Measuring Stability and Security in Iraq Is Submitted Pursuant to Section 9010 of the Department of Defense Appropriations Act 2006, Public Law 109-148

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August 2006 Report to Congress In accordance with the Department of Defense Appropriations Act 2006 (Section 9010) Table of Contents

Executive Summary...... 1

1. Stability and Security in Iraq ...... 5 1.1 Political Progress ...... 5 1.2 Economic Activity...... 13 1.3 The Security Environment ...... 25

2. Iraqi Security Forces Training and Performance...... 41 2.1 Progress in Training and Equipping the Iraqi Security Forces...... 41 2.2 Progress in Assuming Leadership in Counter-Insurgency...... 43 2.3 Ministry of Interior ...... 44 2.4 Ministry of Defense ...... 52

3. Transition...... 59 3.1 Transitioning Security Responsibility...... 59 3.2 U.S. Force Adjustments ...... 62

This report to Congress on measuring stability and security in Iraq is submitted pursuant to Section 9010 of the Department of Defense Appropriations Act 2006, Public Law 109-148. This is the fifth in a series of reports on this subject and the third under Section 9010. The most recent report was submitted in May 2006.

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ii August 29, 2006 Executive Summary

This report is divided into three sections. The and representative government that respects first section, “Stability and Security in Iraq,” political and human rights and with sufficient describes trends and progress toward meeting security forces both to maintain domestic goals for political stability, strengthened eco- order and to prevent Iraq from becoming a nomic activity, and a stable security environ- safe haven for terrorists. To this end, the ment in Iraq. The second section, “Iraqi Secu- United States is pursuing an integrated strat- rity Forces Training and Performance,” de- egy along three broad tracks: scribes progress in the training, development, and readiness of the Iraqi Security Forces • Political: Helping the Iraqi people forge (ISF), including the forces of the Ministry of a broadly supported compact for demo- Defense (MOD) and the police and paramili- cratic government tary forces of the Ministry of Interior (MOI). • Economic: Assisting the Government The third section, “Transition,” describes the of Iraq in establishing the foundations transfer of security responsibility from Coali- for a sound market economy with the tion forces to the Iraqi government, including capacity to deliver essential services prerequisite conditions and criteria for assess- • Security: Contributing to an environ- ing the readiness of provinces to assume ment where Iraqis are capable of defeat- responsibility for security. ing terrorists and neutralizing insurgents A classified annex to this report provides data and illegal armed groups concerning security force training and performance and addresses possible U.S. military Each track is integrated with the other two, force rotations. and success in each affects success in the others. Security depends, in part, on a demo- The information in this report is made avail- cratic political process, which in turn able with the assistance of many departments depends, in part, on economic opportunity. and agencies of the U.S. Government, the Economic progress depends on securing the U.S. Embassy in Iraq, Multi-National Force- Iraqi infrastructure against sabotage and Iraq (MNF-I), and the Government of Iraq. attack and protecting the Iraqi people from The report complements other reports and violence that undermines individual participa- information about Iraq provided to Congress tion in economic development and the politi- and does not replace them. The intent of this cal process. document is to report on the measures of stability and security specified in Section 9010. Although the National Strategy for Victory in

Measures of Stability and Security and the Iraq is not a detailed plan for achieving spe- National Strategy for Victory in Iraq cific objectives, consistent with the public nature of that document, it delineates measur- The President’s National Strategy for Victory able trends along each of these tracks to in Iraq lays out the goals and general frame- indicate where programs are achieving suc- work to achieve security and stability in Iraq. cess and where it is necessary to increase The goal of the strategy is to help the Iraqi efforts or adjust implementation of the people build a new Iraq with a constitutional strategy.

1 August 29, 2006 Major Milestones Toward a Democratic Iraq

Oct 15, 2005 National Referendum on the Constitution

Dec 15, 2005 National Elections under the New Constitution

Mar 16, 2006 First Session of Council of Representatives

Apr 22, 2006 Election of Presidency Council by Council of Representatives Nomination of Prime Minister by Presidency Council

May 20, 2006 Naming of Cabinet by Prime Minister Designee Vote of Confidence for Prime Minister, His Cabinet, and His Program

Jun 8, 2006 Nomination and Approval of Minister of Defense, Minister of Interior, and Minister of State for National Security Affairs

Jul 13, 2006 Transfer of Muthanna to Provincial Iraqi Control

Jul 26, 2006 Prime Minister al-Maliki Addresses Joint Session of U.S. Congress

The President’s strategy also identifies eight in Iraq. The appointments of the Ministers of objectives, or pillars, of the integrated politi- Interior, Defense, and State for National cal, economic, and security strategy: Security Affairs, on June 8, 2006, marked the completion of a national unity government. • Defeat the terrorists and neutralize the Within one month of seating this government, insurgency • Transition Iraq to security self-reliance Prime Minister Nouri al-Maliki presented a • Help Iraqis forge a national compact for “National Reconciliation and Dialogue democratic government Project” to the Iraqi Council of Representa- • Help Iraq build government capacity tives (CoR). This project is a broad initiative and provide essential services aimed at reconciling past inequities; rallying • Help Iraq strengthen its economy Iraqis around a principle of equality, devoid • Help Iraq strengthen the rule of law and of sectarian divisions; firmly establishing the promote civil rights basis of national unity via a democratic politi- • Increase international support for Iraq cal process; and creating the conditions for • Strengthen public understanding of Iraq to assume a leading role both in the Coalition efforts and public isolation of region and internationally. Additionally, the the insurgents CoR began its work in June with an accel- Key indicators of progress since the last erated schedule of sessions. Most of the report are discussed below. 24 Council Committees have formed and named chairs. The CoR is making some pro- Political Progress. This report marks the first gress on key legislation required to implement 90 days of the first representative government the provisions of the Iraqi Constitution.

2 August 29, 2006 Economic Activity. The Iraqi economy con- respectively. Approximately 90% of the Gov- tinues to show progress, but still needs to ernment of Iraq’s revenue comes from oil overcome serious challenges. As the Govern- exports, and higher prices for Iraqi oil con- ment of Iraq was formed just 90 days ago, its tinue to somewhat offset lower than desired institutions are still forming or are immature export volumes. and consequently struggle with many macroeconomic issues. The new government has The Security Environment. Setbacks in the affirmed its commitment to programs sup- levels and nature of violence in Iraq affect all ported by the Stand-By Arrangement with the other measures of stability, reconstruction, International Monetary Fund (IMF) by taking and transition. Sectarian tensions increased important and decisive measures, notably over the past quarter, manifested in an price increases for refined petroleum products increasing number of execution-style killings, that meet IMF targets. The Executive Board kidnappings, and attacks on civilians, and of the IMF subsequently completed its first increasing numbers of internally displaced and second reviews of Iraq’s performance persons. Sunni and Shi’a extremists, particu- under the Stand-By Arrangement on larly al-Qaeda in Iraq and rogue elements of August 2, 2006. Jaysh al Mahdi (JAM), are increasingly interlocked in retaliatory violence and are con- Iraq continues to make progress reducing its testing control of ethnically mixed areas to Saddam-era debt. As of July 2006, 17 of 18 expand their existing areas of influence. Con- Paris Club creditors have signed bilateral cern about civil war within the Iraqi civilian agreements to forgive 80% of Iraq’s sover- population and among some defense analysts eign debt. Russia is the only Paris Club has increased in recent months. Conditions creditor that has not yet signed a bilateral that could lead to civil war exist in Iraq. agreement with Iraq. It has, however, agreed Nevertheless, the current violence is not a in principle on debt relief terms and will civil war, and movement toward civil war can finalize an agreement shortly. Middle Eastern be prevented. Breaking the cycle of violence creditors, which hold the majority of the is the most pressing goal of Coalition and present debt, have not signed bilateral debt Iraqi operations. reduction agreements. In the current reporting period the average Average peak electrical generating output number of weekly attacks increased 15% over increased 15.8% this quarter to 4,573 mega- the previous reporting period average, and watts (MW) and continued to increase over Iraqi casualties increased by 51% compared the quarter. Iraq averaged 14 hours of power to the previous quarter. Much of this violence per day this quarter, an improvement of occurred in Baghdad, as terrorists, insurgents, 3 hours per day over the previous quarter. and illegal armed groups recognized and exploited the political and economic signifi- Crude oil production for the second quarter cance of conducting operations in the capital improved 18% to 2.2 million barrels per day city. However, the Coalition and the Govern- (mbpd), and exports improved by 20%, to ment of Iraq continued to make progress this 1.6 mbpd. Also during this quarter, Iraq quarter, improving the security environment resumed exports from northern fields for the in Fallujah and some parts of northern Iraq. first time since the autumn of 2005. However, Although sectarian violence threatens the oil production and exports still fell short of effectiveness of the Government of Iraqi, the Iraqi goals of 2.5 mbpd and 2.0 mbpd, terrorists have failed to derail Iraq’s political

3 August 29, 2006 process, or to widen their political support to assume security lead in their territory. The among the Iraqi people. Polling data continue number of counter-insurgency operations con- to show the confidence of most segments of ducted independently by Iraqi forces as a per- the Iraqi people in the Iraqi Army and their centage of total combat operations continues rejection of al-Qaeda’s vision of Iraq’s future. to increase steadily. Approximately one-third of the company-sized operations in Iraq Iraqi Security Forces. MOD and MOI secu- during the reporting period were conducted rity forces continue to increase in size and independently by Iraqi forces. As of August 7, capability and are increasingly assuming the 2006, there were 85 Iraqi Army battalions lead combat responsibility from Coalition (5 divisions, 25 brigades) that have assumed forces. the lead for counter-insurgency operations, a 35% increase since the last report. All 27 Training, equipping, and fielding security National Police battalions are currently con- forces continues. Approximately 277,600 ducting counter-insurgency operations, and Iraqi soldiers and police have completed ini- 2 National Police battalions have the security tial training and equipping, an increase of lead for their areas of responsibility. more than 14,000 in the three months since the last report. As of August 2006, approxi- Transition. Iraq achieved a historic milestone mately 84% of the objective end-strength of on July 13, 2006, with the transfer of security MOD forces have been trained and equipped, responsibility in Muthanna Province from while more than 92% of authorized Iraqi MNF-I to the Provincial Governor and the Army battalions have been generated. civilian-controlled Iraqi Police Service (IPS). Remaining train-and-equip efforts will focus on building combat support and combat Moreover, since the May report, MNF-I has service support forces. transferred an additional 10 Forward Operat- ing Bases (FOBs) to the Government of Iraq. More Iraqi units are able to take the lead in Forty-eight of 110 FOBs are now under Iraqi combat operations against the insurgency and control.

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1. Stability and Security in Iraq

1.1 Political Progress With the seating of its constitutional government, Iraq, with the support of the Coalition, The goal of the political process in Iraq is to completed all the milestones required under help the Iraqi people forge a broadly sup- United Nations Security Council Resolu- ported national compact for democratic gov- tion 1546. ernment, thereby isolating enemy elements from the broader public. The United States is The National Strategy for Victory in Iraq lays supporting this effort by: out a specific three-pronged political plan to assist the Government of Iraq in building a • supporting Iraqi leaders in their efforts broadly supported national compact for demo- to include all Iraqis in the political pro- cratic governance. The plan seeks to: cess, through dialogue and inclusive institutions; “3 Isolate enemy elements from those • offering advice and technical support who can be won over to the political for effective governance; process by countering false propaganda • helping build national institutions that and demonstrating to all Iraqis that transcend regional, sectarian, and tribal they have a stake in a democratic Iraq; lines; and 3 Engage those outside the political • assisting Iraqis in replacing the corrupt process and invite in those willing to and centralized Ba’athist system with turn away from violence through ever- effective government bodies at local, expanding avenues of participation; provincial, and national levels. and 3 Build stable, pluralistic, and effective Measures of political progress and stability national institutions that can protect the include: interests of all Iraqis, and facilitate Iraq’s full integration into the interna- • achievement of political goals set forth tional community.” in the Iraqi Constitution, as well as those in United Nations Security Coun- Building a Government of National Unity cil Resolution 1546 and the Transitional Administrative Law; After successful national elections in Decem- • formation of a national unity govern- ber 2005, Iraqis made the commitment to ment representative of all Iraqi com- establish a broad unity government. Rather munities; than allocating all government positions to the • participation in the political process by majority party or coalition, this unity govern- all Iraqi communities and evidence that ment sought to provide fair representation in they view the process as legitimate and the ministries and other government posts effective; among all major parties that won seats in the • adherence to rule of law institutions; CoR. Consistent with this commitment, Prime and Minister al-Maliki announced and won CoR • expansion of international support. approval for his cabinet, which draws minis-

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ters and senior officials from parties repre- the appointment of Shirwan al-Waili as Min- senting all regions, sects, and ethnic groups. ister of State for National Security Affairs. The announcement met the constitutionally mandated deadline, but Prime Minister The appointment of the Ministers of Interior, al-Maliki opted to delay filling the positions Defense, and State for National Security of Minister of Defense, Minister of Interior, Affairs marked the completion of Iraq’s first and Minister of State for National Security representative government. The resulting Affairs to ensure broad support within the cabinet is remarkably inclusive. The new gov- CoR for these sensitive positions. ernment reflects the diversity of the Iraqi people and, with a freely elected parliament On June 8, 2006, after additional negotiations and a popularly ratified constitution, is a strik- ing contrast to the oppressive, one-man rule and compromise, the Prime Minister pre- of Saddam Hussein just three years ago. sented his nominees for the two security ministries. The CoR approved the appoint- Poll data indicates that the majority of Iraqis ments by a majority, confirming Jawad have confidence in the new government; al-Bulani as Minister of Interior and Abd notably, however, confidence levels are al-Qadr Muhammad Jassim al-Mufraji as lowest in mixed and predominantly Sunni Minister of Defense. The CoR also approved areas, such as Kirkuk and Tikrit/Baquba.

Organizational Structure of the Government of Iraq Presidency Council Executive Branch Legislative Branch

PRESIDENT PRIME MINISTER SPEAKER CoR

Jalal Talabani Nouri al-Maliki Mahmoud Mashhadani

NATIONAL SECURITY ADVISOR DEPUTY SPEAKER

VICE PRESIDENT VICE PRESIDENT Muwafaq al-Rubai Khalid al-Attiyah Tariq al-Hashimi Adil Abd al-Mahdi MINISTER OF STATE FOR NAT. SEC. AFFAIRS DEPUTY SPEAKER DEPUTY PRIME MINISTER Shirwan al-Waili Arif Taifor Dr. Barham Salih MINISTER OF FOREIGN AFFAIRS Hoshyar Zebari DEPUTY PRIME MINISTER

MINISTER OF DEFENSE Salam al-Zawbai Abd al-Qadr Muhammad Jassim al-Mufraji

MINISTER OF INTERIOR

Jawad al-Bulani

6 August 29, 2006

How much confidence do you have in the new Iraqi government to improve the situation in Iraq? *

100 Great deal/fair amount Not much/not at all 90 80 70 60 50 40 Percentage 30 20 10 0 Baghdad Kurdish Areas Kirkuk Tikrit/Baquba Mid- South Euphrates

Source: Department of State, Office of Research, June 21-July 6, 2006 Sample sizes: Baghdad-173; Kurdish Areas-308; Kirkuk-108; Tikrit/Baquba-210; Mid-Euphrates-523; South-437 Margin of error: ≈ ±4% for the overall sample, but varies among regions

* Data from Mosul is not included in this chart. It was determined to be unreliable.

The Iraqi Constitution, adopted by popular formed and have named chairs. The CoR has referendum on October 15, 2005, requires made some progress on key legislation, approximately 55 enabling or implementing including progress toward new Electoral acts, in such significant and broad areas as Commission legislation, the first step on the judiciary development and economic reform, path to provincial elections. However, little to make the Constitution operative. Passing substantive legislation was passed in the and enforcing this legislation will be a key indicator of progress for the new Government session that ended in July. of Iraq. The two critical political events facing the Additionally, the CoR began its work in June CoR and the Government of Iraq over the with an accelerated schedule of sessions. next few months are the constitutional amend- Most of the Council Committees have been ment process and provincial elections.

