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Press Briefing, August 1, 2007

Multi-National Force-Iraq

MULTI-NATIONAL FORCE-IRAQ/DEPARTMENT OF DEFENSE PRESS CONFERENCE, MR. PAUL BRINKLEY, DEPUTY UNDERSECRETARY OF DEFENSE FOR BUSINESS TRANSFORMATION, MR. PHILIP REEKER, COUNSELOR FOR PUBLIC AFFAIRS, U.S. EMBASSY, BAGHDAD, AND BRIGADIER GENERAL KEVIN BERGNER, MULTI-NATIONAL FORCE-IRAQ SPOKESMAN.

TOPIC: CURRENT EFFORTS IN IRAQ

LOCATION: COMBINED PRESS INFORMATION CENTER, BAGHDAD, IRAQ

DATE: WEDNESDAY, AUGUST 1, 2007

BRIG. GEN. BERGNER: As-salaam aleikum. Good afternoon. This afternoon I'm joined by two good friends, two colleagues, who are gonna expand our normal weekly update by providing the opportunity to discuss reconstruction, economic, and political efforts that are underway to assist the government of Iraq.

It is my pleasure to introduce the Deputy Undersecretary of Defense and the head of the task force for Business stability operations, Mr. Paul Brinkley. Paul is leading an effort to help Iraq revitalize industrial capacity and transform their own state-owned enterprises into competitive business operations. The task force has been deeply involved here for over a year and is working hard with a variety of Iraqi ministries.

Mr. Phil Reeker is the Counselor for Public Affairs in the U.S. Embassy here in Baghdad and he his my counterpart as the spokesperson for the ambassador. Phil is a longtime public affairs officer with experience in Washington and abroad.

I want to offer just a couple of opening remarks on the security front and then I'll turn it to my colleagues.

We are now into the sixth week of the surge and operations and we're seeing some tactical momentum. Operations by Iraqi and coalition forces have made progress against the extremists on a number of fronts as we have reported to you in the past few weeks. We continue to target the networks and leaders of al-Qaeda in Iraq and the special groups and are steadily chipping away at both sets of extremists. We are seeing progress not just in the number of terrorists leaders that are captured or killed but also in the courage of the Iraqi people, their support for their security forces, and their purposeful stand against violence.

BRIG. GEN. BERGNER: A couple of points of reference for the progress we are seeing. First if the tips from Iraqi citizens. Our focus on population security is facilitating more information exchange. Last month the number of tips reached some 23,000 as we have mentioned before, which is about four times what we saw during the period last year.

In addition, we're seeing awakenings similar to what you have seen in Al Anbar Province. Iraqi tribal leaders are also stepping up their efforts to step away from the violence and pledged to work with their security forces, with their government, and with the coalition. In just the past three weeks, four different communities north and west of Baghdad have joined other communities in declaring their opposition to al-Qaeda and pledging to work with their countrymen to stop the violence.

And finally, I will point to weapons caches which you have heard reported in the last few days. In the first six months of this year, we have already captured more stockpiles of weapons than we did in all of last year. We are achieving that progress because of the breadth of our operations, because of our focus on extremists sanctuaries and operating bases, and most importantly because of the precise information from Iraqi citizens. In many recent instances, it is actually Iraqi security forces who increasingly find and seize these weapons caches. Two recent examples of that. On the evening of Tuesday, July 24th in southern Iraq near Nasariyah, Iraqi police seized 400 rockets, 70 mortars, and some 11 heavy machine guns. On Sunday, July 22nd near Kirkuk, Iraqi army forces from the 2nd Battalion of the 2nd Brigade of the 4th Iraqi Army Division conducted an independent operation known as Operation Home Protector, and seized a weapons cache underneath a building that included rockets, mortars, and bomb making components. The progress being made in these regards reflects the trust and the determination of the citizens of Iraq to make their country more secure. It reflects the increasing contribution of Iraqi forces and it reflects the tactical momentum that the surge in operations is achieving as a result of the courage and commitment of both coalition and Iraqi forces.

The pace and scale of our operations and the tactical momentum that we refer to today is just one element though of the progress that's underway. There's also a steady effort by provincial reconstruction teams and the task force for business stability operations that are working on issues of local governance, of economic development, and reconstruction. And so I'd like to turn now to my two colleagues to provide you a better sense of that effort that's underway in those specific areas. And we'll start with the Deputy Undersecretary of Defense, Mr. Paul Brinkley.

BRINKLEY: Thank you General Bergner and thank you Mr. Reeker. It's a great opportunity to be able to join today in this discussion of economic development and to provide a brief initial progress report for our efforts in industrial and economic revitalization in addition to our collaboration with various ministries.

