Coalition Provisional Authority
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Baghdad Baghdad (; ar, بَغْدَاد , ) is the capital of Iraq and the second-largest city in the Arab world after Cairo. It is located on the Tigris near the ruins of the ancient city of Babylon and the Sassanid Persian capital of Ctesiphon. I ...
, largest_city = capital , common_languages =
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English (''de facto'') , government_type =
Transitional government A provisional government, also called an interim government, an emergency government, or a transitional government, is an emergency governmental authority set up to manage a political transition generally in the cases of a newly formed state or f ...
, legislature =
Iraqi Governing Council The Iraqi Governing Council (IGC) was the provisional government of Iraq from 13 July 2003 to 1 June 2004. It was established by and served under the United States-led Coalition Provisional Authority (CPA). The IGC consisted of various Iraqi pol ...
, title_leader = Administrator , leader1 =
Jay Garner Jay Montgomery Garner (born April 15, 1938) is a retired United States Army lieutenant general who in 2003 was appointed as Director of the Office for Reconstruction and Humanitarian Assistance for Iraq following the 2003 invasion of Iraq, makin ...
, leader2 =
Paul Bremer Lewis Paul Bremer III (born September 30, 1941) is an American diplomat. He led the Coalition Provisional Authority (CPA) following the 2003 invasion of Iraq by the United States, from May 2003 until June 2004. Early life and education Born on ...
, year_leader1 = 2003 , year_leader2 = 2003–2004 , title_deputy = Deputy Administrator , deputy1= Richard Jones , year_deputy1 = 2003–2004 , era = Iraq War , event_pre =
Saddam Hussein Saddam Hussein ( ; ar, صدام حسين, Ṣaddām Ḥusayn; 28 April 1937 – 30 December 2006) was an Iraqi politician who served as the fifth president of Iraq from 16 July 1979 until 9 April 2003. A leading member of the revolutio ...
and Ba'ath Party deposed , date_pre = 21 April 2003 , event_start=CPA established , date_start=16 May , year_start = 2003 , event_end = Interim government , date_end = 28 June , year_end = 2004 , stat_year1 = , stat_area1 = , stat_pop1 = , currency =
Iraqi dinar The Iraqi dinar () (Arabic: دينار; sign: ID in Latin, د.ع in Arabic; code: IQD) is the currency of Iraq. It is issued by the Central Bank of Iraq and is subdivided into 1,000 fils (فلس), although inflation has rendered the fils obsolet ...
, today=
Iraq Iraq,; ku, عێراق, translit=Êraq officially the Republic of Iraq, '; ku, کۆماری عێراق, translit=Komarî Êraq is a country in Western Asia. It is bordered by Turkey to the north, Iran to the east, the Persian Gulf and K ...
The Coalition Provisional Authority (CPA; ar, سلطة الائتلاف المؤقتة, ku, هاوپەيمانى دەسەڵاتى كاتى) was a
transitional government A provisional government, also called an interim government, an emergency government, or a transitional government, is an emergency governmental authority set up to manage a political transition generally in the cases of a newly formed state or f ...
of Iraq established following the invasion of the country on 19 March 2003 by the U.S.-led
Multinational Force A Multinational force is a multinational operation which may be defensive, offensive, or for peacekeeping purposes. In multinational operations, many countries form an alliance to carry them out. Multinational forces include: * Supreme Headquar ...
(or 'the coalition') and the fall of Ba'athist Iraq. Citing
United Nations Security Council Resolution 1483 United Nations Security Council resolution 1483, adopted on 22 May 2003, after recalling all previous resolutions on the situation between Iraq and Kuwait, the Council lifted trade sanctions against Iraq (excluding an arms embargo) and terminate ...
(2003) and the laws of war, the CPA was established in May 2003 and vested itself with executive,
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, and
judicial The judiciary (also known as the judicial system, judicature, judicial branch, judiciative branch, and court or judiciary system) is the system of courts that adjudicates legal disputes/disagreements and interprets, defends, and applies the law ...
authority over the Iraqi government from the period of the CPA's inception on 21 April 2003 until its dissolution on 28 June 2004 (14 months, 1 week). The CPA was strongly criticised for its mismanagement of funds allocated to the
reconstruction of Iraq Investment in post-2003 Iraq refers to international efforts to rebuild the infrastructure of Iraq since the Iraq War in 2003. Along with the economic reform of Iraq, international projects have been implemented to repair and upgrade Iraqi water ...
, with over $8 billion of these unaccounted for, including over $1.6 billion in cash that emerged in a basement in Lebanon.


