The Report of the Iraq Inquiry

696. In response, Sir Nigel Sheinwald, Mr Blair’s Foreign Policy Adviser, commissioned

a paper on UK access to US-funded reconstruction contracts for the 22 January meeting

of the AHMGIR.411

697. The 20 January meeting of ISOG concluded that, in contrast to the UK’s success

in 2003, the UK’s “current record” on winning US contracts was not good.412 The ISOG

agreed that the UK needed a “proper campaign plan” involving Ministers and the British

Embassy Washington, targeting the next tranche of US-funded contracts that would be

awarded by the PMO in March.

698. UKTI submitted a draft paper on UK access to US-funded reconstruction contracts

to the 22 January meeting of the AHMGIR.413

699. The draft paper stated that UK companies had good access to most US-funded

contracts, but had achieved only limited success so far. US procurement rules were

complex; several UK companies had formed joint ventures with US companies to

overcome that barrier. The recent award of the US-funded oil contracts to US companies

(bids with significant UK components had not been successful, despite lobbying by

Ministers) suggested that the UK needed to take a “stronger and more active political

line” in Washington to lobby for UK commercial interests.

700. The draft paper stated that while the British Embassy Washington conceded that

UK lobbying had not been successful, the Embassy was not convinced that the UK had

yet reached the stage where “high level political pressure” was appropriate.

701. The draft paper concluded that, as a first step, the Government should take

the line that UK companies had expertise and capacity in areas needed for Iraq’s

reconstruction, and that the Government wanted to see a significant UK component

in the PMO’s prime contracts. DTI and FCO Ministers should lead the UK’s lobbying.

The UK should consider targeted lobbying visits by Ministers to Washington closer to

the announcement of the PMO contracts.

702. UKTI prepared a final version of the paper for the next meeting of the AHMGIR,

on 12 February.

703. At Mr Straw’s request, Sir Stephen Brown contacted the three unsuccessful

UK companies for their views on the process.414

704. Sir Stephen reported to Mr O’Brien on 30 January that UK companies were

unsurprised at the result; the scale and complexity of the work was such that “US giants”

411 Briefing DTI, [undated], ‘Key Points Brief on DTI Issues: Ad Hoc Ministerial Meeting on Iraq’.

412 Minutes, 20 January 2004, Iraq Senior Officials Group.

413 Annotated Agenda, 21 January 2004, Ad Hoc Ministerial Group on Iraq Rehabilitation meeting attaching

Paper UKTI [draft], 20 January 2004, ‘Access to US-funded Reconstruction Contracts’.

414 Minute Brown to O’Brien, 30 January 2004, ‘Iraq: Access to US Funded Reconstruction Contracts’.

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