As has been communicate before, beginning last fall we put a team in Iraq that is working across all areas of the country where stability is in place to enable the restoration of basic economic activity. Our focus has been on several areas and most visibly the effort to restore production operations in the large former state run industries of Iraq. And we've undertaken this in partnership with our command and in partnership with the provincial reconstruction team leadership in the provinces.

We've announced previously the restart of four operations including the Iskandariah industrial works, the Najaf ready-to-made wear clothing factory, the Ramadi ceramics factory, and the state fun factory for leather industries here in Baghdad. Over the next two weeks, we have restarted and over the next two weeks will be announcing several additional reopened factories across areas of Iraq and we will be communicating the details on that again in a couple of weeks in partnership with the Ministry of Industry and Minerals.

Recently the Congress appropriated 50 million dollars to accelerate our efforts. We have identified in partnership with the economic leadership and multinational forces, multinational corps, each multinational division as well as multinational forces west. We've defined a detailed plan for how those funds will be allocated, two different factories, primarily former state-owned factories but including some private factory operations that have been in distress for the past four years to enable them to quickly restart through acquiring maintenance, training, raw material, just the basic things necessary to enable the most skilled workforce in the middle east to return to a normalcy and a life of economic opportunity that they've all been waiting for.

We're pleased to announce the first order has been placed for clothing from the United States on a clothing factory here in Iraq, a company called Shelmar. It operates 50 stores in seven states in the United States, has placed an order for clothing from an Iraqi clothing factory. This is the beginning of what I anticipate to be significant international interest in acquiring goods made in Iraq. Again, to take advantage of a very skilled workforce and a desire here to engage in basic economic activity with their international counterparts.

The 50 million dollar spend plan. A process has been defined and approved by the Minister of Finance and the Minister of Industry. And again, in partnership with those ministries, we will be sharing the details of that in the next couple of weeks. This will be overseen and audited continually by the international accounting firm Grant Thornton, LLC. Grant Thornton has a significant pool of certified public accountants embedded within our task force. They are working to establish clear, transparent, audible financial management for this execution and for these factory revitalization initiatives to ensure that the funds that are transacted are used for exactly what they're supposed to be used for.

Finally, and what I think is one of the most exciting collaborative developments we have with our Department of State and our Department of Treasury here, our Grant Thornton accounting team has put in place what we call a procurement assistance center which is working here in Baghdad. Two centers have been opened here in Baghdad and one in Arbil working with the Iraqi bureaucracy to empower and re-enable them to execute the basic function of government, which is the acquisition of funds through a variety of mechanisms taxes, tariffs, whatever but most importantly the ability to execute those funds, to execute contracts, to procure goods and services for the Iraqi people in a transparent, nimble, agile manner. Again, and that effort is accelerating and we will be communicating more on that in coming months.

And so, again, I thank you and I welcome your questions. I'll turn it over to my colleague from the State Department, Mr. Reeker.

REEKER: Thank you Paul and thanks Kevin. It's a pleasure for me to be here. I've been in Iraq now for several weeks and have gotten to meet a few of you, both our Iraqi colleagues and the foreign correspondence here in Baghdad and I just want to thank you for the warm welcome and this opportunity to get together and address all of the issues that face our mission.

I think this a unique experience in that we are working so closely. That is the diplomats, the military both the civilian side of the defense department and of course the uniform side. One place where we see this cooperative arrangement so closely is in the provincial reconstruction teams. And I wanted to say just a few words today about that because this is an important focus of our overall mission, these teams which represent our embassy and mission out across Iraq.

As you may know, these are small civilian-military units that assist provincial and local governments in Iraq to govern effectively and deliver essential services. The PRTs are designed to boaster moderates, to promote reconciliation, support counterinsurgency operations, foster development and build the capacity of Iraqi government officials to perform their duties.

The emphasis we've had is on shaping the political environment rather than on building infrastructure. At the PRTs brigade combat teams or BCTs and the PRTs work together as one team receiving guidance from the US Ambassador, Ambassador Crocker, here in Baghdad and from MNF-I commanding General Petraeus. The brigade combat team commander takes the lead on security and movement. While the PRT leader has responsibility for political reconstruction and economic issues. It's very interesting that the PRTs are joint coalition efforts consisting of civilian and military members from the United States but also from the United Kingdom, Italy and Korea. By helping to provide provincial governments the abilities to deliver these essential services to Iraqi citizens, the provincial reconstruction teams help extend the reach of the Iraqi government in key provinces and help build the stability necessary to complete the transition to full Iraqi control. This really gives a U.S. civilian and coalition presence in areas that would not be served otherwise and by helping build the provincial governments abilities to deliver this essential services this is helping empower the provinces in sync with the new Iraqi constitution and build stability necessary to complete the transitions that we've talked about.

