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Nov 3, 2010

Q&A: Is al Qaeda in Iraq coming back?

BAGHDAD (Reuters) – A church massacre and a series of bombs in Shi’ite areas of Baghdad in the past days may indicate that Iraq’s Sunni Islamist insurgency is staging a resurgence.

But, while an al Qaeda-linked group claimed responsibility for taking more than 100 hostages in the Syrian Catholic cathedral in the Iraqi capital on Sunday, it has yet to do the same for Tuesday’s blizzard of explosions.

Oct 26, 2010

U.S. mulls credit card-type monitoring to halt leaks

BAGHDAD (Reuters) – The Pentagon is considering controls like those credit card firms use to detect anomalous behaviour to prevent leaks of sensitive information like the one which led to the WikiLeaks data dump on the Iraq war, a senior U.S. official said on Tuesday.

Deputy Defense Secretary William Lynn said the leak of nearly 400,000 U.S. classified field reports on the war has presented the U.S. military with a dilemma — how to better protect information without denying soldiers the real-time battlefield intelligence they need to win wars.

Sep 7, 2010

Six months on, where’s Iraq’s new government?

BAGHDAD (Reuters) – Talks on a coalition government have come full circle in Iraq six months after an election that produced no clear winner and which has pitted a Sunni-backed alliance against the country’s main Shi’ite-led factions.

A resolution to the impasse appears as distant as ever as politicians fight over top positions, in particular that of prime minister, and public impatience, despair and disillusionment with Iraq’s democratic experiment are mounting.

Aug 30, 2010

U.S. ends combat in Iraq but instability lingers

BAGHDAD (Reuters) – The U.S. military formally ends combat operations in Iraq on Tuesday as President Barack Obama seeks to fulfill a promise to end the war despite persistent instability and attacks that kill dozens at a time.

U.S. troop numbers were cut to 50,000 in advance of the August 31 milestone in the 7-1/2-year-old war launched by Obama’s predecessor, George W. Bush, whose stated aim was to destroy Iraqi weapons of mass destruction. No such weapons was found.

Aug 30, 2010

Q&A: Is the U.S. scaling back in Iraq too early?

BAGHDAD (Reuters) – The U.S. military formally ends combat operations in Iraq on Tuesday, closing what it hopes will have been the bloodiest and costliest chapters of the war launched 7-1/2 years ago by former President George W. Bush.

The milestone, marked by cuts in U.S. troop numbers to below 50,000, allows President Barack Obama to fulfill a pledge to start ending the deeply unpopular war as his fellow Democrats seek to retain control of Congress in elections in November.

Aug 27, 2010

Key political risks to watch in Iraq

BAGHDAD (Reuters) – The end of U.S. combat operations this month places the onus of ensuring security squarely on Iraqi leaders, even though they have yet to form a new government almost six months after an election.

Continued divisions between Shi’ite-led and Sunni-backed political factions and persistent, devastating attacks by insurgents are creating an air of peril that has kept potential non-oil investors on the sidelines.

Aug 19, 2010

U.S. mission in Iraq switches from combat to assist

BAGHDAD, Aug 19 (Reuters) – The U.S. military is on track to
cut numbers in Iraq to 50,000 by end August, when the 7-1/2-year
combat mission launched by former President George W. Bush ends
and operations switch to assisting Iraq’s armed forces.

The 4th Stryker Brigade, 2nd Infantry Division, the last
brigade mainly focused on combat, handed over to Iraqi forces
on Aug. 7 and pulls out this week. Its 100-strong “trail party”
will leave in three days after turning over facilities.

Aug 19, 2010

U.S. on track to end Iraq combat mission

BAGHDAD (Reuters) – The U.S. military is holding steady in its aim to reduce troop numbers in Iraq to 50,000 by August 31, when the 7-1/2 year U.S. combat mission launched by former President George W. Bush comes to an official close.

The last U.S. brigade officially classed as a combat unit formally handed over responsibilities to its Iraqi counterparts on August 7, but U.S. troops have been steadily flowing out of the country on transport aircraft and by road for a year.

Aug 2, 2010

Factbox: Key political risks to watch in Iraq

BAGHDAD (Reuters) – Political tensions rose last month with the cancellation of two scheduled sessions of parliament, an indication Iraq’s squabbling factions are no closer to a deal on a new government.

Nearly five months after a March 7 parliamentary vote that produced no clear winner, Sunni, Shi’ite and Kurdish political blocs have been unable to decide who should be prime minister, the major hurdle toward the formation of a ruling coalition.

Aug 2, 2010

Key political risks to watch in Iraq

BAGHDAD, Aug 2 (Reuters) – Political tensions rose last month with the cancellation of two scheduled sessions of parliament, an indication Iraq’s squabbling factions are no closer to a deal on a new government.

Nearly five months after a March 7 parliamentary vote that produced no clear winner, Sunni, Shi’ite and Kurdish political blocs have been unable to decide who should be prime minister, the major hurdle toward the formation of a ruling coalition.

The long delay could pour fuel on volatile sectarian differences after two large Shi’ite electoral blocs formed a tenuous parliamentary union that could push aside the Sunni-backed coalition that narrowly won the election.

But there are no signs the Shi’ite union has been able to overcome differences on the premiership to solidify a majority.

More delays could thwart U.S. plans to end combat operations in August, although Washington has given no indication it would alter its troop withdrawal schedule.

Iraq, which has the world’s third largest oil reserves, has signed contracts with energy majors such as BP and Lukoil that could more than quadruple oil output in seven years. Those projects are moving ahead, even without a new government.

Investors outside the oil sector remain wary.