History of the CPA

The Office for Reconstruction and Humanitarian Assistance (ORHA) was established on 20 January 2003 by the
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...
government two months before the
2003 invasion of Iraq The 2003 invasion of Iraq was a United States-led invasion of the Republic of Iraq and the first stage of the Iraq War. The invasion phase began on 19 March 2003 (air) and 20 March 2003 (ground) and lasted just over one month, including 26 ...
. It was intended to act as a
caretaker Caretaker may refer to: Arts, entertainment, and media * ''The Caretaker'' (film), a 1963 adaptation of the play ''The Caretaker'' * '' The Caretakers'', a 1963 American film set in a mental hospital * Caretaker, a character in the 1974 film '' ...
administration in Iraq until the creation of a democratically
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civilian government Civil authority or civil government is the practical implementation of a state on behalf of its citizens, other than through military units (martial law), that enforces law and order and that is distinguished from religious authority (for exampl ...
. Retired
United States Army The United States Army (USA) is the land warfare, land military branch, service branch of the United States Armed Forces. It is one of the eight Uniformed services of the United States, U.S. uniformed services, and is designated as the Army o ...
Lieutenant General Lieutenant general (Lt Gen, LTG and similar) is a three-star military rank (NATO code OF-8) used in many countries. The rank traces its origins to the Middle Ages, where the title of lieutenant general was held by the second-in-command on the ...
Jay Garner Jay Montgomery Garner (born April 15, 1938) is a retired United States Army lieutenant general who in 2003 was appointed as Director of the Office for Reconstruction and Humanitarian Assistance for Iraq following the 2003 invasion of Iraq, makin ...
was appointed as the Director of ORHA, along with three deputies, including British
Major-General Major general (abbreviated MG, maj. gen. and similar) is a military rank used in many countries. It is derived from the older rank of sergeant major general. The disappearance of the "sergeant" in the title explains the apparent confusion of a ...
Tim Cross, in 2003. Upon the dissolution of ORHA and the creation of the CPA, he then became the first chief executive of the CPA. Due to his past military experiences in Iraq during
Operation Desert Storm Operation or Operations may refer to: Arts, entertainment and media * ''Operation'' (game), a battery-operated board game that challenges dexterity * Operation (music), a term used in musical set theory * ''Operations'' (magazine), Multi-Ma ...
in 1991 and his reconstruction efforts in northern Iraq during
Operation Provide Comfort Operation Provide Comfort and Provide Comfort II were military operations initiated by the United States and other Coalition nations of the Persian Gulf War, starting in April 1991, to defend Kurdish refugees fleeing their homes in northern I ...
, Garner's credentials and close ties to the U.S. Secretary of Defense Donald Rumsfeld made him an obvious choice for the task. His term, however, lasted only from 21 April 2003 until he was replaced abruptly less than a month later by L. Paul Bremer on 11 May 2003. Garner's swift dismissal from his post by U.S. authorities came as a surprise to many within the CPA. In an interview with the
BBC #REDIRECT BBC #REDIRECT BBC Here i going to introduce about the best teacher of my life b BALAJI sir. He is the precious gift that I got befor 2yrs . How has helped and thought all the concept and made my success in the 10th board exam. ...
...
program ''
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'' Garner publicly stated that his preference was to put the Iraqi people in charge as soon as possible and to do it with some form of elections. Upon assuming the post of chief executive of the CPA in May 2003, L. Paul Bremer also assumed the title of U.S. Presidential Envoy and Administrator in Iraq. He was frequently called Ambassador by numerous media organizations and the
White House The White House is the official residence and workplace of the president of the United States. It is located at 1600 Pennsylvania Avenue NW in Washington, D.C., and has been the residence of every U.S. president since John Adams in ...
because it was the highest government rank he had achieved (Ambassador to Netherlands). But Bremer was not ambassador to Iraq, and there was no U.S.
diplomatic mission A diplomatic mission or foreign mission is a group of people from a state or organization present in another state to represent the sending state or organization officially in the receiving or host state. In practice, the phrase usually den ...
in Iraq until June 2004, after the CPA transferred
sovereignty Sovereignty is the defining authority within individual consciousness, social construct, or territory. Sovereignty entails hierarchy within the state, as well as external autonomy for states. In any state, sovereignty is assigned to the perso ...
to the
Iraqi Interim Government The Iraqi Interim Government was created by the United States and its coalition allies as a caretaker government to govern Iraq until the drafting of the new constitution following the National Assembly election conducted on January 30, 2005. T ...
. At the CPA, Bremer moved quickly to install opaque and corruption-prone methods for the withdrawal and transportation of extremely large amounts of cash often transported from the US to Iraq by C-17 transport plane. The CPA was created and funded as a division of the
United States Department of Defense The United States Department of Defense (DoD, USDOD or DOD) is an executive branch department of the federal government charged with coordinating and supervising all agencies and functions of the government directly related to national sec ...
, and as Administrator, Bremer reported directly to the Secretary of Defense. Although troops from several of the coalition countries were present in Iraq at this time, the U.S. Central Command (USCENTCOM) was the primary military apparatus charged with providing direct combat support to the CPA to enforce its authority during the occupation of Iraq. While many of Saddam Hussein's ornate palaces were looted in the days immediately following the invasion, most of the physical structures themselves survived relatively intact. It is in these numerous palaces situated throughout the country that the CPA chose to set up office in order to govern. Several of these palaces were retained by the U.S. government even after the transition of power back to the Iraqi people. The administration was centered in a district of
Baghdad Baghdad (; ar, بَغْدَاد , ) is the capital of Iraq and the second-largest city in the Arab world after Cairo. It is located on the Tigris near the ruins of the ancient city of Babylon and the Sassanid Persian capital of Ctesiphon. I ...
known as the
Green Zone The Green Zone ( ar, المنطقة الخضراء, translit=al-minṭaqah al-ḫaḍrā) is the most common name for the International Zone of Baghdad. It was a area in the Karkh district of central Baghdad, Iraq, that was the governmental ...
, which eventually became a highly secure walled-off enclave. The CPA was also responsible for administering the
