Communication from the Commission to the Council and the European Parliament - Recommendations for renewed European Union engagement with Iraq
Date: 2006-06-07
Institutions: European Commission
Subjects: Iraq, economic and social cohesion, economic reconstruction, establishment of peace, humanitarian aid, the EU's international role

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 7.6.2006 
COM(2006) 283 final 

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE 
EUROPEAN PARLIAMENT 

Recommendations for renewed European Union engagement with Iraq 

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COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE 
EUROPEAN PARLIAMENT 

Recommendations for renewed European Union engagement with Iraq 

I. 

INTRODUCTION 

Iraq  faces  formidable  challenges:  a  lack  of  security  resulting  from  terrorism,  insurgency, 
organised crime and sectarian-based violence; serious shortages in basic services; widespread 
violations  of  human  rights;  and  widespread  institutional  weaknesses  within  the  national 
administration. 

The  Commission’s  Communication  of  2004,  “The  European  Union  and  Iraq:  A  Framework 
for Engagement”1 and the letter signed by the Commissioner for External Relations and the 
High  Representative,  which  accompanied  it,  set  out  a  medium-term  strategy  for  EU 
engagement with Iraq as a response to the new Iraqi Interim Government and the adoption of 
UN Security Council Resolution 1546. 

Since 2004, against the backdrop of an acute and deteriorating security situation, the country 
has made important progress on the political and constitutional process, which has led to the 
formation of the first constitutionally elected Government. Two elections were held in 2005 
and the drafting of a new constitution was concluded and subsequently adopted following a 
popular referendum in October 2005. Electoral turnout was high at each of the polls. 

With the new government now in place, this is a timely opportunity to take stock of progress 
against the 2004 Communication and to take a fresh look at how the EU can engage with Iraq, 
starting with political dialogue with the new government. 

The  medium-term  strategy  set  out  in  the  2004  Communication  provided  the  following 
objectives:  

•  A secure, stable and democratic Iraq 

•  An open, sustainable and diversified Iraqi market economy 

•  An  Iraq  at  peace  with  its  neighbours  and  integrated  into  the  international 

community.  

These  objectives  are  still  valid  today,  notwithstanding  the  instability,  political  tensions  and 
deteriorating security environment in the country.  

Against  this  difficult  background,  the  EU  has  pursued  the  implementation  of  the  actions 
identified  in  the  2004  Communication.  It  has  been  at  the  forefront  of  international 
engagement with its support for the political and  constitutional  process,  which  has  included 
significant expertise and resources for the electoral processes and the establishment of rule of 

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COM(2004) 417, 9.6.2004. 

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law. It has provided substantial financial aid, notably through the International Reconstruction 
Fund Facility for Iraq (IRFFI). A European Commission delegation has been opened. The EU 
has stepped up its engagement with the Iraqi political leadership through, among other things, 
the  establishment  of  a  framework  for  a  political  dialogue  based  on  the  EU-Iraq  Joint 
Declaration  on  Political  Dialogue  signed  on  21  September  2005,  Troika  visits  and  the  June 
2005 EU-US sponsored international conference in Brussels. The EU has also been in contact 
with  the  new  Government  and  an  offer  to  start  negotiations  for  a  Trade  and  Cooperation 
Agreement  is  on  the  table.  Throughout  its  engagement,  the  European  Union  has  kept  close 
contact and dialogue with other key international players committed to helping the Iraqis meet 
the challenges ahead.  

Based  on  an  analysis  of  the  current  situation  and  the  challenges  going  forward,  this 
communication puts forward a number of recommendations for EU engagement centred on 
a set of key objectives. The communication provides the basis for a framework for dialogue 
and  cooperation  between  the  EU  and  the  new  Iraqi  government.  While  the  government’s 
mandate  will  cover  a  period  of  four  years,  the  recommendations  proposed  in  this 
communication are not tied to a specific timetable.  

•  Two  critical  factors  for  greater  EU  engagement  are  highlighted  upfront.  These 
are:  firstly,  inclusiveness  of  the  political  process  and  in  the  government,  and 
secondly, the security situation in the country. 