You'll recall that the PRT program was announced by Secretary Rice back in October of 2005, so it's been operating now for some 20 odds months. The PRT uses projects and training to promote transparency, accountability and more effective local government as well as the reconciliation and building of civil society and the structures necessary to further economic recovery. Make no mistake, Iraqis lead the process in determining which projects should be funded and implemented and how the PRT will go about its work in that particular location.

Really the PRT is designed to kick-start developmental processes and short-term successes can give momentum for longer term development. The Iraq PRT program supports decentralization of government services which vitally important we believe and in accordance with the 2005 referendum on the Iraqi constitution which mandates more provincial powers.

The five thematic areas that we focus on through the PRT is rule of law, infrastructure, economic development, governance and public diplomacy. And so, these short-term solutions to long-term development challenges allow us to work closely with the Iraqi people to help them in their efforts to build a unified, successful, stable, and prosperous country.

Certainly as I said, it's an interagency effort and I think we have a picture we can put up that shows there are 25 PRTs to date. This map shows the ten original full-sized provincial reconstruction teams, the five smaller teams and the ten new embedded teams. Just to give you an idea of what these teams are like, a full-size team may range in size from 30-60 personnel. I'm not including of course the military movement and support people involved. A smaller team will range in size from 4-14 personnel and these embedded teams have up to eight personnel assigned and are adding more specialist all the time. We're up to about 450 personnel at our provincial reconstruction teams around Iraq now and according to plan, by the end of 2007, we should have about 600 on staff by the end of this year.

We will look at adding additional teams based on conditions on the ground or requests from our military partners and I just thought I would note a couple of examples of some of the things the PRTs are doing before we turn it over to your questions.

In Ninawa, for instance, the PRT there helped establish the Mosul branch of the central criminal court of Iraq which has already tried over 170 terrorism cases and brought 96 militants to justice. Also with the assistance of the PRT, the Ninawa provincial government obtained 241 million dollars from the central government for reconstruction and infrastructure improvements.

Here in Baghdad, the Baghdad PRT has already helped fund over 40 projects totaling more than 80 million dollars to help rebuild the capital.

And at Anbar the PRT there has played an active role to reconnect broken lines of communication between the central government of Iraq and Baghdad and the Anbar provincial government. The governments now able to directly advocate for the needs of the province with the Prime Minister with Cabinet Ministers and others in the executive branch.

In Dakar, the PRT there lead by an Italian diplomat provides Italian medical personnel for onsite training of Iraqis. It's also in the process of completing a surgical facility near their camp for medical services and additional training. They are providing training for 20 Iraqis in Italy and in addition to this medical assistance, they're sending 25 Iraqis, chosen by the PRT, for specialized agricultural training and building a pilot date processing plant in the region. So a lot of things happening there.

Let me just mention the PRT in Salah al-Din which is teamed up with the brigade combat team to join forces with Baiji city and its refinery in reducing illegal exporting and financing of criminal and terrorist activity. The PRT there has also assisted the provincial government in the restoration of municipal services and rehabilitation of the city's infrastructure.

Let me leave it at that, just to give you an idea of the types of things these unique provincial reconstruction teams are doing. We welcome additional interests. I would be happy to setup specialized briefings or help arrange visits for journalists to our PRTs. With that I'll thank you and turn it back to Kevin to lead the questions.

BRIG. GEN. BERGNER: Okay, and with that, we'll be glad to take your questions. Yes sir? Give me one second to put this in my ear so I..

Q My question is to Mr. Kevin Bergner there is some news about secret operation between you and the TurkeyKurdistan? My next question to Mr. Philip, how do you see the American-Iranian dialogue and what's the result of this dialogue? against the workers party in

BRIG. GEN. BERGNER: Well my technical skills are not what they should be today and I got the very last part of your sentence. So,

REEKER: I could do both of those if you want.

BRIG. GEN. BERGNER: Okay.

REEKER: Let me try to answer on Kevin's behalf because it's something that we've talked about. I think we've both seen some of the press reports to which you maybe referring in terms of Turkey. Obviously we don't comment on alligations or suggestions of classified information. But I think you've heard us say repeatedly that we take very seriously the problem of PKK terrorism. We've been working with the government of Turkey, the government of Iraq and the Kurdish regional government to address this threat. But also as we've said before we made clear and we continue to reinforce our opposition to cross-border operations.

