by Laith al-Hamdany
This is the translation of an Arabic article of which a longer version was published in Al-Hewar Al-Mutamadin [Modern Discussion] - Issue: 2268 - 2008 / 5 / 1 . The Arabic version was edited by Wefa M. S. and accessed here: http://iraqshistory.blogspot.com/2010/09/blog-post.html
Translated from Arabic for the Iraq History Group by
Misbah Kamal
Edited by Wefa M. S.
The 1970s and ‘80s witnessed an industrial growth that deserves to be studied and documented.
I will try here to recount, quickly, what has stuck in my memory on the achievements of the industrial sector.
Act No. 90 of 1970 was issued to restructure the industrial sector. The act abolished the State Organization for Industry, which operated a range of companies that were nationalized in 1964 and formed the state’s production sector, plus some enterprises that covered under the Iraqi-Soviet Agreement signed in 1959.
Based on this act, the following specialist organizations were formed:
1 State Organization for Textiles.
2 State Organization for Chemical & Food Industries.
3 State Organization for Construction Industries.
4 State Organization for Engineering Industries.
5 State Organization for Manufacturing Clothing, Leather and Cigarettes.
A few years later, these organizations were restructured to enhance their specialization and turn the Organization for Manufacturing Clothing, Leather and Cigarettes into an organization for chemical industries. In addition, the first enterprise specializing in industrial studies and implementation was set up: the Organization for Industrial Design and Construction.
Also, the Electricity Board was linked to the industrial sector, and subsequently re-branded as a state organization and became known as Public Electricity Corporation. The metal industry, part of the Oil Ministry, was attached to the industrial sector, reconstituted as the General Organization for Metal, and subjected to the same regulations by the Ministry of Industry.
I want to point out that Taha Yassin Ramadan led the industrial sector administratively and politically at that stage, and that the late Najm Qoja Qassab, one of the most efficient engineering cadres in Iraq, was deputy minister for state organizations. The man was not a Baathist but had a leftist background.
The State organizations were as follows:
- Organization for Textile Industries, led by Hassan al-Amiri, who was originally an administrative officer in the sector, and relied in management of the institution on qualified engineers and technicians from within the sector.
- Organization for Construction Industries, led by Qasim Al-Oraibi, who was a talent known within the industry. He progressed in his career over the years starting as an engineer in cement manufacture, and then serving as general manager before becoming president of the Organization.
- Organization for Manufacturing Clothing, Leather and Cigarettes, led at the time of its incorporation by Kathem Al-Sheikh, an administrator of recognized competence and experience.
- Organization for Chemical and Food Industries, chaired by Subhi Yas Al-Samarrai, a chemist who moved upwards in his career working in the industrial sector.
- Organization for Engineering Industries, led for a short time by Hussam Al-Najm before leaving Iraq. Management was then taken over by Ali Hussein Al-Hamdani, an engineer working for the sector.
When I write that a person was working for “the sector,” I mean that he was working in the industrial sector before the advent of the Baath Party to power.
Adnan Al-Kindi, chemical engineer and technical expert who moved upwards in his career in the oil sector, led the State Organization for Industrial Design and Construction. The organization carried out dozens of studies and technical surveys; it was home to several qualified engineering, chemical and economic experts. Ahmed Basheer al-Naib, with a university background led the Electricity Board.
These brains were relied on in industrial construction and management. These people proposed and submitted studies to the government and were either accepted or rejected by the Planning Board. In my work as a journalist specializing in this sector for over two decades, I do not remember cases of setting up a particular enterprise by a political decision except one: the decision to construct cement plants in Al-Kaiem and Sinjar. That decision was taken hastily during the Iraq-Syria unity talks of 1978, which were discontinued.
ACT NUMBER 90 OF 1970 AND THE BEGINNING OF INDUSTRIAL PROGRESS
THE DEVELOPMENT OF IMPLEMENTATION
Immediately after the founding of the state organizations, special studies were commissioned for the development of each sub-sector, based on actual requirements.
Construction Industries
This sector included;
Iraqi Cement Company. Its plants, nationalized in the mid-1960s, included:
* Baghdad Cement Plant (Saida District) in Al-Rasheed Camp.
* Saddat Al-Hindiyah Cement Plant (Saddat Al-Hindiyah District).
* Samawah Cement Plant in the southern Iraqi town of Samawah.
