Iraq spends little on rebuilding despite huge surplus

WASHINGTON - Iraq is amassing a huge budget surplus of soaring oil export revenues, but is spending little on reconstruction, for which the United States is bearing the financial burden, a US government report said.

By (AFP)

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Published: Wed 6 Aug 2008, 8:57 PM

Last updated: Sun 5 Apr 2015, 11:50 AM

The Government Accounting Office report issued Tuesday said that, counting Baghdad's actual budget balance for 2005 to 2007, and the projected budget of 2008, the country would have amassed a surplus of up to 79.3 billion dollars out of revenues of up to 182.2 billion dollars.

But little of that money is going to maintaining and rebuilding key civil infrastructure, the GAO report said.

Over 2005-2007, "the Iraqi government spent only one percent of total expenditures to maintain Iraq- and US-funded investments such as buildings, water, and electricity installations, and weapons."

The report noted that since 2003 the United States has budgeted about 48 billion dollars for Iraq stablization and rebuilding efforts, and had committed about 42 billion dollars of that by June 2008, including 23.2 billion on the security, oil, electricity and water sectors.

"From 2005 through April 2008, Iraq spent about 3.9 billion dollars on these sectors," the GAO report said.

The report said that, according to US government, coalition and international officials, Iraq's capital spending has been hampered by the lack of trained personnel, weak budgeting and procurement processes, and ongoing violence across the country.

It said that the Iraqi government at the end of 2007 had in various bank deposits for the government's Development Fund for Iraq 29.4 billion dollars.

Also at the end of last year, Baghdad had amassed foreign exchange reserves of 31.4 billion dollars, the report said, adding that the foreign reserves might include some of the money in the Development Fund deposits.

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