I think your second question had to do with the talks last week that Ambassador Crocker held, the tri-lateral talks between and among Iran, Iraq, and the United States. As you'll recall, the ambassador described them from this very room as full and frank. We had made clear once again our concerns and as we've said, when there're results they'll be results that we can see on the ground. That's really what the measure is. We laid out at that time what was clear to us as evidence of Iranian support for some of these militia activities and so, I think you heard the ambassador say that we would hope that there'd be a change in the Iranian approach, that they would support efforts to provide security in Iraq It's in their interest. It's their stated policy. If they serious in trying to deal with these issues, we're working on a security subcommittee. The modalities of which are being discussed that will afford the mechanism for IranIraq. rather than instability. to begin taking different kinds of actions here in

BRIG. GEN. BERGNER: I'm not sure who I should direct this to Phil or you, but shukran jazilan. Thank you. Yes sir?

Q Yesterday there was a meeting between the American Ambassador Ryan Crocker and chief of some Iraqi newspapers. He said that the date of the joint reports which will be submitted in September. Do you need more time than September to complete the report?

BRIG. GEN. BERGNER: I'll answer from the multinational force perspective, which is no. When General Petraeus and Ambassador Crocker return to Washington, they will provide a candid and forthright assessment of the circumstances as they are at that point in time in Iraq. And so, there is no question about whether or not that assessment and that report will go beyond that date. They will report as we have said in mid September. Shukran.

REEKER: I don't think I can add anything to that. That's exactly the way Ambassador Crocker feels as well. He'll go back with General Petraeus and they will present a candid honest assessment of what they see on the ground.

BRIG. GEN. BERGNER: Shukran. Yes mam?

Q Anita Miller with Fox News: Seeking a little clarification here if we may. Attacks on the green zone this year, we'd like some hard numbers because we haven't been able to get them up till now. Could you tell us, since the beginning of the year, how many attacks there have been on the green zone and what the casualties, fatal and injuries, that have been as a result of those? Do you happen to have those figures with you? Can you get them to us?

BRIG. GEN. BERGNER: We will work on answering your question with the best information that we can. And one of the considerations as we talk about attacks on the international zone are a consideration of not providing an enemy with a battle damage assessment or better insight into the affects of their attacks than they would otherwise have. And so that's what we continue to be sensitive to only from the standpoint of force protection and only from the standpoint of protecting the operational security involved.

I understand your point and I don't have those kinds of figures in front of me this afternoon. And we will take it on and see what we can provide you in terms of a trend, in terms of numbers and orders of magnitude. I understand the reason for your interest of course because it is a great threat to not only the coalition force, the international community that's working with the government of Iraq, but it's a big threat to the government of Iraq as well.

Q Anita Miller with Fox News : Well indeed and it's clear to everyone living and working here that there's been an increase in attacks on the green zone.

BRIG. GEN. BERGNER: Right.

Q Anita Miller with Fox News : You can't exist in the state of denial about that even if you have your own reasons for not wanting to be completely frank about it.

BRIG. GEN. BERGNER: Yeah, in fact, let me just be completely clear. There is nobody here that would say other than those attacks seemed to have increased. I just can't give you the specific number. And they are definitely a great concern to us for all the reasons you point to.

Q Anita Miller with Fox News: I have another question if I can be slightly greedy. Is that all right?

BRIG. GEN. BERGNER: Sure.

Q Anita Miller with Fox News : For you Mr. Brinkley, and that is if you get these industrial plants, these particular factories up and running how many more jobs do you expect that will bring to the Iraqi economy? And also given the state of security in the Basra region if you're seriously talking about resuming exports, and as I understand it at the moment container ships leave Iraq empty, are you certain you have the security in place to start trucking clothing out to the United States?

BRINKLEY: Sure. So we'll go in order. Um, the way to think of employment in terms of the industrial capacity here in Iraq is the direct employment we recreate when we put people back to work. There is over 1,000 people back to work in Iskandariah for example at industrial operation. But just as in the United States or any other country about 10-12 percent of the workforce here worked in industry, manufacturing. As USAID in partnership with the Center for Statistical Measurement in the Iraqi government, as they measure in their field work everyday, unemployment here is well in excess of 50 percent. And so, it is the multiplicative effect we will see as we restore industrial operations and the multipliers that come from that on a variety of other industrial sectors and economic sectors here that will uplift employment across the country. And of most interest, and again in collaboration with US Agency for International Development, the area we see the greatest potential for that is in agricultural. Many of the food processing factories, many of the operations that support it through irrigation equipment, through tractors many of these industries have been in great distress for the past four years. And that has had a direct and very negative impact on the agricultural sector here. And so this is about getting what I consider the core engine of the economy up and moving again and get it running and then let those multiplier affects the surrounding small companies that are in these towns where these factories exist will begin to revive and we'll begin to see an uplift in employment.