II. 

CHALLENGES FOR IRAQ 

The  main  challenges  for  Iraq  and  for  the  new  government  will  be  to  preserve  national 
cohesion  and  address  national  reconciliation;  to  provide  security  with  respect  for  human 
rights;  to  deliver  basic  services  and  provide  for  employment  opportunities  to  enhance  the 
capacity  of  the  national  administration;  and  to  promote  economic  stability  and  sustainable 
growth benefiting the population at large.  

A  number  of  specific  areas  need  to  be  examined  in  more  detail  when  assessing  the  overall 
challenges  facing  Iraq.  These  areas,  both  political  and  economic  in  nature,  are  mutually 
dependent but fall essentially into two components: consolidating democracy and promoting 
the economy. 

Consolidating democracy and strengthening civil society 

Although the political process was successfully pursued in 2005, the democratic foundations 
would benefit from further consolidation. The planned organisation of local and governorate 
elections  and 
indicators 
demonstrating Iraq’s commitment to democracy.  

the  constitutional  review  process  will  provide 

important 

In  the  referendum  on  the  Constitution  in  October  2005,  the  Iraqi  people  expressed  their 
support  to  a  federal  union  of  regions  and  governorates.  The  Constitution  is  the  framework 
under which the majority of Iraqis have accepted to live together. Yet some Iraqi communities 
feel  that  the  current  text  does  not  fully  recognise  their  concerns  and  aspirations.  The 
Constitution  therefore  needs  to  be  accepted  as  the  legitimate  basis  for  inclusiveness  and 
modern  governance,  with  a  division  of  economic  powers  and  responsibilities  between  the 
central,  provincial  and  local  governments.  It  also  provides  a  basis  for  the  distribution  of 
national wealth and economic, energy and fiscal policies. The Constitution stipulates as one of 

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the  principal  tasks  for  the  newly  elected  Council  of  Representatives  a  revision  and 
development of the legislative and institutional measures contained in the text.  

Essential to the democratic process is the role of civil society. There is considerable scope for 
Iraq and international efforts to strengthen civil society including in areas such as supporting a 
free media, encouraging advocacy and monitoring, promoting human rights and fundamental 
freedoms, including rights of women, children and religious and ethnic minorities.  

National cohesion  

The  question  of  Iraq’s  national  cohesion  is  related  to  the  sense  of  belonging  of  the  people 
and  the  trend  of  identifying  oneself  along  sectarian  or  ethnic  lines.  This  has  been 
demonstrated  at  the  polling  stations,  and  in  the  referendum  on  the  Constitution  in  2005,  as 
well  as  in  sectarian  violence.  An  immediate  challenge  for  the  new  Iraqi  leadership  is  to 
propose and defend a model of governance that overcomes the current deepening divisions.  

This  trend  also  has  an  adverse  effect  on  the  ethnic,  religious  and  political  balance  of  other 
countries in the region and the region as a whole. Several of Iraq’s neighbours share ethnic 
and religious communities with Iraq. If Iraq slides towards disintegration, ethnic and religious 
separatism  may  be  promoted  elsewhere  in  the  region.  The  safeguard  of  Iraq’s  territorial 
integrity  is  therefore  also  in  the  interest  of  its  neighbours,  as  well  as  the  international 
community as a whole.  

For  Iraq  to  steer  away  from  sectarianism,  areas  such  as  the  appointment  of  staff,  the 
composition of the national Iraqi security forces and line ministries, access to public services 
and the sharing  of  resources, will need  to be guided by the principle of inclusiveness.  The 
formation  of  the  national  unity  government  is  already  an  important  step  in  this  direction. 
Initiatives to address national reconciliation are also essential. 

Security and establishment of rule of law 

The  violence  that  erupted  following  the  Samarra  mosque  bombing  on  22  February  2006 
aggravated an already existing trend of sectarian-based violence. This violence increasingly 
involves organised sectarian-based militias and armed groups. The situation is exacerbated by 
the  perceived  inability  of  the  national  security  forces  to  provide  security  as  well  as  links  of 
both  militias  and  security  forces  to  criminal  activities.  To  add  to  this,  organised  crime  and 
street violence continue to threaten ordinary Iraqis. 