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Progress Toward a Democratic Iraq 2006

Iraqi Government Formation

First session of CoR

• Election of President and two Deputies, i.e., Presidency Council, by CoR • Nomination of Prime Minister by Presidency Council

• Naming of Cabinet by Prime Minister-Designate • Vote of Confidence for Prime Minister, his Cabinet, and his program

Constitution replaces Transitional Administrative Law

THE WAY AHEAD

Mar 16 Apr 22 May 20 Enabling legislation drafted

CoR forms Constitution Review Committee for amendment recommendations

Recommendations presented to CoR

CoR approves amendment recommendations

National referendum on constitutional amendment recommendations

Constitution Implementation Provincial and local elections held

The National Reconciliation Process level will be field committees, which will focus on key components of national recon- On June 25, 2006, Prime Minister al-Maliki ciliation and will evaluate progress. presented to the CoR a “National Reconcilia- tion and Dialogue Project,” a 24-point initia- As part of the National Reconciliation and tive aimed at reconciling past inequities, Dialogue Project, a conference of tribal rallying Iraqis around a principle of equality leaders took place on August 26, 2006, in devoid of sectarian divisions. Baghdad that resulted in a statement condemning sectarian violence, and endorsing The National Reconciliation and Dialogue the reconciliation plan. In the coming Project is intended to open dialogue, reduce months, the government will convene a sectarian tensions and violence in Iraq, and conference of religious scholars. The govern- increase commitment to the democratic pro- ment is supposed to convene a conference of cess and the new national unity government. political parties to encourage the democratic process and to solidify support for the The project will operate on three levels. At Government of Iraq. the national level, the High National Commis- sion of the National Reconciliation and Dia- Government Institutions logue Project will be composed of representatives from a diverse cross-section of political, To achieve unity, security, and prosperity, religious, ethnic, tribal, and cultural groups Iraq must develop the capacity to deliver gov- under the leadership of the Minister of State ernment services to its citizens at the national, for National Dialogue. The second level will provincial, and municipal levels. The Govern- be provincial subcommittees, and the third ment of Iraq must transform the country from

8 August 29, 2006

a centralized state, with delivery of essential announced and planned national reconcilia- services traditionally controlled by powerful tion process. bureaucrats, to a responsive federal government with decentralized control. This change The diagram below shows the organizations will take time, consistent mentorship, and an currently helping Iraq develop its capacity to emphasis on both promoting transparency and govern effectively. Ministerial capacity devel- reducing corruption. The Coalition is support- opment is the main focus of the U.S. ing these efforts at all levels of the Govern- Embassy’s Ministerial Assistance Teams ment of Iraq. (MATs). These teams, composed of civilian and military experts in governance and organ- National Institutions izational development, mentor and train both

the Iraqi ministers and their senior staffs in National institutions and forces are essential such areas as budget development and execu- to displace illegal armed groups and to serve moderate sectarian and local loyalties. The tion, inter-ministry coordination, personnel United States supports the development of management, and procurement. Iraq Recon- non-sectarian institutions and the growth of struction Management Office (IRMO) offi- independent media and civil society institu- cials provide expertise in key sectors, such as tions, while continuing to encourage the Gov- oil, electricity, and health, to Iraqi ministers ernment of Iraq to proceed with the and other high-level government officials.

Organizations Supporting Iraqi Ministries

Policy, programmatic, and strategic direction; IRMO Senior Consultants; C N donors O IO O T R A D IN DIN A R T O IO O C N

Iraqi Ministries Ministerial Specialized Assistance and core Teams, function teams, USM-I, MNF-I, national training Iraqi ministry centers, on-site leaders, donors COORDINATION training teams

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Assistance to Provincial Governments antees. The Constitution maintains the independence of the judicial branch, but vests Provincial Reconstruction Teams (PRTs) considerable authority in the CoR to define work with provincial governors and elected the functions of the courts, raising the risk of councils to improve execution of provincial undue influence by political or religious government responsibilities and to increase groups. Iraq’s criminal legal framework is not citizen participation in governmental deci- presently robust enough to adequately address sion-making processes. The teams are contemporary criminal activity, such as intended to develop core competencies in organized crime, trafficking, and some tech- public administration, finance, budgeting, nology-related crimes. Legal experts from the planning, and accountability by boosting U.S. Government are assisting Iraqi legal government capacity and transparency at the scholars in creating a legal system that can provincial level. Four U.S.-led PRTs are fully balance the requisites of modern international operational: PRT Tamim (Kirkuk), PRT law with Iraqi cultural and legal traditions. Ninewah (Mosul), PRT Babil (Hillah), and The Coalition continues to provide adminis- PRT Baghdad. The security situation in some trative support as well as technical and legal provinces hampers interaction between the assistance in drafting legislation. team and provincial leaders. Judiciary Promoting the Rule of Law The Coalition has helped the Government of Political stability in Iraq is predicated on the Iraq improve the judicial system in several effective rule of law in the country. (Note: areas, including building or renovating court- Police and associated institutions are dis- houses, expanding the Central Criminal Court cussed in Section 2 of this report.) Effective of Iraq (CCCI), and improving security. The rule of law in Iraq, as in any country, requires CCCI, for example, now has 12 panels four conditions to be met: effective laws, operating throughout Iraq. It processes, on police to enforce them, courts to administer average, 118 insurgency-related cases each them, and prisons to incarcerate offenders. If month. Due to the limited capacity of the any one of these institutions fails, or cannot 11 panels outside Baghdad, the Baghdad work with the others, the Iraqi regime will be CCCI is the primary facility for hearing insur- unable to enforce the rule of law. The United gency cases. States, its Coalition partners, and international agencies are helping Iraq strengthen the rule Poor security for judges and judicial facilities, of law. Although there have been some posi- an insufficient number of judges, and an tive developments, delay in the formation of inadequate court infrastructure undermine the Government of Iraq resulted in a loss of advancements in the rule of law in Iraq. momentum; rule of law initiatives slowed, Judges are subject to intimidation and in which contributed to the growth of crime, cor- many areas are afraid to prosecute insurgents. ruption, and illegal armed groups. The U.S. Government, through the U.S. Marshals Service, responded by providing Legislation secure housing, personal security details, courthouse protection, and personal protection The Iraqi Constitution sets forth a comprehen- firearms to some members of the Iraqi sive list of rights and freedoms, but additional judiciary. In Baghdad, the Coalition has pro- legislation is needed to implement those guar- vided facilities for 22 judges to reside in the

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International Zone. Working in conjunction stopped at Khan Bani Sa’ad and Nasiriyah with MNF-I, the U.S. Marshals Service has due to problems with the primary contractor. begun training an Iraqi Marshals Service. The Bridge contracts have been awarded to local U.S. Department of Justice, along with the Iraqi contractors to provide site security and U.S. Department of State and the U.S. Depart- to perform some continuing construction ment of Defense, is proceeding with plans for work. The Gulf Region Division of the U.S. the renovation and construction of Iraqi Army Corps of Engineers anticipates that courthouses and other related court facilities, contracts will be issued to a new contractor in including witness protection buildings. As of September and that both facilities will be July 21, 2006, approximately 20 projects to completed in April 2007. Construction at the improve judicial capacity have been com- two Rusafa facilities has been delayed due to pleted, and 13 more are under way. Five addi- a title dispute between the Ministers of Justice tional projects are planned. and Interior. The title dispute is currently in litigation in the Iraqi courts. Dahuk, a The U.S. Department of Justice estimates that 1,200-bed facility in the Kurdish region, is Iraq needs 1,500 judges, yet only about 740 scheduled for completion in February 2007. judges are currently serving. The Iraqi Construction at Baladiyat was completed and Ministry of Justice’s (MOJ) Judicial Training the prison facility there has been activated and Institute has enrolled a new class of 180 is currently in use by the Iraqi Corrections students (40 judges and 140 prosecutors) in a Services. Upon completion in mid-2007, all 2-year program to train new judges and of these facilities will add a combined 4,800 prosecutors. When this class graduates in the beds. Even with these additions, however, fall of 2007, there will still be a significant projections show another 20,000 beds will shortfall in judges. To help address this need, ultimately be needed. Thus, the Government the Iraqi Chief Justice recently nominated 200 of Iraq must address insufficient bed space, lawyers to serve as investigative judges. If enactment of custody transfer laws, abuses in these judges are confirmed, the number of MOI and MOD detention facilities, and the judges will rise to 940. By the fall of 2007, need for more guards and trained supervisors. approximately 980 judges will be serving in The Government of Iraq also faces the Iraq, an increase of 32%, but still well short of problem of prisoner-detainees awaiting adju- the requirement. dication/resolution of the charges against them. The MOI and MOD are believed to be Prisons detaining between approximately 2,000 and 10,000 people in pre-trial status, many in The MOJ is responsible for imprisoning con- crowded, substandard facilities. victed criminals and insurgents in Iraq. MOJ prisons generally meet international stan- Security Internees dards, but are already at maximum capacity. As a result, many detainees spend time in In addition to criminal detainees and convicts MOI or MOD facilities, which generally fall held by the Government of Iraq, MNF-I holds short of internationally accepted standards. To security internees (or detainees) under the address this issue, the U.S. and Iraqi govern- authority of United Nations Security Council ments are funding construction of seven new Resolution 1637. As of July 16, 2006, Coali- MOJ prison facilities, one each in Basrah, tion forces held 12,388 such security internees Khan Bani Sa’ad, Nasiriyah, Dahuk, and outside the Iraqi criminal system. Detainees in Baladiyat, and two in Rusafa. Work has MNF-I custody are treated in accordance with

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Geneva Convention principles. The U.S. Gov- legislation, lack of CCCI capacity, and intimi- ernment has initiated a dialogue with the dation of investigators and judges. Government of Iraq in an effort to transfer these internees to Iraqi custody. However, Obstacles to Political Progress Iraq currently lacks the legal authority to hold security internees outside of the judicial Since the liberation of Iraq, there have been system. Therefore, neither MNF-I-held significant successes in the development of detainees nor MNF-I-run detention facilities legitimate political institutions and processes. can presently be transitioned to MOJ control. The unfolding of the democratic electoral pro- The Coalition continues to urge the Govern- cess over the course of 2005 was a crucial ment of Iraq to accept transfer of security success. Despite these achievements, how- internees in a way that ensures their humane ever, the political process has encountered treatment. Those detainees who do not pose a obstacles. serious threat to the citizenry are released as promptly as possible. (The detainee release Violence program is described in more detail later in this report.) The nature of violence in Iraq is multifaceted. Illegally armed groups that reject the political Anti-Corruption Institutions and Programs process often do so because of long-standing grievances, extremist beliefs, tribal affilia- The Government of Iraq has made a public tions, and/or personal vendettas. No one strat- commitment to eradicate corruption and to egy can address every grievance. A vocal empower anti-corruption institutions. Coali- minority of Iraqis (e.g., religious extremists) tion support for this effort is focused largely fundamentally opposes the idea of a demo- on the three main anti-corruption institutions cratic Iraq. Further, some Iraqis who have in Iraq: the Board of Supreme Audit (BSA), joined the political process are condoning or the Commission on Public Integrity (CPI), maintaining support for violent means as a and the Ministerial Inspectors General (IG). source of political leverage. Both the BSA and CPI have new constitutional status, and the CPI has become the lead The continued violence in some areas, espe- Iraqi anti-corruption agency. The CPI has cially in Baghdad, hampers the formation of investigated 1,158 cases this year. legitimate national institutions. In some towns and neighborhoods, local illegal armed groups The CCCI, which has jurisdiction for public are seen as the primary providers of security corruption cases, does not have the capacity and basic social and essential services. With to process all its corruption cases. There are the extended delay in formation of the 826 criminal cases pending or under active national government and capable ministries, prosecution. Over the past 20 months, 56 offi- these armed groups have become more cials in Iraq’s ministries were either convicted entrenched, especially in some primarily or subject to arrest warrants. The fact that Shi’a sections of Eastern Baghdad and certain there is a functioning process for investigating Sunni neighborhoods in Western Baghdad. and prosecuting corruption, and that some corrupt officials are being brought to justice, Security issues (e.g., the attempted kidnap- is a positive sign. However, the ability of the ping of a deputy minister and threats to minis- government to prosecute corruption cases suc- try personnel who work with Embassy teams) cessfully is hampered by the lack of enabling have made some ministers reluctant to have

12 August 29, 2006

U.S. personnel visit them. This reluctance Corruption hampers coordination between the Coalition and some ministry personnel. Internal politics Corruption in the ministries has further ham- (e.g., political party affiliation) is also an pered their capabilities. Experienced or tal- obstacle to progress in some ministries. ented employees are often purged and replaced with party elements/cronies as a Inexperience result of a spoils system. Many of Iraq’s political factions tend to view government Some Iraqi ministers tend to focus on near- ministries and their associated budgets as term performance, rather than on long-term sources of power, patronage, and funding for capacity building. A lack of effective proce- their parties. Ministers without strong party dures within the ministries, such as policy ties often face significant pressure from the development, procurement, and budgeting, political factions, and sometimes have little was endemic to the Iraqi government under control over the politically appointed and Saddam Hussein, and three years is not connected people serving under them. Still enough time to reverse decades of organiza- entrenched in the culture of the former tional incapacity. This situation should regime, some ministry personnel are reluctant improve with time. to exercise independent initiative or to take any bold action to address Iraq’s problems of Lack of proper “tools,” such as information corruption. technology, finance systems, and planning capabilities, inhibit the governing of complex 1.2 Economic Activity issues. The result is that Iraqi planning, budgeting, and execution processes are less than The National Strategy for Victory in Iraq fully effective. IRMO is currently procuring underscores three objectives in helping the and developing these tools, but it will take Iraqis build their economy: time—years rather than months—before Government of Iraq staff is able to use these • Building the capacity of Iraqi institu- tools fully and to manage the ministries to full tions to maintain infrastructure, rejoin effectiveness. the international economic community, and improve the general welfare of all Foreign Interference Iraqis • Reforming Iraq’s economy, which has Iran and Syria undermine the Government of been hindered by war, dictatorship, and Iraq by providing both active and passive sanctions, so that it can be self-sustain- support to anti-government forces that tend to ing in the future fuel ethno-sectarian tensions. The Coalition • Restoring Iraq’s neglected infrastructure and the Government of Iraq have acted to so that it can meet an increasing counter the Iranian and Syrian influence by demand and the needs of a growing tightening security at the borders. However, economy the borders are porous, and eliminating the transfer of illegal material and foreign fighters This strategy rounds out the National into Iraq is a formidable challenge. Development Strategy (2005-2007) of the

13 August 29, 2006

Government of Iraq, whose national eco- prevent high inflation from becoming nomic objectives are: entrenched.

• Strengthening the foundations of eco- Iraq continues to make progress reducing its nomic growth Saddam-era debt. Iraq’s debt was estimated at • Revitalizing the private sector US$125 billion after the war. This was almost • Improving the quality of life five times the gross domestic product (GDP) • Strengthening good governance and in 2004, an unsustainable burden on the Iraqi security economy. The historic November 2004 debt relief agreement with the Paris Club members Building the Iraqi Economy and subsequent agreements with commercial and other official creditors, as well as some The formation of a new government allowed non-Paris Club creditors, are helping bring Iraq to refocus on its economic agenda. In the Iraq’s debt to sustainable levels. second quarter, the new government affirmed its commitment to the reform program sup- As of July 2006, all 18 Paris Club creditors ported by the Stand-By Arrangement and is except Russia had signed bilateral agreements moving forward with implementation of that to forgive 80% of Iraqi sovereign debt owed. program. The new government maintained Russia is expected to sign an agreement with fiscal discipline, raised domestic fuel prices to Iraq soon. In addition, Iraq has completed its the targeted levels in the Stand-By Arrange- program to restructure commercial claims ment, sent a fuel import liberalization law to from commercial and other official creditors. the CoR, and increased targeted support for the poor. The Executive Board of the IMF • Paris Club – US$41.7 billion owed subsequently completed its first and second before signed bilaterals; US$34.2 review of Iraq’s performance under the Stand- billion will be forgiven under Paris By Arrangement on August 2, 2006. Club terms, including a future Russian agreement. Although the Government of Iraq missed the • Non-Paris Club sovereign debt – March 2006 deadline for the state fuel-price approximately US$63 billion owed increase required by the Stand-By Arrange- (US$2.75 billion worth of debt relief ment for refined petroleum products, on agreed to on US$3.3 billion worth of July 1, 2006, the new Government of Iraq debt, thus far). increased prices (reducing subsidies) for • Commercial and other official creditors regular and premium gasoline, benzene, lique- – debt relief deals completed on fied petroleum gas (LPG), kerosene, and US$19.7 billion of commercial and diesel products, thus meeting or exceeding the other official debt. IMF Stand-By Arrangement-mandated price increases. As long as Iraq continues its progress on implementing the economic reforms in the Inflation threatens the overall macroeconomic IMF Stand-By Arrangement, the country will stability that Iraq has maintained since the remain eligible for the final 20% of debt war ended. Ongoing violence and supply dis- reduction agreed under the Paris Club terms. ruptions are pushing prices higher. The Sixty percent of the Government of Iraq’s Central Bank of Iraq (CBI) must further debt to Paris Club members has already been tighten monetary and exchange rate policy to forgiven, and continued successful comple-

14 August 29, 2006

tion of the Stand-By Arrangement will qualify ment Information System (FMIS) that will Iraq for a final tranche of 20% in late 2007 or provide greater transparency and account- early 2008. The United States forgave all of ability in the government’s budget and expen- Iraq’s debt (US$4.1 billion) and is encourag- diture processes. ing other creditors to follow this example. Debt relief from non-Paris Club creditors is As of July 1, 2006, halfway through Iraq’s expected in accordance with Paris Club terms fiscal year, the Government of Iraq’s minis- or better, and Iraq is beginning to approach tries have spent far below their planned capi- these creditors to ask for debt forgiveness. tal budget expenditures. Iraq’s new ministries The Gulf countries hold the largest amount of do not have experience executing ministerial Iraq’s non-Paris Club debt, estimated to be budgets, and lack of a modern electronic US$45 billion. transfer system, which has hampered transferring funds in locations around the country, In addition to loans, Iraq owes nearly compounded by security problems, contrib- US$32 billion in war reparations (as of utes to an under-expenditure. The Govern- May 1, 2006). These reparations are the result ment of Iraq’s continued inability to execute of claims against Saddam’s regime following its budget places delivery of basic services, as the Gulf War in 1991. Every year, 5% of well as future economic expansion, at risk, Iraq’s oil revenue goes to repayment of war and demonstrates the need for continued joint reparations. As of May 2006, Iraq had paid U.S.-Iraqi capacity development efforts. more than US$20 billion in reparations. The IRMO will soon develop contracts to install United Nations Compensation Commission, government-wide budgeting and procurement which oversees the payment of reparations, modules to add to the FMIS, which was awarded US$21.5 billion in compensation to installed approximately two years ago; oil companies, which lost profits and equip- however, the Government of Iraq is just now ment during the Gulf War. Paying these starting to use this system. These new reparations each year, while simultaneously modules will increase the transparency of the attempting to rebuild its economy, places a significant strain on Iraq’s limited resources. financial system and will improve the effectiveness of in-year and forecasted Building the Capacity of Iraqi Institutions budgeting. It is proposed that the Minister of Finance require all Government of Iraq The economic institutions of the new Iraqi financial transactions to use this enhanced government are still developing. On July 12, FMIS system. Budgets are not effectively Prime Minister al-Maliki outlined his vision delegated from the Ministry of Finance for economic reform to build a prosperous (MOF) to other ministries and provinces. The Iraq based on private sector activity and procedures to enable contracts through the investment, economic diversification, and MOF are proving too cumbersome, and offi- integration into the global economy. The cials are not willing to risk applying perceived Coalition is working with the Government of “incorrect procedures,” as several officials Iraq to appoint an Ambassador to the World have been detained with investigations pend- Trade Organization (WTO) and to complete ing into possible breaches of regulations. the necessary documentation to hold its first Communications between the CBI and the WTO Working Party. In addition, the United MOF have all but stopped; several employees States continues to work with the Ministry of at the CBI have been intimidated and have Finance to implement a Financial Manage- therefore failed to show up for work.

