Swiss firms gear up for Iraq contracts

Iraq has suffered from massive destruction and Swiss firms would like to help rebuild the country Keystone

Swiss firms are waiting to see what role they will play in the reconstruction of Iraq.

But they are remaining tight-lipped about the contracts they hope to secure while the war is still in progress.

During the years of the United Nations Oil for Food programme, which began in December 1996, Swiss firms won contracts worth some $800 million (SFr1.1 billion).

“It’s far too early,” a spokeswoman for the State Secretariat for Economic Affairs told swissinfo. “The war isn’t even over yet and political stability is the first priority.”

Priority goods

If past form is anything to go by, engineering firm ABB will be looking mainly at supplying products for power transmission and distribution.

In the past ten years, the company has been one of the biggest Swiss suppliers to Iraq, providing the products used for the reconstruction of the electricity grid which was largely destroyed in the first Gulf War.

The company supplied substations, power transformers and cables but is reluctant to reveal details of the sums involved.

“We haven’t disclosed any figures,” spokesman Wolfram Eberhardt told swissinfo. “But it’s not a huge amount if you compare it to the revenues ABB generated in this decade in general.

“At the moment, it is really too early to know what we can provide, but in a matter of weeks we can start our evaluation and come up with proposals.”

Oil for food

Iraq typically pumped 1.7 million official barrels of oil a day for the UN Oil for Food programme, earning more than $10 billion in 2002. Under the programme, Iraq imported goods worth $26.8 billion.

Geneva-based inspections firm Cotecna; vaccine manufacturer Berna Biotech and water pump supplier Biral were among 75 firms which traded with Baghdad.

Under an emergency programme approved by the UN Security Council last month, some $83 million worth of urgently needed goods are already on their way from Switzerland to Iraq.

These include a $75 million gas turbine and $6 million worth of drugs and medicinal products.

The Swiss mission to the UN says more Swiss contracts are likely in the immediate future as more than $1 billion worth of goods are expected to be delivered to Iraq by the middle of May.

Bidding war

The United States has assured foreign companies that they will be allowed to bid for contracts for the reconstruction of Iraq after the war is over.

There had been concern in many countries after only US companies were allowed to bid for the first raft of contracts, worth nearly $1 billion. One possible role for Swiss companies would be as sub-contractors.

Seaports, airports, roads and bridges feature among the Iraqi infrastructure which could need rebuilding.

Estimates about how much damage has been done to Iraq’s basic infrastructure over the past two decades of war and sanctions vary, as do figures for the cost of reconstruction.

swissinfo, Vincent Landon

Key facts

The United Nations Oil for Food programme has been running since 1996.
Iraqi oil production for the programme was 1.7 million barrels per day, earning $2 billion in 2002.
Iraq imported goods worth $26.8 billion under the programme.
Seventy-five Swiss firms have traded with Baghdad since 1996.
Swiss companies should earn Iraqi contracts in the near future, as $1 billion in goods are expected to be delivered to Iraq.

In brief

Swiss firms would like to gain new contracts in Iraq, but remain tight-lipped about plans while war continues.

The State Secretariat for the Economy says it is too early to talk about Iraqi deals and contracts.

Companies such as engineering giant ABB reckon they will be able to start evaluating needs in a few weeks time and come up with proposals.

Some $83 million worth of urgently needed Swiss goods are already on their way to Iraq under an emergency programme approved by the UN Security Council.