Risk-Tolerant China Investing Heavily in Iraq as U.S. Companies Hold Back

The Washington Post reports on Chinese investment in Iraq:

China didn’t take part in the U.S.-led invasion of Iraq or the bloody military battles that followed. It hasn’t invested in reconstruction projects or efforts by the West to fortify the struggling democracy in the heart of the Middle East.

But as the U.S. military draws down and Iraq opens up to foreign investment, China and a handful of other countries that weren’t part of the “coalition of the willing” are poised to cash in. These countries are expanding their foothold beyond Iraq’s oil reserves — the world’s third largest — to areas such as construction, government services and even tourism, while American companies show little interest in investing here.

“The U.S. really doesn’t know what to do in Iraq,” said Fawzi Hariri, Iraq’s industry minister. “I have been personally, as the minister of industry, trying to woo U.S. companies into Iraq. There is nothing yet. Nothing tangible.”

In the past two years, Chinese companies have walked away with stakes in three of the 11 contracts the Iraqi Oil Ministry has signed in its bid to increase crude output by about 450 percent over the next seven years. They also renegotiated a $3 billion deal that dates to when Saddam Hussein was in power.


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