15 August 29, 2006

Integrating Iraq into the World Economy growth. The UN now occupies its compound in Irbil, and a UN Liaison Detachment has The United States is working with the Gov- been established in Kirkuk. ernment of Iraq to engage Iraq’s neighbors and the international community on the future The Arab League issued a strong statement of Iraq and the stability of the region. A following its November 2005 “Preparatory sustained dialogue with key international Meeting for the National Accord Confer- partners remains a critical element in assisting ence,” calling for all Iraqi parties and Arab Iraq’s nascent democracy. In this context, last states to support Iraq and respect the political month Prime Minister al-Maliki traveled to will of the Iraqi people. The United States Saudi Arabia, Kuwait, and the United Arab welcomes the planned Arab League-spon- Emirates to promote his national reconcilia- sored Iraqi National Accord Conference (to tion plan and to encourage international sup- be scheduled) as an opportunity for Iraqis port for Iraq. inside and outside of government to discuss the many crucial issues facing their country In late July, the Government of Iraq and the and to support a process of national reconcili- UN, with the strong support of the United ation. Since the November 2005 conference, States, the United Kingdom, and other donor the Arab League has opened its office in states and international financial institutions, Baghdad and has appointed Mukhtar Lamani launched an International Compact with Iraq. as its envoy. The International Compact will, over the next five years, bring together the international Macroeconomic Indicators community and multilateral organizations to help Iraq achieve its national vision. The gov- Economic indicators are collected and pub- ernment’s vision is that, five years from now, lished regularly, largely through the Iraqi Iraq will be a united, federal, and democratic Ministry of Planning and Development Coop- country, at peace with its neighbors and itself, eration and international organizations, such well on its way to sustainable economic self- as the World Bank, the UN, and the IMF, sufficiency and prosperity, and well inte- although gathering accurate statistics on grated in its region and the world. which to base such indicators in the present security situation in Iraq is a challenge. As The International Compact will provide assis- outlined in the table below, projections from tance to Iraq under a contractual agreement; the IMF assume that economic growth over Iraq will undertake specific economic and political reforms designed to bring it into the the medium term will remain dependent on global economy. In return, international the performance of the oil sector, as it donors will increase their financial support for accounts for more than two-thirds of Iraq’s Iraq’s reconstruction. Meanwhile, the Gov- GDP. The outlook also assumes that the ernment of Iraq will continue to enact politi- Government of Iraq’s investment in the oil cal and security measures to achieve national sector will generate increased oil production reconciliation and to build an economic envi- and strong GDP growth over the medium ronment conducive to sustained economic term.

16 August 29, 2006

GDP Estimates and Projections, 2004-2008

2004 2005 e 2006 p 2007 p 2008 p

Nominal GDP (in USD billion) 25.7 34.5 47.0 61.0 71.0

Government Oil Revenue (in % of GDP) 69.6 69.4 66.9 66.5 67.4

Per Capita GDP (USD) 949.0 1,237.0 1,635.0 2,060.0 2,319.0

Real GDP (% change) 46.5 3.7 4.0 14.4 12.9

Primary Fiscal Balance (in % of GDP) -40.6 9.8 -6.1 -2.1 -0.8

Consumer Price Inflation (annual %) 32.0 32.0 30.0 17.0 10.0

Source: IMF Estimates (e) and Projections (p), July 7, 2006

Estimates of unemployment in Iraq vary such areas as privatization and investment to widely. The UN World Food Program’s 2005 spur economic growth. estimate is 13.4%; other estimates are as high as 50%–60%. As of July 2006, the Govern- Using data collected in 2004, the UN World ment of Iraq Central Organization for Statis- Food Program estimates that 15.4% of the tics and Information Technology (COSIT) surveyed population in Iraq lacks adequate estimated that unemployment was 18% and food. Including both severe and moderate underemployment was 34%. The COSIT forms, about 25.9% of the Iraqi children estimates were corroborated by a 2005 United examined were stunted in their physical States Agency for International Development growth, a symptom of chronic malnutrition. (USAID) survey and recent nationwide The lowest rate observed (14.2%) was in polling. This year, the Government of Iraq Sulamaniyah Province, while the highest budgeted to increase employment from (36.5%) was in Salah ad Din Province. 1.1 million to 1.9 million civil servants. State- owned enterprises are expected to add another With support from USAID, the Ministries of 100,000 people to their rolls. Although this Finance, Labor, and Social Affairs have hiring will reduce unemployment, govern- developed a more effective social safety net ment and state-owned-enterprise employment for Iraq’s poorest citizens. This initiative is not a long-term panacea; for example, most helps low-income families manage the effects state-owned enterprises are operating under of subsidy reform, using needs-adjusted cash capacity or are closed. The key to long-term, benefits and services that help families raise sustained reduction in unemployment can be themselves above the poverty level. The achieved only through private sector-led social safety net program is an essential step growth. The U.S. Government is working in reforming national subsidies as required by with the Government of Iraq to develop the the IMF Stand-By Arrangement. The Govern- Iraqi private sector by reforming the banking ment of Iraq is still registering eligible house- system, providing micro-credit lending and holds in a continuing effort to reach those vocational training, and enacting legislation in Iraqis most in need of help. To date, the

17 August 29, 2006

Government of Iraq has enrolled more than perceptions are generally more pessimistic 520,000 people in the social safety net than they were a year ago. program. There is evidence that Iraqi private sector High inflation is threatening Iraq’s overall activity continues to expand. The IMF esti- macroeconomic stability. Inflation continues mates that non-oil GDP growth in 2006 will to be volatile, with spikes generally caused by be 10%. Various U.S. Government agencies commodity shortages and seasonal variations. are attempting to spur private sector activity The annual inflation rate from June 2005 to with microfinance loans, bank lending to June 2006 was 52.5%, according to COSIT. small- and medium-sized enterprises, capital The CBI needs to take steps to control infla- market development, business skills develop- tion. Polling data indicate that the Iraqi ment, vocational training, investment promo- public’s perceptions of the household finan- tion, business center support, and creation of cial situation are mixed, although public economic zones.

ComparedCompared to before to before the the war, war, wouldwould you you say saythat yourthat your household'shousehold's financial financial situation situation has has improved? improved? (percent responding “yes”) 90 2005 June 80 2006 July 70

Percentage 30

0 Baghdad Kurdish Mosul Kirkuk Tikrit/Baquba Mid- South Areas Euphrates

Source: Department of State, Office of Research, June 2005/July 2006 Sample sizes: June 2005 Baghdad-216; Kurdish Areas-344; Mosul-127; Kirkuk-115; Tikrit/Baquba-224/; Mid-Euphrates-527; South-435 July 2006 Baghdad-173; Kurdish Areas-308; Mosul-111; Kirkuk-108; Tikrit/Baquba-210/; Mid-Euphrates-523; South-437 Margin of error: ≈ ±4% for the overall sample, but varies among regions

18 August 29, 2006

How would you rate economic conditions in Iraq today?

Fair 26%

Poor 59%

Good 10%

Excellent 1% DK/NA 4%

Source: Derived from International Republic Institute Polling Data, June 14-24, 2006 Sample size: 2,849 Margin of error: ±3% (see IRI website for further methodology)

Monthly Consumer Price Index (% Change) 15.0%

10.0%

5.0%

0.0% % Change -5.0%

-10.0%

-15.0%

4 4 5 5 5 5 5 5 6 6 6 6 6 6 /04 /0 /0 /0 /0 /0 0 0 /05 /05 /0 /0 /0 /0 /0 0 0 1/04 /1 /1 /1 1/05 1/05 /1 /1 /1 / 0 1 2 /1 / / 0 1 2 /1 /1 9 1 1 1 1 2/1 3/1 4/1/ 5/1/ 6/1/05 7/1/05 8 9 1 1 1 1 2 3/1 4/1 5/1/ 6/1/ 7/1/06

Source: U.S. Treasury estimates

19 August 29, 2006

New NewBusiness Business Registrations Registrations (Cumulative) (Cumulative)

36,000 34,000 32,000 30,000 28,000 26,000 24,000 22,000 20,000

5 5 5 5 5 5 5 5 5 5 5 6 6 6 6 6 6 6 0 0 0 5 0 0 0 0 0 0 0 0 0 0 0 6 0 0 0 0 - - - -0 - - l- - - t------0 - - l- - n b r r y n g p c v c n b r r y n u g a e a p a u u u e o e a e a p a u J u J F M A M J J A S O N D J F M A M J A

Source: Iraq Reconstruction Management Office

Sector Indicators During the past quarter, Iraq resumed exports from northern fields for the first time since Oil Production, Distribution, and Export the autumn of 2005, though on a very small scale. Exports are expected to increase once When Coalition forces began Operation Iraqi three major crude pipelines from Kirkuk, Freedom, they entered a country whose including a new 40-inch line, are put in energy infrastructure had deteriorated over service in September 2006. many years. The Coalition set out to help the Government of Iraq restore oil facilities, Demand remains essentially unchecked for increase production, improve refining of state-subsidized refined petroleum products. natural gas production, and maintain pipeline The Government of Iraq announced reduc- facilities. Poor maintenance, insurgent tions in fuel subsidies on June 21, 2006; on attacks, slow repair, and corruption have July 1, 2006, in accordance with the Stand-By slowed progress. Beyond attacks on various Arrangement, these subsidies started being worksites, terrorists have attacked crude phased in at government-run stations. In June export and petroleum product pipelines, 2006, the government increased prices for impeding exports and the refining and dis- fuel sold through official outlets, in accor- tribution of petroleum products, such as dance with its commitments under its IMF gasoline and diesel. reform program to decrease fuel subsidies. Regular gasoline (85 octane) in Iraq is cur- Despite these challenges, crude oil production rently regulated at about US$0.55 per gallon, for the second quarter improved by 18% to while premium gasoline (92 octane) is regu- 2.2 mbpd, and exports improved by 20% to lated at about US$0.90 per gallon. The 1.6 mbpd. Nevertheless, oil production and premium gasoline price is at the IMF target exports still fell short of the Government of price. These prices are roughly equivalent to Iraq’s goals (2.5 mbpd and 2.0 mbpd, respec- the pump prices in Kuwait and Saudi Arabia, tively). Due to a combination of increased but substantially less than in Turkey, where exports and higher prices for crude, oil reve- gasoline is heavily taxed. This disconnect nues improved in the second quarter, and will between supply and demand leads to black reach budgeted targets by August 2006. market activities and corruption. Efforts are

20 August 29, 2006

Oil Production May–June 2006 3.00

Target Level: 2.5 2.50 2.48 2.35 2.22 2.23 2.27 2.23 2.16 2.17 2.17 2.00 2.11 2.09 2.13 2.09 2.11

1.50

1.00

0.50 Millions of Barrels per day

0.00 May 9 May 16 May 23 May 30 June 6 June 13 June 20 June 27 July 4 July 11 July 18 July 25 August 1 August 8 Weekly Average

Source: Iraq Reconstruction Management Office

under way to encourage the Government of process, an unreliable flow of crude oil into Iraq to adopt legislation allowing private the refinery, and security threats to personnel. imports of premium fuels at market prices. This legislation should allow the refined fuel Maintaining the refinery’s outdated equip- market to clear and help ease the frequent ment is a challenge. Two of the refinery’s shortages. It should also help reduce the three plants have been shut down since May rampant crime and corruption associated with 2006 due to mechanical breakdowns, scheduled maintenance, power outages, and fires. the current fuel production and distribution One power outage damaged the refinery’s process. US$20 million hydrocracker, a critical piece of equipment used to convert heavy fuel oil to The Bayji refinery in northern Iraq is a critical usable products. element in Iraq’s national oil infrastructure. Built in the 1980s, the Bayji refinery is Iraq’s A second factor limiting production at Bayji largest and newest refinery. This refinery is inefficiency in its refining process. For typifies many of the challenges Iraq faces as it every two barrels of crude oil brought into the attempts to modernize its aging infrastructure refinery, Bayji produces about one barrel of and increase its oil exports. Bayji has a nomi- usable product, for an efficiency rate of about nal production capacity of 310,000 barrels per 50%; modern refineries can have efficiencies day. However, since May 2006, the refinery of 90% or higher. The result of the inefficient has not produced more than 170,000 barrels refining process is a large amount of heavy per day, and recent production has been as fuel oil (HFO) byproduct. Bayji does not have low as 7,500 barrels per day. Four primary adequate facilities to refine further, store, or factors have limited production at the Bayji dispose of this byproduct; the excess HFO refinery: maintenance issues with key com- thus interferes with production and storage of ponents in the refinery, an inefficient refining usable products.

21 August 29, 2006

Production at Bayji is also affected by the period. This is an improvement of 15.8% over interrupted flow of crude oil into the refinery the previous reporting period. Iraq averaged from Kirkuk through three key pipelines. The 14 hours of power per day this quarter, an flow has been periodically halted by corro- improvement of 3 hours per day over the pre- sion, fires, maintenance, and attacks, all of vious quarter. Baghdad averaged 8 hours of which serve to hamper production of refined power per day, twice what it had averaged six products and crude oil for export. Construc- months earlier. tion of a new 40-inch line is scheduled to be completed in September 2006. As Iraqis purchase additional electric appli- ances, demand for electricity continues to Electricity Production and Distribution increase. Estimated demand over the 30-day period ending July 15, 2006, was 8,928 MW. The electrical generation and distribution To date in 2006, the highest daily peak supply system in Iraq suffers from unscheduled was 5,283 MW, 2% below the 2005 peak of downtime due to the fragile condition of the 5,389 MW. With all state-owned generators electric grid, sabotage, and poor maintenance running, theoretical maximum output is practices. In addition, shortfalls in petroleum 8,551 MW, or 96% of this estimated new production and distribution lead to occasional demand. However, that level of output has not fuel shortages for electric generators. been achieved, nor could it be sustained if it were achieved. The Government of Iraq’s Despite problems, peak capacity and hours of goal for average peak generating output by power continue to improve. During this the end of December 2006 is 6,000 MW per reporting period, peak generating output was day. During times when state-generated electricity is not available, many Iraqis meet their 5,283 MW on July 17, 2006, with an average electricity requirements through private peak generating output of 4,573 MW over the

Iraq Electric Power Production and Estimated Demand Projection January 2003 - September 2006 10000

9000

8000

7000

6000

5000 Megawatts

4000

3000

2000

3 3 3 3 3 3 4 4 4 4 4 4 5 5 5 5 5 5 6 6 6 6 6 0 0 -0 0 0 0 0 0 0 -0 0 0 0 0 0 -0 0 0 0 0 -0 0 0 - r- y l- - v- - r- y- l - v- n- r- y- l p- v- - r- y l- p- an a a Ju ep o an a a Ju ep o a a a Ju e o an a a Ju e J M M S N J M M S N J M M S N J M M S Date

Daily Peak MW Estimated/Projected Demand

Source: Defense Intelligence Agency

22 August 29, 2006

Average Daily Hours of Electrical Power per Province April-June 2006

9-11

12-16

>16

Source: Iraq Reconstruction Management Office

generators. Electricity usage in Iraq appears to scribers is relatively stable, the three major be in accordance with or less than regional cell phone companies continue to enroll sub- norms. Nonetheless, the data support the con- scribers. IRMO reports that, as of July 25, tention that the current connected capacity is 2006, there were 7.1 million cellular tele- not sufficient to support a growing economy. phone subscribers and 1 million landline con- nections. This reflects an increase in cellular The subsidized state distribution rate affects subscribers since the last report. The number electricity demand, and current electricity of cellular telephone subscribers has doubled rates are nominal, well below regional aver- over the last nine months. The state-owned ages. In addition, not all Iraqis pay for their Internet service provider (ISP) currently state-supplied electricity. About 70% of serves 197,310 subscribers, a slight decrease homes have meters and are billed. Of those, since May 2006. This figure excludes private about 70% pay their electric bills. The rate ISPs and public Internet cafes. It is unknown billed is equivalent to US$.002/kwh. Owners whether expansions of private sector ISPs of private neighborhood generators bill their drew customers from the state-owned service. customers at a rate about 40 times higher, around US$.08/kwh. U.S. Government projects continue to support improved communications among Iraqi min- Communications istries. Thirty-five of 42 government sites in Baghdad, the CBI, and two state-owned banks The communications sector continues to are now connected via the wireless broadband expand, although this expansion is slowing network. The U.S. Government continues to down in comparison with its explosive growth train Iraqi telecommunications engineers on immediately after the fall of the previous proper operations and maintenance proce- regime. Whereas the number of landline sub- dures to maintain and broaden this network.

