Iraq's Odious Debts

No conflict of interest in Iraq contract, says Belka

Odious Debts Online
September 12, 2003

The chair of an international donors’ conference to rebuild Iraq said there was no conflict of interest between his role and his position with a Polish bank, part of a winning tender to establish the Trade Bank of Iraq.

Former Polish Finance Minister Marek Belka who will head the International Coordination Committee for the Reconstruction of Iraq in Madrid this October, said he had not participated in the selection of the winning bidders in a tender to set up and manage the Trade Bank of Iraq – created to accelerate trade between Iraq and the rest of the world.

Belka holds a position on the supervisory board of Poland’s Millennium Bank and is an adviser to JP Morgan Chase & Co, leader of the consortium for the Iraq trade bank tender. Another member of the consortium is Portugal’s Banco Comercial Portugues, which controls Polands’s Millennium.

Belka, who dropped out of the selection committee for the trade bank tender, said he did not inform the committee of his other interests. “Just to avoid this potential conflict of interest, I was not involved in this at all. And I guess nobody really from the selection committee knew that I was involved in Millennium in a supervisory role,” said Belka.

A recent Reuters news service report noted non-governmental organizations and politicians had voiced disquiet over the issue of transparency in Iraq contracts.

Former prime minister of Poland and a senior official at the European Bank for Reconstruction and Development, Jan Krzysztof Bielecki, told Reuters, “In such a situation you are required to sign a written disclosure [of interests]. . . . Without a doubt this is a conflict of interest.”

Non-governmental groups have also questioned whether the issue should have been disclosed.

“I would have thought that the [Belka] conflict of interest should have been declared,” said Justin Alexander, the head of debt campaign network Jubilee Iraq. “The banks that were in the consortium for the trade banks should be those most suited to provide a service for Iraq.”

In August, the U.S. Department of Defense announced Belka would replace Michigan State University President Peter McPherson, currently serving in Iraq as Director for Economic Policy in the Coalition Provisional Authority – a U.S. effort to rebuild Iraq’s banking system. Belka is expected to take over from McPherson on Nov. 1.

  • This news report is based on the following articles:

Iraq donor head says no conflict over bank role, by Daniel Trotta, David Chance, Douglas Busvine and Pawel Kozlowski, Reuters, Sept. 5, 2003

The Heat is On for Polish Business in Iraq, by Kamil Tchorek, Warsaw Business Journal, Sept. 8, 2003

Bremer Names New Director of Economic Policy in Iraq, U.S. Embassy, 22 Aug., 2003 [PDFver here]

McPherson’s Iraq job filled, by Antonio Planas, The State News

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