Identifier
Created
Classification
Origin
08BAGHDAD342
2008-02-06 08:37:00
CONFIDENTIAL
Embassy Baghdad
Cable title:  

IRAQ EXECUTIVE STEERING COMMITTEE - FEBRUARY 1

Tags:  ECON IZ PGOV 
pdf how-to read a cable
VZCZCXRO0486
RR RUEHBC RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #0342/01 0370837
ZNY CCCCC ZZH
R 060837Z FEB 08
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC 5587
INFO RUCNRAQ/IRAQ COLLECTIVE
C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 000342 

SIPDIS

SIPDIS

E.O. 12958: DECL: 02/06/2018
TAGS: ECON IZ PGOV
SUBJECT: IRAQ EXECUTIVE STEERING COMMITTEE - FEBRUARY 1

REF: BAGHDAD 177

C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 000342

SIPDIS

SIPDIS

E.O. 12958: DECL: 02/06/2018
TAGS: ECON IZ PGOV
SUBJECT: IRAQ EXECUTIVE STEERING COMMITTEE - FEBRUARY 1

REF: BAGHDAD 177


1. (C) Summary. Prime Minister Maliki chaired the Baghdad
Security Plan (Fardh al Qanoon ) FAQ) Iraq Executive Steering
Committee (I-ESC) on 1st February. The meeting included much
discussion of the role that that the decentralization and the
private sector can play in Iraq's development - including a
proposal to privatize Baghdad's garbage collection and the
need to allow individual ministries to import fuel products;
an update on kerosene distribution that included claims of
systemic Ministry of Oil corruption; and an update that a
forthcoming revised executive order will stipulate that the
Ministry of Displaced Persons remains the lead of the
inter-agency coordinating committee for returning displaced
persons. End Summary

--------------
Project Clean Delivery
--------------

2. (C) Saeed Jabour, Secretary of the I-ESC and a member of
the Office of the National Security Advisor, briefed an
update of the expansion of the new initiative to improve
efficiency and remove militia involvement in the distribution
of kerosene in Baghdad (Project Clean Delivery -- reftel).
Jabour informed the body that the initiative was implemented
in the Ghazaliya and Beladiyat neighborhoods and that the
increased monitoring associated with the initiative ensured
that ration allocations were received at the GoI stipulated
price. Jabour also noted that the initiative was uncovering
systemic corruption in the Ministry of Oil and that local
militias had assassinated two Neighborhood Advisory Council
members because of these Council members' involvement with
the initiative, which immediately took revenue away from
local militants. Each of the Minister of Defense, Essential
Services Chair Chalabi, the Provincial Council chairman and
the Deputy Inspector General from the Ministry of Oil praised
the initiat
ive.

-------------- --------------
Maliki Urges Immediate Improvement in Services
-------------- --------------

3. (C) Referencing pictures of dilapidated schools shown at
the 7 Dec I-ESC, PM Maliki called for immediate action to
ensure that all of Baghdad's schools have windows and
functioning bathrooms. PM Maliki also asked the Mayor to

"take pressure off" of the Ministry of Education in school
refurbishment and asked if the Mayor needed additional funds
to do so. The Mayor stated that it is not the responsibility
of the Amanat, but that it would assist with the work.


4. (C) The Deputy Minister of Electricity provided a brief
summary of Iraq's electricity challenges that highlighted the
need to increase generation capacity and Provincial adherence
to the national distribution plan. The Deputy Minister also
stated that a lack of heating fuel for homes is currently
causing an increased burden on the electricity grid.


5. (C) Stating that "everything" in the effort to improve
Iraq is based on electricity and fuel, PM Maliki asked that
all Provinces have a regular supply of 12 hours of power by
June. The Deputy Minister stated that although the MoE has
plans to bring on line several generators and is continually
attempting to repair power lines interdicted by terrorists,
he would not be able to commit to such an increase.

