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Reconstruction Activities in Iraq

Andrew Natsios, Administrator, U.S. Agency for International Development
Special Briefing to the Press
Briefing Room, U.S. Department of State, Washington, DC
October 3, 2003

2003/1005

(1:40 p.m. EDT)

MR. ERELI: Good afternoon, everyone. Welcome to the State Department briefing room, where we have a special guest, Director Andrew Natsios of the United States Agency for International Development, will be briefing us on reconstruction in Iraq. Director Natsios will be bringing to us what we think are some really newsworthy success stories of partnership and progress in Iraq with U.S. assistance and Iraqi, sort of ingenuity, know-how and commitment.

With that, I'll introduce Director Natsios, who will have a few remarks of introduction, and then take your questions.

ADMINISTRATOR NATSIOS: School starts tomorrow in Iraq, on the 4th, and when kids return to school they'll find the following things that are very new: 1,595 schools have been completely rehabilitated and reconstructed. These schools, in many cases, had been abandoned for years; in other cases, they had been looted; in other cases, simply, they had fallen into disrepair -- the electrical wiring had been ripped out, the plumbing had been ripped out, the water systems were not functional, there was no electricity; the ceiling fans, which are critically important, what's in 125 degree temperature in the schools in many months during the year, which if the fans don't function, it's difficult for the kids to stay awake.

We have repaired all of that. Much of the window glass was broken in many of the schools. I went to many of these schools myself in June, when I was in Iraq for six days. To have rehabilitated that many schools over a five month period is, I think, a great indication of the rate at which the reconstruction is progressing.

We have also begun to train 5,000 school administrators, and principals and school superintendents in more modern ways of managing schools, in a more collaborative and less autocratic way. There are about 65,000 teachers in the country and we have begun a master teacher program, where we teach democratic methods ("small d"), systems of instruction that are less reliant on rote learning and more reliant on debate and questioning and more -- what we call pupil-focused educational system.

We have been running those seminars now for four months. We also today are announcing three grants, which will be three in a series of grants, with American universities and universities in Europe, partnering with universities in Iraq. For example, just giving you one example here is, SUNY, the State University of New York, will partner with Baghdad University and Mosul University and Basra University; and there is a consortium under SUNY with Columbia University, Boston University and Oxford University, and they will be focused on archeology and environmental research.

In agriculture, we've got a new award of $3.7 million to the University of Chicago's Tropical Agriculture and Human Resource Department, with University of Mosul's Agricultural School.

We can go through them all, but DePaul University in Chicago -- is it Chicago -- DePaul University, wherever it is --

QUESTION: (Inaudible.)

ADMINISTRATOR NATSIOS: Is it?

QUESTION: Yes.

ADMINISTRATOR NATSIOS: -- law school has an Institute on Human Rights, which will be working with an Italian university with the University of Baghdad. This will be for professors to go back and forth.

One of the things I noticed -- I had dinner with a number of university professors around the country, many of them had never in their entire lives been outside of Iraq, not just to the West. They had never been to Saudi Arabia, or even Kuwait, or Turkey or any neighboring countries, and they felt an enormous sense of isolation. Some of these are even older men and women who had never traveled.

And so they want to see what other universities are, how they're run, what the student bodies are like, what methods of pedagogy are used in those universities. And so there's a series of these higher education programs that we'll be doing to link our civil society with their civil society, so we have three of those grants today; 1.5 million schoolbook -- schoolbags were distributed to the children who are returning to school, to secondary schools, in other words, high school students, and you have a picture of this here in your packet.

So every kid in high school goes back with that. We've worked with UNESCO and UNICEF on redoing the textbooks, which were full of vitriol and Baathist party propaganda. And we've now printed 76 math and science textbooks that UNESCO has done, I think, for high school students, if I'm not mistaken; 3 million have been printed already, and another 1.5 million will be shortly printed, and they are being distributed now.

So school buildings, curriculum, teachers, and then the university system that trains the teachers are all part of this effort. So in the area of education, I think we have some accomplishments, not promises, for the people of Iraq.

I might also add that one of the first things that we like to do in societies that have gone through a period of deterioration where the kids aren't in school -- because, apparently, only about 55 percent of the kids who were of school age were in school prior to the war on a regular basis. There was just -- school enrollment declined dramatically, particularly girls' school -- girl children's enrollments went down.

What we notice in those societies, there is a tendency toward more social disorder. If the kids are not in school with an ordered schedule, it causes problems. Certainly the period earlier in the year was somewhat chaotic for kids, and getting them off the streets into schools will increase the stability and the security of the society.

