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and that will continue to be a major objective of our future strategic relationship.

Harry Cohen (Leyton and Wanstead) (Lab): Why is the private sector the priority for the Government and the occupying forces in Iraq? The public sector has been devastated—by bombs and all sorts of destruction. Why, therefore, have a lop-sided policy for privatisation? Is not that old-fashioned and reactionary of the Government?

Mr. Hutton: Well— [Laughter.]

Harry Cohen: I am being serious.

Mr. Hutton: My hon. Friend makes a serious point, but let me make two or three comments. We are not talking about the Government’s policy—

Harry Cohen: You said it.

Mr. Hutton: I am describing the Iraqi Government’s policy to develop a more vibrant private sector. That is the Iraqi Government’s decision, not a judgment call by the British Government. Oil and gas reserves are significant, with assets in the north and south of the country. The Iraqi Government recently sponsored a conference in London to consider the role that international energy companies can play and the extent to which they can help the Iraqis develop a modern and effective oil and gas industry. Few people in the world today—perhaps my hon. Friend is one—believe that all that can and should be done only by state oil companies. That is not the British Government’s or the Iraqi Government’s view. The British Government’s role and objectives are to help support the Iraqi Government to develop those elements of economic policy. It is the Iraqi Government’s chosen path. With great respect to my hon. Friend, it is neither right nor true to describe coalition forces, who operate in Iraq under a UN Security Council resolution, as occupying forces. That is out-dated and inappropriate language.

We have already worked hard to renew vital economic and social infrastructure, stimulate economic growth and attract inward investment, which is necessary to secure the prosperity of the Iraqi economy.

Meg Munn (Sheffield, Heeley) (Lab/Co-op): I am sure that my right hon. Friend agrees that the ability of people from Iraq to travel internationally when developing trade links is important. May I therefore raise the problem of getting visas to the UK? For example, people in the Kurdistan region must go to Oman to get a visa. Given that the position in Iraq has improved so much, will my right hon. Friend examine the matter with his ministerial colleagues so that Iraqi people can travel and do business internationally in the same way as everybody else?

Mr. Hutton: I am grateful to my hon. Friend, who was a Minister in the Foreign and Commonwealth Office, for making that point. The Minister of State, Foreign and Commonwealth Office, my hon. Friend the
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Member for Harlow (Bill Rammell), tells me that the Foreign Office is looking to improve access to visas and the arrangements that apply, especially to those travelling from specific parts of northern Iraq. Perhaps he can develop that point in his response to the debate.

I pay special tribute to Michael Wareing and his work with the Basra Development Commission, which has successfully raised Basra’s profile through a series of investment conferences—most recently last month in Istanbul—and drawn up an economic development strategy. That will become the work of, and come under the ownership of, the Iraqis later this year. It also addresses specific problems, such as youth unemployment, and recently announced a pilot scheme to provide 500 young Basrawis with employment training through placements with local businesses.

The much-improved security situation means that international companies are now seriously considering investing in Iraq. That is a good thing. The UK has facilitated more than 15 investor visits to show international companies the opportunities available in Iraq. That has led to $9 billion worth of proposals being submitted to the Government of Iraq. The next step is for Iraqi institutions to take forward that work. We have helped create the Basra Investment Commission, the launch of which the International Development Secretary attended in Basra on 6 November. Once fully operational, the BIC will lead on promoting investment opportunities in the city, turning proposals—I hope—into jobs and wealth. The opportunities are substantial.

In addition to the development potential of Basra’s international airport, Umm Qasr is Iraq’s only deep water port. It is busier than ever, but antiquated equipment and methods mean that it does not yet achieve anything like its full potential. The UK and our coalition partners are working with the Iraqi authorities to develop the port, and it is one of the key areas in which international companies rightly look to invest.

Iraq has the third largest reserves of oil in the world, and the potential to be an extremely wealthy country. However, decades of under-investment under Saddam and the effects of corruption and sabotage have left Iraq’s energy infrastructure in a deplorable state. The Iraqi Government are now addressing that issue, looking to place major contracts with multinational companies to help repair and modernise equipment and to develop oilfields more efficiently, while ensuring that the Iraqi people retain ownership of their resources.

There are huge investment opportunities for UK businesses, and the Government of Iraq, from Prime Minister al-Maliki downwards, have repeatedly emphasised their strong desire for increased UK investment in Iraq. I greatly hope that UK companies will be quick to join the rush of those seeking to take advantage of these opportunities.

I have tried to describe the challenges that UK personnel have faced and overcome in southern Iraq. I cannot overstate the contribution of the UK’s armed forces, but the achievements in southern Iraq have not been the result of UK military efforts alone—the mission has been joint in every sense. UK forces have co-operated with the Iraqi security forces and our coalition partners. In a prime example of the comprehensive approach that we have tried to follow, the UK effort has been developed and supported across Departments.

