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After IS: Will Mosul reconstruction be next arena of influence in Middle East?

Iraq-reconstruction of Mosul
Men sweep rubble out of a house in Mosul after it was damaged in fighting between Iraqi government forces and IS’ militants, 2 March 2017. Photo Panos Pictures

The lengthy, multibillion dollar reconstruction of Mosul and other cities destroyed in the fight against the Islamic State (IS) will likely become another arena in which regional and world powers compete for influence in the coming years, and may determine whether peace can be forged in Iraq.

Iraqi forces and a US-led coalition declared victory over IS in Mosul on 9 July 2017, following a protracted eight-month battle that left large areas of the city in ruins. At a media briefing in Washington following the victory, Pentagon spokesman Navy Captain Jeff Davis told reporters that since 2014, the coalition has retaken 70 per cent of IS-controlled territory in Iraq and 50 per cent in Syria. Fighting continues in the city of Raqqa in eastern Syria. Yet restoring the formerly IS-held areas to their previous state is another proposition entirely, and an expensive one.

Even before IS was defeated in Mosul, the Iraqi government unveiled a $100 billion, ten-year reconstruction plan for liberated areas, to begin next year, although it is still unclear where the money will come from to pay for the plan. Iraqi officials have estimated the total damage done in Mosul at $50 billion.

The United Nations (UN) estimates that in the short term, rebuilding will cost at least $1 billion. Lisa Grande, the United Nations Development Programme’s resident representative in Iraq, said it will take about $470 million to restore basic infrastructure including the power, water and sewer systems and to rehabilitate hospitals, schools and houses in the neighbourhoods with the most severe damage in western Mosul. At least another $237 million is needed for the more lightly damaged districts in western Mosul and a further $370 for rebuilding in eastern Mosul.

The UN’s stabilization fund for Iraq has received about $420 million from the international community over the past two years, and work has already begun on projects that include rehabilitating water treatment plants, electrical substations, schools and healthcare facilities, Grande said. However, the fund falls far short of the cost of the work needed.

The United States (US), which has been heavily involved in reconstruction efforts in Iraq since it invaded the country in 2003, has contributed about $265 million to the stabilization efforts over the past two years.

Chinese officials have also signalled China’s intention to take an active role in the reconstruction. In a letter to Iraqi President Fuad Masum, Chinese President Xi Jinping pledged 80 million yuan, about $11.9 million, for rebuilding.

The wealthy Gulf states have so far pledged little for reconstruction, although Kuwait has announced plans to hold a conference on rebuilding the areas captured from IS in Iraq, with the aim of raising funds. Other regional powers, including Turkey and Iran, have already begun to make overtures to the Iraqi government.

Iran’s state news agency reported that Iran’s ambassador to Baghdad, Iraj Masjedi, had met with Salim al-Jabouri, speaker of the Iraqi parliament, and ‘explored ways to prepare the ground for Iran’s engagement in reconstruction of Iraq in the post-Daesh [Islamic State] era’.

The report went on to say that ‘Iranian governmental and private sectors in the country are ready to stand by the Iraqi people in the same way they did to fight terrorism, and help the country reconstruct itself’, although it did not put a dollar figure on the aid.

According to the Washington-based Middle East Institute, the Fars News Agency, affiliated with Iran’s Islamic Revolutionary Guards Corps, wrote that Iran should ‘actively participate in the rebuilding of Mosul and other war-ravaged cities of Iraq and export Iran’s technological and engineering services and other goods needed in Iraq … With an active economic diplomacy with Iraq, it [the government] should not let this economic opportunity after the defeat of Daesh be exploited by countries such as America and Saudi Arabia, which have played a role in the creation of Daesh, or Turkey, which has prolonged the crisis in Iraq.’

Adel Albdeewy, a professor of political science at the University of Baghdad, and political analyst Khairuldeen al-Makhzoomi, wrote in an article for the independent media platform openDemocracy, that Iraq could become the site of a political battle between Iran and foreign actors including the US, Iran and Turkey.

‘With the liberation of Mosul, Iran may well conclude that it no longer benefits from any US presence in Iraq. Iran has a vast array of means to exert pressure on the main Iraqi political decision makers, especially through its non-state actors,’ they wrote. ‘As for Saudi Arabia, the country has its own means of keeping Iraq from aligning too closely with Iran. The kingdom could passively refrain from supporting the reconstruction of the liberated areas, or actively support groups and parties intent on destabilizing the peace and impeding the political process in Iraq.’

Iran has already been active in reconstruction in Syria, where it has backed the Lebanese Shia militia Hezbollah which is supporting Bashar al-Assad’s regime. In Aleppo, which suffered catastrophic damage in the fighting between pro-government forces and rebels, Iran has established a reconstruction authority that has publicized plans to renovate schools and other destroyed facilities across the province.

Regardless of who funds the reconstruction efforts in Mosul and other areas formerly under IS control, rebuilding is likely to be hampered by corruption, inefficiency and, potentially, security problems.

An inspector general’s report on the more than $60 billion the US spent on reconstruction projects in Iraq from 2003 to 2013 found many instances of stalled projects, corruption, inefficiency and poor coordination between the US and Iraqi officials. For instance, audits of two warehouse and distribution facilities run by one contractor found some ‘especially egregious’ examples of overbilling by subcontractors, such as $900 being billed for a control switch worth $7 and $3,000 for a circuit breaker worth $94.

In other cases, important projects ran behind schedule and over budget, such as the Basrah Children’s Hospital in southern Iraq, which was completed four years behind schedule and ended up costing $165 million instead of the $50 million originally projected.

More recent reconstruction efforts in other areas liberated from IS in 2015 and 2016 have been slow moving. In Fallujah, many neighbourhoods remained uninhabitable a year after the city was recaptured. The head of the city’s municipal council told the Associated Press that while international aid had begun to rebuild the electricity and water systems, the central government had provided little reconstruction money for the area.

In Mosul, some are worried that the reconstruction will also stall if left to the Iraqi government. In spite of the pitfalls of international involvement, civil society activist Majed al-Husseini told al-Monitor that unless foreign organizations take a lead role in the reconstruction, “political conflicts will bring back murders in the streets”.

“Shiite militias are setting up in the city, which the Sunni majority sees as a provocation … the Kurds have their sights on the disputed areas [and] Sunni politicians have conflicts between them for personal interests,” he said.