23 August 29, 2006

Cumulative Communications Subscriber Data 8

1 Number of Subscribers (in Millions) 0

4 4 4 4 4 4 5 5 5 6 6 -0 -0 -0 -0 -0 -05 -05 -05 -05 -0 -0 -0 -06 -06 -06 g v g p t-0 c r g Jul-0 ep ct ec Jul-05 c an eb Jul-06 Jun-04 Au S O No D Jan Feb-05Mar-05Apr May-05Jun-05 Au Se O Nov-0 De J F Ma Apr-06May-06Jun Au

Cellular Landline Internet

Source: Iraq Reconstruction Management Office

Water and outside the country remains a serious issue. Turkey, where high taxes keep gasoline New projects have “added capacity to provide priced near US$5 a gallon, is a lucrative target an estimated 4.2 million people with access to for smugglers. However, a significant portion potable water—an increase of 1.2 million of illegal trade results in constraining the people since the May 2006 report—but direct supply of gasoline in Baghdad, giving motor- measurement of water actually delivered to ists few alternatives to purchasing black Iraqis is not available.”1 Additional projects market fuel at increased prices. Some pipeline currently under way should increase infra- interdictions are due to insurgent attacks, structure capacity to provide access to clean while some are botched attempts to steal fuel water to as many as 5 million more people. by tapping into a flowing product line. Other incidents include deliberate acts of sabotage Obstacles to Progress intended to manipulate the fuel supply to spur increased profits for black marketeers and There is significant black market activity in corrupt officials. Iraq, much of it in oil products. Although crude oil can be sold on the black market, Black market prices for fuel vary by refined refined product requires less handling, can be fuel type: Benzene typically sells for 3–5 sold almost anywhere, and is more difficult to times the government established price, while trace, thereby making it more profitable. LPG has recently been selling for 10–20 times Much of the black market and corruption the official price. This gap between the activity centers on refined products, such as official price and the black market price pro- gasoline, benzene, LPG, and diesel. vides a strong incentive for corruption. The U.S. Embassy has engaged the Government Although the increases in the official prices of Iraq to follow through on their stated com- have reduced the economic incentive to mitment to encourage liberalization of the smuggle fuel, smuggling fuel for resale inside retail fuel market through enactment of the Fuel Import Liberalization Law being con-

1 sidered by the CoR. This reform will allow Special Inspector General Iraq Reconstruction the private sector to import fuel and sell it at (SIGIR) report, 30 April 06, http://www.sigir.mil.

24 August 29, 2006

market prices. This step is viewed with con- • Iraqi public perceptions of security and troversy in Iraq. Economists predict that security institutions; and private sector retail vendors of petroleum • capabilities of the ISF and Iraqi products would undercut the illegal market, institutions. thus driving them out of business once the Government of Iraq passes the import liberal- Information about the ISF is presented later in ization law. this report.

1.3 The Security Environment Overall Assessment of the Security Environment Defeating the enemy, breaking the cycle of violence, promoting reconciliation, and transi- During this reporting period, attacks and tioning security responsibility to the Govern- civilian casualties have risen, characterized by ment of Iraq remain the top goals in the secu- ethno-sectarian attacks and reprisals. Violence rity track. To achieve these goals, the United escalated notably in Baghdad, which, as the States, its Coalition partners, and the Govern- political, population, and media center of the ment of Iraq are focused on objectives that country, is a high-value target for terrorists. include: Violence in Basrah also rose, partly in response to British actions against the JAM.

The death of terrorist Abu Musab al-Zarqawi • neutralizing enemy effectiveness, influ- in June was a major success for the Coalition ence, and ability to intimidate; and the Government of Iraq, but al-Qaeda in • rapidly reducing sectarian violence and Iraq remains able to conduct operations due to eliminating death squads; its resilient, semi-autonomous cellular struc- • increasing the capacity of the Govern- ture of command and control. Terrorists have ment of Iraq and its security structures failed to advance their primary objectives, and forces to provide national security which include derailing Iraq’s political and public order; and process and widening their political support • helping Iraq strengthen rule of law among the Iraqi people. The Iraqi Army took capabilities in the areas of law enforce- the lead in more counter-insurgency opera- ment, justice, and the corrections tions and assumed security responsibility in system. more areas since the last report. The Iraqi people continue to express confidence in the Indicators of the security environment Iraqi Army to provide for their security and to include: reject al-Qaeda in Iraq’s vision of Iraq’s future, but they are increasingly turning to militias and neighborhood watch groups to • composition, strength, and support for provide security from sectarian violence. groups that threaten security and stabil-

ity: anti-government and anti-Coalition Overall attack levels are higher than last forces (the “enemy”); quarter. In particular, attacks have increased • activity, support, and efforts to disband, in southwestern Diyala Province and in the disarm, and reintegrate militias; cities of Mosul and Kirkuk. Extremists seek- • attack trends (including the number of ing to stoke ethno-sectarian strife have attacks and their effectiveness); increasingly focused their efforts on civilians, • levels of sectarian violence; inciting a cycle of retribution killings and

25 August 29, 2006

Al-Qaeda in Iraq Influence 100% Do not believe al-Qaeda in Iraq will lead to a better life

90% Al-Qaeda in Iraq influence is decreasing in my community 80%

70%

60%

50%

40%

30%

20%

10%

0% Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Source: Poll Based on Key Areas of Interest (Baghdad, Anbar, Salah ad Din, and Mosul) Sample size: ≈2,000 Margin of error: ±4%

driving civilian casualties to new highs. Much respective sectarian groups. However, the of this violence is focused on Baghdad, as Sunni Arab insurgence remains potent and terrorists, insurgents, and illegal armed groups viable, although its visibility has been over- recognized the political and economic signifi- shadowed by the increase in sectarian cance of the capital city. As described below, violence. the Government of Iraq and the Coalition are taking significant steps to reverse the upward On June 14, 2006, Iraqi Prime Minister trend of violence in Baghdad. al-Maliki announced the government’s plan to provide improved security conditions in Recent Developments in the Security Baghdad. Operation Together Forward, or Environment Amaliya Ma’an ila Al-Amam in Arabic, consists of increased checkpoints, curfews, and Rising sectarian strife defines the emerging enforced weapons bans to reduce sectarian nature of violence in mid-2006. Since the last violence in focused areas within Baghdad. report, the core conflict in Iraq changed into a Security forces are also conducting raids struggle between Sunni and Shi’a extremists against terrorist cells and death squads. As seeking to control key areas in Baghdad, part of this operation, Iraqi police, the Iraqi create or protect sectarian enclaves, divert Army, and National Police, supported by economic resources, and impose their own Coalition forces, increased patrols and check- respective political and religious agendas. points in all areas of Baghdad, while concen- Death squads and terrorists are locked in trating on areas of the city that have witnessed mutually reinforcing cycles of sectarian strife, increases in violence and sectarian killings. with Sunni and Shi’a extremists each portray- Security forces also worked to block terrorist ing themselves as the defenders of their entry into the capital city.

26 August 29, 2006

The confluence of high attack levels—many predominance of the execution-style killings targeting civilians—and the increased sec- and other murders in the city. The death tarian violence, combined with the need to squads have fomented sectarian violence, as ensure that the Government of Iraq maintains killings prompt further killings of revenge. momentum in political progress and counter- Coalition forces and the ISF are also targeting insurgency, made Baghdad security a decisive the death squads and other illegal armed element in the campaign. Given the com- groups using checkpoints, patrols, driving plexity of the security situation in Baghdad, bans, curfews, weapons-law enforcement, the Iraqi government planned to execute and intelligence-driven operations, and other complete Amaliya Ma’an ila Al-Amam over a methods. The ISF will rely on their training, period of months, not weeks. After the first experience, and familiarity with Baghdad’s month of Amaliya Ma’an ila Al-Amam, the milieu to focus on neighborhoods with the operation had arrested but had not reversed highest levels of violence. Coalition forces the high attack levels seen in May and June. remain in a supporting role and will be The average of 23.7 attacks per day across employed as requested by Prime Minister Baghdad’s 10 districts was virtually un- al-Maliki and directed by the MNF-I com- changed from the 23.8 average daily attacks manding general. that occurred the month prior to the operation. Moreover, the rate of sectarian-motivated The two primary objectives of the security murders and execution-style killings con- operations in Baghdad are rapidly reducing tinued to rise, primarily in and around sectarian violence by de-legitimizing the Baghdad. illegally armed groups and establishing the ISF as the dominant security presence. The In July, during the prime minister’s first visit changes described above represent a con- to the United States, Prime Minister al-Maliki certed, focused effort by the Coalition and the and President Bush announced an adjustment Government of Iraq. By strengthening the to the Baghdad Security Plan. One of the key capacity of the Government of Iraq and changes is an increase in security force levels spurring economic growth in Baghdad, the in the city. Elements of the Call Forward United States will help the Government of Force were brought forward from Kuwait and Iraq succeed in protecting its population and other Coalition and Iraqi units were reposi- restoring the confidence of the Iraqi people in tioned from less active areas of the country. In their future. addition, the Secretary of Defense extended the 172nd Stryker Brigade Combat Team’s The Nature of the Conflict deployment in Iraq for up to 120 days. Because the 172nd was largely successful in Violence in Baghdad is the most prominent working with the ISF to improve security in feature of the conflict in Iraq in this period, as northern Iraq, it has been repositioned into Sunni and Shi’a extremist death squads Baghdad. pursue their sectarian agendas. The resulting violence overwhelmingly targets civilians, In addition to increasing force levels in causing segments of the populace to tolerate Baghdad, the Coalition and the Government or even endorse extremist actions on their of Iraq developed and refined tactics, tech- behalf as an effective means to guarantee their niques, and procedures designed to reduce the safety, undermining both the Government of sectarian killings. A primary focus is elimi- Iraq’s ability to deliver security and its pursuit nating the death squads responsible for the of a reconciliation program. Although

27 August 29, 2006

Baghdad remains the focus for sectarian and al-Sadr) are among most prominent groups terrorist violence in Iraq, violence tied to the engaging in a continuing pattern of attacks Rejectionist insurgency, terrorist intimidation, and reprisals against individuals or com- political and tribal tensions, and criminality munities representing the other’s sectarian continue in other regions. Sectarian violence affiliation. Thus, the violence in Iraq cannot is gradually spreading north into Diyala be categorized as the result of a single Province and Kirkuk as Sunni, Shi’a, and organized or unified opposition or insurgency; Kurdish groups compete for provincial the security situation is currently at its most influence. Conflict in Anbar Province remains complex state since the initiation of Operation centered on the Sunni insurgency. Although Iraqi Freedom. Similarly, Iraqi or Coalition al-Qaeda in Iraq continues its intimidation to security strategies must be tailored for the coerce passive Sunni support, tribes are different objectives, methods, and support pushing back to eject al-Qaeda in Iraq and re- structures of each particular threat. establish their dominant role. In the southern, predominantly Shi’a region of the country, Terrorists and Foreign Fighters political and tribal rivalries are a growing motive behind violence, particularly in Al-Qaeda in Iraq and its affiliates in the Basrah, with limited anti-Coalition forces Mujahadeen Shura Council consist of both attacks likely undertaken by rogue Shi’a foreigners and Iraqis motivated by an militia with Iranian support. extremist Sunni Islamist ideology, which rejects the West, attacks moderate Islam, and The Enemy seeks to establish an Islamic Caliphate in Iraq. AS is another significant, mostly indigenous Violence against the Iraqi people and Coali- terrorist group that objects to al-Qaeda in tion forces is committed generally by a com- Iraq’s wanton targeting of Muslim Iraqis. bination of both Sunni and Shi’a groups, who Foreign fighters continue to enter Iraq and are overwhelmingly Iraqi but with a small yet constitute the majority of those conducting significant component of foreign suicide suicide attacks. Sunni extremists continue operatives. Sunni groups include Rejection- their efforts to force Coalition withdrawal, ists—many of whom were members of, or perpetuate sectarian violence, and make Iraq associated with, the former regime—and ungovernable as a means of establishing the terrorists groups, including al-Qaeda in Iraq, Caliphate. The death of Abu Musab al- Ansar al Sunnah (AS), and other smaller Zarqawi has dealt a significant blow to al- groups. Shi’a groups include elements of Qaeda in Iraq, though the cellular nature of its militias and illegal armed groups, many of robust network allowed decentralized opera- whom receive Iranian support. The threat tions to continue. Since then, al-Qaeda in Iraq posed by Shi’a illegal armed groups, filling has fomented sectarian violence through high- perceived and actual security vacuums, is profile attacks against Shi’a civilians and is growing and represents a significant challenge engaged in a cycle of retaliatory violence for the Iraqi government. The appearance and involving elements of JAM. Al-Qaeda in Iraq activity of death squads is a growing aspect of recently announced that its “Umar Brigade” the violence in Iraq, with both Sunni and that would begin targeting JAM in retaliation Shi’a death squads adding to the violence by for death squad activities in an effort to targeting civilians and inciting reprisal. Al- portray al-Qaeda in Iraq as a protector of the Qaeda in Iraq and elements of JAM Sunni. Additionally, al-Qaeda in Iraq leader- (nominally under the control of Muqtada ship is increasing convergent with al-Qaeda

28 August 29, 2006

senior leaders on goals and strategy following tion tactics and actively oppose al-Qaeda in Zarqawi’s death. The recent statement from Iraq, sometimes mounting their own anti-al- Usama bin Laden on June 30, 2006, in which Qaeda in Iraq attacks and raids. he addresses the Iraqi “jihadists,” frames the conflict in terms of attacking those who Death Squads support the Government of Iraq. He also warns Shi’a in “southern Iraq” that they are Death squads are armed groups that conduct not safe, if they continue to support Coalition extra-judicial killings. Death squads are operations against Sunni urban centers in formed from terrorists, militias, illegal armed Anbar Province. This is a clear attempt to groups, and—in some cases—rogue elements recast al-Qaeda in Iraq as the most effective of the ISF. Both Shi’a and Sunni death squads defender of Sunni interests. are active in Iraq, and are responsible for the most significant increases in sectarian vio- Sunni Rejectionists lence. Death squads predominantly target civilians, and the increase in death squad Sunni Rejectionists use violence and coercion activity is directly correlated with the increase in an attempt to force withdrawal of Coalition of civilian casualties. Coalition forces and the forces, prevent Shi’a economic and territorial ISF are actively targeting elements that dominance, and reverse Sunni political participate in death squad activity. marginalization by regaining a privileged or protected status within a unified Iraq. The Militias and Other Armed Groups 1920s Revolutionary Brigade is the most prominent of these Rejectionist groups. Sunni Militias and small, illegally armed groups Rejectionists continue to target Coalition operate openly and often with popular forces at rates higher than Sunni extremist or support. This is especially true in areas where Shi’a militia groups. The bulk of the Rejec- the Government of Iraq is perceived as unable tionist insurgency will likely continue to to provide effective social and security attack Coalition forces while they remain in services for the population. Militias—whether Iraq. Some elements are indicating an interest legal or illegal—provide an element of in Prime Minister al-Maliki’s new reconcilia- protection for select portions of the populace, tion effort, while still employing violence usually on an ethno-sectarian basis, resulting against the Coalition forces and the ISF from in, overall, a more dangerous environment for a sense of honor and as a means to force the Iraqi community. Some militias also act as meaningful political accommodation. Moder- the security arm of organizations devoted to ates say they will accept reconciliation social relief and welfare, lending these armed inducements and disarm only after death groups further legitimacy. Whether operating squads are eliminated; Shi’a militias are within or outside the law, these armed groups disarmed; and key security, amnesty, and operate separately from formal public safety political demands are met. Other hard-line structures. Their continued existence chal- elements of Rejectionist groups provide pro- lenges the legitimacy of the constitutional fessional military skills to al-Qaeda in Iraq government and provides a conduit for and other extremists to achieve common foreign interference. An effective disarma- tactical objectives. Other Rejectionists, ment, demobilization, and reintegration pro- including some in Anbar and Baghdad, are gram is essential to meeting near- and long- weary of al-Qaeda in Iraq’s violent intimida- term security requirements for Iraq.

