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171. IRW Briefing: Iraqi Fire Sale

Publication Date:
06-2004
Content Type:
Policy Brief
Institution:
Open Society Foundations
Abstract:
While international attention is focused on the impending June 30 transfer of sovereignty in Iraq, the U.S.-controlled Coalition Provisional Authority (CPA) is committing billions of dollars to ill-conceived projects just before it dissolves, according to this briefing by the Central Eurasia Project’s Iraq Revenue Watch program. The briefing examines and criticizes the CPA’s ongoing rush to commit Iraqi oil funds to projects already funded by the U.S. government, instead of waiting for the interim Iraqi government to make these budgetary decisions when it assumes power.
Topic:
Budget, Accountability, Transparency, Iraq War, and Revenue Management
Political Geography:
Iraq

172. IRW Briefing: Audits Find More Irregularities and Mismanagement of Iraq’s Revenues

Publication Date:
12-2004
Content Type:
Policy Brief
Institution:
Open Society Foundations
Abstract:
This briefing from the Open Society Iraq Revenue Watch reviews the latest audits by the International Advisory and Monitoring Board for Iraq and the Coalition Provisional Authority Inspector General (CPA-IG), both of which reveal hundreds of irregularities in the U.S.-led occupation authority's management of Iraqi revenues, and identify serious weaknesses in Iraq's financial management systems. These audits and others show that the legacy of CPA accounting practices is a poor model for present and future Iraqi governments. It represents a failure to demonstrate by example the importance of transparent and responsible management and expenditure of public revenues.
Topic:
Accountability, Transparency, Iraq War, and Revenue Management
Political Geography:
Iraq

173. Opening the Books: Transparent Budgeting for Iraq

Publication Date:
04-2004
Content Type:
Special Report
Institution:
Open Society Foundations
Abstract:
This report, the fifth in a series by the Open Society Iraq Revenue Watch, evaluates the level of transparency in budget reporting by the Baghdad-based Coalition Provisional Authority (CPA). On the eve of the transition to a new Iraqi government, the report finds that although the CPA’s financial procedures and documents have improved, they still fail to meet internationally recognized standards for fiscal decision-making and reporting. The report calls upon the CPA and the Governing Council to make further improvements in accordance with these standards. Budgetary transparency and accountability can help assure that Iraq does not revert to the tyranny of secrecy practiced under Saddam Hussein.
Topic:
Military Affairs, Transparency, and Revenue Management
Political Geography:
Iraq

174. Disorder, Negligence, and Mismanagement

Publication Date:
10-2004
Content Type:
Special Report
Institution:
Open Society Foundations
Abstract:
Recent audits expose serious failures in American oversight of Iraq’s revenues and U.S. reconstruction funds, according to a report by the Open Society Institute’s Iraq Revenue Watch project. The audits—released in late July by the Coalition Provisional Authority Inspector General (CPA-IG)—paint a picture of disorder and negligence. Contractors made little effort to control costs, while the Coalition Provisional Authority, which was in charge of managing Iraqi reconstruction funds, failed to adhere to federally mandated procedures for awarding and overseeing contracts. “The CPA did not do its job regarding the oversight of reconstruction funds,” said Svetlana Tsalik, director of the Revenue Watch project. “It failed to stop the misuse and waste of money that belonged to the Iraqi people and American taxpayers.” An analysis of the data suggests that of $1.5 billion in contracts, the CPA awarded U.S. firms 74 percent of the value of all contracts paid for with Iraqi funds. Together with its British allies, U.S. and U.K. companies received 85 percent of the value of all such contracts. Iraqi firms, by contrast, received just 2 percent of the value of contracts paid for with Iraqi funds. “Government favorites such as Kellogg, Brown and Root benefited at the expense of Iraqi companies whose workers badly need jobs,” said Tsalik. The report, the sixth in a series by Iraq Revenue Watch, finds that 60 percent of the value of all contracts paid with Iraqi funds went to Halliburton subsidiary Kellogg, Brown & Root (KBR)—the same company that Pentagon auditors in December 2003 found had overcharged the U.S. government for as much as $61 million for fuel imports into Iraq. A criminal investigation of KBR was launched by the Department of Defense in February 2004. The CPA-IG audits confirm the findings of previous ones. A report released in July 2004 by the International Advisory and Monitoring Board, the watchdog body set up by the United Nations, found numerous problems in the CPA’s control and use of Iraqi oil assets during the occupation. These include the absence of oil metering to control theft, poor record-keeping on oil sales, an absence of oversight of spending by the Iraqi ministries, the use of noncompetitive bidding procedures for some contracts, and the CPA’s refusal to transmit crucial information to the UN-mandated body. A recent Pentagon audit of KBR’s billing system, which shows that systematic deficiencies in the company’s accounting and billing procedures incurred significant costs to U.S taxpayers and to Iraqi oil revenues, is further proof of mismanagement. Following the model of its American predecessor, the Iraq interim government to date has provided scant information about how it is managing Iraq’s oil revenues.
Topic:
Oil, United Nations, Military Affairs, Budget, Transparency, and Revenue Management
Political Geography:
Iraq

