Sunday, August 1, 2004

BAGHDAD - Normally, the sounds of hammering would be an annoyance in this health clinic, but young Iraqi mothers with small children pay little heed to the construction din overhead.

The Baghdad clinic’s new second story will be devoted to modern diagnostic equipment such as sonograms, magnetic resonance imaging and new-model X-ray machines.

It is an ambitious addition to the renovated ground floor of the Al-Zewyia Primary Health Care Center, a spacious and clean facility where general practitioners diagnose fevers, obstetricians monitor pregnancies and dentists fill cavities.

“The American … army has done this beautiful thing,” says Dr. Sarra’a Abdul Jalil Habib, senior doctor in the Al-Zewyia clinic. “They are rehabilitating everything, the air conditioning, the furniture, even the instruments.”

The $150,000 project was funded by the U.S. Army’s 1st Cavalry Division through its Commander’s Emergency Reconstruction Program, a fund that allows Army units to spend relatively small amounts on quick-impact projects in neighborhoods.

Capt. Larry Geddings says the clinic was recommended for rehabilitation by the neighborhood council and approved by the division commander.

But Dr. Habib acknowledges that the facility was a curious choice for American reconstruction funding.

“This area is wealthy,” she says. “The women here can pay for their health care and medications.”

Al-Zewyia is a private clinic in the upscale neighborhood of Jaderiya, a tree-lined community of high-walled houses and private security guards.

The clinic and the neighborhood were not looted and suffered no damage during the U.S.-led invasion of Iraq to topple dictator Saddam Hussein.

Its four doctors and two pharmacists see 40 to 50 patients a day. The staff is supplemented by administrators, medical assistants and security guards.

That contrasts sharply with the chaotic, understaffed emergency room at Yarmouk Hospital, a public facility nearby. As many as 150 patients a day pass through the emergency room, some with bullet wounds, others with shrapnel from terrorist bombs.

Doctors at Yarmouk, which serves all of south Baghdad, are desperate for electricity, medicine, bandages and other basic supplies.

Patients lay perspiring in rooms with a dozen beds and scores of visiting relatives as daytime temperatures soar above 125 degrees.

“It is criminal we cannot do more for these people,” says a stunned intern as he races between beds in the wake of a recent car bombing. “I haven’t enough bandages today.”

Hospitals and countless small clinics scattered throughout Iraq face similar misery, as patients wait for treatment in dusty hallways or crouch in whatever shade they can find outside.

A recent Health Ministry survey here found that only 4 percent of the government-run health care facilities received any rehabilitation or reconstruction funds.

“Assessments indicate that as much as 65 percent of equipment in Iraq’s hospitals does not function, or is in need of repair or replacement,” one Health Ministry bulletin reads.

Haphazard efforts

The contrast between the two facilities, both in southern Baghdad, illustrates a problem that plagues U.S. nation-building efforts. The programs remain disorganized, haphazard and even chaotic as millions of Iraqis, especially those in Baghdad, suffer through another blistering summer.

Two congressional appropriations, cash from oil sales, Iraqi assets frozen by the United States during Saddam’s rule and discretionary commanders’ funds all are mixed into the pot of Iraq-reconstruction funding.

That leaves no single official in the U.S. government with a good handle on what is being done or how effectively the money is being spent.

A new audit by the inspector general for the former U.S.-led Coalition Provisional Authority says that civilian administrators failed to keep proper track of nearly $1 billion in Iraqi money spent on reconstuction projects, the Associated Press reported from Baghdad.

The money can be divided into two batches, the first totaling nearly $24 billion that has been “obligated,” according to the congressional Government Accountability Office. The term refers to money set aside to be spent, mainly by big companies such as Bechtel Group or General Electric Corp. as they build infrastructure projects such as power plants and water-treatment facilities.

The $24 billion, which U.S. officials say is “obligated” but not necessarily spent, consists of $8 billion appropriated by Congress in April 2003, another $13 billion from sales of Iraqi oil and more than $2 billion from Iraqi assets that were seized or frozen during Saddam’s rule.

