Bloomberg News

Iraq Unity at Risk Because of Maliki Leadership, Allawi Says

September 03, 2012

Iraq’s former Prime Minister Ayad Allawi, a main opposition leader, said the country’s unity is at risk because of Prime Minister Nouri al-Maliki’s “individualistic” leadership.

The self-governing Kurdish region, which is locked in a dispute over oil revenue with the Maliki government, and other provinces are in “an almost dysfunctional state” with high unemployment and inflation, security problems, sectarian policies and “a frightening degree of corruption,” Allawi said in an e-mailed response to questions. “I expect the problems and the crisis will further escalate in the coming weeks.”

Violence and political clashes in Iraq have increased since December when the U.S. pulled out the last of the troops it had deployed since the 2003 invasion that ousted Saddam Hussein. Allawi’s Sunni Muslim-backed al-Iraqiya coalition boycotted parliament and Cabinet sessions for several weeks earlier this year, demanding that the Shiite premier share more powers.

Investors have been discouraged by Iraq’s failure to vote on an energy law, a setback to the government’s efforts to attract money and expertise to develop the world’s fifth-largest crude oil reserves after years of conflict and sanctions. Iraq is one of 12 members of the Organization of Petroleum Exporting Countries.

Allawi, who is also a Shiite, accused the government of blocking legislation that the country needs to regulate the oil and gas industry and determine how revenue should be shared.

No Bids

The Oil Ministry in Baghdad didn’t get any bids for most of the blocks in its latest energy auction, amid criticism of some of the contract terms.

Iraq’s Kurds, who historically have resisted control by Arab-dominated central governments, are charting a course to independently develop and export oil reserves that the Kurdistan Regional Government estimates at 45 billion barrels -- larger than BP’s estimate for the U.S. or Nigeria, Africa’s biggest producer.

Exxon Mobil Corp. (XOM:US), Chevron Corp. (CVX:US) and Total SA (FP) are flouting warnings by the government against seeking separate deals with the Kurds, who have frequently clashed with Maliki’s government over who controls the northern oil and gas reserves.

Iraq ranked among the 10 least attractive out of 147 destinations for oil and gas investment, trailing Cambodia, Chad and Yemen, according to an annual survey by the Vancouver, Canada-based Fraser Institute released in June. The nation’s public sector also ranked among the world’s 10 most corrupt, behind Haiti and Venezuela, a Transparency International survey showed last year.

Maliki, who has been prime minister since 2006, is currently in his second term and has also held the ministries of the interior, defense and national security. The premier denies allegations that he is accumulating powers and says he is acting in line with Iraq’s constitution.

Allawi said the prime minister’s term should be limited to two mandates.

“We did fight dictatorship for 30 years, myself and others, and we are not going to let go of Iraq or allow it to go down the drain and to be dismembered,” Allawi said.

To contact the reporter on this story: Nayla Razzouk in Dubai at nrazzouk2@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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