175. Turkish Debt 1990-2002: How Did We Get Here

Author:
Caroline Van Rijckeghem
Publication Date:
12-2004
Content Type:
Special Report
Institution:
Turkish Economic and Social Studies Foundation (TESEV)
Abstract:
In the first year of Turkey’s currency crisis, Turkish public debt increased from what was then a “reasonable” level, to one that was judged to be unsustainable by a wide array of observers. As we went to print in late 2004, public debt, as a percent of national income, had significantly fallen, thanks to fiscal austerity, strong growth, and appreciation of the lira, but it was still above its pre-currency crisis levels, and the debate on public debt lived on. How did Turkish debt increase in the 1990s, and in the immediate aftermath of the crisis? What were the key drivers of this build-up? What lessons were to be drawn from the experience? These are the questions that were being asked regarding the nature of this dramatic experience when the project first took off in early 2003, and are still a matter of great interest now. In fact, debt dynamics was already worrisome before the currency crisis, and had been on a sharp upward trend since the early 1990s. We attempted to resolve whether debt accumulation was due to fiscal profligacy or rather high real interest rates. Interestingly, primary balances of the public sector, other than in the early 1990s, were not very large. This suggested to us two possible reasons for the increase in debt: concealed deficits and high real interest rates. Each of these explanations too, had it’s own camp of adherents. The paper endeavored to decompose, as precisely as possible given the data limitations, the increase in the stock of debt into its most relevant components, namely primary deficits from each public sector component, concealed deficits, valuation effects, and real interest payments. The project took off in late 2002/early 2003, under the leadership of Şerif Sayin, the Director of TESEV. Murat Űçer of Eurosource Turkey guided the project in its initial stages, suggesting, for instance, the study of both the micro and macro aspects of what we named in the paper “debt-generating processes”, and provided feedback throughout. He also edited parts of the paper and contributed to the executive summary. Izak Atiyas of Sabanci University, one of our peer reviewers, made substantial contributions, in particular in the section on duty losses. He, along with Şerif Sayin, and most notably Ferhat Emil, author of the accompanying paper “Kamu Borcu Nasıl Oluştu ? Bu Noktaya Nasıl Gelindi ?” and TESEV program director, helped to interpret the initial results and to incorporate the relevant Turkish institutional aspects into the paper. Hakan Yilmaz, author of the accompanying paper and SPO expert, and Zafer Yukseler of the Central Bank of Turkey, one of our peer reviewers, also provided comments that helped clarify the nature of the Turkish data. We also received feedback from a number of colleagues, academics as well as market economists in a seminar held on the topic. Information for the project was obtained from published official and IMF sources, as well as in a series of meeting with various departments of the Treasury.
Topic:
Debt, Economy, Accountability, and Transparency
Political Geography:
Turkey and Middle East

176. Open Society Institute Calls for Vigilant Monitoring of Iraq Supplemental Spending

Publication Date:
01-2003
Content Type:
Policy Brief
Institution:
Open Society Foundations
Abstract:
The Iraq Supplemental bill President Bush signed October 17 goes far in addressing key concerns regarding transparency of U.S. governance in Iraq, but close scrutiny is required, says the Open Society Institute. Against a background of criticism over sole source contracts to Halliburton, allegations of price inflation by U.S. contractors, and the obstacles both Congress and outside observers have encountered in obtaining information about contracts for reconstruction, Congress demanded increased reporting on how U.S. funds to Iraq are spent.
Topic:
Governance, Budget, War on Terror, Fiscal Policy, Transparency, and Iraq War
Political Geography:
Iraq

