US urges help for Iraq, extends $3 billion credit line

KUWAIT — The United States on Tuesday urged members of the coalition fighting Daesh to help rebuild Iraq or risk a reversal of the gains made against the group, and said it would extend to Baghdad a $3 billion credit line.

The United States leads the coalition and hopes that after a three-year fight to defeat the militants it can count in large part on Gulf allies to shoulder the burden of rebuilding Iraq. It is also counting on a Saudi-Iraqi rapprochement to weaken Iran's influence in Iraq.

Iraq declared victory over Daesh in December, having taken back all the territory captured by the militants in 2014 and 2015. The fighters have also been largely defeated in neighbouring Syria.

"If communities in Iraq and Syria can not return to normal life, we risk the return of conditions that allowed ISIS [Daesh] to take and control vast territory," US Secretary of State Rex Tillerson told a donors' conference for Iraq hosted by Kuwait using an alternative acronym for Daesh.

"We must continue to clear unexploded remnants of war left behind by ISIS, enable hospitals to reopen, restore water and electricity services, and get boys and girls back in school."

Tillerson added that the official US export credit agency, the Export-Import Bank of the United States, would sign with Iraq's finance ministry on Tuesday a $3 billion memorandum of understanding "that will set a stage for future cooperation".

Washington appreciates the "generous contributions" of coalition members over the past year but more is needed, Tillerson told a coalition meeting in Kuwait.

However, the US government is not expected to pledge direct financial aid at the conference.

"It's not in the question of a pledging thing where we go out with requests, it's underscoring [that] there is a need for support. It's investment, it's private company engagement, it's DFI," a senior State Department official travelling with Tillerson told reporters on Monday.

The term DFI generally refers to development finance institutions such as multilateral development banks.

Call for vigilance

Rebuilding Iraq will cost more than $88 billion and housing is a particularly urgent priority, Iraqi officials told the conference on Monday.

Prime Minister Haider Al Abadi said Iraq would only successfully rebuild with outside help.

"Iraqis feel that the world is with them. As they were victorious against Daesh they will be, with your support, victorious in the battle of reconstruction," he told the conference.

Tillerson said Washington had also decided to provide an additional $200 million to stabilise liberated areas in Syria.

NATO Secretary General Jens Stoltenberg said the alliance was ready to answer a US call for it to expand its small training mission in Iraq to support reconstruction.

US Secretary of Defence Jim Mattis sent a letter to NATO last month calling for a formal NATO train-and-advise mission, Reuters reported, part of President Donald Trump's campaign for the alliance to do more against militants.

Tillerson cautioned on Tuesday that the end of major combat operations in Iraq did not mean the United States and its allies had achieved final victory over the militants.

"In Iraq and Syria, ISIS is attempting to morph into an insurgency. In places like Afghanistan, the Philippines, Libya, West Africa, and others, it is trying to carve out and secure safe havens," he said.

Tillerson said he was concerned over recent events in northwest Syria, where Turkey launched an assault last month on a US-allied Kurdish militia it considers a threat on its southern border. Tillerson added he was keenly aware of Turkey's "legitimate security concerns".