And children are, essentially, very conservative ("small c"), in their habits. They like order in their day. If they don't have it, they can become disruptive in any society, north or south, east or west. And so a matter of simply rehabilitating the kids and ordering their day better will add to the security and the social order in Iraq.

Anyway, those are some of the things we've accomplished. And I think there's another -- one piece here, which you can see some of the statistics, and then there are some case studies in the back.

Are there any questions from anybody?

Yes, sir.

QUESTION: Total dollar figure on everything you just put together?

ADMINISTRATOR NATSIOS: I can tell you what the contract is for education, not including the reconstruction of the buildings. And that's -- I believe it's $60 million, is the education contract?

A PARTICIPANT: Sixty-seven, I think.

ADMINISTRATOR NATSIOS: Sixty-seven? Let me just see if there's a figure here.

QUESTION: It seems that the figure is 63.

QUESTION: Sixty-three.

ADMINISTRATOR NATSIOS: Sixty-three million is for the training, the textbooks -- training for the teachers, the textbooks and the schoolbags. It does not include the reconstruction of the buildings. It does include new desks because most of the schools didn't have desks. The kids were on the floor or -- I saw some of the old desks, it's rather difficult to believe people sat in them.

The Bechtel contract includes money for the actual reconstruction. Bechtel did about 1,000 schools in the NGOs, and I guess one of the -- the education contractor did do -- or no, it was a local government contractor did some of the schools as well.

In some towns, we gave -- we have given about 850 small grants to city -- these new city councils and town councils have been formed, in order for them to decide what the priorities in their village, and many towns and villages chose the school as the first thing they would rehabilitate; and therefore, in those towns we didn't do the rehabilitation ourselves.

Does that answer your question?

QUESTION: Do you know roughly how much -- what the school rehabilitation was then?

ADMINISTRATOR NATSIOS: I can get, get a figure for you. Do you know what the breakout from -- the task order for Bechtel for the schools was?

A PARTICIPANT: For Bechtel it was a portion of $50 million, but it wasn't all because that was clinics and some other public works as well.

ADMINISTRATOR NATSIOS: Okay. We can get a figure for you if you'd like it.

Yes.

QUESTION: You talk about this Master Teacher Program and teaching new ways of --

ADMINISTRATOR NATSIOS: -- right.

QUESTION: -- kind of teaching. But who is in charge of determining the curriculum? Is it the teachers, themselves, or are you having a hand -- or the administrators?

ADMINISTRATOR NATSIOS: No, no, it's not the teachers. It's the Ministry of Education.

QUESTION: Okay, but is it in collaboration with the CPA? I mean, okay --

ADMINISTRATOR NATSIOS: Yes. All of this -- we report, just so it's clear, AID reports to Ambassador Bremer and the CPA. And the CPA has in it, the Iraqi Minister of Education and the American advisors to the ministry. And they went, worked with UNICEF and UNESCO in redoing these textbooks with our contractor, Creative Associates, and with the NGO community, as well. But the teachers were involved in this, the Ministry of Education was involved in this, they had to approve all of this before it would go out.

QUESTION: I guess what I'm trying to get at is you're teaching them how to -- new ways of how to teach, but you're not kind of dictating to them what to teach?

ADMINISTRATOR NATSIOS: No, no, no. The training is not in subject matter, it's in methods. Because in autocratic, and particularly, totalitarian societies, the system is highly centralized, and literally everybody will be on the same page of the book in every school in the whole country on the same day. That's how the old Soviet system was built.

And you had to -- you know, if kids were more interested in this subject than others, it is completely irrelevant. You have to be on this page for this hour of the day. That is not a helpful way of tying what you're teaching to the needs of the children. And so western systems -- and I might add other, more progressive Arab systems, like the Jordanian and Moroccan educational systems -- we have just been through a whole reform process in Alexandria Egypt, where parent/teachers associations were formed, which is another thing we intend to do, but I don't think that was done. That's hasn't been done yet, Ross, has it?

A PARTICIPANT: It's in the beginning, but it hasn't gotten off the ground very far.

ADMINISTRATOR NATSIOS: Okay. We find in all countries, north and south, that when there are parent/teachers associations involved in the governance of the school, that the learning levels of the kids go up because parents will ask, "Well, what's your homework tonight, and did you get it done, and how can I help you with it?" Parents/teachers associations get the children's parents involved in their own education, which will increase achievement levels.

So those -- there are things that we have learned, not in terms of the subject matter, but just in terms of school governance, in terms of the methods by which material is presented, where there is discussion and people can ask questions, where people just -- the kids don't just learn by rote. They have to reason their way through and use critical reasoning. And these techniques improve the quality of education, regardless of what the subject matter is.

Yes.

QUESTION: Since these buildings have been completely, for the most part, as you've said, just totally devastated for a good period of time, does this also include monies for maybe libraries or computer internet, so that if a library isn't at hand, they can --

ADMINISTRATOR NATSIOS: There are no school libraries. In Iraq -- people think of schools in the United States and they compare them to schools. And the schools, all of the schools I went to in Iraq were simply classrooms, and there was one room for the headmaster or the principal of the school. There's no gymnasiums, there are no lunchrooms, there are no libraries, there's nothing else except the classrooms.

Our plan was not to reconstruct all the schools of the country. We were taking what was there already and making it functional. We're not intending to transplant all of our infrastructure into Iraqi society. We think that would be inappropriate. It would also take a very long time and we're not sure that would be the best use of money right now.

We have introduced internet cafés, but not in the schools. They have a system, a chain, of telephone -- I guess they're sort of related to the post office in many European countries and the Middle East -- and we opened our first one. I went to it in Umm Qasr. It was very interesting because they did not have links to the internet in Iraqi society, except at a very certain number of universities in a very controlled way.

And I watched while an older man learned how to read Arab newspapers from other countries on the internet. And he sat there, and he said he was just astonished. He had heard that there was this sort of magical device that you could take the Cairo newspaper from that morning and read it on this electronic device, and of course, it appeared in front of him, and he read it and he was just astounded. He said "Our society has been cut off from the world for 20 years, and now we're reconnected."

QUESTION: Sorry to interrupt. They were that isolated?

ADMINISTRATOR NATSIOS: Yes. Oh, yes.

QUESTION: I mean, you hear stories -- I mean, certainly that they get, you know, the Arab satellite channels, and things like that. I guess that's for a very small number of the elite?

ADMINISTRATOR NATSIOS: And if you were caught with a satellite, you could get arrested. Now -- I'm not talking about under Saddam -- now there are disks all over the city; apparently, this is one of the big boom businesses.

Yes.

QUESTION: Just for the record, when is the first, normal first day of school in Iraq? And then on the question of --

ADMINISTRATOR NATSIOS: It's the beginning of October.

QUESTION: It is normally now? And then about curriculum, you said it's just methods, but there wasn't any changes in the actual material itself, such as --

ADMINISTRATOR NATSIOS: Yes. Our UNICEF and UNESCO are working with the Ministry of Education under grants from AID through the CPA, to redo the whole curriculum, but it will take a while. This is a vast curriculum for 27 million people.

QUESTION: But, the actual factual stuff is being changed?

ADMINISTRATOR NATSIOS: Only one kid in six in Iraq had textbooks prior to the war. They simply -- and most of them were, like 20 years old, or 15 years old, they're falling apart. I've seen some of them. And so these are the first texts many kids have ever seen in school.

Michael.

QUESTION: I'd like to ask about electricity generation, just to clarify some of the numbers. In your September 30th testimony, you referred to 3,927 megawatts that it had reached on the 28th. The CPA's request for funds refers to 3,600 megawatts. Is it --

ADMINISTRATOR NATSIOS: It goes up. Its' been going up.

QUESTION: Is it now -- I mean, is it now at --

ADMINISTRATOR NATSIOS: It's over 4,000 now.

QUESTION: It's over 4,000 now, okay.

ADMINISTRATOR NATSIOS: Yeah. There was a plan put in place with the CPA. There was an electricity task force that Ambassador Bremer put together and he asked us to serve on with our people from Bechtel and our engineers on the AID staff. And they designed a plan to bring electrical generation up to the level that it was prior to the war and we're just about there, not quite there, but we're just about there.

QUESTION: Well, it was 4400 megawatts, right?

ADMINISTRATOR NATSIOS: Right.

QUESTION: So can you just give an account of -- what is it exactly that has prevented us, several months after the end of major hostilities, from even reaching the level that it was at before the war?

ADMINISTRATOR NATSIOS: Sure. When I was in Iraq in June, there were 65 transmission towers down. Bechtel did a survey by helicopter on May 15th, a month earlier, and there were 15 down. Do you know how many transmission lines are down now? 650.

So it was 15 at the end of the war, it was 65 in mid-June, and it's now 650. These are the towers, the transmission towers, not the poles.

