Bush Officials Draft Broad Plan For Free-Market Economy in Iraq
WASHINGTON -- The Bush administration has drafted sweeping plans to remake Iraq's economy in the U.S. image.</br></br>Hoping to establish a free-market economy in Iraq following the fall of Saddam Hussein, the U.S. is calling for the privatization of state-owned industries such as parts of the oil sector, forming a stock market complete with electronic trading and fundamental tax reform.</br></br>Execution of the plan -- which is expected to be complicated and possibly contentious -- will fall largely to private American contractors working alongside a smaller team of U.S. officials. The initial plans are laid out in a confidential 100-page U.S. contracting document titled "Moving The Iraqi Economy From Recovery to Sustainable Growth." The consulting work could be valued at as much as $70 million for the first year.</br></br>The U.S. Agency for International Development plans to award part of the work to BearingPoint Inc., a Virginia-based consulting firm known previously as KPMG Consulting, an AID official said. BearingPoint, which received a similar $40 million job to do economic work in Afghanistan, was approached as a sole-source bidder. AID plans to open the larger share of the work, including privatization and small-enterprise development, to a limited pool of competitors likely to include Booz Allen Hamilton Inc., Deloitte Touche Tohmatsu and International Business Machines Corp.'s recently acquired PricewaterhouseCoopers' consulting unit. Unlike some of the construction companies that have won contracts, BearingPoint has made few political contributions to either party in the past two years.</br></br>AID has been criticized by some in Congress for the secretive way it has awarded other Iraq reconstruction contracts over the past two months. But AID officials said these contracts will be awarded under the same expedited rules to launch work as quickly as possible.