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Iraqi lawmaker: We are doing our share of reconstruction

  • Story Highlights
  • Haider al-Abadi says Iraq's projected $80 billion surplus is "not real money"
  • He acknowledges that the United States has spent "a lot of money" in Iraq
  • Iraq's surplus drew outrage from leading members of Congress
  • U.S. lawmaker: It's time for Iraq to "fully assume" cost of reconstruction
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BAGHDAD, Iraq (CNN) -- Iraq's government is pulling its weight to reconstruct its war-torn country, Shiite lawmaker Haider al-Abadi said Wednesday, a day after U.S. auditors announced that Iraq has amassed projected surpluses of up to $80 billion from rising oil prices while Washington pays for reconstruction projects.

A woman passes by U.S. army soldiers on patrol in northwest Baghdad on Saturday.

"This is projected and not real money," al-Abadi said. "We have many reconstruction projects and as you know, most of the infrastructure of the country had collapsed after the war and that needs a lot of money to rebuild the country."

He acknowledged that the United States has spent "a lot of money," but stressed that Iraq must build up its central bank reserves considering the flexibility of the cost of oil.

Iraq depends on "one single income, which is oil," al-Abadi said.

Rising oil prices left Baghdad with a $29 billion surplus between 2005 to 2007. With the price of crude roughly doubling in the past year, the projected surplus for 2008 is expected to be between $38 billion and $50 billion, according to a new report from the Government Accountability Office, the investigative arm of Congress.

The assessment drew outrage from leading members of Congress, including Sen. Carl Levin, the chairman of the Senate Armed Services Committee, who called the findings "inexcusable."

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Al-Abadi said the U.S. spending in Iraq is focused more on the military initiatives. "If you look carefully, I do not think that the U.S. budget is spending on the Iraqi economy," al-Abadi said. "U.S. money is not being spent at the moment on reconstructing Iraq, but it's spent on services for the U.S. military. It's a mutual interest for both countries."

However, the GAO auditors concluded that the United States has put about $48 billion toward reconstruction since the 2003 invasion of Iraq. About $42 billion of that has been committed to various projects, including about $23 billion spent on the oil and electricity industry, water systems and security.

Iraq, meanwhile, spent $3.9 billion on those sectors from 2005 through April 2008, according to the GAO. The ongoing fighting there, a shortage of trained staff and weak controls have made it difficult for the Iraqi government to spend that windfall on needed projects, the agency's latest report concluded.

Levin, D-Michigan, has been an outspoken critic of the slow progress of reconstruction and an advocate of a U.S. withdrawal from Iraq, which U.S.-led forces invaded in 2003. But his criticism was echoed by Virginia Republican Sen. John Warner, the former chairman and a leading member of Levin's committee.

"Despite Iraq earning billions of dollars in oil revenue in the past five years, U.S. taxpayer money has been the overwhelming source of Iraq reconstruction funds," Warner said in a joint statement with Levin. "It is time for the sovereign government of Iraq, using its revenues, expenditures and surpluses, to fully assume the responsibility to provide essential services and improve the quality of life for the Iraqi people."

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In its response to the audit report, the Treasury Department said U.S. officials are working with Iraqis to address the issue, "and we believe progress is being made."

Levin spokeswoman Tara Andringa said the senator hopes to tighten rules governing U.S. expenditures on Iraqi reconstruction efforts in the next Pentagon authorization bill.

CNN's Mohammed Tawfeeq contributed to this report.

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