Iraq is largely isolated from world financial markets. Only a short while ago, local banks were so cut off the only way to transfer money across borders was in cash-stuffed bags.

Today, Iraq has little credit. Only a few dozen companies are listed on the local stock market. The Iraqi dinar IQD= is lightly traded. One place to take a punt from afar on Iraq’s future is its Eurobond IQ024029557= XS0240295575=R.

Below are some of the major risks facing Iraq more than seven years after U.S. troops toppled Saddam Hussein.

POLITICAL SQUABBLING, POWER VACUUM

Twice in July Iraqi lawmakers postponed scheduled sessions of parliament, a troublesome sign of the depth of the divisions over Iraq’s top posts — prime minister, president and speaker.

Because no single bloc won a majority in Iraq’s 325-member parliament, coalition talks are key to forming a government.

The Iraqiya bloc led by former Prime Minister Iyad Allawi, a secular Shi’ite with wide support among the Sunni minority, took 91 seats in the election, two more than Prime Minister Nuri al-Maliki’s State of Law bloc.

The Iraqi National Alliance, a Shi’ite bloc which includes anti-American cleric Moqtada al-Sadr, took 70 seats, while a Kurdish alliance picked up 43.

Maliki, a Shi’ite who built his reputation on a claim to have rescued Iraq from civil war, is seeking a second term.

But his ambitions are being opposed by some erstwhile Shi’ite allies despite the merger of Iraq’s two main Shi’ite groups into the National Alliance, which is just four seats short of a working majority.

The extended delay in forming a government is causing serious concern. Barham Salih, the prime minister of Iraqi Kurdistan, called it an "embarrassment" in a recent interview with Reuters and said it must be resolved quickly.

But some Iraqi politicians are now saying it may have to wait until after Ramadan, which means mid-September or later.

The delay could undermine security, while marginalising Iraqiya could anger Sunnis, just as U.S. troops prepare to leave. President Barack Obama, focused on a growing conflict in Afghanistan, plans to cut current troop strength of 65,000 to 50,000 by Sept. 1 ahead of a full pullout by the end of 2011.

What to watch:

— If sectarian or political violence flares, as it did during the five months it took to form a government after 2005 parliamentary polls.

— Parliament, which cannot function without a government, fails to pass investment legislation already delayed by years of political squabbling, sending a poor signal to firms interested in Iraq but worried about legal risks and an opaque bureaucracy.



A RETURN TO MAJOR VIOLENCE

Iraq is far less violent than when sectarian killings peaked in 2006-07. Maliki takes credit for security gains, but a U.S. troop rise and Sunni militia cooperation also played a big part.

Since March, Iraqi forces backed by U.S. troops have scored major victories against local al Qaeda groups, including the killings on April 18 of al Qaeda’s leader in Iraq, Abu Ayyub al-Masri, and Abu Omar al-Baghdadi, the purported head of its affiliate, the Islamic State of Iraq.

Yet Sunni Islamist insurgents, who the government says are in cahoots with Saddam’s Baath party, still stage attacks.

In June, insurgents staged brazen bombings at the Central Bank and the Trade Bank of Iraq, seeking out economic targets in what officials said was an attempt to derail investment.

A disruption in early July of oil flow through the pipeline carrying Iraqi crude to Turkey was blamed on Kurdish rebels.

Political feuds, Sunni discontent or an attack on a holy site or a clerical leader could all spark renewed violence, as could any Israeli strike on Iran’s nuclear facilities. Such an attack might prompt Shi’ite militias to retaliate against U.S. forces in Iraq.

Any major violence will push up prices on global oil markets CLc1, especially if it appears set to persist.

What to watch:

— Attacks on oil facilities or staff. Iraq’s efforts to secure investment could be derailed by attacks on foreigners.

— Signs that U.S. forces are changing withdrawal plans.

— Iraqi security forces are vulnerable to infiltration and some key ministries are still politicised. Iraq’s military still relies on U.S. troops for air support and forensics.



KURD-ARAB CONFLICT

Tensions between Arabs and minority Kurds, who have enjoyed virtual autonomy in their northern enclave for almost 20 years, are festering. Kurds suffered massacres in Saddam’s era, but have gained unprecedented influence since 2003 and hope to reclaim areas they deem historically Kurdish.

Others in disputed areas complain Kurds have exploited their new-found prominence at the expense of Arabs and Turkmen. At the centre of the impasse is Kirkuk, the northern province that sits on an estimated 4 percent of world oil reserves.

What to watch:

— Clashes between the army and Kurdish Peshmerga forces.

— Any breakthrough on oil. Iraqi Kurdistan, which estimates its oil reserves at 45 billion barrels, has signed deals with foreign firms that the Iraqi Oil Ministry labels illegal.

— Any resumed exports from Kurdish fields, halted because of the dispute, would be positive. Iraq’s cabinet approved in May a deal that would allow exports, but they have not resumed.

— Passage of modern oil legislation, held up for years because of the Kurd-Arab feud. The delay has not deterred oil majors, but potential investors in other sectors view the laws as an indicator of stability and friendliness to business.



NEW AUTHORITARIANISM

Iraq’s democratic experiment is important in a region where leaders often leave office only in a "coffin or coup".

Attempts to overturn Iraqiya’s lead after the vote suggest that a democratic culture is still only skin deep.

Many Iraqis believe their country needs a strong ruler. Western powers would be unlikely to stand by if a military coup installed a leader hostile to their interests.

What to watch:

— Any constitutional changes that would allow leaders to amass power or remain in office.

* For political risks to watch in other countries, please click on [ID:EMEARISK] (Additional reporting by Missy Ryan; Editing by Samia Nakhoul)