Development Fund for Iraq In May 2003, following the invasion of Iraq in March of that year, the Central Bank of Iraq-Development Fund for Iraq (DFI) account was created at the U.S. Federal Reserve Bank of New York at the request of the Coalition Provisional Authority (CPA) ...
during the year following the invasion. This fund superseded the earlier UN oil-for-food program, and provided funding for Iraq's wheat purchase program, the
currency A currency, "in circulation", from la, currens, -entis, literally meaning "running" or "traversing" is a standardization of money in any form, in use or circulation as a medium of exchange, for example banknotes and coins. A more general ...
exchange program, the electricity and oil infrastructure programs, equipment for Iraq's security forces, Iraqi civil service salaries, and the operations of the various government ministries. The first act of the CPA under Bremer, Coalition Provisional Authority Order 1, was to order the de-Ba'athification of Iraqi society. On 23 May,
CPA Order Number 2 Coalition Provisional Authority Order Number 2: Dissolution of Entities signed by Coalition Provisional Authority on 23 May 2003, disbanded the Iraqi military, security, and intelligence infrastructure of President Saddam Hussein. It has since bec ...
formally disbanded the Iraqi army, as well as other public servants including nurses and doctors and eventually led to the direct unemployment of more than 500,000 Iraqi citizens. On 22 July 2003, the CPA formed the
Iraqi Governing Council The Iraqi Governing Council (IGC) was the provisional government of Iraq from 13 July 2003 to 1 June 2004. It was established by and served under the United States-led Coalition Provisional Authority (CPA). The IGC consisted of various Iraqi pol ...
and appointed its members. The Council membership consisted largely of Iraqi
expatriates An expatriate (often shortened to expat) is a person who resides outside their native country. In common usage, the term often refers to educated professionals, skilled workers, or artists taking positions outside their home country, either ...
who had previously fled the country during the rule of Saddam Hussein and also with many outspoken
dissidents A dissident is a person who actively challenges an established political or religious system, doctrine, belief, policy, or institution. In a religious context, the word has been used since the 18th century, and in the political sense since the 20th ...
who had been persecuted by the former
regime In politics, a regime (also "régime") is the form of government or the set of rules, cultural or social norms, etc. that regulate the operation of a government or institution and its interactions with society. According to Yale professor Juan Jo ...
. The CPA under Bremer then went on to privatise and sell off publicly owned assets and companies to multinational companies, whilst setting about issuing unilaterally developed decrees such as Order 37 and Order 39, which reduced Iraq's corporation tax from 40% to 15% and allowed foreign entities to enjoy 100% ownership of Iraqi assets. Though still subordinate to the CPA, the Iraqi Governing Council had several key responsibilities of its own: appointing representatives to the
United Nations The United Nations (UN) is an intergovernmental organization whose stated purposes are to maintain international peace and security, develop friendly relations among nations, achieve international cooperation, and be a centre for harmoniz ...
, appointing interim ministers to Iraq's vacant cabinet positions, and drafting a temporary
constitution A constitution is the aggregate of fundamental principles or established precedents that constitute the legal basis of a polity, organisation or other type of entity and commonly determine how that entity is to be governed. When these princ ...
known as the Transitional Administrative Law (TAL), which would be used to govern Iraq until a permanent constitution could be written and approved by the general electorate. In the late afternoon of 14 December 2003, the CPA held a
press conference A press conference or news conference is a media event in which notable individuals or organizations invite journalists to hear them speak and ask questions. Press conferences are often held by politicians, corporations, non-governmental organ ...
at the Iraqi Forum convention center within Baghdad's
Green Zone The Green Zone ( ar, المنطقة الخضراء, translit=al-minṭaqah al-ḫaḍrā) is the most common name for the International Zone of Baghdad. It was a area in the Karkh district of central Baghdad, Iraq, that was the governmental ...
to announce that former
President of Iraq The president of Iraq is the head of state of Iraq and "safeguards the commitment to the Constitution and the preservation of Iraq's independence, sovereignty, unity, the security of its territories in accordance with the provisions of the Con ...
Saddam Hussein Saddam Hussein ( ; ar, صدام حسين, Ṣaddām Ḥusayn; 28 April 1937 – 30 December 2006) was an Iraqi politician who served as the fifth president of Iraq from 16 July 1979 until 9 April 2003. A leading member of the revolutio ...
had been taken into custody the previous night from a foxhole in a town near Saddam's home town of Tikrit, Iraq. Present at the announcement was Lieutenant General
Ricardo Sanchez Ricardo Sanchez (born September 9, 1953) is a former lieutenant general in the United States Army. His career was most notable for his service as commander of Multi-National Force – Iraq and V Corps. Early life and education Sánchez was bor ...
of the U.S. Army, Administrator Bremer, members of the
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and American
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, several members of the Iraqi Governing Council, and a large room full of
journalist A journalist is an individual that collects/gathers information in form of text, audio, or pictures, processes them into a news-worthy form, and disseminates it to the public. The act or process mainly done by the journalist is called journalis ...
s representing news organizations from around the world. In order to defeat possible insurgent planning and under pressure from the Bush White House which wanted the occupation to end by the 2004 presidential election, the CPA transferred power to the newly appointed
Iraqi Interim Government The Iraqi Interim Government was created by the United States and its coalition allies as a caretaker government to govern Iraq until the drafting of the new constitution following the National Assembly election conducted on January 30, 2005. T ...
at 10:26 AM local time on 28 June 2004. The transfer of power was originally scheduled for 30 June 2004, but because of a concern that the transfer would lead to insurgent attacks the ceremony was held, unannounced, two days ahead of schedule. The transfer took place behind closed doors with little fanfare. With the CPA disbanded, Bremer left Iraq that same day. The United States hoped that Iraq could be reconstructed and democratized in much the same way as Japan and
Germany Germany,, officially the Federal Republic of Germany, is a country in Central Europe. It is the second most populous country in Europe after Russia, and the most populous member state of the European Union. Germany is situated betwe ...
were after the
Second World War World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the vast majority of the world's countries—including all of the great powers—forming two opposi ...
, using them as "examples or even models of successful military occupations."


