US trade envoy: American firms cannot afford to wait on Iraq market, or risk being left behind

By Brian Murphy, AP
Wednesday, October 6, 2010

US trade envoy: American firms cannot wait on Iraq

BAGHDAD — American companies cannot afford to wait to go after business deals in Iraq until there is “nice, neat order,” a senior U.S. trade official said Wednesday, warning they could lose ground to bolder international competitors.

“We believe that American companies can compete with anyone in the world, but we do have to show up,” said Francisco Sanchez, the U.S. undersecretary of commerce for international trade, who is leading a delegation of executives from 14 U.S.-based companies visiting Iraq.

His comments appear to reflect a recognition by Washington that American companies are in danger of being outpaced by hard-charging competitors from nations such as China, Iran and Turkey seeking a cut of Iraq’s vast reconstruction projects and potentially lucrative consumer markets.

He acknowledged that potential U.S. investors face specific hurdles such as the possible need for elevated security — even with major attacks seemingly on the decline — and U.S. anti-corruption regulations that try to fight the system of bribes and payoffs common in Iraq and many other nations.

Sanchez also pointed to Iraq’s political gridlock, which has stalled efforts for more streamlined and transparent regulations on foreign investment.

Still, he said U.S. companies cannot afford to wait.

“The time is now. … If they wait a year and wait until everything is in a nice, neat order they are going to cede opportunities to businesses from other parts of the world,” he told a group of reporters.

Some of the companies in the current trade delegations already have business ties in Iraq, including Boeing Co. and General Electric Co. But others are in Baghdad for a first look.

The trade mission comes as Prime Minister Nouri al-Maliki seeks political pledges to allow him to stay in power.

Al-Maliki appears close to drawing in enough allies to give his Shiite-led coalition a majority in parliament and the chance to begin forming a new government after a seven-month political impasse. The stalemate since March elections has frozen discussions on reforms, including more business-friendly regulations.

Al-Maliki was narrowly defeated in the March 7 elections by a Sunni-backed bloc that has not been able to muster a majority in the 325-seat parliament — opening the door for al-Maliki’s drive to stay in power.

The United States has not publicly backed any candidate to lead Iraq, but has repeatedly stressed that the new government should represent all Iraq’s various groups. A statement on al-Maliki’s official website said he met with Sanchez and the third-ranking U.S. State Department diplomat, William Burns, to discuss Iraq’s political future.

Sanchez gave no details of the meeting, but endorsed Iraq’s efforts to quickly put together a new government. Burns did make any public comments.

“I think it’s in the Iraqi people’s interest to be able to form a government as soon as possible,” Sanchez told reporters.

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