Dov Zakheim, former U.S. undersecretary of defense, explains that the Iraqi oil money and assets had been the easiest to access after the invasion.

“We felt it was terribly important to get our hands on the money quickly, especially as donor money was not coming in too quickly,” Mr. Zakheim told the Washington Institute for Near East Policy on June 22.

Restoring power

The first batch of funds was for projects begun last year that are approaching completion. The second sum consists of $18.4 billion appropriated by Congress in November for a whole new set of contracts.

“A lot of things have been built,” says Jim Guy, infrastructure adviser for the U.S. Agency for International Development (USAID). He lists power, sanitation, roads, bridges, schools, airports and the main Umm Qasr seaport.

Project results are difficult to see, officials say, because of the level of degradation in Iraq from years of neglect under Saddam and the impact of U.N. sanctions after the first Persian Gulf war.

The U.S. company Perini Corp. shortly will hand over the keys of three rebuilt power plants in southern Iraq to the Ministry of Electricity. That will add another 310 megawatts to Iraq’s hungry electricity grid.

Perini is one of three companies that won $500 million contracts to get Iraq’s electricity supply back up to the 8,000 megawatts needed nationwide. As of February, capacity hovered around 4,500 megawatts, according to the Department of Energy.

“Overall, we are on schedule,” says John Procter, spokesman for the U.S. Project and Contracting Office (PCO) in Baghdad. “Some areas are more difficult to penetrate, to get engineers and supplies in.”

Former Administrator L. Paul Bremer, who departed Baghdad on June 28 when the U.S.-led coalition returned sovereignty to Iraqi officials, has said that despite best efforts, there will be a shortfall of 2,000 megawatts from the hoped-for 8,000 megawatts this year.

The effort is complicated by daily attacks by insurgents and rising security costs that take a huge chunk from the budgets of any infrastructure project.

There also are reports that Iraqi workers in the crucial oil and electricity sectors are being paid or coerced by insurgents to sabotage projects they work on.

“I am sure the Iraqi government, police and army are doing their best to protect all these completed plants from any attacks by terrorists,” Iraqi engineer Taer Jabur says.


Pace quickens

Spectacular oil fires from sabotaged pipelines repeatedly have interrupted the flow of oil to market, and some fear that power stations will be hit next.

“They have facility-protection services; they have police,” says one Pentagon official, who asks not to be named. “If they ask for security assistance, we would work with them to provide them with assistance. That’s part of why we are still there.”

The U.S. Army Corps of Engineers pushed Perini and other contractors to meet the now-passed deadline of July 1 to fire up the plants. Security threats, particularly around the time of the U.S. transfer of power in June, slowed the process to a crawl.

But the pace has picked back up, and many projects are coming up to completion. Other projects are to break ground by the end of summer or early fall.

New reconstruction projects are expected to come online a lot faster, and Secretary of State Colin L. Powell, in Baghdad on Friday, told reporters that the United States would speed delivery to Iraq of the billions in aid that Congress approved last year.

“We went from contract to award to 100 percent mobilization in 45 days,” Mr. Procter, the PCO spokesman, says in a telephone interview from Baghdad, referring to contracts awarded earlier this year out of the $18.4 billion approved by Congress.

“All of these projects were designed on priorities in very close cooperation with Iraqis in Baghdad, and on a local level: sheiks, tribal leaders, family heads, etc.,” he says.

Although the ribbon-cutting ceremony at Perini’s three power plants will mark a key step, much work remains.

Technical manuals are all in English, and training sessions for Iraqis have been held in English. Interpreters struggle to keep up with the plethora of technical terms being thrown at them.

“They are used to antiquated, primarily Russian-made systems that are 20 or 30 years old, and it will take some time to learn U.S. state-of-the-art systems,” one private contractor says.

“The training thus far has been classroom only and unrealistic because of nontechnical language assistants and a lack of Arabic technical manuals,” the contractor adds, speaking on the condition of anonymity.

Stubborn obstacles

Few, if any, of the expatriate contractors who will walk away from the power-plant construction camps will miss them.

They spent months locked down to complete their work in sites nicknamed “hell’s sandbox” for their remote locations in Iraq’s blistering deserts that harbor scorpions, venomous spiders and snakes.