Structure of the CPA

The CPA was divided into four geographic regions. CPA North was headquartered in the northern Iraqi city of Erbil, CPA Central in Baghdad at Saddam's former Republican Palace, CPA South Central in the Iraqi city of
Al Hillah Hillah ( ar, ٱلْحِلَّة ''al-Ḥillah''), also spelled Hilla, is a city in central Iraq on the Hilla branch of the Euphrates River, south of Baghdad. The population is estimated at 364,700 in 1998. It is the capital of Babylon Province an ...
near the ruins of Babylon and CPA South in the southern Iraqi city of
Basra Basra ( ar, ٱلْبَصْرَة, al-Baṣrah) is an Iraqi city located on the Shatt al-Arab. It had an estimated population of 1.4 million in 2018. Basra is also Iraq's main port, although it does not have deep water access, which is han ...
. Each region operated semi-autonomously, and all four had the same common goals for reconstruction of the country. Throughout the existence of the CPA, the security situation and levels of
civil unrest Civil disorder, also known as civil disturbance, civil unrest, or social unrest is a situation arising from a mass act of civil disobedience (such as a demonstration, riot, strike, or unlawful assembly) in which law enforcement has difficulty ...
throughout the country varied by region, and these variances were reflected in the different levels of program successes within the CPA divisions.


