTER