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Billions pledged for Iraq in Kuwait, but still short of goal

February 14, 2018
Associated Press

KUWAIT CITY (AP) — Billions of dollars were pledged Wednesday at a donor conference for Iraq's reconstruction after the country's devastating war with the Islamic State group, though the amounts announced so far still fall short of the $88.2 billion Baghdad is seeking.

The biggest pledge at the gathering in Kuwait came from Turkey, which announced $5 billion in credit to Iraq, while Kuwait's ruling emir said his oil-rich nation will give $1 billion in loans and $1 billion in direct investments.

Saudi Arabia pledged $1.5 billion while the Kuwait-based Arab Fund says Iraq will receive $1.5 billion in infrastructure aid in coming years.

Qatar, which is embroiled in a diplomatic crisis with a quartet of Arab nations led by Riyadh, pledged $1 billion. The United Arab Emirates pledged $500 million, as did the Islamic Development Bank. Germany pledged 500 million euros ($617 million) and the European Union 400 million euros ($494 million).

The United States, which has been embroiled in Iraq since its 2003 invasion that toppled dictator Saddam Hussein, did not directly give at the conference Wednesday in Kuwait City. However, it plans to offer over $3 billion in loans and other financing to help American firms invest in Iraq.

Kuwait's donation particularly was in many ways stunning as only a generation ago, Saddam Hussein invaded the small, oil-rich nation.

The donation by Kuwait's ruling emir, the 88-year-old Sheikh Sabah Al Ahmad Al Sabah, showed the deep interest his nation has in making sure Iraq becomes a peaceful, stable country after the war against IS. Iraq also still owes Kuwait reparations from Saddam's 1990 invasion that sparked the 1991 U.S.-led Gulf War.

"This large assembly of international communities that are here today is reflective of the large loss that Iraq withstood in facing terrorism," Sheikh Sabah said. "Iraq cannot commence the mission of rebuilding itself without support, which is why we are all here today from all around the world, to stand by Iraq's side."

Wednesday is the last day for the funding to come forward at the summit held in Bayan Palace in Kuwait City. Iraq, however, still needs far more donations — overall, Baghdad is seeking $88.2 billion in aid from donors.

Among the hardest-hit areas in Iraq is the city of Mosul, which Iraqi forces, aided by a U.S.-led coalition, recaptured from the Islamic State group in July 2017. Iranian-backed Shiite militias also participated in the operation, fighting in the villages around the city.

The victory came at a steep cost for Mosul, as coalition airstrikes and extremist suicide car bombs destroyed homes and government buildings.

Of the money needed, Iraqi officials estimate that $17 billion alone needs to go toward rebuilding homes, the biggest single line item offered Monday, on the first day of meetings. The United Nations estimates 40,000 homes need to be rebuilt in Mosul alone.

The war against the Islamic State group displaced more than 5 million people in Iraq, only half of whom have returned to their hometowns.

However, officials acknowledge a feeling of fatigue from international donors, especially after the wars in Iraq and Syria sparked the biggest mass migration since World War II. Iraq also is OPEC's second-largest crude producer and home to the world's fifth-largest known reserves, though It has struggled to pay international firms running them.

The United States under President Donald Trump also seems uninterested in directly investing in Iraq's reconstruction.

The U.S. alone spent $60 billion over nine years — some $15 million a day — to rebuild Iraq. Around $25 billion went to Iraq's military, which disintegrated during the lightning 2014 offensive of the Islamic State group, which grew out of al-Qaida in Iraq. U.S. government auditors also found massive waste and corruption, fueling suspicions of Western politicians like Trump who want to scale back foreign aid.

However, the U.S. has offered an over $3 billion package for Iraq from the Export-Import Bank of the United States. The package will be structured so that the initial amount could rise to as much as $5 billion over several years. That money would include loans, loan guarantees and insurance devices to encourage American investment in Iraq.

Meanwhile, regional tensions may affect how spending comes. Iranian Foreign Minister Mohammad Javad Zarif attended the meeting, but skipped a group photograph held before. Saudi Arabia and other Gulf nations attending Wednesday's conference remain suspicious of Iran's influence in Iraq, as well as its gains following the 2015 nuclear deal with world powers.

Qatar, meanwhile, remains boycotted by four Arab nations, including three in the Gulf, which has split the typically clubby relations among the nations.

For his part, Iraqi Prime Minister Haider al-Abadi urged all his country's neighbors to contribute.

"We need to rely on all our neighbors and friends to help Iraq invest in its future," he said.


Associated Press writers Hussain al-Qatari and Malak Harb in Kuwait City contributed to this report.


Follow Jon Gambrell on Twitter at . His work can be found at .



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