Ministry of Industry and Minerals
Iraq's non-oil industrial sector includes such industries as petrochemicals, phosphate, sulfur, fertilizers, minerals, cement, paper, consumer goods, light manufacturing, electronics, machinery and transport equipment, textiles, leather and shoes, and food processing and packaging. Most major industrial enterprises were state-owned.
Following several decades of centralized economic control, Iraq's economy has been weakened but maintains significant growth potential owing to its abundant natural and human resources. Oil production will account for an important part of Iraq's future GDP. However, Iraq's non-oil sectors, including tourism, agriculture, and small enterprise, also represent potentially vibrant sectors of Iraq's economy with strong growth prospects.
A new Foreign Direct Investment law was passed in September 2003, permitting newly unrestricted ownership of Iraqi companies by foreigners in most sectors of the economy. Foreign ownership is not permitted in oil and mineral production. The retail sector allows 100% foreign ownership, but requires a $100,000 deposit be made with the Ministry of Trade prior to conducting retail trade in Iraq. Foreign capital and expertise are essential for rebuilding the Iraqi economy and generating private sector growth which will provide the jobs and higher incomes sought by all Iraqis.
On 11 May 2004 Ambassador L. Paul Bremer participated in the transition to full authority ceremony for the Iraqi Ministry of Industry and Minerals in the courtyard of the Baghdad Convention Center. The event, hosted by Iraqi Industry and Mineral Minister Mohamad Tofiq Rahim, was part of the return of control over Iraq's ministries to the Iraqi people.
The event highlighted the fact that the revitalization of Iraq's industrial sector was well underway. A year ago, Iraq's industrial sector was non-functioning. Neglect by Saddam Hussein's regime, and lack of principled management had taken its toll on this area of the economy. Many State Owned Entities (SOE) are producing goods and services that are central need items for the rebuilding of Iraq, including cement, chemicals, fertilizers, textiles, pharmaceuticals and food products.
In addition, SOE management structures are in place and functioning. The Minister not only helped rebuild the Ministry, but he rebuilt it atop a foundation of solid business practices and ethical proceedings. The CPA Advisor's Office to Ministry, particularly Senior Advisor Colonel Lettie Bien, has been enormously supportive of all of these efforts.
The employees of the Ministry are its greatest strength and asset. Employees have extensive subject matter expertise, and extensive expertise in machinery operation and processes. Their inventiveness and ingenuity have been critical to bringing industrial plants back online. Managers are educated, and bring a basis of preparation and critical thinking skills. They have completed budgetary planning for fiscal years 2004 and 2005.
Plans for the year ahead included: continued revitalization, as well as development and expansion of the industry; development of business ventures between companies and the private sector; further development and training of the Ministry's employees in order to help the industry compete; and meeting the material and supply needs of the rapidly growing Iraqi economy.
During the transition ceremony, Ambassador Bremer remarked: "A year ago Iraq's state-owned enterprises were dead in the water following decades of mismanagement and theft compounded by looting. Today many of the businesses owned by the Iraqi people produce valuable goods and services. Mr. Minister, your insistence on sound business practices has begun to bear fruit. By encouraging open communication and permitting the creativity of your employees you have produced results."
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