05 November 2003
U.N. Hopes to Increase Operations in Iraq, Official Says
UNDP chief says U.S. success in Iraq is vital to health of global system
By Kathryn McConnell
Washington File Staff Writer
Washington -- The United Nations hopes to expand its operations in Iraq, despite having pulled its international staff out of the country in late October for consultations on security issues, a top U.N. official says.
"We want those [consultations] because we are going to stay in Iraq and we're going to stay carrying out the mission and taking the risks that we recognize are inherent in that mission," U.N. Development Program (UNDP) Administrator Mark Malloch Brown said in November 4 testimony to a Senate subcommittee.
News reports describing the U.N.'s "departure" from Iraq "are wrong," Malloch Brown said during a hearing on financial reconstruction in Iraq. In fact, he said, the UNDP and the U.N. as a whole "want to step up our operations in Iraq in support of the reconstruction and rehabilitation of that country."
Malloch Brown also emphasized the importance the U.N. attaches to the success of the effort by the U.S.-led Coalition Provisional Authority (CPA) in Iraq.
"All of us in the United Nations profoundly want to see the United States succeed in Iraq," he said. Reconstruction is important not only for the well being of Iraq and its people but also "for the health of the overall international system -- not just the fight against terrorism," he said.
Outlining U.N. operations in Iraq, Malloch Brown said the organization currently has 4,000 national staff operating in the country -- many of them highly skilled. The U.N. has been conducting development work in Iraq for 40 years and humanitarian work for the past 20 years, and has an "extraordinary" network of national partners who now play leading roles in national ministries, municipalities and new civil society groups, he said.
He added that the United Nations believes it will be able to continue its work in Iraq with a "light" international presence and extensive support from more secure locations in Jordan, Cyprus and Kuwait.
"It's not ideal," Malloch Brown said. "It's not the way one wants to work but we have to manage this vis-à-vis the risk of kidnapping and armed attack."
In earlier testimony, Peter McPherson, the former director of economic development for the CPA, said that security in Iraq remains a grave problem but should not obscure the very real progress being made.
"I firmly believe that we're beginning to put in place the foundation for a revolutionized economy," McPherson said. "[Iraq's] new economy will in fact be a challenge to the whole region" in terms of introducing sound, market-based policies and attracting foreign investment, he said.
In September, McPherson concluded five months of service in with the CPA in Iraq and returned to his post as president of Michigan State University.
He testified that during the course of his work with the CPA he saw Iraqis playing "a steadily bigger role" in the decision-making process, including in the sweeping economic reforms announced in September.
Among other provisions, Iraq's economic program provides for an across-the-board tariff of five percent (with a few exceptions that go down to zero), a maximum personal income tax rate of 15 percent, and a maximum corporate tax rate of 15 percent, McPherson said. The program permits 100 percent foreign ownership of firms, allows foreign-owned firms to be treated as national corporations, and provides for full repatriation of profits, he added.
McPherson said the changes aim to open the Iraqi economy as much as possible and attract the foreign investment that is sorely lacking throughout the region. He pointed out that in 2002, the Middle East received only $4 billion in foreign investment, compared to the $44 billion invested in Latin America.
He added that future economic reforms should include adoption of bankruptcy and competition laws, and reduction of government subsidies.
McPherson warned that economic growth in Iraq would take time, and praised the U.S. Congress for recently approving $18.6 billion in grants for Iraq as the process of rebuilding moves forward. "We cannot expect growth, substantial real growth, soon," he said. "There's no evidence that that occurs in situations like this."
He and Malloch Brown also agreed on the need for substantial debt reduction by the international creditor community for Iraq.
(The Washington File is a product of the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
This page printed from: http://usinfo.state.gov/xarchives/display.html?p=washfile-english&y=2003&m=November&x=20031105184653ennoccmk0.6075403&t=usinfo/wf-latest.html
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