29 August 29, 2006

Although a number of militias and illegal The Peshmerga are, technically, not a militia, armed groups have operated in Iraq since but have the status of an authorized armed before the liberation, the groups that are force. The Peshmerga maintain security inde- affecting the current security situation the pendently within and along the borders for the most are the Badr Organization and JAM. Kurdish Regional Government. Some elements are integrated into the IPS. The The Badr Organization is an authorized Peshmerga predominantly operate in Kurdish militia under the Iraqi Transitional Adminis- regions, but have also been employed in the trative Law that pre-dated the present Consti- private security company role outside of tution, and the organization actively partici- Kurdistan. The Peshmerga do not attack or pates in the Iraqi government. The Badr oppose Coalition forces or the ISF. In some Organization has not engaged in active vio- cases, Peshmerga provide security for Coali- lence against Coalition forces or the Govern- tion reconstruction efforts. Over the long ment of Iraq; it attacks Sunni targets and in term, however, the perceived dual allegiance the past has also confronted JAM in an effort of the Peshmerga is potentially inconsistent to prevent its expansion of power and with effective national security and gover- influence among the Shi’a. The Badr Organ- nance. ization receives financial and materiel support from Iran, and individuals from Badr have Unlike the Kurdish and Shi’a militia groups, been implicated in death squads. Sunni Arabs do not have formally organized militias, but rely on neighborhood watches, JAM is not a legal militia under Iraqi law. Rejectionists, and, increasingly, al-Qaeda in However, it is well known and supported Iraq. The presence of Peshmerga, Badr popularly in Baghdad and the southern prov- Organization, and JAM individuals in the IPS inces of Iraq, and has achieved a measure of and the National Police contributes to Sunni tolerance from elements of the Government of concerns about the potential for persecution Iraq. JAM is closely associated with the and partisanship. The rise of sectarian attacks Office of the Martyr Sadr and is nominally is driving some Sunni and Shi’a civilians in responsive to his direction. Most, but not all, Baghdad and the mixed-ethnic provinces to JAM elements are following Sadr’s order not support militias. Such support is likely to con- to engage Coalition forces or the ISF except tinue in areas where Iraqi institutions and in self-defense. Still, violence between JAM, forces are perceived as unable to provide the Iraqi Army, and to a lesser extent Coali- essential services or meet security require- tion forces, is frequent. Rogue JAM elements ments. are among the main perpetrators of sectarian violence, and JAM members frequently par- Criminals ticipate in death squad activities. As described above, JAM and Badr Organization members Without an apparent political motive, conven- have periodically attacked one another in the tional criminal elements are also capitalizing past and are political rivals, but intra-Shi’a on the instability in Iraq, although it is conflict has taken a back seat to the ongoing increasingly difficult to distinguish among battle of violence and revenge between al- activities conducted by criminal, insurgent, Qaeda in Iraq and elements of JAM. Like and terrorist groups, as all are engaged in Badr, JAM receives logistical support from kidnappings, extortion, assaults, and other Iran. illegal behavior. In some cases, criminal

30 August 29, 2006

gangs work with terrorist organizations, with of casualties. Overall, Iraqi casualties the former abducting hostages and selling increased by 51% compared to the previous them to the latter, which can use their captives quarter. Most attacks targeting Coalition for publicity or to obtain ransom. The various forces were “stand-off” attacks, not involving groups involved in illicit activity are doing so close-up confrontations between Coalition to generate revenue, expand their influence, forces and insurgents. Such attacks typically and facilitate further criminal, terrorist, or consisted of improvised explosive devices insurgent operations. (IEDs), small arms fire, and indirect fire weapons. The number of car bombs this Attack Trends and Violence quarter increased to levels last seen in the summer of 2005. Over the last quarter, car For this report, the term “attacks” refers to bombs were largely centered on Baghdad, specific incidents reported in the Multi- Mosul, Kirkuk, and the Western Euphrates National Corps-Iraq (MNC-I) Significant valley, and primarily targeted civilians or ISF Activities database. It includes known attacks checkpoints. on Coalition forces, the ISF, the civilian population, and infrastructure. Although the overall number of attacks increased in all categories, the proportion of In the government establishment period those attacks directed against civilians beginning May 20, 2006, the average number increased substantially. Nationally, in April of weekly attacks increased 15% compared to 2006, civilians were the target of 11% of the previous reporting period. Weekly attack attacks; this increased to 15% in June 2006. levels in July 2006 were the highest to date. Baghdad showed a more pronounced shift in Coalition forces continued to attract the the targeting of civilians compared to the majority (63%) of attacks. However, the ISF national trend. In Baghdad, civilian targets and civilians continued to suffer the majority comprised 15% of total attacks in April and

Average Weekly Attacks by Time Period 1 Apr 04–11 Aug 06

800

700

600

500

400

300

200

100

0 Pre-Sovereignty: Sovereignty: Election: Pre-Constitution: Referend/Elect: Gov Transition: Gov Established: 1 Apr - 28 Jun 04 29 Jun - 26 Nov 04 27 Nov 04 - 11 Feb 05 12 Feb - 28 Aug 05 29 Aug 05 - 10 Feb 06 11 Feb 06 - 19 May 06 20 May 06 - 11 Aug 06

Source: Derived from MNC-I

31 August 29, 2006

Average Daily Casualties* – Iraqi (including ISF) and Coalition 1 Apr 04–11 Aug 06 140

120 Coalition

Iraqi 100

0 Baseline: Pre-Sovereignty: Sovereignty: Election: Pre-Constitution: Referend/Elect: Gov Transition: Gov Established: 1 Jan - 31 Mar 04 1 Apr - 29 Jun - 27 Nov 04 - 12 Feb - 29 Aug 05 - 11 Feb 06 - 20 May 06 - 28 Jun 04 26 Nov 04 11 Feb 05 28 Aug 05 10 Feb 06 19 May 06 11 Aug 06

* Casualty data reflect updated data for each period and are derived from unverified initial reports submitted by Coalition elements responding to an incident; the inconclusivity of these numbers constrains them to be used only for comparative purposes.

Source: Derived from MNC-I

Total Attacks by Province 20 May–4 Aug 06

35.0 Rank Ordered by Number of Attacks

30.0

These four provinces have approximately 37% of 25.0 the population but account for 81% of attacks.

20.0

15.0

10.0 Number of Attacks per Day 5.0

0.0

r f d h il h n r it a il k Population a la h a a la h a in a im a b a a s n j b u b a r a s a a a h d y Q n a y Ir weighted map n D iy w m s i y i b i a h e a B W a N r A d D a is a h n D g T h a a a in B d M D t n a a u K B h N A m Q M la la a u S S

Source: Derived from MNC-I

22% in June. The increase in attacks over the Four of Iraq’s 18 provinces (Anbar, Baghdad, past two quarters reflects heightened sectarian Diyala, and Salah ad Din) continue to experi- tension following the Golden Mosque bomb- ence the majority of attacks. Anbar and ing and increased death squad activity. Baghdad are the worst affected provinces,

32 August 29, 2006

accounting for 55% of all attacks. Further, disrupting public essential services. Although Ninewah and Tamim have seen significant the number of attacks is decreasing, the increases in attacks over the last quarter. essential services infrastructure will continue to be a high-value target for enemy elements. Infrastructure Attacks Successful attacks on the infrastructure adversely affect the legitimacy of government The average weekly number of attacks on in the minds of the civil population by critical infrastructure providing essential ser- reducing the supply of essential services. vices to the Iraqi people, such as electrical power, water, and fuel, continued to decline Concerns of Civil War over the past quarter, decreasing from an average of five per week to an average of two Sustained ethno-sectarian violence is the per week. However, the effect of these attacks greatest threat to security and stability in Iraq. has been disproportionate to their numbers for Breaking this cycle of violence is the most several reasons. Most notable among these is pressing immediate goal of Coalition and the slow rate of repair to damage from pre- Iraqi operations. Conditions that could lead to vious attacks. At other times, Iraqi officials civil war exist in Iraq, specifically in and may be slow in initiating repairs. Infrastruc- around Baghdad, and concern about civil war ture repair is often hampered by insurgent or within the Iraqi civilian population has other criminal intimidation of maintenance increased in recent months. Notwithstanding workers. Not all attacks and intimidation are this concern, there is no generally agreed the result of insurgent or other anti-govern- upon definition of civil war among academics ment activity, as described in the economic or defense analysts. Moreover, the conflict in section. Criminal activities, such as extortion Iraq does not meet the stringent international and black marketeering, also have outlets in legal standards for civil war. However

Infrastructure Attacks Weekly Average* by Time Period 1 Apr 04–11 Aug 06 14

0 Pre-Sovereignty Sovereignty Election Pre-Constitution Referend/Elect: Gov Transition: Gov Established: 01 Apr 04- 29 Jun 04- 27 Nov 04- 12 Feb 05- 29 Aug 05- 11 Feb 06- 20 May 06- 28 Jun 04 26 Nov 04 11 Feb 05 28 Aug 05 10 Feb 06 19 May 06 11 Aug

Source: Derived from MNC-I * Average rounded to nearest whole number

33 August 29, 2006

defined, movement toward civil war can be reported 1,600 bodies arrived in June and prevented. The U.S. and Iraqi governments more than 1,800 bodies in July, 90% of which are continuing the military, diplomatic, and were assessed to be the result of executions. political actions needed to prevent a civil war This is due to increased targeting of civilians and bring the situation in Baghdad under by al-Qaeda in Iraq and the increase in death control. Sectarian violence is largely confined squad activity. to the communal level. Furthermore, the Iraqi institutions of the center are holding. Iraqi Sunni and Shi’a extremists, particularly rogue leaders must take advantage of the popular JAM elements and al-Qaeda in Iraq, are, as support for democracy, a unified Iraq, and noted, interlocked in retaliatory violence and opposition to violence to form institutions that are contesting control of ethnically mixed take responsibility for Iraq’s security. areas to expand their areas of influence. Throughout the past quarter, rogue JAM Sectarian tensions increased over the past members continued a campaign of overt quarter, demonstrated by the increasing executions and mass kidnappings of Sunni number of executions, kidnappings, attacks on civilians. At the same time, Sunni extremists civilians, and internally displaced persons. continued to respond by carrying out large- According to an estimate by the United scale and mass-casualty bombings of Shi’a Nations, 22,977 families—137,862 individu- gatherings and culturally significant sites. als—have been displaced in Iraq since the February 22, 2006, Samarra Mosque bomb- Attacks on Shi’a by al-Qaeda in Iraq and ing. Sectarian violence is concentrated on the other Sunni elements are apparently designed boundaries of mixed and ethnically dominated to inflame sectarian tension, which in turn areas of Baghdad and in southwestern Diyala generates and results in retaliatory attacks on Province. Sunni civilians by rogue Shi’a elements. These rogue Shi’a actions increasingly appear According to MNC-I reporting, civilian intent on securing Shi’a enclaves and casualties increased by approximately 1,000 establishing control of contested areas of per month since the previous quarter. Execu- Baghdad. Coalition forces and the ISF are tions in particular reached new highs in the responding by increased targeting of both month of July. The Baghdad Coroner’s Office Sunni and Shi’a death squads.

34 August 29, 2006

Are you very/somewhat concerned that a civil war might break out in Iraq?

100 90 2005 November 2006 March 80 2006 August 70 60 50 40 Percentage 30 20 10 0 Baghdad Kurdish Areas Mosul Kirkuk Tikrit/Baquba Mid- South Euphrates

Source: Department of State, Office of Research, November 2005/March 2006/August 2006 Sample sizes: November 2005 Baghdad-1,365; Kurdish Areas-637; Mosul-521; Kirkuk-213; Tikrit/Baquba-597; Mid-Euphrates-1,017; South-910 March 2006 Baghdad-213; Kurdish Areas-313; Mosul-123; Kirkuk-112; Tikrit/Baquba-211; Mid-Euphrates-550; South-448 August 2006 Baghdad-911; Kurdish Areas-469; Mosul-371; Kirkuk-142; Tikrit/Baquba-361; Mid-Euphrates-678; South-684 Margin of error: ≈ ±4% for the overall sample, but varies among regions

Sectarian Incidents

2500 600

2000 500 400 1500 300 1000 200 Incidents Casualties 500 100 0 0 5 5 5 5 6 6 05 05 0 05 0 0 0 05 0 06 06 06 06 06 0 - - l- - - t- v- - n- - r- r- - - l- ay un u g ep c o ec a eb a ay un u M J J Au S O N D J F M Ap M J J

Incidents Total Casualties

Source: MNF-I

35 August 29, 2006

Public Perceptions of Security include the Basrah area indicate increased confidence in both the police and the Iraqi Ultimately, stability and security in Iraq Army over the last reporting period. Con- depend on the support of the Iraqi people. In fidence in militias is mixed, with a rise in general, Iraqis have had an optimistic outlook confidence in Baghdad countering an overall on their future and the overall security situa- downward confidence trend elsewhere. tion. However, as time has passed, their optimism has eroded. The aftermath of the The perceptions of the Iraqi population will Golden Mosque bombing and the growing slowly respond to visible, effective actions sectarian violence continue to shape their performed by the IPS. It will take continued perceptions. As sectarian violence increases, diligence on the part of the Iraqi Police to be the view of the security situation worsens. seen as actively patrolling their areas and With the view that Baghdad is the key to Iraq, arresting individuals for criminal activity, a similar sentiment toward security exists while paying particular care to avoid the there. appearance of sectarianism. An indication of support for the Government of Iraq within the country is the level of con- Another indicator is Iraqi use of the fidence that the Iraqi people expressly place intelligence hotline for providing tips to in the ISF Forces, especially when compared authorities about suspicious activity. The against militias or other illegal armed groups. population has continued to demonstrate its Since the previous report, confidence in the willingness to report such activity and thereby Iraqi Army has remained generally constant, support the government’s efforts against with the notable exception of Baghdad, where terrorism. Since mid-March, the number of public confidence improved. Despite the tips has increased (see following chart). Con- increase in violence, confidence in the Iraqi tinued timely and effective response of the Army rose from 69% to 78%. Despite the IPS to these tips should increase the con- recent violence in Basrah, polling data that fidence of the population.

36 August 29, 2006

How concerned are you about an increase in sectarian or ethnic violence in Iraq?

100% 90% Very/Somewhat concerned Not concerned 80% 85% 86% 80% 70% 60% 50% 46% 47% 47% 40% 43% 45% 30% 36% 20% Percentage of Respondents of Percentage 10% 14% 14% 0% 6% Baghdad Kurdish Kirkuk Tikrit/Baquba Mid- South Areas Euphrates

* Data from Mosul is not included in this chart. It was determined to be unreliable.

TREND: Thinking about the future, do you feel that things will be…

Actual data points Extrapolated trend

Source: International Republic Institute Polling Data, June 14-24,2006 Sample size: 2,849 Margin of error: ±3% (see IRI website for further methodology)

37 August 29, 2006

Source: Baghdad Public Opinion Poll

% Expressing confidence in ___ to improve the situation in Iraq *

100% Iraqi Army Iraqi Police Badr Org. 80% Mahdi Army Peshmerga

60%

40%

20%

0% Baghdad Kurdish Kirkuk Tikrit/ Mid- South Areas Baquba Euphrates

Source: Department of State, Office of Research, June 21-July 6, 2006 Sample sizes: Baghdad-173; Kurdish Areas-308; Kirkuk-108; Tikrit/Baquba-210; Mid-Euphrates-523; South-437 Margin of error: ˜ ±4% for the overall sample, but varies among regions

* Data from Mosul is not included in this chart. It was determined to be unreliable.

38 August 29, 2006

Total TIPS Actionable Calls

500

450

400

350

300

250

200

150

100

0 1-7 JUL 8-14 JUL 8-14 APR 03-09 JUN 24-30 JUN 10-16 JUN 17-23 JUN 01-07 APR 15-21 APR 22-28 APR 06-12 MAY 13-19 MAY 20-26 MAY 11-17 MAR 18-24 MAR 25-31 MAR 27 MAY-2 JUN MAY-2 27 29 APR-05MAY

Source: MNF-I (includes tips reported to multiple sources)

39 August 29, 2006

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40 August 29, 2006

2. Iraqi Security Forces Training and Performance

The ISF continue to grow in strength and 2.1 Progress in Training and Equipping capability as indicated by: the Iraqi Security Forces

Force generation continues on schedule this • progress in the training and equipping quarter. More than 14,000 additional Iraqi of ISF personnel; soldiers and police have completed initial • assessed capabilities of operational training and equipping since May 2006, units; and bringing the total number of ISF trained and equipped to 277,600. • progress in assuming responsibility for security of areas within Iraq. More than 92% of authorized Iraqi Army battalions are assembled. Train-and-equip Institutional capability within the MOD and efforts remain focused on building combat the MOI is an increasingly important indica- support and combat service support forces providing key enablers to Iraqi combat forces. tor of the transition to Iraqi security self-reli- When fully established, these units will ance. As the MOD and the MOI continue to provide critical combat enablers, such as staff, train, and equip forces, increased logistics and transportation support, intelli- emphasis is placed on the development of gence, surveillance, and reconnaissance. More institutional capacity to direct, support, and than 65% of authorized personnel in the Iraqi sustain the ISF. Army support forces have been trained and equipped. Logistics units and overall logistics capability continues to improve.

Current Status of Trained and Equipped Iraqi Security Forces

Ministry of Defense Forces Ministry of Interior Forces

TRAINED & COMPONENT OPERATIONAL COMPONENT EQUIPPED ARMY* ~113,200 POLICE** ~113,800 AIR FORCE ~700 OTHER MOI FORCES ~48,800 NAVY ~1100 TOTAL ~162,600 TOTAL ~115000 OBJECTIVE 188,000 OBJECTIVE 137,500

Total Trained & Equipped ISF: ~277,600 * MNSTC-I expanded the train and equip mission from 4 to 11 Strategic Infrastructure Battalions (SIBs) on 29 Mar 06. This change is reflected in the adjusted Iraqi Army authorization. ** The Ministry of Interior dissolved the National Highway Patrol into the regular Police on 17 Mar 06. This change is reflected in the adjusted Iraqi Police trained and equipped numbers.

Data as of 7 August 06

41 August 29, 2006

MOI security forces are overall 84% trained and equipped. Baghdad, the other 10 critical cities. and the National Police are at 90% trained and equipped and are expected to reach 100% next quarter. Progress continues to support achieving Objective Civil Security Force goals by December 2006.

