Waiting It Out in Iraq

Despite a massive liquidity crisis in Iraq stemming from its protracted war with Iran, a surprising number of U.S. companies are still doing business there.

More than a score of U.S. companies maintain offices in Baghdad, the Iraqi capital, with several of them having set up offices during the past year.

Among these is NCR, a full-line computer company which employs 25 people in its Baghdad office for maintenance and support of NCR's software. The firm is currently installing computer systems in several Iraqi hotels, and a company spokesman says "we are anticipating several major equipment sales in the next few months." NCR had been represented by an agent for 25 years until it received permission to open a branch office last year. According to the spokesman, Iraq's Ministry of Industry is planning purchases of 100 large-frame computers and up to 5000 minicomputers by 1985, and NCR will be right in the middle of the action.

Other U.S. companies which have made recent deals with Iraq include Raymond International (manufacturing and installing concrete foundations for three water reservoirs); Ionics (supplies for two water treatment plants); Westinghouse (sales of motors and distribution and transmission equipment); and General Electric (providing steam turbine units for the Baghdad South power station). A number of American companies have supplied about 80 percent of the software and medical equipment for the nearly-completed Baghdad Medical City, according to Roger, Burgun, Shahine and Deschler, a New York design and consulting firm which oversaw the project.

This current activity by U.S. firms comes against the background of figures recently released by the U.S. Department of Commerce which show that last year, a period when Iraq had to shelve some of its development plans, U.S. exports to the country diminished only slightly from the previous year—declining from a total of $913.6 million in 1981 to $846.1 million in 1982. The drop, of less than 7.5 percent, was much smaller than many analysts had expected.

Despite the payments difficulties, many companies continue to hang around because they are convinced that the potential of Iraq as a market will be enormous after the war, and they want to be on the ground floor. A spokesman for one of them told The Washington Report that in his opinion, "Once the war is over, Iraq will take Saudi Arabia's place as the greatest construction market in the world."