Non-government organizations and private charities and the CPA


Role of the International Advisory and Monitoring Board (IAMB)

United Nations resolutionbr>1483
transferred the authority to authorize expenditures from Iraq's oil revenue from the United Nations to the Coalition Provisional Authority—under certain conditions, including: * The expenditures were made in an open, transparent manner. * The expenditures were subject to the supervision of a blue ribbon panel of international financial experts, the IAMB. * Spending decisions were to be made with meaningful Iraqi input. The International Advisory and Monitoring Board consisted of senior financial experts from the United Nations, the
International Monetary Fund The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution, headquartered in Washington, D.C., consisting of 190 countries. Its stated mission is "working to foster glo ...
, the
World Bank The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects. The World Bank is the collective name for the Inte ...
and the Arab Fund for Social and Economic Development. The IAMB had serious concerns over the CPA's lack of transparency and lack of adequate financial controls, which were never resolved. The IAMB still exists and is playing a role in the investigations into the CPA's financial management.


The CPA's Program Review Board

The Program Review Board (PRB) was an eleven-member board that consisted of ten staff members from the CPA and one member of the Iraqi Governing Council. The chair of the board was also the CPA's senior advisor to the Iraqi Ministry of Finance. It was the board's responsibility to review and make recommendations to the CPA administrator on which contracts should be awarded. In order to ensure transparency, all key discussions regarding the pros and cons of the programs under consideration were to be made public. The CPA administrator was supposed to make decisions on the awarding of contracts only after receiving a recommendation from this committee. The Notes on Internal Control from KPMG's audit of DFI expenditures was particularly critical of PRB record-keeping's failing to fulfill the CPA's transparency obligation. In particular: * Meetings were held in which attendance was not recorded. * Meetings were held in which decisions were made in the absence of quorums. * The Program Review Board never recorded the motions to approve expenditures, who seconded motions, or which members were for or against those motions. * In the 43 meetings held in 2003, the single Iraqi member of the board attended only two meetings. * The minutes failed to contain sufficient detail for readers to understand why programs were approved. * Program decisions that had been tabled were later approved informally outside the meetings, with no recording of the reasoning behind the decision. * The board chair refused to certify the accuracy of the Board's bookkeeping.


Privatization of Iraq's economy

Prior to US occupation, Iraq had a
centrally planned economy A planned economy is a type of economic system where investment, production and the allocation of capital goods takes place according to economy-wide economic plans and production plans. A planned economy may use centralized, decentralized, p ...
. Among other things, it prohibited foreign ownership of Iraqi businesses, ran most large industries as state-owned enterprises, and imposed large tariffs to keep out foreign goods. After the invasion of Iraq, the CPA quickly began issuing many binding orders privatizing Iraq's economy and opening it up to foreign investment. CPA Order 39, entitled "Foreign Investment," provided that "A foreign investor shall be entitled to make foreign investments in Iraq on terms no less favorable than those applicable to an Iraqi investor," and that " e amount of foreign participation in newly formed or existing business entities in Iraq shall not be limited...." Additionally, the foreign investor "shall be authorized to... transfer abroad without delay all funds associated with its foreign investment, including shares or profits and dividends....". Critics assert that the CPA drastically altered Iraq's economy, allowing virtually unlimited and unrestricted foreign investment and placing no limitations on the expatriation of profit. However, these policies were in accord with current international standards on foreign direct investment to which most of the developed world adheres. The order concluded, "Where an
international agreement A treaty is a formal, legally binding written agreement between actors in international law. It is usually made by and between sovereign states, but can include international organizations, individuals, business entities, and other legal perso ...
to which Iraq is a party provides for more favorable terms with respect to foreign investors undertaking investment activities in Iraq, the more favorable terms under the international agreement shall apply." According to critics, this order was designed to create as favorable an environment for foreign investors as possible, thereby allowing American and multinational corporations to dominate Iraq's economy. Others argue the CPA considered free market reform essential for Iraq's oil wealth to generate sustainable growth and development, instead of consigning Iraq to a resource trap by maintaining the laws of the previous totalitarian regime. CPA Order 17 granted all foreign contractors operating in Iraq immunity from "Iraqi
legal process Legal process (sometimes simply process) is any formal notice or writ by a court obtaining jurisdiction over a person or property. Common forms of process include a summons, subpoena, mandate, and warrant. Process normally takes effect by s ...
," effectively granting immunity from any kind of suit, civil or criminal, for actions the contractors engaged in within Iraq. CPA Order 49 provided a tax cut for corporations operating within Iraq. It reduced the rate from a maximum of 40% to a maximum of 15% on income. Corporations working with the CPA were exempted from owing any tax. CPA Order 12, amended by Order 54, suspended all tariffs, thus removing the advantage that domestic Iraqi producers had over foreign producers. However, a 5% "reconstruction levy" on all imported goods was later reimposed to help finance Iraqi-initiated reconstruction projects. CPA Order 57 provided for the appointment of "Inspectors General" to operate within each Iraqi government ministry, for the purposes of rooting out corruption. These Inspectors General were to be "appointed to a 5-year term by the Administrator aul Bremer" and were given sweeping powers "to conduct investigations, audits, evaluations, inspections, and other reviews...." Critics contend this is a mechanism for ensuring continuing American influence in Iraqi governance even after the transfer of all
sovereignty Sovereignty is the defining authority within individual consciousness, social construct, or territory. Sovereignty entails hierarchy within the state, as well as external autonomy for states. In any state, sovereignty is assigned to the perso ...
to the country.