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Iraq’s future is now in Iraqi hands, and the continued development of a stable, prosperous and democratic Iraq remains vital to the UK’s strategic and national interests. Such an Iraq will promote stability and prosperity in the middle east and be a key ally in the fight against terrorism, and can make a major contribution to improved global energy security.

Our mission in Iraq has freed Iraqis from the oppression of Saddam’s brutal rule. It has empowered them to build their own democratic institutions and paved the way for a different and more positive future—for themselves and the region. I am proud to say that we are at the point of completing the UK mission. When we have done so, our forces can return home with their heads held high. However, their homecoming—warmly anticipated by their families and loved ones—will not be the end of our involvement in Iraq. We look forward to a long and fruitful bilateral relationship, covering the full range of co-operation and engagement, from security to economic, political to cultural: a relationship based on friendship and respect between Iraq and the UK, forged in exceptionally difficult times and now set to develop as a lasting legacy of the service and sacrifice of so many of the brave men and women of our armed forces, who have made all that possible.

2.9 pm

Dr. Liam Fox (Woodspring) (Con): The United Kingdom has paid a high price to remove Saddam and help to build a better Iraq. British forces have been in Iraq for 2,126 days. We have lost 178 of our brave soldiers, sailors, airmen and marines, and hundreds more have been wounded. The long-term psychological impact on the members of our armed forces is virtually unknown, and the British taxpayer has paid out more than £6.5 billion since the invasion in 2003.

But when we consider that steep price, we must not forget that under the brutal and authoritarian rule of Saddam Hussein, Iraq invaded three of its neighbours, fired Scud missiles at five of its neighbours and killed hundreds of thousands of its own citizens and Iranians with chemical weapons. As my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot) has said, history did not begin in 2003. It is hard to believe that anyone still believes that the Iraqi people, the region or the world would have been better off with Saddam still in power. Yet those who believe that the invasion should not have taken place must believe that to be so—I do not believe that and never have.

Sir Robert Smith: The hon. Gentleman is detailing the price that has been paid, but is there not another price that has been paid by the people of Afghanistan? The west went into Afghanistan with a clear purpose and mandate and an important job to do, but then it took its eye off the ball and neglected Afghanistan, diverting resources to Iraq before finishing the job and leaving a high price to pay for the people of Afghanistan and for our troops who are trying to clear up the mess that we have left behind.

Dr. Fox: I will talk about Afghanistan in a moment, but if the hon. Gentleman is saying that the world community should have placed more emphasis on Afghanistan from the outset, he is correct. However, I do not believe that there was a choice between the two.
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Indeed, there is still a strong case for the international community to play a much greater role and to give greater commitment to the United Nations mission in Afghanistan, where there is much still to be done.

The sacrifices of our armed forces and our loved ones should not—cannot—go unnoticed, and our country and the people of Iraq owe them a great deal of gratitude and thanks. Our mission in Basra is coming to an end. When I met General Mohammed recently, he made it clear that the Iraqis no longer see a combat role for British forces. However, in what can be viewed only as a positive development, not only do the Iraqis want to take control over their own destiny, but they increasingly have the means to do so. The Iraqi security forces have significantly grown, and I have seen at first hand how the security situation has improved in Basra. When I was there only a few weeks ago talking to ordinary citizens on the streets and mixing with them freely, which, for the first time, I did without body armour, I found that the conversations and concerns have moved away from security and on to issues such as access to electricity, clean water, jobs and economic prosperity. That those people can think that way is the result of the hard work and sacrifices of thousands of British, American and Iraqi troops over a number of years.

Although the security situation has established the conditions for what will eventually be a total withdrawal—or an almost total withdrawal—of British forces from Iraq, the Government have a responsibility to ensure that they consolidate the recent success into a long-term vision. It is also vital to point out to the international community that a reduction in British forces in Iraq in no way means a British disengagement from the region. In particular, it would be very wrong for Iran to draw the conclusion that any UK troop reduction represents a change in British policy towards the threat that it poses to the region and beyond. The continued and highly valued role being played by the Royal Navy is testament to our continued engagement and interest in the region and its people.

Harry Cohen: I want to return to the hon. Gentleman’s first point, about the removal of Saddam Hussein, whom we all detested. However, notwithstanding that regime change was illegal, does the hon. Gentleman really think that it was worth while for 1 million people to be taken out with him, along with another 1 million people before that through sanctions, making more than 2 million people killed so that Saddam Hussein could be got rid of?

Dr. Fox: It is presumptuous if we think that we know what is good for the Iraqi people better than they do. It is clear to anyone who has been to Iraq and talked to the people there that those people believe that they are better off than they were under Saddam Hussein, because they have a chance to shape their own destiny in a way that they would have been perpetually denied under the authoritarian regime that existed previously. The Iraqi people know that they are better off, and I bend to their judgment on that matter. They are the ones who suffered under that regime.