As a consequence, individuals have turned to their ethnic or religious groupings for protection 
and support, and internal migration and emigration have increased. Communities resident in 
mixed neighbourhoods where they are in minority are moving to areas where their ethnic or 
religious community is in the majority.  

Security will, therefore, be one of the most important issues for the new government to tackle. 
A  key  aspect  of  this  will  be  to  confront  the  insurgency  and  the  militias.  Calls  for 
Disarmament,  Demobilisation  and  Reintegration  (DDR)  initiatives  have  already  been 
made. It is also important, however, that action on security does not compromise the system 
of  rule  of  law  or  respect  for  human  rights.  Addressing  human  rights  abuses  and 
displacement  of  communities  should  be  major  priorities.  Following  years  of  brutality  under 
the  previous  regime,  the  security  apparatus,  judiciary  and  penitentiary  will  need  to  be 
demonstrably changed to restore trust in them. Though the establishment of a system of rule 

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of  law  takes  time  and  cannot  be  managed  overnight,  the  Iraqi  leadership  will  need  to  show 
that it is advancing steadily to improve the situation.  

Achieving the basis for sustainable economic development  

Basic services and job creation 

Equally important, and intimately linked to security, is the delivery of basic services and the 
generation  of  employment  and  income  through  renewed  economic  activity.  These  two 
objectives occupy an obvious place on any new government’s agenda. But in the case of Iraq, 
where the management and the infrastructure in areas such as health, education and electricity 
deteriorated  during  the  later  years  of  Saddam  Hussein’s  rule,  and  where  there  has  been  no 
significant  improvement  in  quality  or  quantity  recently,  the  government  needs  to  focus  on 
firm action to provide basic services to improve the quality of life of its population. The lack 
of  electricity  and  water,  and  difficulties  accessing  education  and  health  services  create 
everyday worries, causing not only social tension, but also slowing down economic recovery. 
Failure to act on these issues will hamper the potential of future generations of Iraqis.  

The  creation  of  employment  opportunities  and  income  generation  activities  is  equally 
pressing.  Employment  will  remove  the  financial incentive  for  joining  militias,  insurgents  or 
terrorists  groups  for  some  Iraqis.  Iraqi  human  capital  used  to  be  one  of  the  country’s  main 
assets. Iraqi educational levels were substantially higher than in other countries in the region 
20-25  years  ago  but,  over  the  years,  Iraq’s  record  has  sunk  to  levels  far  below  those  of  its 
neighbours. Today, younger generations are often less educated than their parents. This trend 
needs to be reversed for Iraq to be able to fully draw upon its human capital.  

Establishing a functioning administrative framework 

The  civil  service  is  the  largest  employer  in  the  country  but  it  has  suffered  from  years  of 
mismanagement,  with  little  modernisation  or  upgrading  of  skills.  Improvements  to  its 
effectiveness  and  efficiency  are  needed  to  enhance  its  capacity  to  develop,  implement  and 
deliver policy. These weaknesses have serious implications for management of the economy 
and  the  provision  of  essential  public  services.  Iraqi  led  reform  of  the  structure,  regulations 
and  procedures  of  the  public  administration  should  be  supported  by  the  international 
community.  

Energy and economic diversification 

Iraq holds the world’s second largest oil reserves and also significant untapped natural gas 
resources.  The  economy  is  driven  by  the  energy  sector  but  performance  is  well  below 
capacity and revenue is far from optimum. Outdated techniques the absence of a transparent, 
efficient and modern administration, a lack of investment and frequent looting and sabotage 
of infrastructure are some hampering factors. Furthermore, due to technical shortcomings in 
the oil metering system, the administration does not have a clear overview of production and 
export levels which encourages smuggling and embezzlement of oil revenues.  