Legitimacy under international law

Critics contend that the controversial policies are fundamentally anti-democratic, or illegal under international law, because significant economic reform can only be legitimate if passed initially by an elected Iraqi government free of foreign occupation and domination, and because an occupying power is prohibited from rewriting the laws of the occupied country. The CPA argued that imposing Order 39 was permitted under Resolution 1483, because it required the CPA to "promote the welfare of the Iraqi people through the effective administration of the territory," and to create "conditions in which the Iraqi people can freely determine their own political future." Proponents of this position state Resolution 1483 necessarily requires radical economic restructuring, so it allowed an exception to international law regarding occupation. However, others point out that Resolution 1483 "calls upon all concerned to comply with international law including in particular the Geneva Conventions of 1949", which would require an occupying force to respect the laws in force in the country unless absolutely prevented.


Criticism of financial management

In May 2003, the CPA took over the responsibility for administering the
Development Fund for Iraq In May 2003, following the invasion of Iraq in March of that year, the Central Bank of Iraq-Development Fund for Iraq (DFI) account was created at the U.S. Federal Reserve Bank of New York at the request of the Coalition Provisional Authority (CPA) ...
(DFI). Established from the earlier UN oil-for-food program, the CPA was authorized to manage the DFI, which took in approximately $20 billion in the year after the invasion. The CPA also administered $18.4 billion that the
United States Congress The United States Congress is the legislature of the federal government of the United States. It is bicameral, composed of a lower body, the House of Representatives, and an upper body, the Senate. It meets in the U.S. Capitol in Washing ...
allocated for Iraqi reconstruction in November 2003, known as the Iraq Relief and Reconstruction Fund (IRRF). By June 2004, the CPA had spent, or allocated, $19.1 billion of the DFI funds—while spending only $400 million from the IRRF. Critics suggest that Bremer selectively spent from the DFI because it was more free from accounting oversight by the Government Accountability Office (GAO). This balance between DFI and IRRF expenditures might be justifiable by the argument that the IRRF was not intended to finance the Iraqi government ministries or the Public Distribution System (state food rations from the Oil-for-food program), which the DFI was intended to cover. The $18.4 billion authorized by the U.S. congress was intended to finance large reconstruction projects such as power and sewage plants, not to provide the day-to-day operating expenses of the Iraqi government. Expenditure on the IRRF projects could be seen as delayed by the projects being in their planning and early site preparation stages and it could be said that it is not surprising that little money had been disbursed at that point, or that so much of the
Development Fund for Iraq In May 2003, following the invasion of Iraq in March of that year, the Central Bank of Iraq-Development Fund for Iraq (DFI) account was created at the U.S. Federal Reserve Bank of New York at the request of the Coalition Provisional Authority (CPA) ...
had been expended as that fund was the primary source of revenue the Iraqi government had. However, by reviewing reports from Special Inspector General for Iraq Reconstruction (SIGIR) and other reviews and audits, it becomes clear that DFI funds were expended on projects that clearly would have been appropriate for management under IRRF. What has been troubling to auditors and inspectors general is that large amounts of DFI funding is as yet unaccounted for and was expended in reconstruction projects that failed to provide a return on investment for the Iraqi people. By funding projects under DFI the CPA avoided legal requirements to comply with US Federal Acquisition Regulations (USFARS) as required for the administration of IRRF and other US taxpayer provided funding. It is also pertinent that expenditures under IRRF were also not administered strictly according to USFARS thereby causing severe waste, fraud and abuse as documented by SIGIR and other auditing agencies.