QUESTION: So it's almost entirely sabotage?

ADMINISTRATOR NATSIOS: It's not sabotage. Almost none of it is sabotage. There's some around Baghdad. Most of it is a criminal gang called the Garumsha (ph). The Iraqis told me about it, the British office has told me about it, the Iraqis in the streets said, "Oh, the Garumsha (ph) are at it again."

Apparently, they're sort of a criminal mob that's been around for a long time. They make their living by stealing stuff. They have no interest in politics. They don't shoot at our soldiers or anything. They're selling the copper from the wiring, and because of it, there's been such a flood in the market in the Middle East of copper tubing from Iraq's electrical system that the price for copper is now depressed in the Middle East.

QUESTION: So how do you spell that name of the group?

ADMINISTRATOR NATSIOS: I don't know how to spell it. I'm sorry.

QUESTION: We'll get it for you. And so what exactly has Bechtel been doing since it made that initial survey?

ADMINISTRATOR NATSIOS: It's been focused on the electrical generating plants themselves.

Let me just tell you that the transmission system is not necessary for people to have electricity in their houses, it is necessary for stability in the system. The way our system works or works most of the time, as we had a little incident this summer as you know, the transmission system is designed to increase the reliability and the stability of the electrical system. I was in the industry for two years. I know I'm not an expert on this.

But the reason for the transmission system is it links all of the generating plants together with the distribution systems. And what it does is, if there is a plant that goes down somewhere in the United States, because there's always excess amount being produced, then the electricity simply will flow from the excess areas of the system. But the linking of the system increases the reliability so you never have outages -- or you're not supposed to.

Until we can restore those transmission lines, there will be instability in the system. Now, one of the interesting effects of this is because Baghdad got 23 hours of electrical power before the war for 10 years or 20 years. No matter what was going on, they got their power because it was the center of a totalitarian state.

Basra had an average of three to four hours. Basra now has 23 hours of electrical power. And the reason is, is because Basra has been de-linked from Baghdad because the transmission lines are down. So the people in Basra might not want the transmission lines back up.

QUESTION: I don't understand something. The transmission -- I mean the generating capacity has not really been affected by this criminal gang, too?

ADMINISTRATOR NATSIOS: No. There have been -- there is a huge problem with the quality of the -- I went through several of the plants. And I, again, was in the industry for a couple of years. I have never seen anything in such horrendous condition. The stuff is rotting out. I was amazed the stuff was functioning as it was. And they would have outages constantly in the old order, because there was never any replacement equipment. They would go to the dumps to scavenge stuff.

Let me just tell you, there was a little --

QUESTION: But they're still producing 4400 megawatts, which we're not at yet. And if the criminal gang is hitting the transmission line --

ADMINISTRATOR NATSIOS: But what we're doing --

QUESTION: -- but doesn't affect the generating capacity, why is the generating --

ADMINISTRATOR NATSIOS: Because we're taking the plants down that are unstable or on the edge of collapse and we're repairing them. And this article you saw in a major newspaper earlier last week -- late last week, which interviewed a engineer at a particular electrical generating plant, who said, "We've been waiting for six months." That guy's going to be waiting for the next six months, because that is the -- we triaged that plant, it was in such horrendous condition.

Our engineers -- we also have, by the way, the Corps of Engineers overseeing the Bechtel stuff with us. We have them doing part of this, too. But this is a CPA effort. Bechtel and AID have a leading role in it with the Corps. And we categorized all the plants in the whole country. We've done a complete survey of the condition of all the generators and all the plants in the country, and the ones that can be fixed the fastest, that have a regular supply of gas or oil and can be fixed the cheapest are the ones done first.

The ones that have an erratic or unreliable source of energy cost a huge amount of money and will take two years to fix were put in the bottom and they were, frankly, triaged. We're not going to do them for probably another six months to a year. And the one that was -- the guy who was interviewed in that article, which annoyed me a lot to be very frank with you, I'm not sure the reporter understood it, but that plant was on the bottom of the list.

It was never going to be repaired and we've never told the engineers at that plant that they're just going to have to wait because they're probably one of the worst -- plant in the worst condition in the country.

QUESTION: Just one final question on this. Is it -- have there been any attacks, whether it's with a criminal gang, whether it's any saboteurs, anyone, attacking any of these generating plants?

ADMINISTRATOR NATSIOS: Yes. Yes, we have had --

QUESTION: How many incidents have you had?

