TADHAMUN تـضـامـن

Tadhamun (solidarity) is an Iraqi women organization, standing by Iraqi women's struggle against sectarian politics in Iraq. Fighting for equal citizenship across ethnicities and religions, for human rights, and gender equality.

جمعية تضامن تدعم المساواة في المواطنة بغض النظر عن الأنتماء الأثني أو الديني وتسعى من أجل العدالة الأجتماعية و حماية حقوق الأنسان في العراق
Petition sign and circulate:

Release Iraqi women hostages, victims of terrorism themselves

بعيدا عن الوطن؛ حراك التضامن مع الوطن فنا، شعرا وكتابةً
Away from Home; Memory, Art and women solidarity: you are invited to an evening of poetry and music 22/3/2017 18:30 at P21 Gallery London click here for more details
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Public meeting at The Bolivar Hall, London Sat.14/5/2016 at 15:00 IDPs : Fragmentation of Cultural and National Identity



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Protest the suffering of Iraqi Christians: No to terrorism No to state terrorism.Hands off our minorities. Hands off our people. Shame on the human rights violators on all sides. Assemble 11:30 on 28/7/14 near Parliament Square, near Westminister tube station London. For more past events click here

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Useful links






Halt All Executions! Abolish The Death Penalty!

We women of Tadhamun condemn the persisting practice of arbitrary arrests by the Iraqi security forces. We condemn their arrests of women in lieu of their men folk. These are 'inherited' practices. We are alarmed by credible media reports of the Green Zone government’s intentions of executing hundreds of Iraqi men and women.


For more info click here
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Professor Zaineb Al Bahrani of Columbia University NY speaking at a our meeting on the destruction/damage to historical sites in Iraq

On youtube: Part1
Part 3
Part4
One more video:



Human Rights Watch: No woman is Safe

Thursday, May 21, 2009

Iraq’s Oil Field Bid Rounds – Development Or ‘Stabilization’?

By Greg Muttitt

11-May-2009

 

As Iraq pushes ahead with its plans to bring in international companies to carry out oil investment, a wider perspective on the role of oil in Iraq’s future is being lost. This paper aims to shed light on Iraq’s investment options, and to illustrate how rather than driving Iraq’s development, the current approach risks locking (or ‘stabilizing’) the country into its current unhappy state.

 

Capacity To Succeed

One can understand the frustration of some Iraqi oil professionals. Almost nothing has happened since 2003, even to maintain Iraq’s oil production, let alone develop it – with the result that the industry is now in decline. For those who have dedicated their lives to that industry, it must be a sad sight.

 

The causes of the failures include of course the security situation, paralysis in the government, and the appointment of officials who were politically but not technically qualified. All of this has led some to conclude that the Iraqi Ministry of Oil is simply not capable, in current circumstances, of doing the job. Their argument is supported by the loss of many of the Iraqi oil sector’s best experts overseas, and tragically, also to kidnap and murder.

 

So if the expertise no longer exists among Iraqis, the argument goes, international oil companies (IOCs) will have to be brought in to do the job.

 

However, that conclusion is undermined by precisely the same argument. It is not just engineers, geologists and chemists that Iraq is short of, but also lawyers, accountants, negotiators and regulators. And the clear lesson from other countries is that good outcomes from foreign investment occur precisely when the investors are well contracted and regulated: when there is a clear legislative framework, skilled negotiators and sufficient capacity to oversee development and production. In the absence of these factors, countries tend to suffer from the ‘resource curse’ – from corruption to ‘Dutch disease’.

 

Compare Norway, for instance, where international oil investment has been quite successful; with Alaska, where regulatory collapse has led to major environmental problems; with Russia, where errors in both contracting and oversight have led to long delays, technical mismanagement and economic loss; or with Nigeria, where the absence of rule of law has allowed oil production to descend into anarchy, as well as thoroughly losing local people’s consent.

 

However frustrating it may be for some, Iraq may fare much better through a more gradual approach: prioritizing rehabilitation of producing fields such as Rumaila and Kirkuk, and development of partially tapped supergiant fields such as Majnoon and West Qurna. This work is quite within the capabilities of Iraqi companies, making use where required of oil service companies for particular technical jobs.

 

At the same time, the Ministry of Oil would be wise to focus on developing internal capacity: offering competitive terms and sufficient security protection to attract back Iraqi overseas experts, and an aggressive program of training mid-ranking technicians, managers and officials.

 

New Hope Or New Haste?

In many of these respects, things have recently begun to look more hopeful. Political divisions remain a concern, alongside the impasse in revising the Constitution. But security is greatly improved, the January elections confirmed a decisive step away from the disastrous sectarianization of politics, and the government has started to recognize the need to focus on developing capacity.

 

Yet rather than trying to make use of Iraq’s improved conditions, or giving these new initiatives a chance to succeed, the two bidding rounds for field development and management by IOCs continue apace.