Audits of the CPA's expenditures of Iraqi funds

When authority to manage the revenue from Iraq's oil on behalf of the Iraqi people through United Nations resolution, that authority was transferred under certain conditions. * The funds were to be managed in an open, transparent fashion. * The CPA was to submit to oversight from the International Advisory and Monitoring Board, a blue ribbon panel of senior international banking experts. The IAMB tried to insist on certain financial controls, with limited success. With input from the IAMB accounting firm KPMG was appointed to audit the CPA's expenditures from the DFI. On 20 June 2005 the staff of the Committee on Government Reform prepared a report for Congressman
Henry Waxman Henry Arnold Waxman (born September 12, 1939) is an American politician who served as a U.S. representative from California from 1975 to 2015. He is a member of the Democratic Party. His district included much of the western part of the city of ...
on the CPA's expenditures from the DFI that raised additional causes for concern. Further criticism was leveled at the CPA when it was revealed that $12 billion of cash had been delivered by C-130 planes on shrinkwrapped pallets of $100 bills. The cash deliveries were described in a memo prepared for the United States House Committee on Oversight and Government Reform, which concluded that "Many of the funds appear to have been lost to corruption and waste.... Some of the funds could have enriched both criminals and insurgents...."
Henry Waxman Henry Arnold Waxman (born September 12, 1939) is an American politician who served as a U.S. representative from California from 1975 to 2015. He is a member of the Democratic Party. His district included much of the western part of the city of ...
, the chair of the House committee commented, "Who in their right mind would send 363 tons of cash into a war zone?" A single flight to Iraq on 12 December 2003 which contained $1.5 billion in cash is said to be the largest single Federal Reserve payout in US history according to Henry Waxman. In 2011, a new American audit found that almost all of the missing $6.6 billion had been transferred to the Central Bank of Iraq. Special Inspector General for Iraq Reconstruction Stuart Bowen said that "Any doubts about how the money was handled after it left U.S. control is an Iraqi -- not U.S. government -- question".


Reconstruction

Although the CPA awarded contracts for essential reconstruction to American firms, some critics claim those firms did relatively little work. Bechtel, for instance, was awarded the contract to repair the Iraqi sewage and drinking water plants. Yet today many Iraqis remain without safe drinking water or adequate supplies of electricity. Coalition military forces were too heavily tasked to provide requisite security for all contractors in Iraq. Contract funds therefore had to be partially shifted from reconstruction activities to meet security requirements that had not been envisioned when the contracts were initially let. Moreover, progress in reconstruction frequently faced setbacks due to insurgency activities designed to disrupt rebuilding of the infrastructure. This insurgent activity significantly slowed reconstruction and required adjustment of project goals due to funds consumed by providing necessary security in excess of that originally planned. According to USAID, as of October 2003, peak electrical generation had reached pre-war levels of 4,500 MW, and they were then collaborating with Bechtel as well as the Iraqi Interior Ministry and others on some 2,000 MW of projected capacity. The CPA set a goal of 6,000 MW generation capacity for the summer of 2004, which has never been reached. Peak generation capacity of 5,365 MW was achieved in August 2004, six weeks after the transfer of sovereignty. Current generation stands at approximately 13,000 MW. Weekly updates and financial summaries are provided by USAID's Iraq homepage as currently as is possible.Official website


Administrators of the CPA

*
Jay Garner Jay Montgomery Garner (born April 15, 1938) is a retired United States Army lieutenant general who in 2003 was appointed as Director of the Office for Reconstruction and Humanitarian Assistance for Iraq following the 2003 invasion of Iraq, makin ...
(21 April 2003 – 12 May 2003)
as Director of the Office for Reconstruction and Humanitarian Assistance *
Paul Bremer Lewis Paul Bremer III (born September 30, 1941) is an American diplomat. He led the Coalition Provisional Authority (CPA) following the 2003 invasion of Iraq by the United States, from May 2003 until June 2004. Early life and education Born on ...
(12 May 2003 – 28 June 2004) ** Richard Jones (U.S. diplomat), Deputy Administrator **Rear Admiral David J. Nash, U.S. Navy (ret.), Director of the Program Management Office **Major General Ronald L. Johnson, U.S. Army, Deputy Director of the Program Management Office **Lawrence Crandall, U.S. Agency for International Development, Deputy Director of the Program Management Office **Stuart W. Bowen Jr., Inspector General of the Program Management Office **Rear Admiral Larry L. Poe, U.S. Navy (ret.), Deputy Inspector General of the Program Management Office


