UK firms 'to win more Iraq deals'

US firms have won the majority of big contracts in post-war Iraq

UK companies will win more reconstruction contracts in Iraq - but they will come in a second wave of smaller deals, say business leaders.

Foreign Office Minister Mike O'Brien is going to Washington to lobby for UK companies to be awarded more contracts.

There have been reports of UK firms' frustration at the big Iraqi contracts being dominated by US companies.

But the chief of the British Consultants and Construction Bureau says UK firms should remain optimistic.

'Tilting at windmills'

Colin Adams, chief executive of the BCCB, said UK companies expecting to win the initial, prime contracts in post-war Iraq were "tilting at windmills".

There is a perception that UK companies are not winning contracts - but that's missing the point that many are deep in dialogue over sub-contracts Colin Adams, BCCB chief executive

Instead, the UK businesses and consultancies were more likely to succeed in the next phase of smaller awards.

"There is a perception that UK companies are not winning contracts - but that's missing the point that many are deep in dialogue over sub-contracts," said Mr Adams.

And he said that businesses were confident of winning such contracts, as part of larger deals - and that the World Bank would be providing a briefing about Iraq to UK businesses next month.

As the Iraqi administration becomes responsible for awarding more contracts later this year, UK companies would also be "playing on more of a level playing field", he argued.

This could include bidding for large-scale projects such as re-building hospitals.

Security fears

But he warned that the security threats represented a serious problem for UK businesses wanting to operate in Iraq. "It's an extremely difficult situation," he said.

Mike O'Brien is taking a lobbying visit to the US on behalf of UK industry

Security and administrative costs could mean that it cost firms £6,000 to move a single member of staff from Kuwait to Basra, said Mr Adams.

The Construction Confederation also pointed to the UK's greater opportunities to win sub-contracts and to operate as "part of the supply chain" alongside other companies.

But a spokesman also emphasised how fears over safety were proving an obstacle to UK companies considering bidding for contracts in Iraq.

The visit by the Foreign Office minister to the United States was welcomed by the Confederation for British Industry, which said it was "pleased that ministers are pushing for the UK to receive its fair share of Iraqi contracts".

"The most recent contracts have unfortunately overlooked British firms and it would be disappointing if this were not corrected when the next major round of contracts are awarded," said Andy Scott, the CBI's head of international competitiveness.

The Guardian newspaper had earlier published a report saying that the ministerial visit to Washington would highlight practical obstacles for UK companies in Iraq.

This included the need for US and UK companies to have a common security agreement over contractors' passes.