The  heavy  dependency  on  oil  revenue  makes  Iraq  very  vulnerable  to  external  economic 
factors. The recent rise in oil prices on the international market has been to Iraq’s advantage. 
However, a fall in prices will hit the economy hard. Reducing the dependency on oil, through 
economic  diversification,  would  help  mitigate  the  impact  of  oil  price  fluctuations  and 
generate  employment.  This  could  be  achieved  through  promoting  different  (non  energy 

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sector)  income  generation  activities,  which  draw  on  Iraq’s  other  assets  such  as  water  and 
agriculture,  in  particular.  Iraq  is  unique  in  the  region  in  that  it  has  two  major  waterways 
running  through  it.  The  heart-land  of  the  ancient  Fertile  Crescent,  almost  20%  of  Iraq’s 
working population is employed in the agricultural sector. In a region, where many countries 
struggle with limited water supplies for their agricultural sector, Iraq is better off than others. 
Increased  production  and  export  of  agricultural  products  are  important  potential  sectors  in 
supporting economic prosperity and diversification. Water could also be an asset in regional 
trade. 

Iraq’s  fiscal  deficiencies  need  to  be  addressed  as  a  priority.  Currently  a  massive  amount  of 
Iraq’s GDP is consumed on the public distribution system (a legacy of the pre-2003 sanctions) 
and  subsidies  to  domestic  consumption  of  oil.  Economic  reforms  (as  stipulated  by  the  IMF 
Stand-By  Arrangement)  will  allow  the  government  to  pursue  public  investment  and  its 
development  agenda  as  defined  in  the  National  Development  Strategy.  Urgent  reforms  are 
needed  to  strengthen  the  budget  process,  including  the  recording  of  revenues  and 
expenditures,  and  promotion  of  accountability.  The  budgeting  process  should  be  used  as  a 
primary policy instrument. The government needs to prepare a unified budget for capital and 
recurrent  expenditures,  within  a  medium-term  expenditure  framework.  All  donor  aid  should 
be brought within the unified national budget. 

Reforms  in  the  business  and  financial  services  regulatory  environment  need  to  be 
introduced to ensure private investment,  which in  the medium  term  is  needed  to finance oil 
and  electricity  infrastructure.  However,  reforms  would  need  to  be  calibrated  in  order  to 
counter any negative social welfare impacts that may result. 

III. 

RECOMMENDATIONS FOR EU SUPPORT  

Iraq is a country rich in human, natural and cultural resources, with vast potential to become 
again an important regional and international partner, but the current situation is one of acute 
insecurity  and  instability.  Whatever  the  future  situation,  Iraq  will  continue  to  have  security, 
economic,  energy  and  political  implications  for  the  European  Union.  It  is  therefore  in  the 
European  Union’s  interest  to  encourage  a  secure,  stable,  democratic  and  economically 
prosperous  Iraq,  which  is  at  peace  with  its  neighbours  and  integrated  into  the  international 
community.  

With the formation of the first constitutionally elected Iraqi government, there is a renewed 
opportunity  for  the  European  Union  to  engage.  It  is  well  placed  to  do  so.  Geographical 
proximity;  experience  already  gained  in  Iraq  and  in  other  post-conflict  scenarios;  well-
established  relations  with  key  international  players,  including  Iraq’s  neighbours;the  EU’s 
economic strength; and the potential contribution of Iraqi European migrant populations are 
all  assets  on  which  the  European  Union  can  build  to  help  the  Iraqis  to counter  the  negative 
trends.  The  EU  can  also  use  the  experience  gained  in  Iraq  through  political  dialogue, 
Community reconstruction funding (in 2003-2006 reaching around €720 million), cooperation 
in rule of law and relations established through EU presence in Iraq.  

In the short term, the European Union should focus its engagement on a small number of key 
objectives,  to  which  it  can  bring  added  value  and  provide  early  and  tangible  results.  To 
maximise impact and efficiency, Community and EU Member States should concentrate their 
efforts  around  those  key  objectives  in  a  complementary  manner.  The  UN  should  continue 
playing a leading role both on the political and the economic reconstruction fronts.  

