BAGHDAD, Iraq—Iraq will get a new national currency, an independent central bank and a budget for the rest of the year that calls for spending oil money on electricity and other basic needs, the U.S.-led administration announced Monday.
Money in most of Iraq still has Saddam Hussein's picture on it and there are only two notes, the 250-dinar and 10,000-dinar. Many businesses no longer accept the 10,000-dinar notes, forcing Iraqis to exchange them for 250s, often at a loss. The Kurdish-controlled part of northern Iraq will use the new national currency, too. It has been using the so-called "Swiss" dinars that existed before 1991, but they're so old that they're falling apart.
The new Iraqi dinars—without Saddam's picture—will be available Oct. 15. They will come in denominations of 50, 250, 1,000, 5,000, 10,000 and 25,000.
L. Paul Bremer, the top U.S. administrator in Iraq, also approved Iraq's national budget for the remainder of 2003. Nearly $3.5 billion, a little more than half the budget, will come from oil revenues. Several billion dollars will come from frozen assets or assets that were found after the war. The biggest line item in the budget is improvements to the electricity system, with other money earmarked for spending on justice and security, public health, water and sewage, and telecommunications.
"The officials who used to steal most of Iraq's resources, and misuse what little was left have gone," Bremer said in a radio and TV broadcast outlining the economic plans. "All of Iraq's resources will now be spent on you, the Iraqi people, and on projects which directly benefit you."
Bremer's team announced that Faleh Salman will be the acting director of Iraq's central bank, and the bank will be independent of other branches of the government.
Andrew Bearpark, a senior member of Bremer's Coalition Provisional Authority said attacks on Iraq's power lines and oil supply system had been rising in the last few weeks, and contended that ordinary Iraqis were beginning to think the strikes were directed against them.
"I do not want to be too optimistic too soon, but I think we may be seeing ordinary Iraqi people assuming that this activity is actually directed at them, not at us, that they are the ones who have been suffering from lack of electricity or lack of water," Bearpark, a British development and humanitarian aid official who is the provisional authority's director of operations, said in a videoconference from Baghdad.
Bearpark said officials hoped Iraqis would help U.S.-led occupation forces by identifying saboteurs and averting attacks.
American and British forces can't watch all of Iraq's extensive power grid or oil supply system, Bearpark said. "We are talking about hundreds and hundreds of miles of power cables, hundreds and hundreds of miles of pipelines and all of the associated facilities," he said. "There just aren't enough tanks in the world to put one tank on every electricity pylon."
During the videoconference, another provisional authority official, Maj. Gen. Carl Strock of the U.S. Army Corps of Engineers, said Iraq's electrical system was so poorly put together and badly maintained that an attack on one part could have a serious impact on the entire network.
Strock and Bearpark said the reconstruction effort was making significant progress in rehabilitating infrastructure that Saddam's government neglected.
Iraq for years lacked the generating capacity to meet the needs of its people. Before the war, Baghdad received a larger share of power than other parts of the country. The U.S.-led administration has tried to make electrical distribution in the country more equitable, and as a result, Strock said, power shortages in Baghdad are somewhat worse than before the war.
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(Hull reported from Baghdad; Landay reported from Washington.)
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(c) 2003, Knight Ridder/Tribune Information Services.
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PHOTO (from KRT Photo Service, 202-383-6099): usiraq+reconstruction
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