VZCZCXRO2559
PP RUEHBC RUEHDA RUEHDE RUEHDH RUEHIHL RUEHKUK
DE RUEHGB #3112/01 3340952
ZNR UUUUU ZZH
P 300952Z NOV 09
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC PRIORITY 5588
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY

UNCLAS SECTION 01 OF 02 BAGHDAD 003112 
 
AIDAC 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EFIN EAID ECON IZ
SUBJECT: ACTION REQUEST: INCREASING WORLD BANK 
EFFECTIVENESS IN IRAQ 
 
REF: A. BAGHDAD 1045 
     ¶B. 08BAGHDAD2768 
 
This cable is sensitive but unclassified; please protect 
accordingly. 
 
This is an Action Request.  Please see para 4. 
 
¶1.  (SBU)  Summary: Overall assistance funding to Iraq is 
decreasing and the GOI is increasingly looking for technical 
assistance and capacity development from all donors, 
including multilateral institutions.  The UN and World Bank 
will both be critical partners for Iraq's future, and while 
UNAMI has made significant progress in expanding its presence 
and effectiveness, the World Bank lags behind.  Post requests 
that an appropriate senior-level USG official meet with 
senior leadership at the World Bank, including World Bank 
Vice President for Middle East and North Africa Shamshad 
Akhtar, to press the Bank to strengthen its presence in Iraq. 
 End Summary. 
 
Background: World Bank in Iraq 
============================== 
 
¶2.  (U) The World Bank has been active in Iraq since 2003 
through participation in the International Reconstruction 
Fund Facility for Iraq (IRFFI), under which the World Bank 
Trust Fund collected $493 million from 17 donors, including 
$5 million from the United States.  The Bank's projects are 
primarily in the areas of health, sanitation and public 
financial management.  On November 24, the Council of 
Ministers approved the World Bank-supported Poverty Reduction 
Strategy (to be reported septel). 
 
¶3.  (SBU) The World Bank office should be a source of neutral 
support and unbiased advice for local authorities on a wide 
range of economic topics.  Current World Bank staffing in 
Iraq is weak, ineffective, and does not have the confidence 
of the GOI and international community.  The World Bank 
Baghdad office is thinly staffed with a Country Manager, one 
Task Team Leader for the Public Finance Management project, 
and one or two additional staff in the pipeline.  Senior 
World Bank management had resisted increasing staff levels, 
but the new Vice President for Middle East and North Africa, 
Shamshad Akhtar, the former Governor of the Pakistan State 
Bank, is more favorably disposed toward Iraq.  Since assuming 
her position in July she has been supportive of a proposed 
Development Policy Loan (DPL) to complement the IMF's 
proposed Stand By Arrangement.  The Bank's increasing 
activities that include private sector development, public 
financial management and state bank restructuring suggest 
that the time is right to send a senior, experienced official 
to lead a solid local staff.  The Bank can then become a 
respected source of information, provide quick responses to 
the many economic policy questions that arise among Iraqi 
authorities, and provide daily support and encouragement for 
effective development reforms.  Other donors share our views 
on the World Bank's presence in Iraq.  Together, we have been 
pressing the case for a strengthened Bank presence here for 
the past two years with little result (reftels). 
 
Action Request: Suggested Talking Points for 
Meetings with World Bank Officials 
============================================ 
 
¶4.  (SBU) Post requests that an appropriate senior-level USG 
official meet with senior leadership at the World Bank, 
including World Bank Vice President for Middle East and North 
Africa Shamshad Akhtar, and deliver the suggested points 
below.  (Note: These points have been discussed here in 
Baghdad with other donors, and some have indicated that they 
will make similar approaches to the World Bank leadership.) 
 
-- The World Bank needs to strengthen its presence in Iraq 
Q-- The World Bank needs to strengthen its presence in Iraq 
through increased on the ground expert staff led by a senior 
Bank official who is willing to engage the GOI 
authoritatively over a wide range of issues. 
 
-- We understand that any significant increase in staffing 
will take time, but there are some immediate steps that could 
be taken to send the right signal to the GOI about the Bank's 
commitment to Iraq. 
 
-- First, a resident Country Director (CD) should be assigned 
to Baghdad.  This would demonstrate the seriousness of the 
Bank's commitment to Iraq and give the Bank presence the 
authority it needs to accomplish the vital tasks at hand. 
 
-- Second, a Deputy Country Manager (or Deputy Country 
 
BAGHDAD 00003112  002 OF 002 
 
 
Director if a CD has been named) should be named to help in 
running the office.  This would allow the WB to maintain 
continuity of its activities in Iraq and its engagement with 
the GOI when the current Country Manager is out on R&R or 
other travel. 
 
-- Third, the Bank should ensure that all staff who are 
working "on Iraq," regardless of where they are based, are 
available to come to Iraq and be here on the ground as 
needed.  The GOI needs to see that Bank staff are willing to 
come here, whenever needed and as needed. 
 
-- Finally, there are currently a number of regional staff 
outside of Iraq that are providing back office administrative 
support and other logistical support to the World Bank 
presence in Iraq.  Where possible, and understanding the need 
to minimize disruption, these staff could be replaced by 
Iraqi employees working in Iraq. 
FORD