Mosul Cement Company included:
* Hammam Al-Aleel Cement Plant.
* Badoush Cement Plant.
Serchinar Cement Company had one plant in Serchinar, Sulaymaniyah.
Also at that time, there were projects under implementation such as the Kufa Cement Plant and Fallujah Cement Plant.
The construction industry sector also included brick and concrete block factories that were called the Real Estate Industries. There was also the Asbestos Manufacturing Company that included a plant for manufacturing pipe and asbestos panels. The company was formed as part of the mid-1960’s nationalizations.
During the period 1970-1990, the following plants were constructed:
* The new Kufa Cement Plant No. 2 at the Kufa site.
* The new Samawah Cement Plant at the Samawah site.
* Karbala Cement Plant in Karbala Governorate.
* Taslujah Cement Plant, Sulaymaniyah Governorate.
* White Cement Plant in Fallujah.
* Kubaisa Cement Plant in Anbar Governorate.
* Al-Kaiem Cement Plant in Anbar Governorate.
* Sinjar Cement Plant in Mosul Governorate.
* The new Badoush Cement Plant at the Badoush site.
* The new Hammam Al-Aleel Cement Plant. (1)
The latest technologies used in the industry globally at that time were incorporated in the new plants and environmental concerns were taken into account.
In the brick making area, there was Al-Wassi Brick Plant, one of the nationalized factories, and another plant under construction. The majority of building works in Iraq use bricks made in the factories of the private sector, which were simple factories (2). Among the most pre-industrial of which were called the “alkour”, spread around Baghdad and in the southern provinces, where the soil was suitable [provided the raw material] for this type of manufacturing. These projects were executed in the construction industry, and new technologies were introduced in the areas of kneading, cutting and handling. The most notable of these projects were:
* The new Baghdad Brick Plant.
* Essowayerah Brick Plant.
* Kut Brick Plant.
* Missan Brick Plant.
* Tikrit Brick Plant.
* Karbala Brick Plant.
* Diyala Brick Plant.
Also introduced, for the first time in Iraq, were alternatives to bricks in order to reduce the destruction of agricultural land by scrapping the soil in manufacturing bricks. Accordingly, the following were erected:
* Thermal Block Plant in Baghdad (located at the old Baquba road) (Thermal block is a lightweight concrete block).
* Thermal Block Plant in Hammam Al-Aleel in Mosul.
* Thermal Block Plant in Basrah.
In addition to the limestone brick plants in some parts of Iraq, a plastic pipes factory was built in Baghdad at the site of the Asbestos Company as a prelude to stopping the use of asbestos pipes because of the damage to health and the environment caused by asbestos. And another factory for plastic pipes was erected in Al-Amarah in Missan Governorate. A number of modern factories for high quality plaster (3) used in coating interior walls of houses were built. The Glass and Ceramic Plant was re-studied and developed accordingly. These plants were established under the Iraqi-Soviet Agreement.
Textile Industries
In the textile industry, the following projects were implemented:
* Project for the development and modernization of the textile plants of the Iraqi Textile Company in Kadhimiya, Baghdad.
* Project for the development and modernization of the Fattah Pasha plants.
* Completion and operation of the Fine Textile Plant in Hilla.
* Development and modernization of the textile factory in Mosul.
* Development of the synthetic silk factory in Saddat Al-Hindiyah.
* The establishment of the Cotton Textile Factory in Diwaniya.
* Development and expansion of the textile plants in Kut.
* Development and modernization of the bags making plant (jute) in Baghdad.
* Building of a modern carpet factory in Baghdad.
* Construction of a Kurdish fabrics factory in Dahuk.
* Development of the old tailoring factories in Waziriya, Baghdad.
* Construction of three new factories with large production capacity for ready-to-wear clothing. The first for men's clothing in Najaf, the second for babies clothing in Mosul and the third for women’s clothing in Sulaymaniyah.
* Construction of a plastic bags plant in Tikrit, to cater for the needs of the agricultural sector.
Overall, the textile sector witnessed significant developments in the quality of production, methods of quality control and the establishment of modern laboratories for the first time.
Food Industries
Prior to 1968, the food industry included:
* Vegetable Oil Company.
* Cottonseed [Oil] Company.
* Dairy Company in Abu Ghraib
* Canning Factory in Karbala.
* Mosul Sugar Factory to which a yeast production line was added.