--------------
Petraeus Notes Loss of Electricity
--------------

6. (C) CG Petraeus distributed a hand out that showed that
Baghdad is currently loosing approximately 2 hours of power
per day, increasing to 4 hours this Spring, due to a lack of
sufficient Diesel Fuel needed to avail generator capacity.
Furthermore, the CG stated that Iraq will need an additional
1.5 million L/day (2.8 million L/day total) by April to
utilize generators coming on line and reminded IESC members
of the difficulties in procuring diesel from Kuwait last
summer.


7. (C) In response to comments from Essential Services Chair
Ahmed Chalabi that the GoI must allow individual ministries
to bypass the Ministry of Oil's marketing arm (SOMO),which
is the sole entity authorized to import fuel products, CG
Petraeus praised Chalabi's spirit of ingenuity and
strenuously noted that Iraq must overcome its centralized
bureaucracy if it is to successfully develop. As evidence,
CG noted that electricity supplies from Turkey are currently
halted due to a cumbersome payment process requiring
agreement and joint signatures from the Ministry of
Electricity and the Deputy Prime Minister's Office.
(Comment: the implementing regulations for the Fuel Import
Liberalization Law do allow private imports of refined
products, but only by private companies for retail sale to

BAGHDAD 00000342 002 OF 002


the local market. End comment.)


8. (C) PM Maliki stated that he would suggest to the Cabinet
that any Ministry should be able to import directly. The
Governor of Baghdad noted that this would necessitate quickly
acquiring dollars at the Central Bank, which is itself
problematic. Continuing his attacks on centralized
bureaucracy, CG Petraeus also noted that it is "insane" that
the GoI only allows the Trade Bank of Iraq to offer Letters
of Credit and urged that private banks be allowed this right.
PM Maliki stated that he was open to this idea and that he
would instruct the Economics Committee to consider the issue.
(Comment: Private sector solutions are frequent themes of
Chalabi and CG Petraeus at the IESC. Maliki seems genuinely
supportive of an increased private sector in current GoI
activities, but seems to lack the ability to fully understand
and/or execute the policy reforms that such increases would
require. For example, Maliki sometimes notes that he
previously supported private companies being allowed to
import fuel, but that
none were interested given that the world market price for
fuel products is in excess of GoI mandated prices. Maliki
has never followed up these comments with the obvious
observation that the GoI should end its fuel price controls.
Neither the Ministry of Finance nor the Ministry of Trade
regularly attends the IESC. End Comment.)

--------------
Privatization of Baghdad's Garbage
--------------

9. (C) The Mayor of Baghdad stated that Baghdad's ever
present garbage problem could be improved by: 1) increasing
recycling; 2) the Amanat being granted access to 500
allegedly unused trucks belonging to the Ministry of Interior
and 3) accepting a proposal from an Iraqi company that has
worked in Bahrain to collect Baghdad's garbage at no expense
provided that they be given exclusive rights to the refuse
for 15-20 years. (Comment: No further details were given
about the Bahraini's proposal. While the scrap iron present
in many of the rubble heaps in Baghdad is valuable, it is
unknown if such an agreement makes economic sense for common
garbage in general. End Comment). PM Maliki stated that any
company that would take Baghdad's garbage can have it and
said that he would ask the Economic Committee to consider the
proposal.

--------------
Revised IDP EO Expected Soon
--------------

10. (C) Provincial Chair Mueen stated that returning
Displaced People (IDPs) remains a problem and asked that the
Governor be given the responsibility of the "non-functioning"
IDP Committee. PM Maliki stated that the Minister of
Displaced Persons leads this committee but that the Governor
is a member of it. PM Maliki went on to explain that
problems in the original executive order establishing the
committee were being rectified by the National Security
Advisor's Office and that the new order would be sent soon.
Maliki also stated that it is essential that this committee
begin its work as soon as possible.

--------------
Chalabi Sits Next to Prime Minister
--------------

11. (C) Comment. Dr. Chalabi sat next to PM Maliki,
inserting himself in the seat normally occupied by NSA
Rubaie. At every previous IESC he attended, Chalabi sat at
least four seats down on the right of the table. As
Chalabi's relative influence has increased sense being named
Essential Services Chair, he continues to take a more
prominent role in the meeting. End Comment.
BUTENIS