Now your second question had to do with imports and exports. And this has been a good learning exercise for us. And one of the things many people like to do is go into the markets in Iraq. I can buy Colgate toothpaste in a market in Iraq. And you say to yourself how is possible that western goods are arriving in the markets in Iraq? And then you talk to the Iraqi businessmen and they're people traders, logisticians, logistics firms that do not operate under any sort of coalition protection that bring goods and services in and out of Iraq. If you wanna see very compelling examples of this, go into some of the cities of the north, Arbil, Sulaymaniyah. There are goods that come into Basra on container ship, broken down and shipped all over this country into retail outlets and that are put for sale that go through some of the cities where even some of the security situation is challenging for us.

And so, what we're looking at case by case by case as we begin to work to create international opportunity for Iraqi businesses so that some of those containers start to go out full of goods manufactured in Iraq and we restore some trade balance here. I have confidence. Now it's a bit of a blind confidence but I have confidence that the same people who know how to move those goods into Iraq will know how to move those goods out of Iraq. They've been trading in the part of the world for thousands of years. And I think if we empower Iraqi businessmen under a transparent, seamless process where corruption and things of that nature are avoided, I'm confident this business community here will unlock the ability to move goods out of the country. They don't need us to hold their hand on every aspect of this undertaking.

BRIG. GEN. BERGNER: Yes sir?

Q I have two questions. Some sources say that some American weapons found their ways to the armed groups in Iraq. Four of them were responsible for these caches were killed by unidentified gunmen and they discovered that American made weapons were found at the hands of the PKK and these weapons were confiscated in the hands of the PKK and the Turkish army sent a file to the US Administration but the American Administration didn't answer for this. How do you comment on this?

BRIG. GEN. BERGNER: Well the first thing I'd say is we take the question of accountability with the greatest of concern. And the weapons and the equipment that are supplied to Iraqi security forces we work very hard, as well does the government of Iraq to establish the appropriate levels of accountability for those weapons. I have seen the reports that you refer to that have been in the Turkish press.

We have looked into those alligations. It's not to say that a weapon or weapons have not sometimes found their way from an Iraqi security force member into the hands of someone who should not have it. But in the specific case that you refer to, we have not found any substantiation to that specific case. And we are working very hard with the government of Iraq and with the Iraqi security forces at every level to increase the accountability and to increase the security of the weapons that are provided to the Iraqi forces. And it's one that I know from having worked directly with Iraqi forces over the years that most of them take very seriously as well. And I would point to the chief of police in Mosul, General Lothic (sp). I would point to the Iraqi army division commanders I have worked with. This is of great concern to them as well. And so we take it seriously and we're working very hard to further improve the level of accountability for all of that equipment. Shukran. Thank you. Yes mam?

Q Hi, Kim Gamel, Associated Press: The military officials have been expressing it seems increasing frustration that while some success has been made on the military front it hasn't been so forthcoming on the political front. The largest Sunni block announced today that it was pulling out from the cabinet. How can the U.S. strategy work when al-Maliki's government seems to be falling apart? And is his government sustainable? And that's a question for General Bergner and Phil.

BRIG. GEN. BERGNER: Okay, I'll start off by telling you as a solider and as a member of the multinational force our focus is very clear and very straightforward and that is we're trying to help improve the level of security so that those specific political challenges have a better opportunity to make progress. Our focus is on the security aspect of that. We are tackling that on a number of levels and we have talked in detail with this group before about what we're doing in regard to the al-Qaeda in Iraq network, how we are dealing with the affiliate groups associated with them, and how we are continuing to chip away at the special groups and the threat that they provide to the government of Iraq and to the people of Iraq as well as our forces. That's where our focus is. Um, we don't really- we don't have the luxury to spend too much of our time and effort in the other lanes because that has us completely consumed in terms of our mission focus.

We understand though how difficult the challenges are on the political side. And they absolutely are very immense. This is a country that's dealing with some of the most challenging issues a society has to come to grips with. How it shares it wealth, how it organizes itself legally, how it shares power between the central government and between the provincial governments and even those of us that are soldiers have great appreciation for just how difficult those fundamental issues are for any country or any society to work with. But we continue to keep our focus on the security side and with the full intent that progress there can increase the level of stability and could increase therefore some of the prospects for progress on the political side. And I'll turn to Phil.

