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Last Updated: Monday, 9 June, 2003, 11:58 GMT 12:58 UK
Iraq's companies head for sell-off
An Iraqi man walks past two US soldiers
Dozens of Iraq's state-owned companies could be earmarked for privatisation within a year, it has been reported.

Tim Carney, the senior coalition adviser to the Iraqi ministry of industry and minerals, told the Financial Times newspaper that the need for foreign investment was too great for sell-offs to be delayed.

Previously the US-led coalition had said it would wait until an elected Iraqi government was in place before starting privatisation.

The prospective sell-off of Iraqi state assets is a sensitive issue - critics of the US-led war have questioned the authority of the US administration in Iraq to initiate it and said Western corporations are more likely to benefit than the Iraqi people.

The counter-argument is that Iraq's run-down and cash-starved infrastructure is in desperate need of rehabilitation and that private sector and foreign investment will be the quickest and most efficient way of achieving it.

Not oil

The FT said Mr Carney had met officials from the industry ministry for a first "brainstorming session" on how to begin the privatisation.

The ministry controls 48 state companies employing 96,000 people.

The Iraq National Oil Company, which has run the country's oil industry, is not among them. It is overseen by the oil ministry.

Mr Carney told the newspaper that the ministry was beginning to divide its enterprises into those that could be privatised early, those that should be held back, and those that should be dissolved, or merged before they were sold.

For the early privatisations he said "no one is talking about a time frame of longer than one year" to begin the process.

A senior official involved in the talks told the FT that foreign participation would almost certainly be allowed but that the details, such as the percentages available to foreigners, were still being worked out.

Mr Carney said officials wanted a formula that would give priority in the privatisation process to Iraqis.

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