* Sugar factory in Al-Amarah (Al-Mejjer)
* Plants for the production of soft drinks. These were old enterprises distributed in Baghdad, Basra, Kirkuk and Hilla.
The food sector was re-organized under Law No. (90) of 1970 whereby the Vegetable Oil Co and the Cottonseed Oil Co were merged to create a single giant facility that has seen expansion of production in most of its facilities and meeting a significant part of local demand for vegetable oils and soaps.
The dairy industry has witnessed significant developments with the addition of new production lines and cold storage facilities in Abu Ghraib. Later the following were achieved:
* Construction of a vegetable oil factory in Baiji.
* Construction of a number of dairy factories in Muqdadiyah, Tikrit, Diwaniya, Mosul and Nasiriyah.
* Liquid sugar factory in Hindiyah. Because of delays and rising production costs, the project was modified for the production of molasses from date.
* Development of Mosul Sugar Factory.
* Development of Missan Sugar Factory.
* Construction of an alcohol factory in Khalis.
* Expansion and development of the canning factory in Karbala.
* Construction of a canning factory in Baquba.
* Construction of canning factories in Balad.
* Construction of two beer breweries in Mosul and Al-Amarah.
* Rehabilitation of sugar cane plantations in Missan and treatment of agricultural problems, especially the smut disease, which afflicted cane.
* Construction of a large-capacity factory for soft drinks in Baghdad.
* Construction of a factory for soft drinks and bottling plant for mineral water in Bani Khaylan, Sulaymaniyah.
Clothing, Leather and Cigarette
At its inception, this state organisation included the following establishments:
* The old private sector tobacco factories, using rudimentary semi-manual methods.
* Tailoring Factory in Waziriya, Baghdad.
* Tanning Factory in Saida, Baghdad.
* Footwear factories in Baghdad and Kufa.
* Sulaymaniyah Tobacco Factory.
* Synthetic Silk Plant.
After its formation, this organisation witnessed a comprehensive development. The old cigarette factories in Baghdad were dismantled; these were establishments that lacked the minimum safety and health conditions. Trade union workers struggled for decades for the provision of the appropriate conditions to avoid tuberculosis caused by dust in the tobacco production halls. Instead of these plants, the following were built:
* A cigarette factory in the Nathimiyah District, Baghdad incorporating modern technologies for ventilation.
* A cigarette factory in Irbil.
* Modernisation and development of the cigarette factory in Sulaymaniyah.
In the 1980s, the most up-to-date cigarette factory was built in the Habibiyah District, in Baghdad.
The tanning industry was drastically improved, new modern equipment were installed to reduce the burden of unhealthy conditions borne by the workers in this industry. In the footwear companies, new production lines were introduced increasing the capacity on the one hand and upgrading the quality of production on the other.
Years later this sector was re-organized whereby the cigarette, silk and tailoring factories were allocated to other specific establishments because of the expansion witnessed by the chemical industry. The following were implemented:
* Expansion and development of the drugs plant in Samarra after linking it to the industrial sector.
* Establishment of two large capacity fertilizer plants in Basra.
* Construction of a paper mill in Basra and later its expansion.
* Construction of a paper mill in Missan
* Introduction of new lines for the production of eggs trays.
* Construction of a factory for plastic pipes and tiles in Al-Amarah.
Then began the implementation of a petrochemical project Number 1, which lagged behind because of the outbreak of the Iraq-Iran war [1980] and its bombing more than once.
This period also saw the construction of a factory for manufacturing tyres for vehicles in Diwaniya and was expanded later.
Engineering Industries
In 1970, when the new law was applied, the engineering industries sector comprised:
* Dry Battery Plant, an old plant belonging to the army.
* Liquid Battery Plant, affiliated to the Ministry of Municipalities, with a small production capacity designed to meet the needs of the Passenger Transport Board.
* The Agricultural Equipment Plant in Alexandria, installation of machinery was delayed due to political circumstances in the aftermath of February 8th 1963 [coup d'état] as it was part of the Iraqi-Soviet Agreement. In fact, this project, despite its aging equipment, has become a training center for engineering experts, who led dozens of civilian and military industrial projects.
* Electrical Equipment Factory, part of the Iraqi-Soviet Agreement.
Also in this sector, the following projects were executed:
* The expansion of the Dry Battery Plant, and the addition of new production lines and additional production halls.
* Expansion of the Liquid Battery Plant and review of quality control methods.
