UK companies urged to seek Iraq contracts

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Uk companies were urged by the Government to bid for work in Iraq after being told yesterday they would be eligible to become "prime contractors" for the £10.9bn reconstruction work that is being financed by the US.

A conference in London heard that British companies would not face competition from, for instance, French or German businesses for the lucrative prime contracts. Only businesses from countries that supported the US-led coalition in Iraq are eligible for the main contracts. Delegates also heard that the US requires the work to be carried out on a "very aggressive timetable".

The Trade minister Mike O'Brien, who addressed the conference, told The Independent that there was a lot of interest from British companies in the projects.

He admitted there remained severe security risks to operating in Iraq. He added: "British companies have expertise in operating in dangerous environments. It is essential that British companies become involved in Iraq."

Usually, only American companies are allowed to be prime contractors in aid work financed by the country's government. A dispensation to allow certain non-American businesses to be awarded Iraq work is seen by some as a "pay-back" for supporting the war.

Mr O'Brien said: "Iraq is a dangerous place. It is important that British companies recognise the risks and help Iraqis rebuild their country."

Andy Bearpark, director of operations at the Coalition Provision Authority, which is running Iraq, said that between 15 and 20 prime contracts would be available. These will cover sectors such as oil, electricity and water. The main contracts, expected to last no more than five years, will be awarded in January, with work beginning in February.

The thousands of subcontracts, that will be let out by the prime contractors, are to be open to companies from any country.