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French can't wait for the dust to
settle
By Julio Godoy
PARIS -
French and United States companies have entered battle
over the potentially lucrative business of
reconstruction of Iraq after the assumed victory for
coalition troops.
Senior officials from the
French Ministry of Economics and Finance this week met
representatives of the Mouvement des Enterprises de
France (MEDEF), the main lobbying group for industry,
"to analyze how French enterprises can do business in
Baghdad after the war is over", said a source at the
ministry.
France is keen to make up for lost
business. Its annual trade with Iraq has been worth
about US$1.5 billion a year. Estimates of the cost of
reconstruction vary from $25 billion to $100 billion.
The French moves follow news that the US government has
begun to grant contracts to US firms for reconstruction
of infrastructure after the war.
The US Agency
for International Development (USAID) quietly invited a
handful of US construction and public-works companies
last month to bid for the first reconstruction contracts
in Iraq, worth some $900 million. The chosen enterprises
were Kellogg Brown & Root, Bechtel, Parson,
Washington Group and Louis Berger. USAID did not invite
public bidding. "The urgency of the circumstances and
the need to give the companies sensitive military
information" dictated this procedure, said USAID
spokesman Ellen Yount. Contracts would be awarded on the
basis of "the companies' experience in this field".
MEDEF wants the French government to make sure
that reconstruction is decided at the United Nations.
"That way, the whole world will be able to participate
in public bidding organized by the UN," MEDEF said in a
statement.
The daily Le Monde says that USAID
picked the companies "for their friendship" with US
leaders. "The five companies contributed more than $2
million to the electoral campaign of President George W
Bush," Le Monde reported.
The announcement that
USAID had granted a contract to the Texas-based firm
Halliburton to fight the fires in oil wells in Iraq and
to restore the facilities seemed to confirm French
apprehensions. Vice President Richard Cheney was chief
executive officer of Halliburton until 2000. A second
contract for restoration work around the southern port
of Umm Qasr has also gone to a US company.
The
news weekly Le Canard Enchaine says US lobbyists have
offered to represent French companies before the US
government. "US lawyers, really serious people well
known for selling Bush business plans to the Congress,
were in Paris to contact leading French companies," the
magazine quoted an executive from a leading French
electronics group as saying. "The lawyers' message was:
if you work with us, the diplomatic tensions between
Paris and Washington won't affect your business in
Iraq."
An official at the Ministry of Economics
and Finances says the government wants to make sure that
"our country's legitimate business interests won't be
put aside by the US-British coalition. The
reconstruction of Iraq is being studied at the ministry.
We are considering all aspects, and we're sure that
France will get its share of it." French managers are
apprehensive that the anti-war position taken by France
will provoke business losses and an unofficial boycott
of French goods in the US. Another meeting between
government officials and MEDEF representatives is due
next Thursday, says Gilles Munier, general secretary of
the French-Iraqi Friendship Association. "We have to
examine how dangerous possible alliances with US
enterprises in Iraq might be," Munier said. But he
figures that Iraqi resentment against US and British
representatives would be so great that it would be
impossible for their companies to work safely in Iraq on
their own.
Many managers say that such efforts
will not work. "We know already that our companies won't
get any contract for public works in Iraq," said Yvon
Jacob, leader of the French Federation of Mechanical
Industries.
These fears are shared by the French
oil giant TotalFinaElf, which had signed several
contracts with the present Iraqi authorities. A new
government is unlikely to honor these contracts, company
managers say. "Those who control the oil routes have
extraordinary leverage in negotiating oil contracts,"
said Pierre Terzian, director of the journal
Petrostrategies. "In this sense, the new war against
Iraq is giving the US-British coalition a strategic
advantage in the future management of Iraqi oil."
French President Jacques Chirac does not seem
unduly concerned. "We're still in the demolition stage,"
he said at the European summit in Brussels last week.
"Let's wait and see what is left to rebuild."
(Inter Press Service)
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