* The development and expansion of the electrical industries plants in Waziriya, Baghdad.
* Expansion of the Alexandria plants and utilisation of their vocational training centers.
* Construction of the light industries complex in Diyala.
* Construction of Al-Nasr Establishment for Heavy Industries. This was a basic foundation for heavy engineering industry.
* Construction of the Aluminium Foil Plant in Nasiriyah.
* Construction of the Cables and Wires Plant in Nasiriyah.
* The Construction of the Iron and Steel Plant in Khor al-Zubair, Basrah.
During this phase, the technical and economic cadres (all were Iraqis) of State Organization for Industrial Design and Construction were engaged in the preparation of studies for new and expansion projects.
Overall, the textile sector witnessed significant developments in the quality of production, methods of quality control and the establishment of modern laboratories for the first time.
Food Industries
Prior to 1968, the food industry included:
* Vegetable Oil Company.
* Cottonseed [Oil] Company.
* Dairy Company in Abu Ghraib
* Canning Factory in Karbala.
* Mosul Sugar Factory to which a yeast production line was added.
* Sugar factory in Al-Amarah (Al-Mejjer)
* Plants for the production of soft drinks. These were old enterprises distributed in Baghdad, Basra, Kirkuk and Hilla.
The food sector was re-organized under Law No. (90) of 1970 whereby the Vegetable Oil Co and the Cottonseed Oil Co were merged to create a single giant facility that has seen expansion of production in most of its facilities and meeting a significant part of local demand for vegetable oils and soaps.
The dairy industry has witnessed significant developments with the addition of new production lines and cold storage facilities in Abu Ghraib. Later the following were achieved:
* Construction of a vegetable oil factory in Baiji.
* Construction of a number of dairy factories in Muqdadiyah, Tikrit, Diwaniya, Mosul and Nasiriyah.
* Liquid sugar factory in Hindiyah. Because of delays and rising production costs, the project was modified for the production of molasses from date.
* Development of Mosul Sugar Factory.
* Development of Missan Sugar Factory.
* Construction of an alcohol factory in Khalis.
* Expansion and development of the canning factory in Karbala.
* Construction of a canning factory in Baquba.
* Construction of canning factories in Balad.
* Construction of two beer breweries in Mosul and Al-Amarah.
* Rehabilitation of sugar cane plantations in Missan and treatment of agricultural problems, especially the smut disease, which afflicted cane.
* Construction of a large-capacity factory for soft drinks in Baghdad.
* Construction of a factory for soft drinks and bottling plant for mineral water in Bani Khaylan, Sulaymaniyah.
Clothing, Leather and Cigarette
At its inception, this state organisation included the following establishments:
* The old private sector tobacco factories, using rudimentary semi-manual methods.
* Tailoring Factory in Waziriya, Baghdad.
* Tanning Factory in Saida, Baghdad.
* Footwear factories in Baghdad and Kufa.
* Sulaymaniyah Tobacco Factory.
* Synthetic Silk Plant.
After its formation, this organisation witnessed a comprehensive development. The old cigarette factories in Baghdad were dismantled; these were establishments that lacked the minimum safety and health conditions. Trade union workers struggled for decades for the provision of the appropriate conditions to avoid tuberculosis caused by dust in the tobacco production halls. Instead of these plants, the following were built:
* A cigarette factory in the Nathimiyah District, Baghdad incorporating modern technologies for ventilation.
* A cigarette factory in Irbil.
* Modernisation and development of the cigarette factory in Sulaymaniyah.
In the 1980s, the most up-to-date cigarette factory was built in the Habibiyah District, in Baghdad.
The tanning industry was drastically improved, new modern equipment were installed to reduce the burden of unhealthy conditions borne by the workers in this industry. In the footwear companies, new production lines were introduced increasing the capacity on the one hand and upgrading the quality of production on the other.
Years later this sector was re-organized whereby the cigarette, silk and tailoring factories were allocated to other specific establishments because of the expansion witnessed by the chemical industry. The following were implemented:
* Expansion and development of the drugs plant in Samarra after linking it to the industrial sector.
* Establishment of two large capacity fertilizer plants in Basra.
* Construction of a paper mill in Basra and later its expansion.
* Construction of a paper mill in Missan
* Introduction of new lines for the production of eggs trays.
* Construction of a factory for plastic pipes and tiles in Al-Amarah.