 

It may seem odd to complain about a rush after six years of stagnation. But it is hard to see things in any other way. The Ministry of Oil intends to sign 20-year contracts with IOCs, for fields containing around 75% of Iraq’s known reserves, between June and December this year (and exploration and development contracts for Iraq’s prospective areas are expected to follow close behind). At no point in the history of the oil industry have contracts to develop such a great quantity of known oil – around 80bn barrels – become available.

 

Tendering one or two of these fields at a time would have forced investors to compete fiercely to offer the best terms for Iraq – and would meanwhile have given an opportunity for learning and Iraqi capacity development at the same time. Instead all of the fields are being offered at once, creating a competitive dynamic that will inevitably favor the investors. And all this at a time when Iraqi institutions are still weak, and the country not yet fully sovereign.

 

Stuck In The Downturn

Furthermore, it comes at a bad time in the price cycle. At February’s Istanbul workshop, the Ministry of Oil sweetened the terms of the contracts on offer (notably, by further increasing the IOCs’ control over decision-making), in part because of the fall in the oil price – as government officials noted that they had to do more to attract investors.

 

International oil companies, on the other hand, have learned to expect fluctuations in oil prices. “We stay within a range looking at the future and therefore we don’t make investments that require a real high price to be successful,” ExxonMobil’s Chief Executive Rex Tillerson recently told Reuters. “We don’t invest outside of the range when it is high, and we don’t worry about it when it gets too low.”

 

Oil field investment behaves as an imperfect market in this respect. Whilst the low price might make it hard for smaller oil companies to obtain capital, the majors have no such shortage, having invested little during the years of high price: they in fact prefer to sign contracts when the price is low, and with it host government bargaining power. As a result, the terms tend to reflect the current moment, but persist as conditions improve, leading to generous profits.

 

It sounds like a fairly obvious point – but apparently not for some advocates of the bid rounds. In all these unfavorable circumstances, it is difficult to see the wisdom in signing 20-year, fixed commitments for the vast majority of Iraq’s economic resources.

 

Prolonging The Pain

However, the issues go beyond the technical, and even the economic. At stake within the oil question is the very future of the country.

 

One aspect of the bid round contracts that has received little attention, despite its profound consequences, is the stabilization clause. In the leaked November draft model contract, Article 29 states that if the law changes, the contract will be adjusted to preserve the investor’s “financial interests” – in short, profits are protected from changes in the law.

 

It was only six years ago that Iraq was governed by a dictatorship; and since then, the country has been occupied by foreign troops, and torn apart by ethno-sectarian interests. Inevitably, the rule of law and the framework for protection of citizens’ rights continue to reflect these political realities. The development and evolution of Iraq’s laws and institutions will be vital if it is to emerge from the shadow of its horrific past. Yet the stabilization clauses in oil contracts threaten to hold back this development.

 

What does this mean in practice? It is best understood through an example. In 1987, Saddam Husain introduced Law 150, which treats all public sector employees (including in the oil sector) as “civil servants”, who are prohibited from trade union membership. This law is still in force in Iraq, and has been used as a justification for a number of attacks on unions since 2003. It is unlikely that the law will be repealed, amended or replaced before June, the Ministry of Oil’s target for signing the first round of contracts (in spite of the law’s inconsistency with Iraq’s constitution, or its international obligations).

 

Let us imagine that at some point in the future, say in two years’ time, the Iraqi government decides to repeal Law 150. An IOC might complain, pointing to Article 29 of its contract, that the government should either exempt that company’s operations from the change in law, or compensate the company for its extra costs, for example in having to negotiate wage levels with workforce representatives. In short, the government would have to pay the cost of the IOC’s compliance with the changed law.

 

Of course, the same would apply to any other change of law too – including economic laws and policies, agreements with international bodies such as OPEC, environmental laws or anti-discrimination laws. And the prospect of having to compensate investors would create a significant disincentive on the government against passage of new laws – what the UN High Commissioner on Human Rights has called a “chilling effect” on the progressive realization of human rights.

 

A Trip To Paris

Now let us imagine that the government passes a new law regardless, without compensation. Iraq is a sovereign nation, the government might argue, and companies operating there should be subject to its laws that exist at the time. Citizens of Iraq cannot ask for exemption from or compensation for new laws, so why should foreign companies?

 

At this point, the IOC and the government would be “in dispute,” and Article 37 of the contract (in the November draft) kicks in. Assuming agreement cannot be reached by negotiation, including between senior management of the two sides, the matter will be arbitrated by an investment tribunal in Paris, in the English language, under the rules of the International Chamber of Commerce. (Purely technical issues could alternatively be judged by an independent, non-Iraqi expert).

 

In the tribunal, it would be difficult for the Iraqi side to defend its position. Although other narrow legal issues may be raised – such as questions of jurisdiction, or of status of the contract – in general, arbitration tribunals consider only the terms of the contract, and not the broader range of national and international law (let alone public interest), except in so far as those laws relate directly to investment. In these tribunals, the legal principle of pacta sunt servanda (contracts are sacred) outweighs those of permanent sovereignty over natural resources, or of the sovereign immunity of states.

