IRAQ; in war and peace; From an oil-rich boom country to war and financial doldrums
When Iraqi leader Saddam Hussein launched his lightning tank attacks two years ago against Iran, his country was undergoing rapid modernization. Hussein himself was poised to play a larger role as a regional leader. Now the situation is much different. Edward Girardet, special Monitor correspondent in Paris, examines the much different Iraq of today.Skip to next paragraph
Subscribe Today to the Monitor
Hardly two years ago, Iraq was considered the boom country of the Middle East.
Bristling with cranes, Baghdad was one huge construction site. In clouds of dust, crumbling old buildings with carved balconies and hidden courtyards that could only hint at the splendors of their Oriental past vanished before the blades of bulldozers. Western-style hotels, office blocks and urban expressways began to spring up in their place.
Foreign companies flocked in to benefit from an economic explosion estimated at $23 billion and considered even more impressive than any of Iraq's oil-rich neighbors. So did hundreds of thousands of workers, both skilled and unskilled, from Egypt, Pakistan, Yugoslavia and elsewhere.
From the Jordanian and Turkish borders, transcontinental trucks roared along shimmering desert roads transporting seemingly endless supplies of consumer goods to satisfy the nation's newly-acquired taste for modern comfort.
But today, Iraq is in the financial doldrums, and as a result, it is finding itself confronted with a situation that could prove politically detrimental to the present Baathist regime of President Saddam Hussein.
''While the going was good,'' said a French businessman who regularly travels to Iraq, ''he had everything going for him and his country.'' He had the population, the economic resources and the political potential to become the region's most influential leader. But caught between trying to support the war with Iran and a massive development program, Hussein's Iraq not only faces a military stalemate but can no longer pay its bills.
Government salaries have been cut and overseas embassy staffs reduced, while the bazaars, once stocked with Japanese TV sets, French perfumes and English furniture, have been visibly diminished. Imports dropped from $19 billion in 1981 to about $13 billion a year later. Food and even fuel shortages have now become a daily fact of life.
The United States, whose relations with the Baghdad regime are described by diplomats as ''correct'' despite having had no official ties since 1972, provided Iraq with a $460 million loan at modest interest for a grain purchase last December.
Several ministries responsible for most of the country's planned enterprises grossly overstepped their 1982 budgets. Construction projects have either been cancelled or temporarily retarded, inciting a clamor for compensation among many contractors.
With total foreign currency reserves reduced from $30 billion in September 1980 to roughly $6 billion to $8 billion, French, West German, Japanese, and other Western companies have been particularly badly hit.
Several factors have contributed toward Iraq's present plight. The fighting, for one, has had its negative effects both at home and abroad. Apart from the funerals of dead soldiers, military convoys and the government's TV propaganda, there are few indications in the capital that Iraq has a war along its frontier. Only in the early days of the conflict did Iranian Phantom jets shriek over Baghdad.