ADMINISTRATOR NATSIOS: We have had three or four instances of sabotage at electrical generating plants. Isn't that correct, Ross?

ROSS*: Not external attacks, but, yes, sabotage inside.

ADMINISTRATOR NATSIOS: Inside sabotage.

QUESTION: Okay. And have those completely taken down those plants?

ADMINISTRATOR NATSIOS: Yeah, temporarily, and then they get put back up again, which is why plants go on and off. They go on and off for several reasons, that's one of them. Another thing we're doing, which is a very interesting thing from a security perspective, you can do reconstruction in a way that increases the security of public services.

Right now -- and I had it happen to me in my -- supposed to take a shower the next morning when I was in Baghdad -- what happens, the electricity goes out, we knew it was going to go down. But guess what else went down? The water system and the sewer system, the pumps don't work.

So what we are now methodically doing in the larger cities, is deconnecting the water pumping stations, the water purification stations, the sewer pumping stations, and the treatment plants from the electrical grid. They have their own generators. And it's much easier to protect through point security, a facility than a transmission line. So even though electricity may go down for whatever reason at some point in the future, water and sewer services will continue.

Yes, sir.

QUESTION: That gang you mentioned, is there a -- I don't know if it's your area -- but is there a strategy for going after -- either going after them, or preventing the copper from making it to market or some way to stop it?

ADMINISTRATOR NATSIOS: We actually were considering intervening in the copper market, to pour copper in to depress the price, but it's already happened. Most of it was going to Iran, apparently, and they're melting it down into bars. The British brigadier down in -- I think it was the second in command down in Basra, told me that they closed just that week I was there six copper smelts that had been -- black market copper smelts -- that had been set up to melt these wiring down.

I went by a --

QUESTION: Where in the country, you say?

ADMINISTRATOR NATSIOS: Sorry?

QUESTION: Where in the country?

ADMINISTRATOR NATSIOS: In Basra, the city of Basra, down at the -- the southerly most city in the country.

And so they have actually now, I think, closed down about 40 or 50 of them. They're doing it on a regular basis because it's a little difficult to hide them.

Yes, sir.

QUESTION: Looking over your September 30 testimony, it wasn't clear to me you've got --

ADMINISTRATOR NATSIOS: People actually read my testimony?

QUESTION: Well, parts of it at least.

(Laughter.)

ADMINISTRATOR NATSIOS: I shouldn't have said that, I think.

(Laughter.)

QUESTION: It wasn't clear to me whether you've actually gotten to, say, have commercial traffic on a regular basis in Umm Qasr and --

ADMINISTRATOR NATSIOS: Oh, yes, definitely.

QUESTION: What is the situation with commercial flights going in and out of the airports?

ADMINISTRATOR NATSIOS: 600,000 tons of tonnage arrived in Umm Qasr in the month of September, and some of that was food --

QUESTION: So the operation will be able to process up to 600 metric tons?

ADMINISTRATOR NATSIOS: Well, I believe it did last month. A lot of it's food from the Oil-for-Food program. But I was there when commercial -- I was there the first day we opened it, the regional governor and I, and four commercial vessels arrived that were private when I was there.

QUESTION: And the airports?

ADMINISTRATOR NATSIOS: In Umm Qasr.

QUESTION: Yeah. And the airports?

ADMINISTRATOR NATSIOS: The airport of Baghdad is open to chartered commercial traffic, military traffic. I don't think any airlines are yet landing there. I think there were like 200 flights last month, or something like that, into Baghdad International Airport.

We've got to finish the tower. Almost all the work is done, but there's some of this equipment that -- what do they call that?

QUESTION: Air traffic --

ADMINISTRATOR NATSIOS: Air traffic safety control equipment that has been ordered that has not yet been installed in the tower. And we're now beginning work on Basra International Airport. We've got three airports to do that are important to the economy of the country, which is why Ambassador Bremer made them a high priority. They will affect commerce and the business community coming in to invest and that sort of thing.

Yes, sir.

QUESTION: Mr. Natsios, you've mentioned the fact that there's children coming to school and the satellite dishes, but is there any implementation of the new radio and television type -- either in network or local stations -- to communicate to, obviously, people out in both the urban and rural areas?

And also, do many of these people -- adults, as well as maybe teenagers, do they have portable radios where they can get communications and --

ADMINISTRATOR NATSIOS: They do.

QUESTION: -- if the rest of the infrastructure was ruined, any plans to perhaps build a cellular telephone system?