 

Thus, going back to our example of the 1987 law, whereas an Iraqi court might seek to balance the investor’s right to a ‘stable’ framework with Iraqi workers’ rights to join unions, the investment tribunal would carry out no such balancing. And under ICC rules, there is no right of appeal or recourse; the ruling of the tribunal is final and binding.

 

International investment law has increasingly broadened the concept of expropriation to include not just a nationalization of assets, but any change which affects the profits or interests of an investor, known as a ‘creeping expropriation’. Such changes – including progressive changes of law – are thus treated as if the government had seized part of the investor’s assets, and accordingly compensated by arbitral awards.

 

One disturbing example of this occurred in South Africa, over its post-Apartheid system of Black Economic Empowerment, which aims to reverse decades of discrimination by promoting greater management roles for black, mixed race and Indian-origin South Africans. In March 2007, three Italian mining companies filed an arbitration claim for $350mn against the South African government, claiming the policy constituted an expropriation of their interests. That case is pending.

 

The Threat Of Enforcement

Efforts are now under way to close the final escape hatch from investor control over Iraq’s oil – that future governments might, on principle, insist on their right to pass laws in the public interest, and ignore arbitration awards that were considered unjust. (This is an unlikely outcome, as it would incur significant economic and political costs).

 

The mechanism of enforcement of rulings by international arbitration tribunals, as well as the resolution of conflicts between investment contracts and national or international laws, are determined in large part by international investment agreements signed and ratified by the country.

 

For Iraq, these currently include the League of Arab States Convention on Commercial Arbitration and a number of bilateral investment treaties, mainly with Arab nations. However, the US government, along with the US Chamber of International Business and some investment lawyers, are calling for Iraq to become a party to the New York Convention on Recognition and Enforcement of Foreign Arbitral Awards, a stronger protection for investor interests. Indeed, the OECD has worked with Iraqi government officials on moving towards adoption of the Convention.

 

Under the New York Convention, in the event of an unmet arbitration award, the winning party is entitled to seize assets of the losing party in any of the 140 countries that are party to the Convention. Thus in the case of the changed law and an arbitral ruling in favor of the investor, the Iraqi government would pay the cost of the investor’s compliance, voluntarily or involuntarily.

 

2009 Forever?

No-one would deny Iraq’s urgent need for investment. But conversely, few would argue that Iraq’s current economic situation is a good reflection of its potential, nor that the protection of human rights in Iraq is adequate. The key question is what form the investment takes.

 

This paper has argued that the current course, of extensive and rapid bid rounds for IOCs to develop the vast majority of Iraq’s oil, carries significant costs. In particular, the economic terms of the resulting contracts will inevitably reflect Iraq’s weak bargaining power at the time of signing (due to the political situation and the low oil price), yet will persist for 20 years.

 

Similarly, the contracts’ use of stabilization and arbitration clauses are likely to restrain progressive development of Iraq’s framework of rights protection and rule of law, despite the country’s recent emergence from dictatorship, and its political problems since. In effect, that development could be postponed for 20 years.

 

“We have to do something,” goes the current refrain. But the best solution is rarely obtained by a desperate grasp. It is hoped that this paper might help provoke discussion on how to achieve a better outcome than the current “something.”

 

Mr Muttitt is an independent researcher, writer and consultant on Iraqi oil policy. He previously worked at the London-based NGO Platform, where he campaigned for a greater voice of Iraqi civil society in long-term oil decisions.

Disclaimer

Articles published on this site do not necessarily reflect the opinion of WSIUI or its members


المقالات المنشورة على هذا الموقع لا تعكس بالضرورة آراء منظمتنا أو أعضاء منظمتنا


Samarra Minrate built in 852 AD

Samarra Minrate built in 852 AD
Building of 1 500 massive police station !
From the angle of the photo, it is possible to calculate that the complex is being built at E 396388 N 3785995 (UTM Zone 38 North) or Lat. 34.209760° Long. 43.875325°, to the west of the Malwiya (Spiral Minaret), and behind the Spiral Cafe.
While the point itself may not have more than Abbasid houses under the ground, it is adjacent to the palace of Sur Isa, the remains of which can be seen in the photo. While the initial construction might or might not touch the palace, accompanying activities will certainly spread over it.Sur Isa can be identified with the palace of al-Burj, built by the
Abbasid Caliph al-Mutawakkil, probably in 852-3 (Northedge, Historical Topography of Samarra, pp 125-127, 240). The palace is said to have cost 33 million dirhams, and was luxurious. Details are given by al-Shabushti, Kitab al-Diyarat.
Samarra was declared a World Heritage site by UNESCO at the end of June. The barracks could easily have been built elsewhere, off the archaeological site.--
Alastair Northedge Professeur d'Art et d'Archeologie Islamiques UFR d'Art et d'Archeologie
Universite de Paris I (Pantheon-Sorbonne) 3, rue Michelet, 75006 Paris
tel. 01 53 73 71 08 telecopie : 01 53 73 71 13 Email :
Alastair.Northedge@univ-paris1.fr ou anorthedge@wanadoo.fr