Economy Hurting
More Than Violence
By Dahr Jamail
11 November, 2004
Dahrjamailiraq.com
Violence
is taking a heavy toll in Iraq, but everyday economic difficulties could
be hurting people more.Nearly 20 months into the occupation, Iraqis
find themselves in a desperate situation, with countless struggling
to survive.
U.S. President George
W. Bush said at a speech at the U.S. Army War College May 24 this year
that the United States wants "freedom and independence, security
and prosperity for the Iraqi people."
Prosperity now looks
like 70 percent unemployment. A recent study found that if the food
ration programme set up by Saddam Hussein's regime during the U.S.-led
sanctions was disbanded, more than 25 percent of Iraqis would starve
to death.
Bush had also praised
"a growing private economy" in Iraq after the former governing
council approved a new law "that opens the country to foreign investment
for the first time in decades."
But Antonia Juhasz,
project director at the International Forum on Globalisation based in
San Francisco in the United States says that orders to this effect by
the disbanded Coalition Provisional Authority have allowed the economy
of Iraq to be sold from under Iraqis.
In a paper 'The
Hand-Over That Wasn't: Illegal Orders give the U.S. a Lock on Iraq's
Economy', she wrote that order no. 39 allows for "(1) privatisation
of Iraq's 200 state-owned enterprises; (2) 100 percent foreign ownership
of Iraqi businesses; (3) 'national treatment' -- which means no preferences
for local over foreign businesses; (4) unrestricted, tax-free remittance
of all profits and other funds; and (5) 40-year ownership licences."
Iraqis are therefore
not given preference in reconstruction efforts in their own country.
Foreign corporations such as Halliburton and Bechtel have been allowed
"to buy up Iraqi businesses, do all of the work and send all of
their money home," Juhasz said.. "They cannot be required
to hire Iraqis or to reinvest their money in the Iraqi economy. They
can take out their investments at any time and in any amount."
The consequences
of those decisions are being felt in Iraqi homes. Abu Ahmed al-Hadithi,
40, sells vegetables in the al-Adhamiya district of Baghdad. "The
economic situation is very bad now," he said as he stood waiting
to sell some cucumbers. "The costs of gas and food are going up
so high. So even if we make more now, everything is costing more."
The vegetables he
sells now are imported. "I make less profit now, I have nine people
to take care of, and it has made my life very difficult," he said.
This is the consequence
of order no. 12 of the Bremer orders as they came to be called after
former U.S. administrator in Iraq L. Paul Bremer. The order suspends
"all tariffs, customs duties, import taxes,
licensing fees and similar surcharges for goods entering or leaving
Iraq."
Juhasz says this
led to "an immediate and dramatic inflow of cheap foreign consumer
products -- devastating local producers and sellers who were thoroughly
unprepared to meet the challenge of their mammoth global competitors."
Another critical
factor leading to the dismal economic situation in occupied Iraq is
that little has come by way of the promised reconstruction funds.
Anthony Cordesman
from the Centre for Strategic and International Studies in Washington
says that as of June 25 this year, "the Programme Management Office
(PMO) data show...out of 18.4 billion dollars in aid, 11 billion dollars
has been apportioned, 7.6 billion dollars has been committed, 4.8 billion
dollars has been obligated, and all of 333 million dollars has actually
been spent."
This has meant idle
factories, and Abu Gouda, 50, knows what that means. The ex-factory
worker too is now selling vegetables in al-Adhamiya market.
"I make between
8,000-10,000 dinars (five to seven dollars) a day, and this is just
enough to feed my family of seven," he said at his vegetable stall.
"Things have become so difficult for us, this is what I
have to do to take care of my family."
The charity Christian
Aid says the U.S.-controlled coalition in Baghdad is handing over power
to an Iraqi government without properly investigating what it has done
with some 20 billion dollars of Iraq's
own money. Many Iraqis say the economy is suffering because of the
security situation.
"We have no
security and this means our economy cannot function," said Sabah
Ahmed, a former local official, now unemployed. "People are in
a critical situation because of the increase in prices. The gasoline,
transportation, everything is going up so much."
Another former official
is trying to sell sweets, but does not sell many.. "Before people
used to eat so many sweets, but now they are buying less because nobody
can afford them."
Dahr Jamail is one of those very few independent journalists
in Iraq. His travel and reporting expenses are covered by the donations
he receives from his readers. You can help Dahr continue his crucial
work by making donations. For more information or to donate to Dahr,
visit http://dahrjamailiraq.com/donate/