Even in the more stable south, Iraq rebuilds slowly

By Missy Ryan

DHI QAR PROVINCE, Iraq (Reuters) - Local leaders in southern Iraq pleaded for greater reconstruction assistance this weekend even as U.S. and Iraqi officials touted tentative improvements since 2003 in rebuilding a country crippled by war.

Senior members of Prime Minister Nuri al-Maliki's government, Washington's ambassador to Iraq and other officials flew on Saturday to a dusty military base in Dhi Qar, a poor southern province where shepherds hustle animals across cracked plains and the horizon is dotted by Bedouin tents.

Deputy Prime Minister Barham Salih told visiting dignitaries, local tribal leaders and other officials that a sharp drop in violence in recent months had laid the groundwork for renewing Iraq's decrepit infrastructure and ailing economy.

"We are in a new era in our history ... where we are going to build a peaceful country," he said.

Yet in Dhi Qar, complained Governor Aziz Kazem Alwan, 300 villages remain without electricity. He clamoured for more help from the central government and donor countries to improve irrigation for local farms, replace mud-built schools, pave roads and provide better health care.

"All our farmers and sheikhs (tribal leaders) are waiting for these projects," he said.

The United States has poured more than $525 million since 2003 into rebuilding Dhi Qar, Ambassador Ryan Crocker said. An Italian-led team is now driving foreign reconstruction efforts in Dhi Qar, part of Iraq's more stable Shi'ite south.

Still, guaranteeing security is seen as crucial to capitalising on investments in the province's schools, water and energy infrastructure.

Across Iraq, reconstruction data paints a mixed picture more than four years after the invasion to topple Saddam Hussein.

Despite billions of dollars being spent, peak electricity output in June 2007 remained 6 percent below pre-war levels. Oil production this summer was 23 percent lower than before the war.

FOCUS ON LOCAL OFFICIALS

Crocker and other foreign officials argue that the biggest challenge now, rather than bringing cash for big infrastructure projects, is to improve local officials' ability to manage reconstruction in the future.

They also want to inject new life into local business, such as assisting date farmers process and market their goods.

But investors are not yet flocking to Dhi Qar or to Iraq's other provinces. While rampant violence has been the chief hindrance, another bottleneck is a delay in implementing a law passed last year to safeguard investor rights.

Officials tout Dhi Qar, which has been spared much of the bloodshed in other parts of the country, as a model for Iraqis taking back control of security. British forces had responsibility for security until handing back control in 2006.