Equipment such as turbines had to be transported vast distances in guarded convoys, facing the same types of ambush threats as U.S. soldiers did during the march to Baghdad last year.

For many, if not most, companies, publicity in Western newspapers is not particularly welcome.

Perini officials at the company’s home office in Massachusetts decline to comment on progress in the region.

But personnel on the ground warn that maintaining the multimillion-dollar projects would be a challenge, given the lack of trained Iraqi personnel, continued security problems and threats against Iraqi workers.

“There is an above-average chance of sabotage or attack because of the high-dollar value of the materials on site and the general shortages in Iraq, because most things like stainless steel and copper cables are not manufactured here,” the contractor says.

Cost overruns present another obstacle.

USAID, for example, beginning in April 2003 channeled $680 million to Bechtel to assess and rebuild key components of Iraq’s infrastructure, including power, water, sanitation, roads, bridges, schools, airports and the seaport at Umm Qasr — Iraq’s gateway to the Persian Gulf.

“As we began to work, it became clear that the money we had was insufficient to do the work, to do all the things that were required, because there was so much to be done, and that was before security became a problem,” USAID’s Mr. Guy says.

The contract was bumped up to $1.03 billion.

Work and pay

The reconstruction effort comes amid chronic unemployment for Iraqis and disappointment that the effort has been slow to create jobs for locals.

The U.S. decision to dissolve the Ba’ath Party’s civil service and the Iraqi army left some 25 percent of the work force jobless — driving the overall unemployment rate to an estimated 50 percent or higher.

Moreover, the cost of living in Iraq continues to increase.

Mr. Jabur, the Iraqi engineer, estimates that 70 percent of those working now are making between $100 and $800 a month.

With rent and food eating up more than half that amount, the dream of a middle-class lifestyle with a house and car remains elusive, despite the country’s vast oil wealth.

“I have 328,000 dinar [$218], my husband is a former military officer, has no salary, and we have three children,” says a teacher who would give her name only as Bushra. “I work extra hours as a tutor just to earn money.”

The discrepancies between salaries for Iraqis and non-Iraqis has been particularly grating to locals, adding to the general feeling that U.S. private firms are in Iraq to make money off the nation’s oil wealth.

This is particularly true of projects being run by U.S. contractors and financed with sales of Iraqi oil. Expatriates earning up to $1,000 per day work with Iraqis making less than $10.

‘Final say’

Adding to the growing us-versus-them sentiment is the constant fear of attacks by insurgents and terrorists. Iraqis working with foreign forces and private contractors come under attack 40 to 50 times a day.

Nearly 1,000 have been killed in the month since the coalition transferred power to the interim Iraqi government.

Projects are managed by U.S. Ambassador John Negroponte and David Nash, a retired rear admiral who heads the PCO in Baghdad. The Pentagon provides administration and staff to the PCO, while “policy guidance” comes from the State Department.

Mr. Procter, PCO spokesman in Baghdad, says Iraqis are participating on an advisory level, but that ultimate control over the funds is in the hands of the United States.

“These are U.S. taxpayer dollars, so we do have final say,” he explains.

According to the GAO, ensuring accountability and oversight is a fundamental responsibility of U.S. agencies involved.

At a primary care clinic operated by the Iraqi Red Crescent in the low-income Tahrir Square neighborhood in Baghdad, doctors cope with as many as 200 patients a day.

A similar U.S.-funded rehabilitation project long has been scheduled for the Tahrir Square clinic. But, in an ironic twist, the project is on hold because of the success generated by the U.S. grant to the Al-Zewyia clinic.

Health Ministry officials twice have called Dr. Habib as part of an investigation of how her private clinic in a wealthy neighborhood got cash so quickly while other health care facilities continue to languish.

Dr. Habib says officials questioned both her ethics and her honesty.

“They want to know why the Americans put money here, instead of someplace needy,” says the obstetric specialist, an elegant woman whose green head scarf matches her eyeliner. “But I did nothing wrong. We accepted their offer through the district council.”

• Betsy Pisik reported from Baghdad.

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