There is one further point to be made about the withdrawal of British troops and its impact. Let me say a word of caution. No one in this country should believe that removing our troops from Iraq will in some way be a panacea for troop shortages in southern
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Afghanistan. Many people, including some commentators, seem to believe that a simple shift of British troops from Basra to Helmand is possible. However, for some very good military, logistical and welfare reasons, it is not as simple as that. Although reduced commitments in Iraq may relieve the overstretch of our forces to some extent, the key to alleviating the shortfall in manpower in the vital, if not existential, struggle for NATO in Afghanistan is for our European allies to contribute more troops and equipment to the fight in southern Afghanistan. As we have said so often in the House, it is not acceptable for all the countries to get the insurance policy when only a few are paying the premiums.

It is clear that our relationship with Iraq is changing and evolving, which is natural. That relationship can be viewed in a number of ways, as the Secretary of State said. It can be viewed as a commercial and economic relationship and as a military and political relationship. I want first to deal with the commercial and economic relationship, which the Secretary of State discussed. According to Iraqi Government officials, Iraq’s budget surplus was $72 billion in 2008 and is forecast to be $90 billion in 2009, which is a change from what we are experiencing in the United Kingdom. Needless to say, a lot of money is being awarded in the form of lucrative contracts for the reconstruction of Iraq.

Considering the Secretary of State’s previous incarnation in the Cabinet, I am compelled to ask where Britain plays a role in that process. When I visited Iraq recently, I was horrified to learn that the Department for Business, Enterprise and Regulatory Reform had a representative in the UK embassy in Baghdad until 2007, but that the post was cut in 2008 owing to “resource issues”. How short-sighted can we get? Our lack of trade presence in Baghdad means that we may have shed blood for Iraq but stand little chance of benefiting from the contracts flowing from Iraq’s fiscal surplus.

I found it rather pathetic that the FCO, the MOD and DFID were talking about pooling their budgets to get a trade representative in Baghdad because the Government would not fund one centrally, which was certainly the position at the end of last year. I am sure that when the Minister responds to this debate, the House will want an assurance that that is no longer the case, because it is unacceptable to hon. Members on both sides of the House.

There is a lot of potential for Iraq to become a regional financial and trading hub. We must do all that we can to help that become a reality, because, as the Secretary of State correctly said, a stable and prosperous Iraq is in all our interests. That is why we welcomed the Prime Minister’s announcement about the formation of a Basra Development Commission in October 2007, with one of its goals being to

The Prime Minister was referring to the port of Umm Qasr. I recently visited the airport, which is clearly ready for business. I also welcome the Secretary of State’s announcement that the airport was transferred to Iraqi control, on time, on 1 January.

There are currently discussions about building a new deep-water port near Basra. Such a facility in the north of the Gulf could be the starting point for goods to be
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moved overland by rail from Iraq to Europe via Turkey, offering an alternative to the Suez canal and the strait of Hormuz and reducing the overall time to transport goods to Europe, which would be a major strategic advantage for us in the west. There is also talk of creating an economic free zone around Basra like that found in Dubai. Those would be extremely welcome projects not only for the people of Iraq, but for the region and, I believe, for us. We need to know what the Government think they can do to ensure that those projects become a reality.

There is clearly a lot of reconstruction going on in Basra. When one visits it, it is not hard to imagine what a beautiful city it must have been and, almost by definition, could be again. There are plans to build a new bridge across the Shatt al-Arab waterway, which would drastically decongest the waterway and allow more shipping to get into the port. What are we doing to help all those projects? How is our expertise helping to make them a reality? I hope that the Minister will address those issues, because they will affect our future relationship with Iraq.

Turning to our military relationship with Iraq, I welcome the fact that the Government believe that, some day, our military relationship will be

My right hon. and learned Friend the Member for Kensington and Chelsea (Sir Malcolm Rifkind) has referred to that point as well, which is something that we should be aiming for. Right now, the main effort of the British Army is to train the Iraqi 14th Division so that it can eventually act autonomously while conducting security operations.

But, as Britain’s military role is transformed from being ground based to being maritime based, how will the status of forces agreement impact on our Royal Navy’s ability to accomplish its mission of mentoring and training the Iraqi navy? I ask that because it is my understanding that the Australian Government have removed the Australian navy from Iraqi territorial waters—and, consequently, from coalition task force 158—over concerns about the status of forces agreement. There are differences between the UK-Iraq agreement and the agreement between Iraq and the United States. The UK’s agreement gives Iraq far wider jurisdiction over UK service personnel, stating that they

The qualifiers relating to intent and gross negligence do not appear in the US agreement. There is also no mention in the UK agreement of the due process protections offered to US service personnel. The House and our armed forces must be completely reassured that our forces are not in any way compromised when it comes to their legal protection. This is important because the Royal Navy is doing an outstanding job in securing Iraqi oil platforms and increasing the capability of the Iraqi navy as part of CTF158.

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