100%

90%

80%

70%

60% 50% TRAIN 40% EQUIP 30%

20%

10%

0% IPS (Cities) IPS NP BORDERS PORTS (Provinces)

Data as of 15 July 2006

MOD Forces’ Assessed Capabilities

120

Units Not Ready 100 21 Units Fighting Side by Side with Coalition Forces Units in the Lead with Coalition Enablers or Fully Independent 80

60 55 40 85

20 24 0 Jun-05 Aug-06 Jun-05 Aug-06 Jun-05 Aug-06 Jun-05 Aug-06

Iraqi Army & Special Logistics Enablers Air Force Navy Operations Combat Forces

Data as of 7 August 2006

MOI National Police Forces’ Assessed Capabilities

25 Units Not Ready Units Fighting Side by Side with Coalition Forces Units in the Lead with Coalition Enablers or Fully Independent 20

15 27

10 13 5 9 7 22 0 Jun-05 Aug-06 Jun-05 Aug-06 Jun-05 Aug-06

National Police Combat Battalions National Police Brigade Headquarters National Police Division Headquarters

Data as of 7 August 2006

42 August 29, 2006

2.2 Progress in Assuming Leadership in assume the lead once it has been thoroughly Counter-Insurgency assessed and has demonstrated that it is capable of planning and executing combat The ISF are increasingly taking the lead in operations. Although these units lead security operations and assuming primary respon- operations, most still require support from sibility for the security of their nation, as Iraqi Coalition forces because their logistics, sus- army and police forces demonstrate an tainment, and command and control capabili- increased capability to plan and execute ties are not fully developed. The Coalition’s counter-insurgency operations. The following primary force development objective to date charts depict this progress. As of August 7, has been to produce trained, equipped, and 2006, 5 Iraqi Army divisions, 25 brigades, capable combat units; there has been less and 85 battalions, and 2 National Police emphasis placed on enablers, including logis- battalions assumed lead responsibility for tics and command and control. Now that more security in their areas of operation. than two-thirds of the Iraqi Army combat units are in the lead, the Coalition’s focus will In total, there are 106 Iraqi Army combat shift more toward helping the Iraqis develop battalions and 8 Strategic Infrastructure Bat- these enablers. MNF-I will also continue to talions (SIBs) conducting operations at vary- help improve the capacity of the MOD to ing levels of assessed capability. Another organize, train, equip, sustain, and modernize three combat battalions are in the process of its forces, with the goal of eventually elimi- forming. In addition, 27 National Police bat- nating the Iraqi Army’s reliance on Coalition talions are now operational and active. The support. green shaded areas on the maps above depict areas where Iraqi Army units have assumed the lead for security responsibility. A unit can

Iraqi Army Lead and National Police Lead

Baghdad Area Baghdad Area Oct 05 Aug 06 Mosul Tall ‘Afar Mosul Tall ‘Afar IZ Kirkuk Kirkuk

Samarra Samarra

Ramadi Ramadi Fallujah Fallujah

Najaf Najaf

Basrah BasrahBasra

Component DIV HQs BDE HQs BNs Component DIV HQs BDE HQs BNs Iraqi Army 1 4 23 Iraqi Army Lead Iraqi Army 5 25 85 National Police 0 2 6 National Police National Police 0 0 2 Total 1 6 29 Lead Total 5 25 87 Source: MNC-I, C3 as of 30 Oct 2005 Source: MNC-I,Source: C3 as MNC-I, of 7 Aug C3 2006as of 7 Aug 2006

43 August 29, 2006

2.3 Ministry of Interior develop the IPS. The IPLOs provide the civilian police with expertise in all technical The objective for the MOI, in partnership aspects of criminal investigation and police with the Ministry of Interior Transition Team station management. The deployment of five (MOI-TT), is to become a forward-looking additional Military Police companies in July ministry that is effective, efficient, account- 2006 added extra PTTs, enabling the expan- able, representative, appropriately structured sion of the program to assess and assist in the to deal with the prevailing security conditions, development of the IPS. and staffed by people who are committed to upholding the rule of law. The MOI forces Twenty-seven BTTs mentor and enable devel- consist of the IPS, the National Police, the opment of border forces. Additionally, border forces, and the Center for Dignitary Department of Homeland Security Customs Protection. and Border Patrol Teams (CBPTs) provide critical mentorship at ports of entry, while The MNF-I initiative to develop professional 38 National Police Transition Teams (NPTTs) civil security forces able to assume the lead continue to support the development of the for the security of the Iraqi people has been National Police units. These transition teams dubbed the “Year of the Police.” The focus is are intended to improve the readiness and on creating a force loyal to the people of Iraq capability of their MOI partner units. and its Constitution, and committed to guaranteeing human rights and the rule of The Coalition Police Assistance Training law. This was designated as one of MNC-I’s Team (CPATT) is on track to meet the goal of main efforts in 2006. recruiting and training the authorized number of MOI forces by the end of December 2006. Mentoring of civil security forces is con- The force generation of the Department of ducted by Police Transition Teams (PTTs), Border Enforcement (DBE) and the IPS will National Police Transition Teams (NPTTs), occur in November 2006 and December 2006, Border Transition Teams (BTTs), and respectively. Specialized police units, such as Customs and Border Protection Teams the Criminal Investigative Division (CID) and (CBPTs). More than 160 PTTs are assisting the National Information and Investigative the development of the IPS. Because of the Agency (NIIA), will be trained by the end of large number of police stations dispersed 2006. throughout Iraq, the PTT program has initially focused on provincial headquarters, district Iraqi Police Service headquarters, and Iraqi police stations in key strategic cities, but will spread to other sta- The IPS is composed of patrol, traffic, station, tions throughout the country as more stations and highway police assigned throughout achieve a higher level of readiness. To con- Iraq’s 18 provinces. Its mission is to enforce duct their mission, the PTTs travel to their the law, safeguard the public, and provide assigned stations to train, teach, and coach the internal security at the local level. Iraqi police and to conduct joint patrols with their Iraqi counterparts. CPATT has trained and equipped approximately 113,800 IPS personnel, an increase of The integration of International Police Liaison 12,600 since the May 2006 report. CPATT Officers (IPLOs) into the PTTs significantly projects that it will have trained and equipped increased the Coalition force’s ability to 135,000 IPS by December 2006. Although the

44 August 29, 2006

force will be manned in the aggregate by the However, the recent arrival of five additional end of the year, proper distribution is a Military Police companies will greatly challenge. Certain areas have a shortage of increase the ability to assess the IPS. trained officers while additional hiring in other areas has resulted in an overage in the IPS Recruiting and Vetting force. More than 230,000 MOI employees have As of July 24, 2006, 71,324 police recruits been screened by the Iraqi Police Screening have received training in the 10-week basic Service, which checks fingerprints against course. Police officers with prior experience Ba’ath Party records and Saddam-era criminal attend a 3-week course, the Transitional Inte- records. Of these, 5,300 were reported as gration Program (TIP), instead of attending possible derogatory matches, and 74 have the full 10-week basic course. Originally been dismissed. There is currently no screen- intended only for police trained during the ing process to ascertain militia allegiance. Saddam regime, the TIP was expanded in July More than 54,000 police candidates have been to include serving police officers who have screened for literacy by Morris & McDaniel, not been trained but who have served on the 73% of whom passed and were allowed to force for at least one year. The TIP includes enter basic training. Currently, no method training on human rights, crime defensive exists to track the success rates of these or tactics, democratic policing, first aid, patrol other police officers. procedures, firearms (9mm and AK-47), and anti-terrorism. The Officer Transitional Inte- IPS Equipment gration Program (OTIP) course curriculum includes democratic policing, human rights, The IPS is equipped with AK-47s, PKC light first aid, police ethics, supervision and machine guns, Glock pistols, individual body leadership, use of force, firearms (9mm and armor, high frequency radios, small and AK-47), communications and problem- medium pick-up trucks, and mid-sized SUVs. solving skills, anti-terrorism, patrol proce- The IPS in Baghdad and the nine other key dures, critical for officers, and police investi- cities had been provided with 99% of their gations. Some 41,051 police officers have authorized equipment at the end of June 2006. graduated from the TIP and OTIP programs. They will have received 100% by mid-August 2006. The IPS in all 18 provinces have been IPS Operations provided with 66% of their authorized equipment and will receive 100% of their author- The IPS constitutes the majority of MOI ized equipment by the end of December 2006. forces in the country. Each month, PTTs assess the operational readiness of a portion IPS Leadership of the police forces, using the Transition Readiness Assessments (TRA) process. The Leadership in the IPS is the cornerstone for TRA evaluates the police on the core func- success. The IPS currently has three leader- tions required for effective law enforcement ship courses to develop high-quality leaders. and community policing. Shortages of PTTs The First Line Supervisor Course is designed has limited observation of the IPS in Anbar, for company grade officers. The Intermediate- Babil, Basrah, Tamim, Wasit, Karbala, Level Course is designed for field grade Maysan, Ninewah, Qadisiyah, Salah ad Din, officers, and the Senior-Level Course is Irbil, Dahuk, and Sulamaniyah provinces. designed for General Officers. Each course is

45 August 29, 2006

two weeks long. Program topics are designed The 1st and 2nd National Police Divisions for the target audience and include human reached 99% of equipping and authorized rights, discrimination, right to life, code of manning by July 2006 and will continue to conduct, democratic policing, modern polic- progress through TRA levels, with the coming, the role of the supervisor, communication pletion of force generation by December and the supervisor, delegation, change man- 2006. agement, ethics, police corruption, problem employees, community policing, field training Unprofessional and, at times, criminal police leadership, history of management, behavior has been attributed to certain units in modern supervision in today’s law enforce- the National Police. This behavior and the ment organizations, crime scene management, decrease in public confidence in these forces civil disorder, records management, budget- has been the impetus for a National Police ing, logistics, equipment and facilities man- reform program. Each unit and its leaders will agement, group problem solving, mission be assessed by a joint (Coalition and Iraqi) values, six-step problem-solving models, committee. Substandard leaders at all levels overview of law enforcement planning, strat- will be removed and units will undergo re- egic planning, motivational theory, and training. analyzing employee performance problems. A plan is in place to develop a more extensive National Police Training and Personnel Intermediate-Level Officers course, slated to begin in the fall of 2006. There are currently approximately 24,300 trained and equipped National Police, an The Officer Education System has been increase of approximately 1,600 since the last successful in developing junior leaders loyal report. They are trained in Iraqi law, human to the Iraqi people. However, certain senior rights, the rule of law, and democratic leaders are products of the former regime and policing techniques at the National Police continue to view leadership as an entitlement, Academy. not a responsibility. As these officers are identified, they are removed. New recruits undergo six intense weeks of training at the academy in northern Baghdad. National Police Training includes weapons qualification, urban patrolling techniques, unarmed combat Organized into a National Police Head- apprehension, use of force, human rights and quarters, two National Police Divisions, the ethics in policing, introduction to Iraqi law, 1st National Police Mechanized Brigade, and vehicle checkpoints, and IED characteristics the Emergency Response Unit (ERU), the and recognition. National Police are charged with maintaining law and order while an effective community National Police Operations police force is developed. All National Police battalions are currently The National Police Headquarters provides conducting counter-insurgency operations, command and control, staffing, equipping, with two battalions having security lead for training, and sustainment for these National their areas of responsibility. NPTTs are Police Forces. It also commands the two embedded at all levels of the National Police training and professional development acad- units, down to the battalion level. All National emies at Camp Solidarity and Camp Dublin. Police units work in Combined Operations

46 August 29, 2006

Areas (COAs) and partner with Coalition DBE Training and Personnel forces who provide support and advice. The DBE has 23,900 trained and equipped National Police Recruiting and Vetting personnel, an increase of 1,800 since the previous report. The DBE is organized into The MOI recruits and vets the National Police 5 regions, 12 brigades, and 38 battalions, and force. Coalition forces provide advisors for includes the forces that staff 258 border forts. the recruiting process, but neither actively recruit nor provide lists of names of recruits Three academies, each with a capacity of to the MOI. A National Police officer is approximately 800, train border patrol forces. recruited and provided an academy start date; The Iraqi Border Patrol Basic Training upon arrival at the National Police academy, Course focuses on an introduction to law the candidate is interviewed by a senior staff enforcement, human relations, human rights, officer (either a Colonel or Brigadier weapons qualification, combat life saving, General). If he or she passes the interview, the vehicle searches, Iraqi border law, arrest and officer is admitted to the academy. The detainee procedures, and small unit patrolling. individual’s personnel file is then forwarded to the MOI, where a vetting team reviews it. DBE and POE Operations If the officer is certified by the vetting process, he or she will be retained and allowed to The DBE is supported by 27 Coalition Border complete the academy. If the candidate is dis- Transition Teams (BTTs). The 11-man BTTs approved, the officer is immediately removed mentor and support the development of the from the academy. border units. The BTT members are trained in various specialties, including logistics and National Police Equipment communications, and provide critical assistance to the border force commanders in the The National Police have received 92% of areas of personnel management, intelligence, their authorized equipment and will have operations, budgeting, equipment account- received 96% of their authorized equipment ability, and maintenance. Additional BTTs by the end of November, missing its goal of deployed in early June to support the 100% by a small margin. They will have development of the POE at critical high-threat received 100% of their authorized equipment border crossings. In February 2006, MNF-I by the end of December. The police are supported the accelerated development of the equipped with small arms, medium machine POE through the deployment of a combined guns, and RPGs, and they patrol in light Border Support Team (BST), consisting of trucks. The mechanized battalions are customs border protection agents and BTTs. equipped with Armored Security Vehicles and In March 2006, most DBE units reached TRA REVAs, a South African wheeled APC. Level 3, but remained short of equipment and key personnel. The DBE and POE are a Department of Border Enforcement and higher priority for allocation of critical Department of Ports of Entry equipment; and cross-leveling of personnel has occurred to raise units to TRA Level 2. The DBE and the Department of Ports of By November 2006, the DBE and POE are Entry (POE) are collectively charged with expected to have 28,360 trained and equipped controlling and protecting Iraq’s borders. personnel.

47 August 29, 2006

There are 14 land POEs, of which 13 are Facility Protection Service functional. Efforts continue to improve POE security. Progress in designation of POE In addition to the regular MOI forces, there standard organizations, delineation of respon- are an estimated 145,000 Facility Protection sibilities, and development of detailed Service (FPS) personnel who work directly policies and procedures has continued. The for each of the 27 ministries. These forces act U.S. Department of Homeland Security, in as security guards at government buildings coordination with Multi-National Security and allow the IPS to police the communities. Transition Command-Iraq (MNSTC-I), has They are minimally trained and equipped, continued its rotation of Customs and Border generally without Coalition oversight, and Patrol Teams. These border security experts lack centralized control. FPS personnel have have had an important impact on the POEs, not always proven reliable, and some have particularly along the Syrian border. The been responsible for violent crimes and other increased emphasis on BTTs and the Customs illegal activity. Unfortunately, the FPS and Border Patrol Teams has improved DBE uniform looks similar to the police uniform, readiness levels, as the Coalition’s expertise which causes many Iraqis to confuse the FPS and mentorship affects the Iraqi border forces. with the better-trained IPS, undermining the reputation and credibility of the IPS. The DBE and POE Equipment Coalition and the Government of Iraq are establishing a program of reform to better Organizational equipment includes small and regulate the FPS. medium pick-up trucks, mid-size SUVs, generators, and radios. Personal equipment, MOI Capacity Development including AK-47s, medium machine guns, and individual body armor, complete the The MOI overall TRA remains at outfitting of the border forces. The DBE TRA 3-Partly Effective. The MOI Transition currently has received 81% of its authorized Team is working daily in the MOI, stressing equipment. They will have received 97% of planning and programming resources. The their authorized equipment by the end of new Minister of Interior, Jawa al-Bulani, is August, just short of the 100% goal for that embracing the need to reform the ministry. date. They will reach the 100% goal one Logistics is the only essential system still month later. Iraqi POEs will have received assessed as ineffective. Improvement of the 100% of their equipment by the end logistics system is a focal point for the next December 2006. 90 days. All other major functional areas and systems are considered partly effective. Over Center for Dignitary Protection the next 90 days, emphasis will also be placed on building a solid framework of plans, Training and equipping of the Center of policies, and processes to ensure that the MOI Dignitary Protection (CDP) is complete. The can manage personnel efficiently, conduct force of approximately 600 people has been policing operations effectively, and maintain prepared to serve as the Protective Security and sustain capability. Details (PSDs) for Iraq’s new government leaders. It is unknown how many of these MOI Logistics personnel remain employed by MOI. An Iraqi training team assumed responsibility for Logistics capabilities continue to be an area of training future PSD personnel in June 2006. significant concern for the IPS, particularly

48 August 29, 2006

with respect to vehicle maintenance. How- Iraqi control in August 2006. A plan is being ever, accountability of equipment continues to formulated to hold a National Logistics improve as verified by reports submitted by Conference in September 2006. PTTs. CPATT/MOI-TT continues to provide logistical support in both an advisory and MOI Equipment financial capacity to assist with sustainment operations. Recently, a Director General for MOI security forces are on track to reach Logistics and staff were put in place. A December 2006 Objective Civil Security 6-month vehicle maintenance contract for the Force equipping goals. The following graph National Police and the Baghdad IPS was depicts the equipping status and key shortfalls agreed upon. Currently, there is a of Baghdad and the 9 other key cities, US$950,000 vehicle spare parts contract for 18 provinces, the National Police, the DBE, MOI forces, and a US$350,000 vehicle spare and the POEs. Equipment-issue priorities parts contract for the National Police is in focused on equipping Baghdad, the 9 key place. The average monthly logistical life cities, and the National Police, while support provided from April through June was US$20,266,121, for a total of simultaneously building initial functionality US$60,798,363 during that timeframe. Con- in the provinces, borders, and ports of entry. struction of a MOI National Storage and In general, these goals were met. However, Maintenance Facility was started in June the MOI doe not currently have an effective 2006, with an estimated completion in equipment management system in place. As a December 2006. Currently, we are in the result, it is unknown what percentage of the process of conducting a test case to hand over equipment issued to the MOI is still service- an LDI storage warehouse (one of seven) to able.