Then began the implementation of a petrochemical project Number 1, which lagged behind because of the outbreak of the Iraq-Iran war [1980] and its bombing more than once.
This period also saw the construction of a factory for manufacturing tyres for vehicles in Diwaniya and was expanded later.
Engineering Industries
In 1970, when the new law was applied, the engineering industries sector comprised:
* Dry Battery Plant, an old plant belonging to the army.
* Liquid Battery Plant, affiliated to the Ministry of Municipalities, with a small production capacity designed to meet the needs of the Passenger Transport Board.
* The Agricultural Equipment Plant in Alexandria, installation of machinery was delayed due to political circumstances in the aftermath of February 8th 1963 [coup d'état] as it was part of the Iraqi-Soviet Agreement. In fact, this project, despite its aging equipment, has become a training center for engineering experts, who led dozens of civilian and military industrial projects.
* Electrical Equipment Factory, part of the Iraqi-Soviet Agreement.
Also in this sector, the following projects were executed:
* The expansion of the Dry Battery Plant, and the addition of new production lines and additional production halls.
* Expansion of the Liquid Battery Plant and review of quality control methods.
* The development and expansion of the electrical industries plants in Waziriya, Baghdad.
* Expansion of the Alexandria plants and utilisation of their vocational training centers.
* Construction of the light industries complex in Diyala.
* Construction of Al-Nasr Establishment for Heavy Industries. This was a basic foundation for heavy engineering industry.
* Construction of the Aluminium Foil Plant in Nasiriyah.
* Construction of the Cables and Wires Plant in Nasiriyah.
* The Construction of the Iron and Steel Plant in Khor al-Zubair, Basrah.
During this phase, the technical and economic cadres (all were Iraqis) of State Organization for Industrial Design and Construction were engaged in the preparation of studies for new and expansion projects.
The Mixed Sector
This sector was indirectly linked in 1970 to the Industrial Bank and included:
* The Light Industries Company, co-founded by a group of investors, notably Ismail al-Rubaie. The bank owned more than 50 percent of its shares.
* The Electronic Industries Company.
* The Bicycle Company in Mahmudiyah.
* Al-Hilal Industrial Company.
* Karbala Food Products Company (it produced molasses from dates). The company was liquidated later.
This sector was restructured later and included:
The Chemical and Plastic Industries Companies, formed by merging three companies operating in the same branch of industry. New production lines were added to it and become a giant company in this sector.
* Modern Clothing Company.
* Paints Company.
* Carton Company.
* Food Industries Company.
* Electronic Industries Company.
Behind the development of these companies and their expansion were the Industrial Bank and its team of economists, foremost among them Dr. Farhang Jalal, Basima Al-Dhahir, Abdul Salam Allawi and a group of managing directors and technicians. The Light Industries Co saw a qualitative leap in the diversification of its products and their modernisation in line with consumer needs. While the company produced popular cookers (which were small, the kind placed on table) and oil heaters, it moved on to produce gas heaters and cookers (large with oven) and refrigerators with distinctive designs and qualities. This development was accompanied by an increase in the manufacture of components within the company (reducing dependence on kits for assembly). The same was the case with the Electronics Industries Co, considered to be one of the pioneering companies in this sector. Its products have won the confidence of consumers in Iraq and neighbouring countries.
The Bicycle Co has added a line for production of pipes that contributed to economies in production. It also improved the quality of bikes produced making its operations profitable and enabling it to raise its capital and upgrade its facilities.
The Chemical Industries Co went through a wide range of developments including the addition of new production lines, manufacturing of plastic granules, high-pressure sponge, and interlinking of production with the private sector.
The Paints Co specialized in producing various types of paints with international specifications while the Modern Clothing Co specialized in making modern garments, shirts and pyjamas. Its success enabled it to occupy a privileged position in the local market.
As for the Carton Company specialized in producing cartons and packaging materials, while the Food Industries Co specialized in producing concentrated juice and beer. The production of Al-Hilal Co evolved to include air conditions. And the Electronic Industries Co was able, thanks to its staff, to gain the trust of the Iraqi consumer who began to prefer the company’s products to those imported.
Electricity
At the level of electricity generation a number of power stations were built, for example in:
· Nasiriyah Power Station.
· Hartha Power Station in Basra.
· Latifiyah Power Station.
· Mosul Power Station.
· Samarra Hydroelectric Station
Other stations doubled production capacity several times, although the electricity sector continued to suffer from the problem of not being able to fully satisfy the demand for power.