REEKER: I agree fully with what Kevin said and that's very much in line with what you've Ambassador Crocker say over many months. Indeed the surge has done what we wanted it to do in terms of bringing down levels of violence in Baghdad and Anbar stabilizing populations, protecting populations, and that's gone very well.

As you point out, the hardest part is taking advantage of these security gains to move a political process forward, both at the national and at the local levels. I think locally we've seen some very positive steps as I pointed out in my quick summary of some highlights from our provincial reconstruction teams in Anbar and the Baghdad area. But nationally as you quite rightly point out, Iraq's leaders continue to grapple with these very, very difficult hard issues. For them, these are existential issues and they have been deepened and sharpened not just by the recent experience of the past three -four years um but by 35 years of Baath oppression and terror that preceded that. And so, as Ambassador Crocker pointed out, democracy is never easy. It's certainly not easy with the problems that face Iraq. These are things that Iraqi political leaders need to grapple with. They need to find mechanisms through which they can work together to compromise to find accommodation, mechanisms of engagement so that they can work toward their goal of making things work for Iraq providing services that Iraqi people want. And that's not easy. It's not easy for any place but in Iraq So they will continue to work at this. You've heard the Iraqi leaders say that. They have to get through these very difficult challenges themselves. it's very hard.

BRIG. GEN. BERGNER: Would we like to see progress go faster? Sure we would.

REEKER: Yeah. Is it frustrating? Absolutely. As Ambassador Crocker has said, it's frustrating for us. It's frustrating for them and it's frustrating for the Iraqi people.

Q Do you mind just a follow up? But the [inaudible]fronts decision leaves Maliki's government with basically two-thirds of its members. How big of a setback is this with just a few weeks to go before the progress report is due?

REEKER: I think again this is democracy. These are different political entities that have got to find ways in which they can work together, ways in which they can work for Iraq under the constitutional system that they have. And uh, I can't categorize for you exactly how they may do that but that is something they are all I think pledged to continue working at to try to find those mechanisms and to move forward.

BRIG. GEN. BERGNER: Yes sir?

Q General Bergner, after many months of Fardh al Qanoon Operation, can you please define to me the secure areas in Baghdad or the areas which have been secured and about the projects the [inaudible] what is the percentage of the American side in these operations and these projects? You know, the violence and the military operations?

BRIG. GEN. BERGNER: The levels of security in Baghdad are variable and there are particular places where it is the most challenging because of the fault lines that exist in those areas. In the Rashid area and in the southern part of the city continues to be one of those areas where it is the most difficult. It's where coalition and Iraqi forces are funneling a great deal of our effort. Adhamiya remains a place where there has been progress made but there continues to be challenging in the fault lines there as well. But as you know, better than anyone, Baghdad is very much a mosaic. It is a place where there are very tough fights going on and there are still very difficult circumstances for the population. And then there are also places like Dora where the markets have come back to life and places like Haifa street where you see a great deal more economic activity and a great deal more security for the Iraqi people. And so you could walk your way across the city and have a very diverse mixture of both improved security, improved economic activity and you could also find places like east and west Rashid where it's still very, very difficult for the Iraqi people.

And so we're focusing, General Aboud with the Baghdad Operational Command and his Iraqi forces as well as the multinational division in Baghdad are focusing on those places where the fault lines are still the most difficult. And we're also seeing places where the Iraqi people are coming forward to rise up against the terrorists threats in their neighborhoods and try to help both their security forces and ours. So it's a mixture. And it's still a place where there is much work to do. And it's not just in Baghdad as we have talked about. There are neighborhoods in Baghdad that have a diverse security circumstance but many of the problems that effect the Baghdadies are coming from the areas to the south and to the north and to some degree to the west. And so that's why we're continuing our operations outside the city to reduce those safe havens, to reduce those operating bases where extremists have organized themselves and launched attacks from. So it's not just a question of the districts in Baghdad. It's the belts around Baghdad that matter. And that's what this surge of operations is doing. It's working simultaneously on the districts in the city as well as the belts around the city to try to improve the security situation.

I'll defer to either Mr. Reeker or Mr. Brinkley a little bit about some of the economic efforts that are underway. But there are diverse economic efforts underway to help return the water plants and other things. Yes sir?

Q I want to know the percentage of Fardh al Qanoon in its operation. What is the percentage of success of Fardh al Qanoon Operation? You as a military leader.

