IRAQ - Dealing With Corruption, Violence & Reforms.

For the time being, Maleki is preoccupied with a series of corruption scandals which may have serious implications for his political base ahead of crucial parliamentary elections to be held in January 2010. Maleki is particularly worried by such implications, with Iraq classed among the world's most corrupt countries. The previous US administration, which was Republican under George W. Bush, used to regard Iraq as its top priority in the (GME). Obama's Democratic administration has shifted the US focus from Iraq to the Afghanistan/Pakistan (AfPak) front and this has caused Maleki's leadership to be particularly worried.

What concerns Maleki is the way President Obama's offer of dialogue with Iran's theocracy is affecting Iraq. While Tehran is yet to respond favourably to this offer, the bargaining in the background tends to translate into violence in Iraq. A new wave of Neo-Salafi attacks is reversing the security gains achieved by Maleki's government since the spring of 2008, when its forces prevailed over Shi'ite militias and compelled them to lie low and/or be disarmed. Soon after Obama came to office on Jan. 20, 2009, Neo-Salafi suicide bombers began to concentrate their attacks on both Shi'ite civilians and members of the Sunni Arab awakening councils (ACs).

While Maleki has had little sympathy with the AC movement which was founded and armed by US forces, Neo-Salafi attacks on its members is causing some of the latter to switch back to the Sunni insurgency. In parallel, Neo-Salafi attacks on civilian Shi'ites, including Iranian pilgrims, are causing some Shi'ite militia groups to resort to arms.

The main cause of the Neo-Salafi resurgence was the release of Sunnis from US prisons - part of American plans to withdraw from Iraq. Most of those released had been Neo-Salafi insurgents. Now thousands of such elements have returned to the Qaeda-led insurgency. What adds to the confusion is that Iran has been in tactical alliance with al-Qaeda and other Neo-Salafi groups, despite the fact that these are Sunni and seen as potential time-bombs for the theocracy. Al-Qaeda has a unit based in Iran and headed by Sa'd bin Laden, a son of Usama bin Laden (see news9GCC-IranQaedaAug25-08).

The theocracy's Supreme Leader Ayatullah 'Ali Khamenei on May 19 accused the US of promoting terrorism and using arms and money to plot against Tehran. His words, in a televised speech during a visit to Iran's western province of Kurdistan, disappointed Obama, who had been seeking rapprochement after three decades of mutual mistrust. Referring to the US presence in Iraq, Khamenei stated: "I say this firmly that unfortunately across our borders, our western borders, the Americans are busy making a conspiracy, they are busy fostering terrorism. Money, arms and organisation...are being used by the Americans directly across our western borders in order to fight the Islamic Republic's system. We should be awake". He was partly referring to the Neo-Salafi attacks against Shi'ites, including Iranian pilgrims, thus implying that the US was behind them. But in Najaf, Sistani is well informed about the Tehran-Qaeda alliance and its implications for Iraq as well as for the future of Iran (see rim5IrqWuF-May25-09).

Khamenei spoke a day after Obama - then meeting at the White House with Israeli PM Benjamin Netanyabu - set a rough timetable for his offer to Iran, saying he wanted to see serious progress by end-2009. Obama held out the prospect of tougher sanctions against Tehran "to ensure that Iran understands we are serious". (Washington and its Western allies suspect Iran's nuclear programme is aimed at making bombs, a charge Tehran denies. But in a break with his predecessor Bush's approach, Obama has offered direct talks with Tehran to resolve the dispute. Iran, which has repeatedly rejected the West's Iran strategy, says the US must show a real shift in its policies towards Tehran before a dialogue begins).

Khamenei, ending an eight-day visit to Kurdistan, said the US had "dangerous plans" for Kurdish-populated areas and sought to dominate the Kurdish people. Iran, whose forces often clash with Kurdish separatist rebels, has in the past accused its Western enemies of seeking to destabilise sensitive border regions. Like Iraq and Turkey, Iran has a sizeable Kurdish minority.

In Iraq, the US-backed Kurdistan Regional Government (KRG) has recently forced Baghdad decision makers to accept crude oil exports to move from its territory through the country's national pipeline to Turkey's Mediterranean terminal of Ceyhan. The move has encouraged IOCs to move into Kurdistan, where the KRG is offering them exploration and production sharing agreements (EPSAs), while Baghdad considers such deals illegal. KRG now is pushing for a major natural gas pipeline to be built to Turkey to link up with a planned 31 BCM/y Nabucco gasline to Central Europe (see omt21IraqWhoMay25-09).

