Major US firm pulls out of Iraq
2004-12-22 17:11
Washington - Contrack International Incorporated has become the first major US contractor to pull out of the reconstruction effort in Iraq, the Los Angeles Times said on Wednesday, adding that high security costs were to blame.
"We reached a point where our costs were getting to be prohibitive," said Karim Camel-Toueg, president of the Arlington, Virginia-based Contrack, which had won a $325m award to rebuild Iraq's shattered transportation system.
US officials said Contrack's decision to terminate work in Iraq was reached with the US government in November but had not been publicly disclosed.
US officials told the daily that Contrack, the leader in a partnership that won one of 12 major reconstruction contracts awarded in 2004, was the largest company to pull out of Iraq to date.
However, the officials added, the company's move would not hamper rebuilding in Iraq, adding that they planned to put the contract up for rebidding, a process the paper said could take months.
"It's not a terrible loss," said Army Burns, spokesperson for the Pentagon's Iraq Project and Contracting Office.
Some analysts, however, thought differently.
"It's a very bad sign," said Michael O'Hanlon, a scholar at the Brookings Institution think tank in Washington.
"If this is how other private companies are thinking, it's a very bad potential warning."
In the eight months Contrack was under contract in Iraq it was paid about $30m, mostly for site assessments and design work, company and US officials told the daily.
The Conrack partnership intended to build new roads, bridges and transportation terminals in Iraq, but only managed to refurbish a handful of train depots, company officials said.