Monday, August 02, 2010

Crumbling Foundations, Missing Billions

AT a time when Iraq’s farmers are struggling over irrigation water, and people in the towns suffering power cuts and shortages, the country's largest dam is less than half full. Officials blame poor maintenance, and crumbling foundations. If the dam fails cities could be threatened with flooding.

Iraq's treasury is also light, to the tune of over $9 billion, and they say the US military and its contractors were last to see the missing billions.

Here's a report on the dam:

Iraq’s largest dam loses 60% of its water reserves

By Khayoun Saleh

Azzaman, July 26, 2010

The Mosul Dam, Iraq largest water reservoir, suffers from serious erosion of its foundations, according to a senor Electricity Ministry official. The dam, which used to hold 11 billion cubic meters of water, is less than half fall, said Musaeb al-Mudaress, the ministry’s information officer.

Mudaress made the remarks as he tried to explain to local reporters the reasons for the slump in power supplies and the worsening conditions of the national grid. The dam, which in terms of capacity is the fourth largest in the Middle East, suffers from neglect and lack of maintenance and repairs.

"The Mosul dam cannot be filled with more than 40% of its capacity" of 11 billion cubic meters of water, Mudaress said. Its hydro-electricity power plants used to produce around 320 megawatts, enough to feed the northern city of Mosul, home to nearly 2 million people.

But as the dam’s storage capacity has declined so has its power generating potential, according to Mudaress.

Today, the dame produces less than 100 megawatts and the output is erratic. The drastic decline in reserves is catastrophic to Iraqi agriculture since the water reserves were essential to farmers cultivating land on both sides of the River Tigris that bisects the country from north to south.

The dam’s plummeting reserves are not due to lowering water levels from the Tigris which originates in Turkey. They are necessary to preserve its shaky foundations and prevent its failure which is bound to inundate major cities including Mosul and Baghdad if it bursts at full capacity.
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Meanwhile billions of dollars meant for reconstructing Iraq have gone missing, with fingers pointing out to the US Department of Defence, reports al Jazeera. .

"According to a newly released audit by the Special Inspector General for Iraq Reconstruction, the Pentagon was entrusted with $9.1bn after the fall of Baghdad - money that came from the sale of Iraqi oil and gas.

Out of this, nearly 95 per cent, around $8.7bn, has not been properly accounted for.

Subsequently, most of it has been at least partially tracked. However, the military failed to produce any records whatsoever for $2.6bn.

In addition, the US military continues to hold over $34mn, which it was supposed to return to the Iraqi government in 2007.

The Pentagon has blamed poor record-keeping and lax oversight. They have pledged to undergo what they call a process of archival accounting to track missing funds.

Iraqi officials say they know nothing about the missing billions".

And the Guardian takes up the story:

The US department of defence has called in forensic accountants to help track $8.1bn (£5.2bn) of $9.1bn in Iraq's oil revenue entrusted to it after the fall of Baghdad, following an official audit that revealed the money was missing. The funds were to be used for spending on reconstruction during 2004-07, a period when Iraq was under weak transitional rule.

The report was issued today by the Special Inspector General for Iraq Reconstruction, which had previously criticised poor book-keeping by senior officials throughout the last seven years.

Iraqi officials said they knew nothing about the missing billions and had no means to find where they had been spent. "We will speak to the oil ministry finance committee tomorrow about this," said a spokesman for Iraq's oil minister.

The revelation was made against a backdrop of limited services nationwide made worse by a summer that has seen demand for electricity well exceed Iraq's meagre means to supply it through weeks of staggering heat.

The reconstruction of Iraq's worn-out infrastructure was to be a central plank of the US military's achievement. However, as combat forces steadily withdraw from the country to meet a 31 August deadline of only 50,000 troops remaining – mostly engineers and trainers – Iraqis are pointing to a dearth of the services that they were promised.

The Pentagon pledged to undergo a process of "archival accounting" to track missing funds, some of which is thought to be a result of shoddy book-keeping. However, the audit could not find any documentation to substantiate how the Pentagon spent $2.6bn. An additional $53bn has been allocated by Congress to rebuilding Iraq and the audit committee is examining whether those funds can be accounted for.