ADMINISTRATOR NATSIOS: Actually, we're building -- we're rehabilitating -- we're not reconstructing, we're rehabilitating the fiber optic cable system that goes from the north of the country down right to the south that ties the country together that had been destroyed during the war, and that will help with communications.

We're also putting up dishes that will allow the country to be tied together for -- with cellular communication. That's a contract of -- subcontract of Bechtel. This was also at Ambassador Bremer's insistence.

What was the first question?

QUESTION: Well, I wanted to know, just because --

ADMINISTRATOR NATSIOS: Oh, about the television-radio station.

QUESTION: Right.

ADMINISTRATOR NATSIOS: We're not in charge of running the stations, but we did reconstruct the looted radio and TV commission headquarters that was run by the state, that the CPA now controls, and I was there when they were broadcasting.

They have since, apparently, substantially upgraded those facilities so that Ambassador Bremer can speak to the people and they get outside news. And I guess programming from neighboring Arab countries is brought in from Lebanon and from Egypt to play, and I guess it's on the radio and TV.

There is also Radio SAWA, which predates the war. That's U.S. subsidized. It's a private radio station, but we subsidize it, I guess, and that reaches about 40 percent of the kids in the country -- at least pre-war -- listen to it every day because it's got a lot of music on it and that sort of thing.

Yes, sir.

A PARTICIPANT: I think we have time for just one more question.

ADMINISTRATOR NATSIOS: Who hasn't asked a question? Anybody hasn't?

Okay. Yes, sir.

QUESTION: On the debate over the UN resolution, it seems that one of the issues at hand is that the -- a lot of the other countries want the U.S. to put the reconstruction money through a common fund, and I'm wondering if maybe from your point of view you would explain why it is the Administration is really holding the line on this point? Why would that make the job more difficult for you, or what's the problem there?

ADMINISTRATOR NATSIOS: I'm not -- I have to say the debate in the UN is something that Secretary Powell and the State Department deals with.
International funds are generally useful for smaller countries that do not have large aid agencies and do not have a presence on the ground. That's why we set it up in Afghanistan, and also to provide monetary support to the Afghan Government.

That is not what we're facing in Iraq on a mass scale. There would be no point to us going through a fund like that with the large amounts of money we're dealing with because we're already spending it on the same things that would be spent through the fund, so -- but I'm not an expert in the resolution. You'd really have to ask the State Department that.

QUESTION: Can I ask one?

ADMINISTRATOR NATSIOS: Yeah, one last question. Maybe I'll regret this. What's the --

QUESTION: You've got, obviously, a lot of big projects underway: telecommunications, electricity -- how much of that work -- what are the basic guidelines for allowing non-American companies to do some of this work? And I'm not referring only to the Iraqi ones. I'm thinking of, you know, the European ones --

ADMINISTRATOR NATSIOS: Sure.

QUESTION: Siemens. Companies like that are expert in some of the --

ADMINISTRATOR NATSIOS: There are a very large number of British companies, for example, that have got contracts.

QUESTION: Yeah. There's, but how much is --

ADMINISTRATOR NATSIOS: Ambassador Bremer --

QUESTION: -- "buy America" policy, you know, affected here?

ADMINISTRATOR NATSIOS: We have a new edict from, from Ambassador Bremer, which, as I thought about it when I was there, I fully agreed with him.

We are now employing 55,000 Iraqis doing the reconstruction work. If people are working, they're not shooting at us. So maximizing Iraqi business participation in this will increase the security of the country, keep people off the streets, particularly young men who, in any society, increase the level of instability if there are high unemployment rates.

So it's one of the things we always look for in a country that's unstable is, how many young men there are between 15 and 25 or 30? And what's the unemployment rate? And it's very high in Iraq. But Ambassador Bremer wants us to bring up total employment just through our contracts to $300,000 by next year. And we think we -- I'm not sure we can do it as rapidly as he wants, but we're up to $55,000 now. That's a lot of people in five months to be working.

This is not just one day. Most of these people are working, you know, the wage is not great. The wage by our standard is $4 a day, $5 a day. But by Iraqi standards, that's a very good wage.

And so what he has asked us to do is make sure the subcontracts primarily go to Iraqi firms. And Bechtel made a commitment that they would get up to 70 percent of the subcontracting going to Iraqi firms. So there's a heavy emphasis on Iraqi companies.

We are noting, though, some of the Iraqi companies are -- have joint ventures with Turkish companies or Egyptian companies or neighboring countries.

Thank you.


Released on October 3, 2003

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