THE INDUSTRIAL SECTOR, WAR & SANCTIONS
The industrial sector encountered many problems during the years of the Iraq-Iran war [1980-1988]. On the one hand, the military effort swallowed Iraq's resources; on the other hand, productivity in the sector was negatively affected by mobilizing people for military service forcing most of the companies to employ non-qualified workers, turning the companies to training centers. The consequence of this condition impaired the efficiency of operating machinery as well as the quality of production.
Then came the years of sanctions [1990-2003] to make matters worse. The sector was denied development, modernization and the machinery and equipment used became obsolete and production lines ceased to operate because industry, as is known, is a complex of techniques that are constantly modernized, and obsolescence of machinery and equipment weakens the economies of production. Obsolescence of machinery and equipment turns them into non-economic units.
During the 1990s the Government has committed a grave mistake when it pursued the so-called privatization. This was applied in line with the political orientations of the regime that caused damage to this sector and resulted in the sale of many of the state companies under the pretext that they were loss-making establishments. Most of them were sold to people linked to the leadership of the regime. In fact, mismanagement and insistence on Baathification in the years that followed the outbreak of the Iraq-Iran war led to losses in most cases. Privatization resulted in the suspension of development and making thousands of workers redundant. Moreover, the state’s attention at that stage was focused on military industrialization and neglecting civilian industries, even though I disagree with those who view military industrialization as if it is an absolute evil (4). Despite these difficulties, the state was working on Petrochemical Project No. 2 and endeavoring to develop existing industries.
The Metal Industries
As for the Metal Industries, they witnessed major development by expanding the Al-Mishraq Sulfur Factory and establishing the Akashat Complex, which enabled this sector to enter in the export markets for Phosphate fertilizers.
The Private Sector
The State did not ignore the private sector, but unfortunately the position on the sector fluctuated up and down. In 1970, a statement by President Ahmad Hassan Al-Bakr announced support to this sector. Accordingly, enterprises were allocated to the sector for investment. The government bolstered the position of the State Industrial Bank by increasing its capital and widening its functions. It has also supported the State Organization for Industrial Development by allocation of annual funds required for imports by the private sector. The state also encouraged the Federation of Iraqi Industries to carry out studies for the development of some industries. Actually one such project undertaken was the automation of brick production. The engineering staff of the Federation included two engineers, Yusuf Hassan Mahdi and Kamal Ahmed Agha, who worked on following-up this project to ensure its success. Brick making was one of the under-developed industries where labor was employed in a manner close to slavery (5), and has contributed to the contamination of the environment around the city of Baghdad and southern cities in general, especially Al-Amarah. Scores of these factories were upgraded and turned into semi-mechanical plants by the introduction of mechanized incinerators and automated cutting machines. These upgrades have contributed to improving the quality of the product used by Iraqi citizens in construction, especially in central and southern Iraq.
The sector suffered damage as a result of the entry into the sector in the 1980s and 1990s of people having no connection with industrial work. This state of affairs was in fact a product of marrying money and power and thus projects were built for making a quick profit, taking advantage of the privileges that were granted by the State Organization for Industrial Development in the areas of import.
AFTER THE OCCUPATION, MASS DESTRUCTION AND RETREADING BACKWARDS
Planned Destruction and Denial of History
Within the first days of occupation, it was clear that the industrial sector, like others, would be visited with destruction. On the one hand, most of the plants of the sector were looted and destroyed in addition to the facilities of the military industry, which cost the state billions of dollars and which had begun the transition to be civil establishments. Witnesses, who knew the reality of these facilities, affirmed that their machinery and equipment were transferred by organized gangs belonging to the participating parties in power, to Iran and sold at the cheapest of prices. Most of this loot was heavy equipment carried on tank transporters, which were also looted from army camps and sent to Iraqi Kurdistan and Iran. A review of the reality of these facilities will clearly show the extent of destruction caused to them.
In the statement issued in 2004 on the liquidation of some manufacturing plants it was stated that more than 50-70 percent have been looted. Friends working in the industrial sector confirmed to me that experts carried out the looting and that the machinery (including computer-controlled precision lathes) was transferred to Iran directly.
After the looting came the sabotage approved by all members of Paul Bremer’s Governing Council, when the borders were wide opened for a long time for import without or purely notional custom duties, which led to the destruction of the national industrial market and dumping the market with products that may be competitive in terms of prices but are not competitive in terms of quality, with the almost total absence of the Central Organization for Standardization and Quality Control, which used to inspect all imports from abroad.