"I will need a lot of convincing," said Adnan Makhoul, a businessman from the Baghdad suburb of Karrada. "In fact I will never believe it, look around and tell me how any money has been spent."

Yunadim Kenna, a member of the Iraqi parliament's economic committee, said the massive shortfall had its roots in the heady early days after the fall of Saddam Hussein when billions of dollars of reconstruction contracts were handed out by the-then Coalition Provisional Authority.

"In the beginning, the contracts were huge, especially with the American companies and local mediators. It was not supervised well and it was very clear there was massive corruption, especially in projects related to the oil, defence and interior ministries.

"The Americans were spending wildly in the early days. We didn't know what on and there was no documentation. But after 2008, things became more organised."

If the war was fought for control of oil, there is violence now in the aftermath because farmers are competing for water.

Urban drinking water supplies are sometimes polluted.

Meanwhile, Iraq's electricity supply industry has still to recover from years of sanctions and war. In the capital, Baghdad, the electricity was only on five hours a day last month, according to a report today in the New York Times, which also describes people stealing electricity by illegally attaching cables to power lines.

"Iraq’s electricity problem is, of course, older than its still-uncertain embrace of a new form of government. Before Mr. Hussein’s invasion of Kuwait 20 years ago this month, Iraq had the capacity to produce 9,295 megawatts of power. By 2003, after American bombings and years of international sanctions, it was half that.

"The shortages since have hobbled economic development and disrupted almost every aspect of daily life. They have transformed cities. Rumbling generators outside homes and other buildings — previously non-existent — and thickets of wires as dense as a jungle canopy have become as much a part of Iraq’s cityscapes as blast walls and checkpoints.

"Most of the generators are privately operated, and the cost — roughly $7 per ampere — has for ordinary Iraqis become too exorbitant to power anything more than a light and a television.

“I’ve never seen good electricity from the day I was born,” said Abbas Riyadh, 22, a barber in Sadr City, the impoverished Shiite neighborhood in Baghdad. As he spoke, as if on cue, the lights went out.

Billions of Dollars Later

"The United States has spent $5 billion on electrical projects alone, nearly 10 percent of the $53 billion it has devoted to rebuilding Iraq, second only to what it has spent on rebuilding Iraq’s security forces. It has had some effect, but there have also been inefficiency and corruption, as there have been in projects to rebuild schools, water and sewerage systems, roads and ports.

"The special inspector general for Iraqi reconstruction, Stuart W. Bowen Jr., said that one quarter of 54 reconstruction projects his office had investigated — including those providing electricity and other basic services — had not been completed or carried on by the Iraqis they were built for.

"The United States is now winding such projects down, leaving some unfinished and others, already in disrepair, in the hands of national and provincial governments that so far seem unwilling or unable to maintain and operate them adequately".

Lenin once tried to sum up socialism roughly as rule by the soviets plus electrification of the whole land. It would seem that for Iraqis, at least, imperialist-delivered "democracy" means corrupt government, consumerism for those who can afford it, but lack of basics such as clean water and electricity supplies.

"Iraq’s electrical grid remains a patchwork of old power plants and new, supplemented with makeshift and inadequate solutions. Iraq now imports 700 megawatts from Iran. When temperatures soared this summer, it paid for two electricity-generating ships from Turkey to dock near Basra, one of the most badly affected cities, at a cost of hundreds of thousands of dollars.

"The country’s transmission and distribution networks are aging and mismanaged by a bureaucracy as sclerotic as it was in Mr. Hussein’s era.

"The entire system is hampered by poor planning and by inter-agency rivalries that, for example, delay fuel to power plants; by a lack of conservation; by continuing terrorist attacks on electrical towers, including four in the last half of July in Baghdad, Anbar and Diyala Provinces.

"Corruption — which the special inspector general’s office called “Iraq’s ‘second insurgency’ ” in a report released on Friday — is pervasive. Mr. Farhan, the shop owner, said his landlord had bribed Ministry of Electricity workers to install the pirated cables three years ago. “He couldn’t just connect the cables himself,” he noted.

We might wonder whether there is any connection between the problems of electricity supply and the recent raids on the electricity workers' trade union. The workers might be able to take an overview of the industry and organise it for their people's needs, without favouritism, foreign bank accounts, or corruption. But in Iraq as in any other country, there are limits to bourgeois democracy

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