Cablegate: Chalabi's Provision of Services Committee - March 4

DE RUEHGB #0675/01 0670408
P 070408Z MAR 08




E.O. 12958: N/A
SUBJECT: Chalabi's Provision of Services Committee - March 4

1. SUMMARY: Following a February 29 discussion at the I-ESC, Dr.
Chalabi convened a special meeting to discuss water availability in
Baghdad. Participants included representatives from the National
Plastics Industry (NPI), the Ministry of Municipalities and Public
Works (MMPW), the Baghdad Water Authority (BWA) - a division of the
Amanat, the Ministry of Electricity (MoE) and US Embassy staff,
including ITAO Water. Those present concluded that delivering water
by tanker truck throughout the summer to neighborhoods suffering
from water scarcity was the best short-term solution. No medium or
long term solutions were discussed. There was, however, a general
consensus that as long as there is as much electricity for the
summer as predicted, most of Baghdad will receive adequate water.
The concern was for specific neighborhoods.

2. Following the water session, the Provision of Services Committee
met. The committee discussed transportation needs in Baghdad which
includes planners, land for depots, buses and fuel for buses. The
Deputy Minister for Transportation also urged that a transportation
pricing review board be developed. The committee then reviewed
Baghdad Clean-up Days, an ongoing initiative suggested by the Amanat
to clean the streets of Baghdad. Concluding the meeting, the Deputy
Minister of Health provided a brief report on health conditions in
Sabi' al Bor. END SUMMARY.

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Special Session: Water Shortages in Bagdhad
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3. Appearing to stem from a tasking from the February 29 I-ESC
meeting, Dr. Chalabi convened a special working group to address
water shortages in Baghdad. (Note: We believe that Dr. Chalabi's
meeting was in response to the Deputy Prime Minister's request to
convene a special committee to discuss the quality of water in
Bagdhad. However, when we probed Dr. Chalabi about why that issue
was not on the agenda, he said that water quality discussions masked
the real, larger issue - availability: "People talk about water
quality who don't want to answer questions about availability." End

4. The committee heard first from the National Plastics Industry.
Company representatives described their limited ability to provide
potable water, which is a by-product of their manufacturing
processes. NPI is currently able to produce 6,000 cubic meters of
potable water per day. Dr. Chalabi grilled NPI on their business
plan, including their current debt levels and their plan to create
revenue and profit, but the representatives struggled to provide
specific answers. They maintained that capacity was limited.Dr.
Chalabi said he would assist in "finding" a loan to replace obsolete
pumps. Later in the discussion, Dr. Chalabi suggested that NPI water
be sent to Nahrawan, an eastern qada of Baghdad. The MMPW said they
were only capable of tanking 30 trucks per day to Nahrawan, so
Chalabi suggested contractors. MMPW still seemed reluctant due to
quality concerns.

5. Dr. Chalabi pressed for specific details on the average potable
water production and what people were actually getting, but the BWA
was unable to provide that information. The General Director (GD) of
BWA discussed at length seven ongoing projects which will produce an
additional 2.8 million cubic meters once completed. The GD
maintained that projects are hindered due to unreliable electricity,
despite having their own power lines paid for by the Amanat
supplemented by back-up generators. Back-up generators when used
only provide 50% of capacity because they were designed for
emergency purposes only. Also regarding the generators, fuel
shortages limit their regular use according to the GD. Dr. Chalabi
reminded the BWA of their authority to import their own fuel as
granted by the Prime Minister. The GD estimated that more than 150mw
were needed. (Note: It was not clear if he meant per project. A time
frame i.e. 150 mw per day, per hour, was not offered. End Note) The
GD did; however, note that power failures vary from project to
project, but he did not offer specifics.

6. The MoE retorted that power outages are less frequent than
claimed. As a result, Dr. Chalabi asked for a report on the power

7. Approximately 260,000 cubic meters of water are lost per day to
illegal tapping of the lines. Chalabi estimated that 500,000
families are deprived as a result. The BWA GD complemented the
efforts of the FPS (Facility Protection Service, a police force),
but he said more was needed to reduce this problem. Dr. Chalabi
requested a memo, detailing the situation, including the specific
locations where trespassing is a problem. The memo will be sent to
the BOC for further action. Committee members agreed that illegal
tapping that provides drinking water to people who need it is a
lower policing priority than against farmers who are stealing
drinking water from the system to irrigate crops. Part of the
solution to that problem is to restore the pumping system that
irrigates fields with river water.

