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Fodla32, July 1, 2013 in Eacnamaíocht \ Economics
There are still 14,000 contractors (mercenaries), including 5,500 security guards, in Iraq even though the last troops left in December 2011.
“Contractors are here to stay as real players,” says Stuart Bowen, the special inspector general of Iraq reconstruction. “The opportunities in this field are shaped by the unpredictable rhythm of when a fragile state will fail.”
The FT’s list of the top earners over the past decade is based on all federal government contracts awarded for performance in Iraq and neighbouring Kuwait since the invasion was planned.
Compiling such a list is tricky because some contractors operate under a variety of names to avoid scrutiny. That makes these figures conservative.
The list includes companies working in supplying support services, security, reconstruction and the oil industry.
“This is not my grandfather’s military industrial complex,” said Dan Goure, vice-president of the Lexington Institute, a national security think-tank partly funded by defence contractors. “There’s not a single munitions producer in this list.”
Instead, the US had created a fifth branch of the military, he said. “It’s called the private sector.”
The extensive use of contractors in both Iraq and in Afghanistan has been steeped in controversy.
A 2011 report from the commission on Wartime Contracting in Iraq and Afghanistan estimated that defence contractors had wasted or lost to fraud as much as $60bn – or $12m a day – since 2001.
Private contractors have been involved in some of the most shocking events of the Iraq conflict – from the Nisour Square shootings in 2007 in which Blackwater security guards killed 17 Iraqis, to the Abu Ghraib prison scandal.
While the era of easy money may have ended for these contractors, that does not mean the boom times are over.
In 2011, the state department estimated that it would pay $3bn over the next five years on its private security contracts to protect its massive embassy complex in Baghdad alone.
Meanwhile, contractors are winning new business as oil companies ramp up their operations, especially around areas such as Basra in the south.
“It’s not like these companies have shut up shop and are going home,” says Stephanie Sanok of the Center for Strategic and International Studies. “We are still sinking a lot of money into this and we are still trying to get our oil dividend.”
That means that companies that branch out into other areas could have an even better decade ahead.
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