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Continued  EU  support  to  the  UN  efforts  should  remain  at  the  core  of  EU  engagement, 
together  with  increased  dialogue  and  cooperation  with  other  key  stakeholders.  Enhanced 
dialogue with Iraq’s neighbours and support to initiatives to strengthen regional co-operation 
should further be pursued. The EU should also remain supportive of Iraqi calls for a renewed 
international political and economic engagement through an international conference. 

However, external political support and assistance will not be sufficient to help Iraq. Change 
in  Iraq  must  be  Iraqi-owned  and  led.  The  EU  needs  a  solid  partner,  committed  to 
implementing policies and addressing the current problems. EU action will be dependent on a 
conducive  policy  and  security  environment  in  Iraq.  A  certain  number  of  enabling  factors 
have  therefore  been  identified  which  will  determine  the  impact  of  EU  action.  These  factors 
will  be  fine-tuned  through  a  process  of  dialogue  with  the  newly  formed  Iraqi  government. 
Two  main  critical  factors  are,  however,  common  to  all  challenges:  Iraqi  political  will  and 
improvement in the security situation.  

From the analysis of the challenges that Iraq faces and the position of the EU, it is suggested 
that efforts be focused on a number of concrete objectives.  

EU objective: 

Endorse  and  support  a  model  of  democratic  government  that 
overcomes divisions 

The European Union should continue its support to the political process by backing policies 
and  initiatives  that  counter  sectarianism  and  facilitate  respect  and  dialogue  between  the 
various communities. To this end, the EU should actively work with the national government 
and regional administrations, with civil society as well as with the UN and other international 
partners.  The  EU  could  also  support  national  reconciliation  efforts  and  back  policies  to 
mainstream inclusiveness throughout the administration.  

The EU should also make best use of its relations with regional stakeholders to encourage 
their advocacy of Iraq’s territorial integrity and national unity, and to discourage interference 
in Iraqi domestic affairs. 

The EU could continue to make a valuable contribution, in close co-operation with the UN, to 
the constitutional review process, and could share Member States’ experiences in division of 
administrative responsibilities, economic equilibriums and solidarity schemes. This could be 
complemented with more ambitious measures to reach out to the Iraqi population and ensure a 
better understanding of the political and economic stakes.  

Furthermore,  EU  action  could  support  parliamentary  and  democratic  institutions. 
Capacity building and technical assistance for the relevant Iraqi institutions, and exchanges or 
twinning-type  programmes  with  EU  Member  States’  administrations  and  the  European 
Parliament are measures that could be considered. Additionally, continued assistance for the 
Independent  Electoral  Commission  of  Iraq  and  for  civil  society  organisations  are  other 
possible areas of support. 

The EU should not limit itself to working on human rights and democracy at central level, but 
should  explore  ways  to  reach  out  to  regional,  provincial  and  local  levels  to  mainstream 
policies and monitoring implementation.  

Enabling factors - EU assistance in these fields will already benefit from the inclusive nature 
of  the  government.  The  impact  of  EU  support  will  be  enhanced  with  the  adoption  of 

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transparent,  meritocratic  and  sectarian-neutral  recruitment  in  the  national  administration. 
Adherence  to  the  timetable  for  the  electoral  process  will  enhance  Iraqis’  participation  and 
confidence in the political process.  

EU objective: 

Contribute  to  a  consolidation  of  security  by  underpinning  the 
system  of  rule  of  law  and  promoting  a  culture  of  respect  for 
human rights 

A  number  of  EU  Member  States  are  already  involved  in  work  to  improve  security  in  the 
country.  Security  training  for  police  and  military  personnel  is  being  provided  by  some  EU 
Member States. The Integrated Rule of Law Mission for Iraq, EUJUST LEX, in the context of 
ESDP, is working with the Iraqi police, judges and prison personnel to develop an integrated 
rule of law system/criminal justice system. The mission, which started in July 2005, has been 
extended. 