BRIG. GEN. BERGNER: Yeah. I'm not sure I could give you a very neat percentage because what it means if you're a company or battalion commander out there and what it means if you're a brigade or division commander is different when you're at the corps for the multinational force level. And I think that periodically General Phil and General Odierno have tried to characterize, from their perspective, what different districts in different areas of Baghdad security are. So I will see what the current percentage is and I'll follow up with you on exactly how they're characterizing it today. Shukran. Anything to add on economic?

I would just point out that part of our work involves helping Iraqis with economic development that also includes humanitarian assistance and aid and would point out that the United States has spent many billions of dollars since 2004 in development aid focused particularly on restoring essential services like water, like electricity, and oil and improving health and education among other things. So these are challenging things that we've taken on along with our Iraqi partners and as we take advantage of the security brought by the surge and the positive developments there we can continue working with the Iraqis to see further these economic developments.

Yes mam?

Q My question, I have two questions. First question, the factories which will work in Iraq for the American states, what are the conditions that should be in the Iraqi worker who will work in these factories? And about the Iraqi soccer team which won the National Cup, will the multinational forces secure the safety of the team or is it only the responsibility of the Iraqi security forces?

BRINKLEY: So the first question pertaining to Iraqi worker conditions. I'll make a general statement. Generally, the factories in Iraq and the workforce in Iraq in addition to being highly skilled the conditions they worked within were extremely favorable relative to what one would encounter in other areas of the world where globalization and economic activity has taken hold and more distress populations are moving out of poverty. In this case, we have a skilled workforce and many of the forces have automation capability in place for being able to compete internationally even where labor rates and things like that and labor processes are much more progressive in Iraq than they are in other parts of the world. So we will be taking print and video media to some of the operations where these are orders are being placed and will be communicating details about where clothing manufacture. General Petraeus went with us a few, I don't know, eight weeks or so ago down to the Najaf clothing factory. That is a state-of-art clothing factory. Pristine building. Working conditions are outstanding. 70 percent of the workforce there are women. Many of the engineers and supervisors are women there in Najaf and the working conditions are as good as a western textile company. And so, I am very pleased to say that in the cases where goods are being exported and licenses and things are being negotiated for export it is not to take advantage of great labor differentials. It's being done to take advantage of a skilled workforce in factory capacity that exists here but can in some cases compete on world markets. And I think that's an exciting development for the Iraqi workforce and for the Iraqi people.

BRIG. GEN. BERGNER: As for the Iraqi soccer team, first I want to say congratulations and it was absolutely a pleasure to be able to watch the game and to see not only the stunning victory and it was truly an impressive victory. There is no question who was the better team on the field that evening. And those of us who serve here and have served here before were tremendously proud to watch that level of accomplishment take place Because we know that it represents the unity of the Iraqi people on that field and we know that it evokes great pride for the people of Iraq. And so we have the same level of interest and concern for their security as any citizen of Iraq does. And we'll work very closely with the government of Iraq and assist in whatever way is appropriate for us to help the government of Iraq make sure that they can be safe and secure in their country. Shukran.

Yes sir?

Q Orin Dural, USA Today: I was wondering if you could just kind of describe for us what to expect for the month of August. This is basically the last full month before, you know, this report needs to made in September and I'm trying to understand. I wonder if you can give us a picture of, you know, whether there's gonna be extra operations, military operations. You know, what are you doing extra or different this month and you know what are we gonna see this month? And also, this is probably difficult to say but whether, you know, you have any intelligence or estimations of what you expect insurgents to be doing this month too?

BRIG. GEN. BERGNER: That's a good question. Um, first I'll start off by where I sort of left off with my opening remarks. There is a certain amount of tactical momentum that's been achieved just in the first six weeks of the surge in operations. It is both the function of the Iraqi people, the Iraqi security forces and our forces being able to operate simultaneously and applying pressure both in Baghdad and in the belts around Baghdad, the approaches to the city.

That momentum has allowed us to make significant progress against the al-Qaeda leadership in Iraq. It has also allowed us to make progress against their networks, both in Mosul and in Baghdad. And so when you get that momentum started as a military operation you want to not only sustain it and build on it but you want to exploit the advantage that you're starting to achieve in terms of creating a circumstance where this enemy can no longer find safe havens or operating bases on the scale that he perhaps once was enjoying that capability.

And so we will continue to press against the al-Qaeda safe havens and operating bases. We will also focus on sustaining those gains that have been made in continuing to deploy Iraqi security forces to each of those areas as well.