It seems that everything was planned to end those achievements by [the beneficiaries of the new Iraq]. More than 90 percent of the private sector factories were closed, and this favored Iranian production (6) and all protection that was provided by the state to the national industry came to an end under loose slogans revolving around the market economy (7). Under these conditions, it became impossible for Iraqi industries to continue and secure means of updating due to high production costs associated with the already high fuel prices and an almost total absence of electric power and security conditions.
The mixed sector, a leading sector, also declined and some of its production lines stopped and are no longer working not even at half of their available capacity. As an example of the general downturn in the industrial sector it is enough to read the statements of government officials. Thus the Undersecretary of the Iraqi Ministry of Industry for Development and Investment said on 3/21/2008 that there are 14 cement plants offered to private sector companies for rehabilitation and development. He pointed out that the experts at his ministry think that it is likely for the investing companies to recoup the invested funds in a period not exceeding three years. One of the applicants for the rehabilitation of a Al-Kaiem Plant was Al-Hanthal Group in association with the Jawhara Co of the Gulf and Al-Bunyan. The agreement includes, inter alia, provisions for increasing the capacity of the Al-Kaiem Cement Plant to 900,000 tons (the plant’s production capacity, as I remember, was one million tons) (8).
Imagine that a country in which the size of corruption is some (18) billion dollars is incapable of rehabilitating key plants needed for reconstruction, assuming that actually there is a reconstruction. Do any of the investing applicants have the expertise of the Iraqi staff in the industry or that such transactions are but another kind of corruption. Minister of Industry, Fawzi Hariri, had announced before that (9) that the ministry has prepared a comprehensive programme for the rehabilitation and modernization of 12 plants. These plants are Karbala Cement, Muthanna Cement, Kufa Cement, Sinjar Cement, Al-Kaiem Cement, the Iron and Steel Plant, Abu Al-Khaseeb Fertilizer, and Petrochemical companies (10), Missan Paper Mill, Vehicles Manufacturing and the Glass Factory of Rumadi.
Iraq’s real private industrial sector will not have any role in the rehabilitation of these factories because most of its leading figures are out of Iraq to escape kidnapping and murder and paying astronomical ransoms to the gangs sheltered by the parties holding power. And partners of companies applying for rehabilitation of state factories will certainly be supporters of those in power and not men of the traditional industrial private sector. Those who are acquainted with the paper Strategies of Developing the Public Industrial Sector (11) - in which Dr Sami Al-Araji, Undersecretary of the Ministry of Industry, outlined the rehabilitation stages and development of companies and plants of the ministry – realize the generality of the strategies and the absence of any serious plans for the revival of the industrial sector. In paragraph 1 of the paper it is admitted that sabotage has continued until now, and pointed to the market economy as though it is the magic solution to the problems of the sector in a country which is in dire need to provide jobs for millions of unemployed people.
• This article reviewed projects based on memory. I apologize to the reader if there are projects that I have not covered.
END NOTES
1. A former official wrote that industrial development in the Baath era was sectarian because it was focused on Sunni areas. He cited the numerous cement plants in Anbar province. In our review is that the statement of this official is inaccurate. The reason for the presence of the cement plants in Anbar is well-known to those who understand industrial business - namely, that the Anbar region is one of Iraq’s richest areas in limestone, a raw material used in cement manufacturing. Knowing that the construction of projects near raw material sources reduces the costs.
2. Brick making was one of the most backward industries. Owners of these plants resorted to employing a whole family and paid a lump sum. It was natural to see an eight-year boy run in the mud in the process of kneading, or climb up the foretop to pour oil, as well as the elderly and women. The number of modern factories did not exceed the fingers of one hand.
3. Juss [gypsum] is generally used in construction in Iraq to coat the interior walls of houses. It was produced in a primitive way and there were only a few plants that were mechanized, but with small production capacity. The State established a number of modern factories in different parts of Iraq; these were sold in the 1990s.
4. Military industrialization was not a threatening evil, as some try to portray it. It has contributed significantly to establishing technology in Iraq and using reverse engineering on a large scale. It has also contributed to the construction and reconstruction of what was destroyed in the [Iraq-] Kuwait War [1991]. The best example of the construction capability of the military industry was the reconstruction of the bridges that were destroyed in the war and building the double-deck bridge, the last bridge which was built in Baghdad.