The  EU  will  continue  to  work  towards  establishing  security  and  rule  of  law.  The 
Commission will build on the lessons learned from the EUJUST LEX Mission in preparing a 
programme in the area of the rule of law, to strengthen the judiciary both in criminal and civil 
matters. A close coordination will be ensured between further efforts in the context of ESDP 
and  Community  action  in  this  field.  Future  cooperation  will  work  towards  mainstreaming  a 
culture of respect for human rights, including those concerning gender equality, children’s 
rights and religious freedom; this will include capacity building to monitor compliance with 
human  rights.  The  European  Union  could  also  consider  supporting  Disarmament, 
Demobilisation  and  Reintegration  initiatives  on  the  basis  of  experience  gained  in  other 
post-conflict scenarios. The EU could also support capacity building efforts to help the Iraqi 
government  and  institutions  monitor  progress  towards  implementation  of  the  relevant 
international conventions under human rights law. 

Enabling factors – The impact of EU efforts will be enhanced if the government is committed 
to the necessary reforms in the judiciary, and to respect for human rights in the Iraq security 
apparatus.  Strengthening  a  Human  Rights  Ministry,  the  establishment  of  a  Human  Rights 
Commission and other institutions to investigate human rights abuses would be a step in the 
right  direction.  The  government  also  needs  to  curb  the  militias  and  non-government 
militarised groups. A supportive framework for Civil Society to operate would also be helpful.  

EU Objective: 

Support  national  and  regional  authorities  in  improving  the 
delivery  of  basic  services  and  in  promoting  a  conducive 
environment for job creation  

The  European  Union,  through  the  Community  assistance  and  in  close  cooperation  with  the 
UN, is already a major contributor to targeted programmes aimed at improving access for the 
Iraqi population to basic services (water, education, health, sanitation and others) - with the 
general  objective  of  improving  the  quality  of  life  in  Iraq  and  securing  sustainable  medium-
term stability. For improvements to be long-lasting, the government needs to adopt long-term 
social  development  policies.  Implementation  of  policies  could  be  supported  by  the  EU, 
drawing upon the Iraqi National Development Strategy adopted in October 2004, which will 
certainly be updated by the new Government. The EU could also assist in reforming the social 
security system in cooperation with other international players.  

Job  creation  is  a  priority  for  the  new  government.  Efforts  must  be  focused  on  creating  an 
environment  conducive  to  employment  creation  and  development  of  income  generating 

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activities.  This  could  be  addressed  by  harmonising  the  various  reconstruction  programmes, 
job  creation  components  and  by  promoting  private-sector  job  creation  activities for  Small 
and Medium-Sized Enterprises. IRRFI efforts could be further pursued. This would also allow 
for a diversification of the economy and build a basis for increased trade potential. 

Enabling  factors  –  The  impact  of  EU  support  will  be  enhanced  by  an  updated  national 
development  strategy  setting  out  clear  priorities.  The  government  needs  to  find  a  policy 
compromise  between  implementing  key  structural  reforms  (which  may  require  short-term 
pain  for  long-term  gain)  and  preventing  social  unrest.  At  the  same  time  functioning  donor 
coordination mechanisms will help match needs to resources. Enhanced visibility of support 
would be welcomed by donors once the security conditions so permit.  

EU Objective: 

Support  mechanisms  to  pave  the  way  for  Iraq’s  economic 
recovery and prosperity 

The  European  Union  is  already  involved  in  promoting  economic  reforms  and  fostering 
development  in  the  area,  and  will  use  its  experience  to  work  with  the  Iraqi  government  to 
promote economic development and prosperity. The EU will maintain an open dialogue with 
the government to encourage economic development through funding, debt reduction efforts 
and greater cooperation schemes.  

The  initial  focus  for  EU  action  will  be  to  address  the  current  deficiencies  in  Iraq’s  energy 
sector.  The  EU  should  support  the  regulatory,  legal  and  financial  framework,  both  to 
encourage investment and to deter corruption, organised crime and criminality. In parallel, it 
will  encourage  regional  energy  cooperation  through  EU  regional  networks.  There  is  also 
potential  for  commencing  a  technical  dialogue  with  Iraq  on  the  development  of  Iraqi  oil 
resources and exploitation of natural gas reserves, and particularly in export to the Mashreq 
and EU markets, could supplement ongoing regional efforts. 

