Schroeder seeks to revoke Iraq shutout

12 December 2003

BERLIN – German Chancellor Gerhard Schroeder is to quietly press Washington to scrap its shutout of French, German and Russian companies from Iraq reconstruction contracts.

“I hope it does not stay that way,” he told an interviewer on national ARD television news. It would be difficult to explain to the German public why Germany was providing humanitarian and civilian aid to Iraq while German companies were being treated this way.

“That can’t be right,” said Schroeder, adding that he had agreed with US President George W. Bush at their last meeting in New York to let bygones be bygones with respect to Iraq.

The behaviour of US Deputy Defence Secretary Paul Wolfowitz, who issued the directive favouring 63 US allies for the contracts, was “backward looking”, the chancellor said.

He added that he did not want to “dramatise” the issue. Instead, he would raise it with Bush special envoy James Baker who visits Berlin next week and discuss it calmly with him.

Visiting UN Secretary General Kofi Annan joined Schroeder on Thursday to criticize the US shutout.

“I find this unfortunate,” Annan said of the decision.

At his side, Schroeder said the reconstruction of Iraq was “everybody’s business” and it made little sense to discuss who could take part and who not.

Annan added that in the current phase it was important to seek commonality rather than be divisive. He hoped the United States would think again about the decision.

Schroeder added that his assessment of future moves on Iraq was “identical” with Annan’s. It was important to establish stable and democratic conditions in the war-damaged nation as fast as possible.

Annan added that the United Nations was willing to help in arranging elections, but whether it did so depended on the response from the US authorities in Iraq and the provisional governing council.

Germans across the political spectrum have been outraged at the exclusion of German companies from the huge reconstruction projects.

Christian Schmidt, a defence specialist with the opposition Christian Social Union (CSU), termed Wolfowitz a “forest demon” for the ordinance, telling a newspaper, the Leipziger Volkszeitung, that the move was not that of someone who wanted NATO or the West as a whole to engage in Iraq.

However, a leading German expert on world trade voiced doubt Thursday about whether the US move actually breached international law.

Dean Spinanger of the Institute for the World Economy (IfW) in Kiel, northern Germany, said he saw practically no way of the World Trade Organization (WTO) coming to the aid of countries like Germany.

“Iraq is not a WTO member, so in my view the rules (on fair tendering) do not apply in this case,” he said.

Only if Iraq were to be considered sovereign US territory because it was under US military control would the world trade rules apply.

DPA
Subject: German news