| Kippreport.com

Wishful thinking—Should Iraq reach for the stars or go back to basics first?

August 22, 2011 12:22 by Reuters

In Iraq where renovating a single street can take years, government plans for a multi-billion dollar high-speed train to rival Japan’s bullet train have been greeted with scepticism by many Iraqis struggling to get even basic electricity services.

The $10 billion project to build a railway connecting Baghdad to the southern provinces is the latest in a series of large-scale infrastructure proposals by Iraq’s government to try to rebuild the OPEC oil-producing country after years of war.

Iraq needs development in almost every sector in a country where piles of rubble and incomplete buildings are commonplace more than eight years after the 2003 US-led invasion that toppled Saddam Hussein.

Most Iraqis, fed-up by the lack of jobs and pre-occupied with food rations and security concerns, have to contend with an acute water shortage and receive only a few hours of electricity a day from the national grid.

Baghdad, the capital, is plagued by badly paved roads and blast walls erected to protect buildings from bombings.

“The government cannot even accomplish projects that are much easier than the high speed train,” said Ahmed Saleh, an architectural engineer. “The airport road they kept talking about for three years is still in bad shape.”

Some analysts said the government was indulging in wishful thinking, refusing to acknowledge that a lack of funding, technical capabilities and continuing violence have put the break on development and foreign investment.

Violence from Iraq’s war has fallen sharply since the height of sectarian strife in 2006-2007, but almost daily attacks, bombings and assassinations make security costs a huge part of foreign investment expense.

While oil investment is flowing into the country, investors in other sectors often complain about bureaucracy and red tape. Political infighting in the government is also helping delay projects in areas such as electricity and telecommunications.

“In reality it is not possible to implement these projects on the ground,” said YahyaKubaisi, an analyst at Iraq’s Institute for Strategic Studies. “They are just dreams and wishful thinking by government officials.”

OIL-FUELLED RECOVERY

Rebuilding Iraq’s roads and transport system is vital for foreign oil companies to transport equipment as they develop the country’s petroleum industry.

Iraq, which has the world’s third biggest crude reserves, hopes to rebuild the country using its oil revenues, which account for more than 95 percent of state income.

But Iraqhas little public transportation, relying mostly on taxis and minibuses and a dilapidated railway system connecting the provinces.

Baghdad signed a memorandum of understanding with French engineering group Alstom in June to build a 650 km-long railway and an express train, an official in the Transport Ministry said.

An initial agreement to build an overground urban metro line in Baghdad for $1.5 billion was also signed with Alstom in May. The first part of the project is expected to be completed in 2014.

Other large scale projects include the Sadr city slum “10 x 10″ plan to build… (cont’d)

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Tags: Iraq, iraq airport, Iraq government projects, Iraq infrastructure projects, Iraq projects, oil, railway projects in Iraq, rubble, US led Iraq invasion