5. Brick workers lived near the factories in an atmosphere highly contaminated as a result of the incomplete process of fuel combustion. Working conditions were very harsh and children aged 8 years or even 7 years, worked in inhumane and unhealthy conditions. The people of Baghdad remember these factories and their smoke filling the sky, scattered at the northern entrance to Baghdad (Taji District).
6. A newspaper quoted a statement by Dr. Mohsen Al-Ahmad, Director-General in the Ministry of Industry, saying: “that Iran has been hindering, and since the past two years, the process of rehabilitation of the cement plants, iron and steel, bricks, drugs, health, electrical and plastic industries in order to compel Iraq to continue to import these materials from Iran at high cost and low quality. Al-Ahmed pointed out that senior officials, at the Iraqi Ministry of Finance, members of the government and the Iraqi parliament, were complicit in this scandal.
7. Industrial protection was granted to national industries at different rates commensurate with the quality of national production and available production capacity in the country. Studies on granting protection were considered by committees comprising representatives from the Ministry of Finance, Ministry of Commerce, the Central Organization for Standardization and Quality Control, Ministry of Industry and the Federation of Iraqi Industries. The Ministry of Finance, represented by the General Customs, determines customs duties on imports that had similar local products based on those studies.
8. Mr. Radhi Radhi, head of the Integrity Commission, at a hearing before the U.S. Congress said that the cost of corruption uncovered by the Integrity Commission was about 18 billion dollars. He concluded that major corruption cases involved 35 high officials.
9. The Minister of Industry said to the correspondent of the Lebanese newspaper Al-Akhbar in Baghdad, that the ministry has prepared a program for the rehabilitation and modernization of 12 plants, including cement, fertilizer, glass and others. The fertilizer industry was one of the export-oriented industries, which had a large market for the high quality of its products. Is it really beyond Iraq's ability, whose wealth and funds are looted daily, to allocate funds for the rehabilitation of these industries?
10. This paper was published in Al-Sabah newspaper of Iraq on 2 September 2007. It is full of generalizations and lacks clarity, especially regarding the future (i.e. the reconstruction phase). It relies on what it calls the perspective of a market economy.
11. On 17/11/ 2007 the US Al-Hurra satellite channel, reported that the Ministry of Industry will close the State Company for Petrochemical Industries because of its inefficiency. A cleric, Sheikh Al-Yaqoubi, took the initiative to send a delegation to the Ministry of Industry urging it to retreat from its decision for reasons that he has mentioned in the statement issued on 19/11/2007 and posted to a website named Jund al-Marjieyah. Note that the level of degradation is such that the ministry is considering dismantling one of the major industries of Iraq.
Translator’s Notes:
The original Arabic paper was published by Laith al-Hamdani on Al-Hewar Al-Mutamadin [Modern Discussion] - Issue: 2268 - 2008 / 5 / 1
Here is the link: http://www.ahewar.org/debat/show.art.asp?aid=133109
Laith Al-Hamdani has published other articles on industry in Iraq that deserve to be collected, expanded and edited as he provides a corrective to the unqualified statements that are made by those with an axe to grind about industrial development in Iraq and its political economy.
Arabic readers interested in pursuing Iraq’s modern economic history and attempts at building a modern economy can read Dr Sabri Zire Al-Saadi, "al-tajruba al-iqtisadiya fi al-iraq al-hadeeth: al-naft, wa aldimouqratiya, wa al-mashroea al-iqtisadi al-watani (1950-2006)”, (The Economic Experience of Modern Iraq: Oil, Democracy, and the National Economic Project, 1950-2006, (Baghdad, Beirut & Damascus: Al Mada Publishing Co, 2009).
One of Al-Hamdani’s papers, in Arabic, related to this translated version entitled “The Iraqi Ministry of Industry and Dealing with its Companies between Yesterday and Today: The Story of the Company that Laid the Foundations of Heavy Industry in Iraq.” The article was published on 22 August 2008 by Al-Hewar Al-Mutamadin website and can be accessed at http://www.ahewar.org/debat/show.art.asp?aid=144668
I have added a few sub-headings to the translated paper. I have also added some information in square brackets.
Thanks to Wefa M. S., moderator of the Iraq History Group, for offering Laith Al-Hamdani’s article for translation.