Furthermore,  the  European  Community  will  encourage  economic  diversification  by  lending 
support to the development of a trade and investment regime which  offers a minimum of 
predictability, transparency and legal certainty. The establishment of such a regime is a pre-
condition  for  private  domestic  and  international  operators  to  invest  and  create  further  job 
opportunities in the country. 

The  negotiation  process  for  the  Trade  and  Cooperation  Agreement  should  also  in  itself 
act as a factor of support for internal reforms. The negotiations of the Trade and Cooperation 
Agreement  may  also  serve  as  a  precursor  to  the  WTO  accession  process  and  will  bring  the 
Iraqi trade regime closer to multilateral system rules and disciplines, facilitating accession to 
the WTO. The possibility for Iraq to take advantage of the generalised system of preferences, 
which  would  give  improved  access  to  the  EU  market,  remains  open.  Engagement  of  the 
European Investment Bank in Iraq could enhance confidence in Iraq on the global financial 
stage. To complement these processes, the EU could provide support to strengthen the Central 
Bank  and  the  Ministry  of  Finance,  in  coordination  with  other  international  financial 
institutions. 

Enabling factors: - A strong political will to tackle embezzlement and corruption and address 
fiscal deficiencies is a pre-condition for economic well-being. Iraq needs to commit itself to 
optimising  the  use  of  its  vast  natural  resources  to  generate  additional  income.  The 
government needs to adopt appropriate policies and initiatives in this sector.  

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EU Objective: 

Promote  the  development  of  an  effective  and  transparent 
administrative framework 

Reforms  of  the  public  administration  are  required:  an  overhaul  of  the  legal  structures, 
strengthening  of  human  resource  capacity  and  introducing  principles  of  transparency, 
accountability  and  sound  financial  management.  The  European  Union  has  a  whole  range  of 
administrative  systems  and  cultures  across  individual  Member  States  and  at  EU  level. 
Experience from the enlargement process and support for building capacity and institutions 
in other parts of the world can be brought to bear to help the Iraqi administration implement 
reforms. 

The  process  of  negotiating  the  EU-Iraq  Trade  and  Cooperation  Agreement  (TCA)  will 
complement EU support for public administration reform.  Targeted EU support could  focus 
on a broad number of issues, touching upon the areas of responsibility of various ministries 
and government bodies. 

The TCA negotiations, and their successful conclusion, would benefit from the establishment 
of  a  functioning  administration.  In  key  areas  of  common  interest,  setting  up  technical 
working groups to support the exchange of know-how and expertise will be an additional 
asset where EU resources can be drawn upon.  

Enabling factors - Iraq has already committed itself to reforms, as part of its obligations to 
international  funding  institutions  and  other  international  stakeholders.  Reform  of  the  Iraqi 
administration  will  need  strong  political  commitment  and  a  “roadmap”  based  on  realistic 
goals and benchmarks.  

IV. 

CONCLUDING REMARKS 

The challenges facing Iraq are many, complex and pressing. The EU has a strong interest in 
helping  Iraq  stabilise  and  supporting  its  political  and  economic  regeneration.  The  EU’s 
geographical proximity and its distinctive role in Iraq put it in a unique position to further its 
engagement with the new government. This is a strategic opportunity to help Iraq regain its 
position  as  an  important  regional  and  international  partner.  EU  engagement  along  the  lines 
proposed in this document should take account of Iraqi ownership, capacities and values and 
use the new government’s programme and priorities as a point of departure.  

However, the EU is not alone. The UN remains a key partner. To ensure full effectiveness, it 
is also essential that the EU works alongside other players and stakeholders, both regional and 
international, in supporting Iraq’s path towards stability and prosperity. This will continue to 
be  a  priority  for  the  EU.  Iraq  needs  to  position  itself  politically  and  economically  in  the 
region. Iraq’s neighbours have an important role to play in this.  

EN 

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