See also

*
United Nations Security Council Resolution 1483 United Nations Security Council resolution 1483, adopted on 22 May 2003, after recalling all previous resolutions on the situation between Iraq and Kuwait, the Council lifted trade sanctions against Iraq (excluding an arms embargo) and terminate ...
* Iraq Relief and Reconstruction Fund *
Reconstruction of Iraq Investment in post-2003 Iraq refers to international efforts to rebuild the infrastructure of Iraq since the Iraq War in 2003. Along with the economic reform of Iraq, international projects have been implemented to repair and upgrade Iraqi water ...
*
Provisional government A provisional government, also called an interim government, an emergency government, or a transitional government, is an emergency governmental authority set up to manage a political transition generally in the cases of a newly formed state or ...
s *
Development Fund for Iraq In May 2003, following the invasion of Iraq in March of that year, the Central Bank of Iraq-Development Fund for Iraq (DFI) account was created at the U.S. Federal Reserve Bank of New York at the request of the Coalition Provisional Authority (CPA) ...
* Coalition Provisional Authority Program Review Board * International Advisory and Monitoring Board *
KPMG audit of the Development Fund for Iraq In May 2003, following the invasion of Iraq in March of that year, the Central Bank of Iraq-Development Fund for Iraq (DFI) account was created at the U.S. Federal Reserve Bank of New York at the request of the Coalition Provisional Authority (CPA) ...


Notes


Further reading


Who's Who in the Coalition Provisional Authority
'' The Washington Monthly'', December 2003.
Coalition Provisional Authority
Archived site carrying CPA news releases, mission statements and budgets.
USAID Assistance for Iraq Homepage
(See right column for weekly updates.)
Overview of CPA Orders Affecting Iraq's Commercial Law


12 July 2010.
Iraq Project and Contracting Office Website

Global Justice Project: Iraq

Iraq's Economy Past, Present and Future

Crossed Wires Deprived Iraqis of Electric Power: War Plans Ignored Worn Infrastructure
''
The Washington Post ''The Washington Post'' (also known as the ''Post'' and, informally, ''WaPo'') is an American daily newspaper published in Washington, D.C. It is the most widely circulated newspaper within the Washington metropolitan area and has a large nati ...
'', 23 September 2003.
Iraq - Transitional Administrative Law
an English translation of Iraq's Interim Constitution.
Foreign Direct Investment Restrictions in OECD Countries
an explanation of current common national practices regarding foreign direct investment and foreign ownership in OECD nations, including WTO regulations.
Fair and Equitable Treatment Standard in International Investment Law
OECD, 2004.

the ''Wall St Journal'' on Iraq's looming "independence". (13 May 2004).

''The Washington Post'', 22 May 2004.
Boston Globe article that recounts questionable fiscal management on the part of the CPA
.
U.S. Funds for Iraq Are Largely Unspent
''The Washington Post'', 4 July 2004.
A Historic Review of CPA Accomplishments
(to 30 June 2006).
Video Seminar on Iraq Coalition Politics
20 April 2005, sponsored by the Program in Arms Control, Disarmament, and International Security at the University of Illinois.
Rules and Cash Flew Out the Window
''
Los Angeles Times The ''Los Angeles Times'' (abbreviated as ''LA Times'') is a daily newspaper that started publishing in Los Angeles in 1881. Based in the LA-adjacent suburb of El Segundo since 2018, it is the sixth-largest newspaper by circulation in the U ...
'', 20 May 2005.
Iraq too dependent on Oil Revenue - govt
Reuters, 5 June 2005.
Iraqis Look at Cuts in Payroll
''Los Angeles Times'', 6 June 2005.


Bechtel's Dry Run (.pdf)
an independent review of the Bechtel water rehabilitation work.

''
The Guardian ''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers ''The Observer'' and ''The Guardian Weekly'', ''The Guardian'' is part of the Gu ...
'', 7 July 2005.
U.S. Using Cash as a Defensive Weapon
''The Washington Post'', 26 July 2004.

12 December 2005.
Tony Sodaro's "Iraqi Blog" after CPA, 03 October 2008
* Chandrasekaran, Rajiv

''The Washington Post'', 17 September 2006.
Occupying Iraq: A History of the Coalition Provisional Authority
The RAND Corporation, 2009. By James Dobbins, Seth G. Jones, Benjamin Runkle, Sidd harth Mohandas.


External links


Official Web Page of the Coalition Provisional Authority


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