A key part of our effort during August will also be in the lines of operation that you heard here. As Baqoubah, for example has become increasingly under the control of the Iraqi forces, the government of Iraq and our forces, it's a place where the deployment of food and the restoration of the public distribution system, the deployment of medicines and healthcare capability which had been hijacked by the terrorists and the return of consumer fuels and those kinds of things are really essential for the Iraqi people, in Diyala to see a tangible improvement in their circumstance.

So the month ahead is not just one of the surge and operations continuing, which it certainly will. It is also one where the government of Iraq and the PRTs that work with it will be focused on filling in behind those security gains to make sure that the economic and reconstruction efforts now start being real for the citizens of Iraq. And so that's our focus. Build on the momentum, exploit the capability that we achieve there, and then sustain it by the provision of economic and reconstruction efforts that are very tangible to the Iraqi people.

And I would point out at that when the Prime Minister most recently visited Baqoubah that was the focus. It was working with the leadership in Diyala Province and the Iraqi forces and the tribal leaders to chart the necessary course for the central government to resource the provincial government to get them the necessary funding levels they need and then to workout the details of food shipments and medical supplies which are so critical.

We have time for one more question.

Q I have a quick followup.

Sure.

Q Are you expecting this month to be hotter than the past, you know, the past couple of months? Are you expecting the military operations to see more of that than we've seen or is it going to kind of taper off?

BRIG. GEN. BERGNER: We're gonna continue the pace of operations at the highest possible level that we can. And we're gonna continue to crank up the pressure on al-Qaeda. We're gonna crank up the pressure on the special groups and other extremists that are operating against the Iraqi people and the coalition forces. So we will continue to operate with the surge of operations to exploit the momentum that's currently being achieved. Last question.

REEKER: I'm sorry. I had a couple of words on the diplomatic line of operation as well. As Kevin said, taking advantage of the tactical momentum we have certainly Ambassador Crocker has made clear we will continue very much the hard work diplomatically here in Iraq working with Iraqi politicians, government leaders as well as internationally. You've seen the Secretary of State and the Secretary of Defense working in the region to promote support for Iraq's progress, security and stability, and prosperity. So those things will continue certainly through this month as the government of Iraq and its politicians have pledged also to continue working toward a number of the goals as well as legislation that they have so that when the counsel of representatives returns after consulting with their constituents they can keep working on legislative aspects as well.

BRIG. GEN. BERGNER: Yes mam, last question.

Q Back to factories if I may. Yesterday the Iraqi Minister of Industry was saying that while he shares your excitement about foreign investment and foreign partnership and getting these facilities up and running that one of the main obstacles has been undoing basically all the work of the CPA which sort of went in and wanted to sell everything off, privatize, you know, overhaul the socialist economy. Do you agree with that?

I think the assumptions that we made in 2003 based on what was known on the ground in 2003, there were some assumptions made that have turned out in retrospect as circumstances changed not to lead to the outcome that they desired. I mean, everyone here from the very beginning has shared a uniform vision including the Iraqi Minister of Industry and the U.S. government, whoever has been there. And that is a vibrant, thriving, free market economy that takes advantage of and provides opportunity to again the most skilled workforce in the middle east, the broadly skilled workforce in the middle east. The question of how you get from point A to point B and the approaches that were taken in 2003 versus today, it is difficult. Given operations that have been idled to restart a factory. Imagine that anywhere in the world. Imagine going into a city in the United States where a factory has been closed for a few years and the workforce has been out of work for a few years and try to do that very quickly. The Minister of Industry is working very closely with us on this. This would be difficult in any environment. It's very difficult here. And I think that's what Minister Hariri, his excellency Fawzi Hariri has indicated. And I think if you think about that, what I take away from that is I almost think it would be impossible to go into a western city, close a factory, four years later decide we need to reopen it, we need to reopen it quickly. We need to restore employment to these people and get them building and shipping goods. Imagine that challenge.

The fact that we're doing it here in Iraq that it has happening here in Iraq, I think is a testimony to the desire among the Iraqi workforce and the Iraqi management to engage in normal life. To re-embrace and engage in economic activity. So again, sometimes I'm accused of seeing the positive on these things too much but in this case I think that's a very compelling example of the desire that exists in most of this country among the business leadership to step forward and seize economic opportunity when it's presented to them. And I remain optimistic that over the next several months we'll continue to restart dozens of operations, restore employment to thousands and thousands of Iraqis and the cascading effects of that activity will manifest themselves broadly in this economy and in making life a lot easier for our security forces to establish stability both our security forces, the American military and the Iraqi security forces. Shur khan.

Okay. Shukran jazilan. Masalama. Thank you everybody have a good afternoon.

END.