Is anyone surprised by this move?
Sunday November 9, 2003
The US is to reaffirm that non-American companies cannot win government contracts in the multi-billion dollar effort to rebuild Iraq.
Only companies with US joint ventures can expect to take prime contractor roles in a fresh wave of reconstruction programmes to be funded by the $18.6 billion budget cleared by the US Congress last month.
Few UK companies have such agreements, although engineer Amec has a venture with California counterpart Fluor, through which it is bidding for oil and capital construction projects. The UK government is encouraging other interested companies to follow suit.
The contracting strategy will be spelt out at roadshows in Washington and London later this month by David Nash, the retired US admiral who heads the Iraq Infrastructure Reconstruction Office, part of the Coalition Provisional Authority.
The US-first rules have been a source of grievance to UK companies seeking to win work in Iraq. Some companies, and industry bodies such as the British Consultants and Contractors Bureau hoped the regulations would be relaxed.
But a briefing to British contractors from UK Trade and Investment, the government agency that promotes British commercial interests overseas, makes clear this will not happen: 'It is reasonable to expect that strong US connections will enhance the potential for businesses to secure contracts either by creating joint ventures with American majority partners or presenting themselves through their US operations.'
The key items in the reconstruction include $5.5bn on the electricity sector, $4.3bn on water systems and $1.9bn on oil infrastructure.