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August 8, 2011

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Iraqi minister sacked over 'irregularities'

IRAQI Prime Minister Nuri al-Maliki has dismissed his electricity minister after the government said an investigation had uncovered irregularities in power contracts with two foreign companies, a source in Maliki's office said yesterday.

The electricity ministry also said it had asked the Cabinet to rule on a US$2.76 billion power plant construction contract with a unit of South Korea's STX Group after saying the company risked missing a deadline to meet one of its contract terms.

The dismissal of electricity minister Raad Shallal, which under Iraqi law has to be approved by parliament, could complicate government efforts to attract investors to tackle chronic electricity shortages that have infuriated Iraqis looking to rebuild their economy.

A government ombudsman said on Saturday that Iraq had canceled power plant contracts worth US$1.7 billion with Canadian and German companies after uncovering "manipulation and misleading information" about their finances or ability to carry out the work.

But a senior official in the electricity ministry defended the contracts, saying the companies had agreed to continue construction with favorable conditions.



 

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