177. OSI Supports the Establishment of New Monitoring Board in Iraq; Calls for Vigilant Oversight

Publication Date:
12-2003
Content Type:
Policy Brief
Institution:
Open Society Foundations
Abstract:
Prospects for the independent oversight of how the Coalition Provisional Authority manages Iraqi oil revenues were improved Friday with the first meeting of the International Advisory and Monitoring Board (IAMB), says Iraq Revenue Watch, a program of the Open Society Institute's Central Eurasia Project. The audit body, created in May under United Nations Security Council Resolution 1483, consists of four members representing the United Nations, the International Monetary Fund, the World Bank, and the Arab Development Fund.
Topic:
Governance, World Bank, Transparency, Iraq War, and IMF
Political Geography:
Iraq

178. Caspian Oil Windfalls: Who Will Benefit?

Author:
Svetlana Tsalik
Publication Date:
05-2003
Content Type:
Special Report
Institution:
Open Society Foundations
Abstract:
Caspian Oil Windfalls: Who Will Benefit?, a publication from the Central Eurasia Project's Caspian Revenue Watch, calls for greater accountability, transparency, and public oversight in the oil and natural gas industries of Azerbaijan and Kazakhstan. It urges foreign oil companies, their home governments, and international financial institutions to promote good governance and democracy in both countries to ensure that petroleum revenues generate social prosperity and stable governments. Written by Svetlana Tsalik, director of the Caspian Revenue Watch, the report also offers recommendations based on in-depth analysis of natural resource funds in other nations as well as models of citizen oversight. The foreword was written by Joseph E. Stiglitz, the former chief economist of the
Topic:
Oil, Natural Resources, Accountability, Public Policy, Transparency, and Fossil Fuels
Political Geography:
Caspian Sea and Central Eurasia

179. Keeping Secrets: America and Iraq’s Public Finances

Publication Date:
10-2003
Content Type:
Special Report
Institution:
Open Society Foundations
Abstract:
Keeping Secrets, a report from the Open Society Iraq Revenue Watch project, concludes that Iraq’s public finances have so far fallen short of international standards of accountability. The report was released on the eve of an international donors’ conference for Iraq in Madrid, scheduled for October 23–24. It calls for greater transparency in the management of the Development Fund for Iraq (DFI), the central repository for U.S. reconstruction assistance as well as Iraqi oil and gas revenues. The Coalition Provisional Authority (CPA)—the U.S.-established governing agency in Iraq—has delayed the establishment of a crucial oversight body and refused to disclose basic information about large purchase contracts and DFI expenditures, the report says. Keeping Secrets calls on the CPA to reverse these trends and offers a set of recommendations, including increased Iraqi involvement in the DFI, more substantial oversight authority for the United Nations’ International Advisory and Monitoring Board, and better public access to information.
Topic:
Finance, Accountability, Public Sector, Fiscal Policy, Transparency, and Public Spending
Political Geography:
United States and Iraq

180. An International Methodology for Evaluation of Combat Capabilities of Military Systems: The Bulgarian Perspective of Greater Transparency and Confidence

Author:
Volodya Kotsev
Publication Date:
10-1996
Content Type:
Special Report
Institution:
Institute for Security and International Studies (ISIS)
Abstract:
The problems of peace and security in Europe occupy an important place in the public conscience. New ways of improvement of the security situation are constantly being examined. The lessons learned from the terrible events in former Yugoslavia show us there is a lot to be done. Europe needs new and better instruments for strengthening of stability and security, applicable to all countries. This Research Report offers some ideas in that direction. The dissolution of the Warsaw Pact increased the number of countries in Europe whose national security interests are being defended mainly by themselves. The usefulness of all the international efforts, like the Helsinki Final Act, the Declaration of Madrid Meeting and the CFE Treaty is indisputable. They treat the problems of the then existing two opposing military alliances. The efforts of the people who gave birth to these processes deserve the highest estimation and respect. Now new steps towards a further development of the confidence and the security of our continent are needed. Our special interest is directed to a higher transparency in the military area.
Topic:
Security, Military Affairs, Weapons, Transparency, and Political System
Political Geography:
Europe and Bulgaria