Equip Update • Overall on track to meet OCSF equipping goals by Dec 06 • Expect significant progress on weapons when shipment arrives from Russia in Aug 06 • Shipping delays regarding comms equipment resolved; equipment inbound • Pistol purchase contract challenged causing delay in manufacture and delivery

9+ CITIES % EQPD OVERALL Key Shortfall 18 PROVs % EQPD OVERALL Key Shortfall Baghdad 98 AK47s Baghdad 98 AK47s Fallujah 100 Anbar 43 Personnel Ramadi 99 AK47s Dahuk 16 All, Priority North Babil 96 PKM Irbil 53 Comms Mosul 100 Karbala 73 PKM, Comms Tal A’Far 100 99% Najaf 86 PKM, Comms Najaf 100 Sulymaniyah 13 All, Priority Baqubah 100 Wasit 68 Glocks, PKM, Comms Basrah 93 AK47s Babil 72 Glocks, PKM, Comms Kirkuk 100 Basrah 71 AK47s, PKM, Comms Samarra 100 Dhi Qar 8266% Glocks, PKM, Comms Diyala 57 AK47s, PKM, Comms

National Police 92 92% B.A, Glocks, PKM, Comms Maysan 82 Glocks, PKM Muthanna 91 Glocks, PKM DBE 81 PKM, Vehicles Ninewah 62 Weapons, Body Armor 56% Qadisiyah 75 Glocks, PKM, Comms POE 32 Glocks, Body Armor, Comms Salah Ad Din 68 AK47s, PKM, Comms Tamim 79 PKM, Comms

< OR = 84% 85% to 99% 100% or Better

Data as of 15 July 2006

49 August 29, 2006

Train and Equip/Update Manning and Training

Number to be Trained in 2006 z Total Objective Civil Security Force at end of 2006

1st NP: 2nd NP: DBE: NIIA: CID: IPS: 1,116 3,634 4,351 1,471 1,173 41,179 z 11,238 z 11,238 z 28,360 z 2,500 z 4,000 z 135,000

NIIA, MCU, and NP Trained DBE Trained IPS Trained JAN FEBMAR APR MAY JUN JULAUG SEP OCT NOV DEC

Equipping

Key Cities IPS 100% Key Cities 99/100% 100% IPS Provincial IPS 100%

NP 92% 96/100% 100%

97/ DBE 100% 81% 100% DBE 100% POE 100%

Data as of 15 July 06

The equipping effort did experience to be on the MOI payroll are CPATT trained unforeseen delays. and equipped. CPATT estimates attrition to be at least 20% per year going forward. The • Large shipments of Russian weapons MOI reports paying death benefits for more were delayed clearing customs while than 6,000 police officers since the fall of the exiting Russia and entering Iraq. Ba’athist regime in May 2003. • Glock pistol delivery delays occurred when a U.S. manufacturer challenged In addition to the overall number of police in the award of the pistol contract to a Iraq, there are some issues with distribution of non-U.S. company. the police among the various provinces. For • Communications gear was delayed due example, by the end of the year, Diyala to shipping problems. Province will have recruited its authorized force, but will not have trained the entire All matters have now been resolved and items authorized number. In the case of Diyala, the have either arrived or are inbound. All equip- provincial leadership has resisted sending ment fielding goals are on track to be met by 100% of the force to training due to security December 2006. concerns and the reluctance to take its police off the streets. Anbar, Basrah, and Ninewah MOI Attrition and Absenteeism may also miss their training targets for the same reason. Rather than let training seats go The MOI does not currently have an effective unfilled, other provinces were permitted to personnel management system. As a result, it send some of their untrained personnel to is unknown how many of the forces trained training. As a result, those provinces will have by CPATT are still employed by the MOI, or more than the authorized force trained in their what percentage of the 146,000 police thought provinces.

50 August 29, 2006

As with the IPS, the National Police payroll is sentative National Police. Recruiting initia- significantly larger than its authorized end- tives targeting Sunnis have improved the strength. There are currently more than diversity. Unlike the National Police, local 29,000 National Police on the MOI payroll, police forces tend to be of the same ethnic but it is unknown how many of these have mix as the communities in which they live been trained and equipped. Absenteeism and work. among National Police units generally follows the same pattern as in the military. Leave Corruption in MOI policies and immature personnel management policies account for 30%–40% of personnel In 2005, the MOI IG conducted 790 corrup- not present for duty. Absenteeism in the IPS tion-related investigations. Of these, 472 is difficult to quantify because shift schedules (60%) were closed. Of the 472 closed preclude PTTs from ascertaining which police investigations, 118 (25%) were forwarded to officers are absent and which are simply off- the CPI or to a court for adjudication, 350 duty. (74%) were closed because of “insufficient evidence,” and 4 (1%) were handled as The DBE payroll is also larger than its internal MOI discipline. To improve the IG’s authorized end-strength, with 25,832 DBE capability to investigate, the Specialized personnel on the MOI payroll. It is currently Advance Training Unit at the Baghdad Police unknown how many untrained DBE personnel College will train new MOI investigators. It are on the rolls and how many of the trained will take approximately 18 months to train the and equipped border personnel have left the Investigations Directorate at the basic investi- MOI. As with the other personnel issues, an gator level. Beyond the IG training, improve- effective personnel management system will ments in leadership oversight, accountability, help resolve these reporting and account- and reductions in sectarian and militia influ- ability deficiencies. ence are required before Iraqis become con- fident that MOI forces can ensure security and Sectarian Issues at MOI uphold the rule of law in Iraq.

The U.S. Government is committed to helping Foreign/Political/Militia Influence the Government of Iraq create an MOI that reflects the diversity of the Iraqi people. The Corruption, illegal activity, and sectarian bias goal is to create ethnically integrated units at have constrained progress in developing MOI the national level, while still allowing local forces. Inappropriate tolerance of and infiltra- police to reflect the ethnic composition of the tion by Shi’a militias, some of which are communities in which they serve. The former influenced by Iran, is the primary concern of Police Commandos, now part of the National the Government of Iraq. A lack of effective Police, are becoming increasingly diverse. leadership and policies to stem corruption The former Public Order Battalions, also now through accountability for actions, equipment, part of the National Police, tend to be dispro- portionately Shi’a, due to a lack of Sunni par- and personnel have enabled the theft of pay ticipation when these units were being formed and equipment, unlawful detentions, and in preparation for the January 2005 elections. reported cases of abduction and torture or Merging the National Police Commandos and execution of Sunnis. The minister is com- the Public Order Battalions into one National mitted to changing corrupt leaders and insti- Police force has helped produce a more repre- tuting policies to eliminate corruption.

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An additional 45 transition teams were logistics and support for each division, with deployed in July to increase PTT coverage Taji National Depot providing depot-level across the country. As stations begin to reach maintenance and resupply. Each battalion, TRA Level 2 in August, transition teams will brigade, and division headquarters will be expand their coverage of nearly 1,000 total supported by a Headquarters and Service stations across Iraq. This will limit infiltration Company (HSC) providing logistical and by militias, improve adherence to the rule of maintenance support to its parent organiza- law, and prevent complicity and participation tion. The Army will also include 17 SIBs and in sectarian violence. a Special Operations Forces Brigade consisting of two special operational battalions. The 2.4 Ministry of Defense Air Force will consist of six squadrons, and the Navy will consist of two squadrons and a The Iraqi MOD forces consist of Army Marine battalion. (including Special Operations Forces), Air Force, and Navy (including Marines) Army personnel. The end state of the Objective Counter-Insurgency Force will be an approxi- The Iraqi Army includes approximately mately 137,500-person force based around an 115,000 trained and equipped combat soldiers Army with 9 infantry divisions and 1 mecha- (including SIB personnel and around 9,600 nized infantry division consisting of 36 bri- support forces). The capability of Iraqi Army gades and 112 battalions. Nine Motorized Transportation Regiments, 5 logistics bat- units continues to improve, facilitated by the talions, 2 support battalions, 5 Regional mentoring by embedded advisors at the Support Units (RSUs), and 91 Garrison battalion, brigade, and division levels, and Support Units (GSUs) are intended to provide partnership with Coalition force units.

Iraqi Army Battalions in Combat 130

110 114 90 102 88 70 69 50

10 5

-10 Aug-04 Feb-05 Sep-05 Jan-06 Aug-06

NOTE: Includes special operations battalions and Strategic Infrastructure Battalions, but does not include combat support and combat service support units Represents the addition of Strategic Infrastructure Battalions to the total number Data as of 7 Aug 2006

52 August 29, 2006

Combat Operations (Company level and above*)

70% 1200

522 60% 1077 1000

1074 50%

800

727 933 40% 863 634 589 600 545 255 30% 553 59% 512 585 56% 50% 400 20% 39% 39% 36% 32% 33% 111 29% 29% 26% 207 24% 25% 200 10% 11% 13%

0% 0 Dec-05 Feb-06 Apr-06 Jun-06 Aug-06

Combined ISF Coalition Combined ISF

* Includes MOD and National Police units; data includes only those ISF independent operations that are reported to the Coalition

Source: MNF-I Data as of 15 August 2006

Force generation of Iraqi Army units is Three of the nine planned Motorized Trans- increasingly focused on combat enablers and portation Regiments (MTRs) are approaching continues in accordance with the force full operational capability. While a shortfall development plan. All three planned Iraqi of fully competent maintenance personnel Training Battalions are formed and fully adversely affects full capability, these MTRs operational. These battalions allow the Iraqis provide improved mobility and sustainment to train soldiers independently in sufficient support for Iraqi forces. Progress has been quantities for force generation completion and made in establishing HSC units for each replacement needs. New recruits attend a combat battalion, brigade, and division to pro- 13-week program of instruction. Upon gradu- vide transportation, communications, medical, ation, soldiers receive additional training supply, and maintenance support. Approxi- specific to their military occupation. Depend- mately 80% of the planned HSCs have been ing on their military occupational skill assign- formed; one-third are operational, and the ment, the length of training ranges from three remaining planned HSCs are scheduled for to seven weeks. Other training initiatives, completion by December 2006. such as the Military Intelligence School, the Signal School, the Bomb Disposal School, the Currently, 17 SIBs are being trained and Combat Arms Branch School, the Engineer equipped. Although the Iraqi Army maintains School, and the Military Police School, operational control of the SIBs, at present contribute to the growing professionalism of only 1 SIB is capable of planning and execut- the Iraqi Army through teaching diverse spe- ing independent operations, and all 17 require cialties necessary to conduct and sustain Coalition logistical support. Training of these counter-insurgency operations. battalions continues to employ a “train-the-

53 August 29, 2006

trainer” model that focuses specifically on The Iraqi Navy Training Department squadron- and platoon-level tasks. continues to develop unit-level refresher training and naval skills improvements, The capability of the SIBs is growing as they including basic seamanship and maritime receive training and more modern equipment. security operations. In June 2006, the Train- MNC-I is partnering the more capable SIBs ing Department independently conducted with locally deployed Iraqi Army units to basic training and successfully graduated 324 provide them with counter-insurgency experi- naval recruits. Its training efforts range from ence and to accelerate their leaders’ profes- mentorship, as conducted by the Naval sional development. Evaluation of their effec- Transition Team, to active skills training, as tiveness in securing infrastructure, particu- conducted by Coalition Navy, Marine, and larly oil pipelines in northern Iraq, is ongoing. Coast Guard Forces.

The Iraqi Armed Service and Supply Institute Air Force (IASSI) at Taji plays a critical role in training the officers and non-commissioned officers The Iraqi Air Force continues to evolve (NCOs) to fill support and combat service toward supporting the counter-insurgency support positions in the Iraqi Army. The force, but progress has been slowed by IASSI has trained more than 5,000 officers difficulty in recruiting qualified applicants. and NCOs who serve as leaders in the MTRs, There are currently 750 personnel in the Iraqi RSUs, and HSCs. The IASSI continues to Air Force, with development plans calling for support the development of critical Iraqi a concentrated recruitment effort over the Army support and combat support capabili- next 18 months to at least double the per- ties. sonnel by the end of December 2007. This effort is intended to provide a satisfactory Special Operations Forces corps of professionals as a foundation for future growth. The Iraqi Special Operations Forces (ISOF) are composed of approximately 1,600 soldiers The Intelligence Surveillance and Reconnais- organized into the Iraqi Counter-Terrorism sance aircraft at Kirkuk Air Base (7th Squad- Task Force, the Iraqi Commandos, a support ron with five CompAir 7SLs) and Basrah Air battalion, and a special reconnaissance unit. Base (70th Squadron with two Seekers and six CH-2000s) are performing operational Navy missions. These aircraft are primarily deployed to patrol oil pipeline infrastructure The Iraqi Navy is tasked with defending in the north and south, with occasional Iraq’s coast, territorial waters, vital ports, and missions conducted in support of Iraqi Army offshore oil platforms. The Iraqi Navy has units. There have been recent airworthiness more than 1,100 trained and equipped sailors issues with the CompAir 7SL aircraft, and the and marines organized into an operational Coalition is working with the Iraqi Air Force headquarters, two afloat squadrons, and five to develop solutions and alternatives to Marine companies. The Iraqi Navy is devel- continue supporting the mission. oping independent capabilities for surface surveillance, maritime interdiction, oil ter- Helicopter operations from Taji Air Base in minal protection, and support operations. central Iraq are still in their infancy, but the

54 August 29, 2006

next six months should see a marked sonnel in the Iraqi Army’s support forces are improvement. The 2nd Squadron is expected trained and equipped. to receive the first 6 of 16 Huey IIs from a modification factory in the United States by Equipping the Iraqi Armed Forces continues the end of January 2007 and the remainder as planned since the May 2006 report, with before April 2007. The 2nd Squadron will 92% of authorized equipment issued to the primarily be used for casualty evacuation. It is 10 Iraqi Army Divisions and subordinate expected to reach initial operational capability formations. MNSTC-I is on track to issue all by the third quarter of FY2007. currently authorized equipment by the end of December 2006. Equipment is distributed and Three C-130Es from 23rd Squadron at New filled according to the commander’s opera- Muthanna Air Base round out the Iraqi Air tional assessment. MNSTC-I is currently Force fleet. Early complications with low working with the MOD to transition main- mission capable rates have been solved, and tenance capabilities to the Iraqi Army. To fleet-wide readiness was measured at 72% in date, two Regional Support Units facilities July 2006. The Iraqi Air Force has requested have been transitioned to the Iraqi Army. an additional three aircraft from the U.S. Government to bring the fleet total to six. Leadership These additional aircraft reflect the Coalition Air Force Transition Team’s force generation The lack of junior officers and NCOs plan and efforts are under way to identify continues to be one of the biggest factors additional funding to meet this request. impeding development of MOD forces. There is a shortage of school-trained officers and Assessing MOD Capability NCOs to fill lower-level staff and leadership positions. The shortage of leaders will abate Operational/Unit Readiness as officer recruits are commissioned and they join their units. For NCOs, qualified soldiers Embedded Transition Teams continue to pro- are being “grown from within” through devel- vide monthly TRAs measuring the staffing, opment and schooling to achieve promotion command and control, training, sustainment/ to NCO leadership positions. logistics, equipping, and leadership of their partnered Iraqi units. The Regional Training Centers (RTCs) and the NCO Academy focus on junior leader Personnel and Equipment Status development that is critical to building a professional force. The RTCs conduct Squad The total number of MOD military personnel Leader and Platoon Sergeant Courses. Newly trained and equipped is currently more than formed Sergeants Major and Chief Warrant 115,000, approximately 84% of the objective Officer Courses have been added to the NCO end-strength. Professional Education System. Specialized

With the generation of Iraqi Army battalions leadership courses, such as Logistics Super- more than 92% complete, the focus of the visor, are being conducted at the Iraqi Army Iraqi Army’s train-and-equip effort shifted Service and Support Institute at Taji. Three during this reporting period toward building Iraqi Military Academies at Zahko, combat support and combat service support Qalachwalan, and Ar Rustimiyah continue to forces. More than 65% of authorized per- train future officers.

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The institutional leadership courses are com- taking responsibility for their own security plemented and reinforced through partnership and interests. with Coalition Military Transition Teams. These teams, embedded with every Iraqi MOD Capacity Development battalion, brigade, and division, provide daily guidance and mentorship. In addition, Iraqi The new Minister of Defense, Abd al-Qadr units are partnered with Coalition force units. Muhammad Jassim al-Mufraji, is confronting These partnerships, combined with the the challenges he faces and is already making expertise and leadership taught through the his mark. Previous logjams in acquisitions institutional base, are critical for development and contracting are being eased, and he is of both unit proficiency and leadership essen- working closely with MNSTC-I to proceed on tial to increased operational effectiveness. force development, force expansion, and logistics support. The MOD Transition Team The importance of ethics, human rights, and grew to meet this accelerated pace of business leadership in the Iraqi Armed Forces has and expanded to more than 50, half of whom engendered a concept for a Center for Ethics are Military Professional Resources Incor- and Leadership to provide institutional over- porated contractors. Close and effective sight for ethics education, training, and relationships are being forged by team assessment. members with all senior MOD headquarters officials, and the confidence, and thus A promising trend is that military leadership capacity, of these officials is strengthening. has become more involved with civic leaders The ministries and the Joint Headquarters are and sheiks in their areas of operation. This expected to be in the lead with Coalition activity will continue to reinforce and support by the end of 2007. However, a establish the importance of Iraqis leading and partnership with these institutions will be

Force Generation Timeline Manning and Training

Number to be Trained in 2006 z Total Objective Civil Security Force at end of 2006

1st NP: 2nd NP: DBE: NIIA: CID: IPS: 1,116 3,634 4,351 1,471 1,173 41,179 z 11,238 z 11,238 z 28,360 z 2,500 z 4,000 z 135,000

NIIA, MCU, and NP Trained DBE Trained IPS Trained JAN FEBMAR APR MAY JUN JULAUG SEP OCT NOV DEC

Equipping

Key Cities IPS 100% Key Cities 99/100% 100% IPS Provincial IPS 100%

NP 92% 96/100% 100%

97/ DBE 100% 81% 100% DBE 100% POE 100%

Data as of 15 July 06

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required through at least the first peaceful with ensuring that the MOD properly supports transfer of power in 2010. all Iraqi Army life support requirements.