8. Dr. Chalabi asserted that there would be an immediate need for
potable water as the summer approaches. He suggested that tankers be
used to truck water into severely deprived muhallas or

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neighborhoods. Based upon some quick math, Dr. Chalabi noted that
500 tankers could provide only 10,000 cubic meters of water -
meeting only 10% of need. Nonetheless, meeting attendees noted that
it would be logistically challenging to tank more water because of
the probable shortage of trucks and fuel. UNICEF successfully tanked
1,000 trucks per day in the past, but they are no longer providing
this service according to the GD. The BWA volunteered to do a quick
study conducted by each municipal office on their local water needs.
The study is to be presented next week. (Note: It was not clear who
will be briefing the study or when and where the briefing will
occur. Embassy staff is working to answer these questions. End Note)
Funding to tank water was briefly mentioned, but no source was

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The Provision of Services Committee Follows
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9. Chalabi commenced the meeting by sharing the outcome of the
previous water session with attendees which included the Ministries
of Trade, Health, Transportation, Defense and Oil. The Iraqi Red
Crescent (IRC) was also present. While not in attendance at the
special water meeting, the IRC added that they are installing 50
purifying units, or compact units, in various locations across Iraq.
When questioned by Chalabi, the IRC maintains that the units will be
powered by already purchased generators and the IRC has the fuel to
operate the generators. The IRC representative, Dr. Saaid Hakkiasked
for money from the committee to support its project, but Dr. Chalabi
did not respond to that request.

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Transportation Drives Topic of Conversation
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10. The Ministry of Transportation (MoTrans) discussed their need
for additional bus depots, at least one in each province. To date,
Najaf has given 10 acres of land for a depot and reportedly the
Prime Minister has allocated emergency, contingency funding for a
depot in Karbala. The Ministry requests other provinces cooperation,
particularly Baghdad. Chalabi suggested that the MoTrans draft a
memo to the Amanat requesting specific pieces of land. Chalabi's
staff went one step further and suggested a subcommittee to work
with the Amanat and the MoTrans. (Note: According to the MoTrans
representative, under the former regime, the MoTrans reined a
significant amount of authority to claim property as needed. This
concept sounded like eminent domain, but in terms of seizing
government property, not private property. End Note)

11. The MoTrans also discussed the need to review transportation
costs, i.e. bus ticket prices, airfare, etc. He noted that Iraqi
Airways is facing significant difficulties due to jet fuel shortage.
The MoTrans sought the authority from Dr. Chalabi to confiscate
vehicles from drivers who were charging illegal fares. Chalabi said
he could not help with this issue and suggested that the MoTrans
approach parliament about it. However, he was pessimistic about its
passage, noting that government confiscation of private property was
reminiscent of the Saddam era. The MoTrans then suggested that the
Government of Iraq import cars and provide loans because the
existing banking system in Iraq is not car loan friendly. There are
few loans to be had and the ones that do exist charge exorbitant
interest rates, somewhere between 17-20 percent. Dr. Chalabi acted
as though he was appalled by the rates (Note: He knows very well
what they are. End note.) and offered to send a memo to the Prime
Minister informing him that the current banking system in Iraq does
not facilitate reconstruction and development due to high interest
rates and bureaucracy. He said that he is seeking a study of the
current banking system.

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Baghdad Clean-Up Days: A Bigger Mess for the Amanat?
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12. An idea proposed by the Amanat, "Baghdad Clean-Up Days," is
reportedly lacking assistance from the Amanat's own staff. The
MoTrans, Ministry of Trade (MoT) and the Ministry of Construction
and Housing (MoCH) all complained that the Amanat was absent during
these monthly neighborhood cleanings. The committee will send a
letter to the Prime Minister asking him and/or the respective
ministries and the Amanat to appoint General Directors to serve on
an executive planning board to ensure equitable participation.

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Health Check Up
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13. The remaining time of the meeting were devoted to a quick update
from the Deputy Minister of Health. Because of claims that the
Mahmoudiya public health clinic (PHC) is sub-par, the committee will
visit to survey the situation. A report is expected for next week's
meeting. The Deputy Minister said that an internal committee has
been created to specifically address the health needs in Sabi' al
Bor. The ministry also intends to meet with the Karkh Director to
discuss Sabi' al Bor's health care needs.

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