Israel working behind scenes to get Iraq contracts - Washington sources

Israels efforts are limited to subcontracting work in telephony, infrastructures, and irrigation.

Israel assumed a long time ago, perhaps as a result of hints from the US, that it would not be included in the list of countries eligible to participate in Iraqi reconstruction tenders. Israel is now working behind the scenes with the Bush administration and the US Congress to obtain access to these projects, Washington sources told Globes yesterday.

Israel Ambassador to the US Daniel Ayalon responded, No comment to a Globes question on the subject.

The sources said that Israel and the US had no interest in publicizing their discussions on this very sensitive issue. They explained that the two countries were under an international microscope because of the links between them before and during the war in Iraq, which included the assignment to Israel of a senior US liaison officer. The sources added that the provisional Iraqi administration operating under the auspices of the US occupation authorities would oppose any Israeli presence in reconstruction work in Iraq. The sources noted that Israel was aware of this sensitivity, and was not trying to achieve the status of main contractor for large projects, realizing that that such an aspiration was simply unrealistic.

Israel is demanding, however, that it be given the opportunity to serve as a subcontractor in telephony, infrastructures, irrigation, and other projects, and as a supplier of inputs.

Israel claims that it meets the criteria for participating in the tenders, since it supported the US war in Iraq, although, at the request of the Bush administration, Israel never expressed its official support. Furthermore, according to press reports, the two countries are cooperating militarily with regard to the war in Iraq.

It is believed that Israeli companies will be able to participate indirectly in reconstruction work, through subsidiaries operating outside Israel, or in other indirect ways. In any case, it is clear that no known Israeli company will have an office in Baghdad or Mosul in the near future, one source said.

Support for this assumption was provided by US State Department spokesperson Richard Boucher yesterday, who said that there were restrictions on main contractors, but very few restrictions on subcontractors. He added that the International Monetary Fund and the World Bank might have their own rules for tenders in Iraq.

Published by Globes [online] - - on December 11, 2003

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