The Iranian theocracy, leading an axis of anti-US/anti-Israel forces in the GME, has seen its regional influence grow since the 2003 downfall of Saddam's Sunni/Ba'thist dictatorship in Iraq, sparking unease among Sunni powers. As a result, Saudi Arabia is leading a Sunni front to curb Iranian influences in the GME. This is one of the reasons why President Obama is to visit Saudi Arabia on June 3, before going to Egypt where he will make an important speech to the Islamic world on June 4.

In other comments under-scoring deep suspicion of the US, Khamenei in April blamed US forces for two Neo-Salafi suicide bombings which killed dozens of Iranian pilgrims in Iraq. 'Ali Ansari of the University of St Andrews in Scotland said Khamenei was trying to "rein in" moderate candidates in Iran's June 12 presidential election advocating better ties with the West. He said Khamenei was "ideologically disinclined" to relations with Washington but was not closing the door to a possible opening.

Khamenei on May 18 urged Iranians to support anti-West candidates, without openly supporting President Mahmoud Ahmadi-Nejad, a supremacist seeking a second four-year term in the June 12 polls. Ahmadi-Nejad is a vocal opponent of Western policies. In a televised speech in the western city of Bijar, Khamenei told Iranians: "Do not let those [presidential candidates] who would surrender to the enemies (the West) and harm our nation's prestige to get into office".

Ahmadi-Nejad, who looks set to be re-elected (see news21IrnPresMay25-09), promises his support base total victory over the US and its allies - global and regional powers - although the Iranian economy has entered its deepest recession under his stewardship. The mistake which his three rival candidates have made is not to focus the debate on Ahmadi-Nejad's potentially catastrophic foreign policy, a policy of constant provocation, bluffs, and picking up unnecessary quarrels - which is said to have greatly frustrated Sistani. The three rivals have not taken the race into this arena because they try to appear moderate and revolutionary at the same time.

If Ahmadi-Nejad is re-elected, the subsequent six months will prove crucial to the way he enters Iran's history. The Israelis are beating the drums of war against an ever more threatening Iran and Obama may yet take that course if US attempts at rapprochement go nowhere.

'Abdul-Bare' Atwan, editor of the pan-Arab newspaper al-Quds al-Arabi, on May 15 wrote: "Such a conclusion would be disastrous, destabilising to the entire region and with the real possibility of wider involvement. If, however, Ahmadi-Nejad's brinksmanship brings about a lasting peace, the incentives the US is proposing will consolidate Iran's role as the major regional super-power, its nuclear programme will re-shape the balance of power in the Middle East and Ahmadi-Nejad will emerge as a national hero".

The 1st US Battalion, headed by Capt Natahan Williams, are preparing to pull out of their base in Baghdad's Hurriyah zone. The battalion of a 150 soldiers was leaving the base on May 30, a month ahead of the deadline for all US combat forces to transfer to garrisons outside Baghdad. They were to hand over Hurriyah, scene of vicious 2006 Shi'ite-Sunni fighting, to an elite Iraqi Army battalion.

A Pentagon report in January found that, as of October 2008, only 17 of the 175 Iraqi combat battalions and two of the 34 National Police battalions could operate on their own. The US-Iraqi SOFA requires American combat troops to leave urban areas by June 30 and relocate in huge garrisons on the edge of the cities.

The months after the pull-out from the cities will be a crucial test for Baghdad and Obama's Iraq strategy. In preparation for the transfer, Capt Williams was on May 21 quoted as saying his soldiers were patrolling Hurriyah much less frequently than before. Their Iraqi counterparts are increasingly less enthusiastic about joint patrols.

A roadside bomb on May 25 killed three Americans - including a State Department official working at the US Embassy in Baghdad - travelling in Falluja, west of Baghdad. They were driving along a road used exclusively by US military and reconstruction teams when an improvised explosive device went off. That was one of the attacks caused by Neo-Salafi and Ba'thist insurgents since early 2009. Three bombings on May 21 killed at least 25 people and wounded more than 50 others, as US soldiers, police officers and AC members were targeted. These brought to almost 90 the number of people killed in a 24-hour period. Women on May 21 wept in Baghdad during the funeral of a victim of a car bombing which killed 40 people. May was the deadliest month for the US troops since the autumn of 2998. By end-May the number of US soldiers killed in Iraq since the March 2003 invasion had risen to over 4,300. Three US soldiers were killed on May 21 in a roadside bombing in the southern Baghdad district of Dora while they were patrolling near a popular outdoor market (see details the May violence in gmt21IraqWhoMay25-09).

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