Coalition Support Requirements DOD requested US$151 million for MOI sustainment in the FY2007 Budget Amend- MNC-I continues to provide logistical support ment request, but did not ask for funding for to the Iraqi Armed Forces where the estab- MOD sustainment. lished system falls short. Although there has been some success with Iraqi Army units Coalition forces are also supporting the using their own processes, there is still a great Government of Iraq with fuel. In June 2006, deal of institutional development remaining. all Iraqi Army units submitted requisitions for MNF-I is working with both MNC-I and fuel; MTRs provide the majority of the fuel MNSTC-I to aid the Government of Iraq in distribution. Storage capacity will not be fully developing a defense logistics system, but in fielded until December. Additionally, the the absence of a self-reliant system, MNF-I GSUs will not be fully on-line until March must provide extensive support to Iraqi 2007. Until the MTRs and GSUs are in place, forces. the Iraqi Army units will not be fully self- MNSTC-I processed life support contracts in sufficient in terms of bulk fuel transportation a total amount of approximately US$7.8 mil- and storage. lion for the months of May and June 2006. Currently, all life support contracts have been Coalition forces supported the Iraqi Army transitioned to the MOD. MNSTC-I has units with the combined fuel report listed formed a Transition Working Group tasked below.

APRIL 2006 MAY 2006 JUNE 2006 TOTAL Fuel Type Gallons Fuel Type Gallons Fuel Type Gallons Fuel Type Gallons DIESEL 133,590 DIESEL 964,598 DIESEL 352,042 DIESEL 1,450,230 MOGAS 89,935 MOGAS 83,956 MOGAS 73,613 MOGAS 247,504

JP8 42,347 JP8 29,101 JP8 34,955 JP8 106,403

Quarterly 265,872 1,077,603 460,610 1,804,085 Subtotal

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Obstacles to Progress battalion commanders of one particular group tend to command only soldiers of their own Absenteeism sectarian or regional backgrounds. The Minister of Defense, through an Officer In the Iraqi Army, approximately 15% Selection Committee, has used the normal attrition is the norm for initial training. When transitions to continue to diversify the senior a unit is fully trained and employed in combat leadership in the Iraqi Army. This continuing operations, some soldiers find that they do not process strives to ensure that the Iraqi Army like the particular location or they cannot is led by competent leaders who are repre- cope with dangers of the counter-insurgency. sentative of the national fabric. In the Absent-without-leave rates are typically about aggregate, Sunni, Kurd, and Shi’a are well 1%–4% for most Iraqi Army divisions, and appropriately represented in senior although deployments to combat sometimes leadership positions. The Sunni and Kurds are cause absentee spikes of 5%–8%. However, slightly over-represented, while the Shi’a are soldiers in units in this final stage of develop- slightly under-represented, though Shi’a ment are less likely to abandon the service. As commanders still hold a large majority of with any organization, the units with strong, competent leaders tend to have higher command positions. The percentage of Sunni present-for-duty rates than those with weak leaders at each level remains constant. At the leaders. However, there is currently no judi- battalion level, the echelon in which the Shi’a cial punishment system within the Iraqi have the highest percentage of commands, Army. Therefore, Iraqi Army commanders they are appropriately represented when com- have little legal leverage to compel their pared to the demographics of the Iraqi soldiers to combat, and soldiers and police population. The relatively high percentage of can quit with impunity. Sunni and Kurds in higher-level commands is a result of the requirement for experienced Sectarian Issues military leaders, of which few were Shi’a. Generally, Shi’a and Kurds were excluded The U.S. Government is committed to creat- from higher-level positions in the former ing an Iraqi military that reflects the ethnic regime. The Kurds, however, benefited from and religious fabric of Iraq, with diverse units years of experience in the Peshmerga. loyal to the nation and not sectarian interests. Nationally recruited Iraqi Army divisions are Although competence and merit are the otherwise representative of the ethno- deciding factors when selecting recruits, religious composition of the country. The particularly leaders, the ISF are developing so even-numbered divisions were originally that they generally mirror the demographic formed as National Guard units, with the make-up of Iraq. Sectarian lines remain intent that these units would serve in the drawn, however, along geographic lines, with respective local regions. The composition of Sunni, Shi’a, or Kurdish soldiers mostly these units tends to be representative of the serving in units located in geographic areas region in which they serve. Over time, familiar to their group. These divisions are replacements from the national recruiting pool even stronger at the battalion level, where will increase the diversity of these divisions.

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3. Transition

3.1 Transitioning Security Responsibility aging its own security and governance duties at the provincial level. The transition decision Process for Implementing Provincial Iraqi also reflects a joint assessment of the overall Control threat situation in Muthanna, the capabilities of the IPS and the Iraqi Army, and the provin- The transfer of security responsibility from cial leadership’s ability to coordinate security. Coalition forces to the Government of Iraq is Transition Teams are in place to smooth the an objective of the security track outlined in transfer process, and multinational forces the National Strategy for Victory in Iraq. stand ready to provide assistance if needed. Such transfers reflect the capability of the Government of Iraq to fulfill its sovereign Dhi Qar Province appears to be ready to responsibility in the most fundamental, vital assume security independence within the next interest of any state—to protect its citizens 45 days, and several other provinces should and safeguard its territory. As Iraqis take on meet the transition criteria before the end of more responsibility for security, Coalition the year. The Government of Iraq and the forces will increasingly move to supporting MNF-I will continue to transfer security roles in most areas. This may allow for future responsibilities in other provinces as prerequi- personnel reductions or a delay in previously site conditions are met. scheduled deployments. The Coalition’s military posture on the ground will remain In concept, security transition is a four-phased responsive and flexible. As the security situa- process. tion evolves, MNF-I will maintain sufficient forces on the ground to help Iraq consolidate 1. Implement Partnerships. MNF-I and and secure its gains on many different fronts. its Major Subordinate Commands estab- The recent agreement between Prime Minister lish and maintain partnerships across al-Maliki and President Bush to increase force the entire spectrum of ISF units, from presence in Baghdad is indicative of this battalion to ministerial level. flexibility. 2. Iraqi Army Lead (IAL). Process during which Iraqi Army units progress Iraq achieved a historic milestone on July 13, through stages of capability from unit 2006, with the transfer of security respon- formation to the ability to conduct sibility in Muthanna Province from MNF-I to counter-insurgency operations. the Provincial Governor and civilian-con- 3. Provincial Iraqi Control (PIC). Iraqi trolled Iraqi Police Service. Muthanna is the civil authorities satisfy the conditions first of Iraq’s 18 provinces to be designated required to assume control and to for transition to Provincial Iraqi Control, exercise responsibility for the security which represents the successful development of their respective provinces. of Iraq’s capability to govern and protect 4. Iraqi Security Self-Reliance. The itself as a sovereign and democratic nation. Government of Iraq achieves PIC (or a combination of PIC and IAL) through- The joint decision between the Government out Iraq, and the government, through of Iraq and MNF-I to hand over security its security ministries, is capable of responsibility is the result of Muthanna’s planning, conducting, and sustaining demonstrated ability to take the lead in man- security operations and forces.

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These phases are not strictly sequential. For 4. MNF-I Ability to Respond Quickly to example, the Iraqi Army does not have to Major Threats, if Needed assume the lead in a province before Coalition forces may begin transfer of provincial The recommendation to transfer security control. This was the case in Muthanna. responsibility is based on the specific situation in any one province or provincial capital Phase 1 of the security transition concept— in the context of the overall security environ- implementing partnerships—is already ment. The appropriate Multi-National Force complete. As described above, the second Division Commander and Provincial Gover- phase, Iraqi Army lead, is well under way in nor, assisted by representatives of the Iraqi many provinces. The third phase, establishing Ministries of Interior and Defense and U.S. provincial Iraqi control over security, will be and United Kingdom Embassies, conduct implemented on an area-by-area basis. The monthly assessments of provinces and of Government of Iraq, jointly with military and provincial capitals. The JCTSR working political leadership of the United States and group meets monthly to review the assess- Coalition partners in Iraq, will assess when ments and to present recommendations to the conditions permit handing over security JCTSR principals regarding which provinces responsibility for specific areas from Coali- are ready to be transferred. Once a decision is tion forces to the Iraqi civil authorities. The made, the JCTSR working group will provide Joint Committee to Transfer Security Respon- oversight of the development of transition sibility (JCTSR) has developed criteria to directives, develop a public affairs plan, and guide the transfer of security responsibility. arrange a post-transfer security agreement Recommendations for transfer include an between MNF-I forces and provincial assessment of conditions in four categories: governors. Every transfer will ensure an effective and successful handover of security 1. Threat Assessment responsibilities. Moreover, the transition and 2. ISF Readiness reduced presence of MNF-I forces will be 3. Local Governance Capability plainly visible to the Iraqi people.

Provincial Security Transition Assessment (PSTA) As of July 2006

Dahuk

Irbil Ninewah Irbil

Tamim Sulamaniyah

Salah Ad Din Provincial Iraqi Control Diyala Ready For Transition Partially Ready For Transition Baghdad Anbar Not Ready For Transition Wasit Karbala Babil

Qadisiyah Maysan

An Najaf Dhi Qar

Muthanna Basrah

Source: MNF-I

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Detainee Operations Transition of Coalition Detention Facilities and Detainees to the Government of Iraq Releases MNF-I has begun training Iraqi guards for a In June 2006, MNF-I, in coordination with the potential transition of the Coalition detention Government of Iraq, conducted a large-scale facilities and detainees. Transitioning detainee release of detainees in support of the newly operations is a three-phase process. formed national unity government. The release served as a visible symbol of the gov- 1. Phase 1 consists of individual and ernment’s commitment to national unity and collective training of Iraqi guards and reconciliation in the progress toward demo- leaders, including training alongside cratic governance and the rule of law. MNF-I their U.S. counterparts inside the facility. released 2,500 low-risk detainees over a 2. Phase 2 consists of the removal of period of three weeks. Coupled with the 500 U.S. guards and establishment of a detainees from the normal Combined Review U.S. transition team to supervise Iraqi and Release Board process, MNF-I had a net Security Forces and to maintain legal reduction of more than 2,000 detainees in custody of detainees. June. A MNF-I special board reviewed 3. Phase 3 consists of the final removal approximately 6,500 records to identify the of all U.S. personnel and turnover of low-risk detainees. Each file was also the facilities and legal custody of the reviewed by the MNF-I Deputy Chief of Staff detainees to the Government of Iraq. for Intelligence to consider any additional intelligence reports. Detainees involved in The criteria for transfer includes the require- violent acts, IED making/placement, financ- ment for the Government of Iraq to possess ing insurgent operations, identified as key the legal authority to hold security detainees, insurgent leaders, or who have been recap- each facility demonstrating the ability to meet tured were not considered for release. the care and custody standard, and the MOJ

Detainee Population - 2003 through 2006

16000 15000 14000 13000 12000 11000 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 Jul-05 Jul-04 Jul-06 Jul-03 Jun-06 Jun-05 Jun-04 Jun-03 Apr-05 Apr-04 Jan-05 Jan-04 Apr-06 Apr-03 Jan-06 Oct-03 Oct-04 Oct-05 Nov-03 Nov-04 Nov-05 Feb-05 Aug-04 Aug-03 Feb-04 Aug-05 Feb-06 Mar-05 Dec-03 Mar-04 Sep-03 Sep-04 Dec-04 Mar-06 Dec-05 Sep-05 May-05 May-04 May-06 May-03

Source: MNF-I

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having effective oversight of the program. As security conditions improve and as the ISF MNF-I is currently in Phase 1. Significant becomes more capable of securing their own challenges exist to ultimately meeting these country, Coalition forces will move out of the criteria. The Iraqi Corrections System has not cities, reduce the number of bases from which demonstrated the capacity to effectively they operate, and conduct fewer visible resource and run a major facility, such as missions. However, they will remain postured Camp Bucca. Additionally, based on the com- to assist, including supporting the ISF with position of the guard force, serious questions transition teams. Although the Coalition remain as to whether they would be able to military presence may become less visible, it maintain the required standards of care and will remain lethal and decisive, able to custody. The most significant obstacle confront the enemy wherever it may gather remains establishing the legal authority to and organize. hold security detainees. There is widespread opposition inside the Sunni political leader- The Coalition retains the ability to quickly ship to providing this authority to the Govern- reinforce the Iraqi Army as required and to ment of Iraq. provide critical enablers as Iraqis develop their own capabilities. Coalition personnel 3.2 U.S. Force Adjustments levels will increase, if necessary, to defeat the enemy or to provide additional security for In consultation with the military commanders key events, like the 2005 referendum and in Iraq, the Government of Iraq, and Coalition elections. But the goal, over time, is to reduce partners, the Secretary of Defense continues Coalition forces as Iraqis continue to assume to advise the President on the appropriate more of the security and civilian respon- level of U.S. forces in Iraq and the surround- sibilities themselves. This process is already ing theater of operations based on current under way. conditions. These conditions include, but are not limited to, key elements of the MNF-I The Government of Iraq has agreed to form a Campaign Plan, such as the increasing Joint Committee with MNF-I and the U.S. responsibility of the ISF in counter- and UK Embassies to develop a conditions- insurgency operations and ownership of areas based roadmap for the full transition of of responsibility and progress in the political security responsibility to the ISF. This road- process. map will consist of recommended conditions intended to lead to the eventual and gradual Arbitrary deadlines or timetables for with- withdrawal of multi-national forces from Iraq. drawal of Coalition forces—divorced from conditions in Iraq and the region—would be a The Joint Committee for Achieving Iraqi serious strategic error, as they would suggest Security Self-Reliance (JCAISSR) will base to the terrorists, the Rejectionists, and the its roadmap on much of the successful work various illegal armed groups in Iraq that they that has already gone into developing the can simply wait or stall to win. The absence strategy for transition of security respon- of a specific timetable does not mean that the sibility in Iraq: Coalition’s posture in Iraq is static. On the contrary, the Coalition continually reviews Governance the situation in Iraq and adjusts its posture and approaches as conditions evolve and Iraqi The seating of the new Government of Iraq’s, capabilities grow. based on its Constitution, sets the conditions

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for continuing progress toward Iraqi security the UK Ambassador, and the Commanding self-reliance. Toward this end, the govern- General and Deputy Commanding General, ment’s program calls for speeding up plans MNF-I. This committee will be supported by for completing the preparation of the ISF; a working group of direct subordinates. speeding up the process of transferring security responsibilities and powers to the Conditions recommended by JCAISSR will, at a minimum, include consideration of the Iraqi Army, police, and security forces; and threat situation across Iraq, security force cooperation with the multi-national forces in a readiness, capacity of key security and sup- way that will allow the handover of security porting ministries, and development of the responsibilities to the ISF, the completion of overall Iraqi national security processes. the mission, and the exit of the multi-national forces. MNF-I Basing Construct

Development of the ISF MNF-I will efficiently consolidate its foot- print in Iraq to reduce its military basing Efforts to develop the capacity of the ISF requirements progressively. The MNF-I have been successful. In November 2005, the basing strategy is an integral part of the Iraqi Army had 4 brigades and 23 battalions Campaign Plan. MNF-I uses a conditions- in the lead. As of August 7, 2006, the Iraqi based process to synchronize basing require- Army has 6 Division Headquarters, ments with Coalition force structure and 25 brigades, and 85 battalions that have projected command and control structure. assumed responsibility. MOI forces also grew Several factors are considered when employ- significantly, from approximately 93,000 ing this process, including cost-effective use trained and equipped members in November of resources, maintaining security presence 2005 to more than 160,000 today. where required by the mission and maintaining only those bases required, transi- Provincial Iraqi Control Plan tion of operations to the ISF as they continue to assume the lead in security operations, and The Government of Iraq and MNF-I have other factors. Specifically, MNF-I seeks to already developed a conditions-based frame- minimize its presence in major cities while work for the transition of security respon- building the flexibility required to support sibility from multi-national forces to Iraqi other elements in Iraq, including Coalition leadership. As a result of this work, security partners, PRTs, Transition Teams, Depart- responsibility for Muthanna Province transi- ment of State activities, and other supporting tioned to the provincial governor on July 13, units and entities. This process will culminate 2006. Security responsibility for as many as in the transition through Operational and nine of Iraq’s provinces could transition to Strategic Overwatch, which will leverage and Government of Iraq authority by the end of maximize support through a minimum 2006. number of strategically located FOBs and Convoy Support Centers. The JCAISSR will comprise the Iraqi Prime Minister, the Iraqi National Security Advisor As of August 7, 2006, MNF-I has closed 48 (Chair), the Minister of State for National of its 110 FOBs, handing over 31 to ISF, Security Affairs, the Ministers of Defense and MOD/MOI; and 17 to the Ministry of Interior, the Director of the Iraqi National Finance. Thirteen more FOBs are scheduled Intelligence Service, the U.S. Ambassador, for closure and handover by January 2007.

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