Procurement: A Bribe Too Far In Iraq


November 13, 2012: On November 10th Iraq cancelled a $4.2 billion arms purchase deal made with Russia in October. This was caused by accusations in Iraq that the price included hundreds of millions of dollars in bribes for the politicians and officials who negotiated the purchase. The Russians are known to be compliant when it comes to including bribes in export sales. Western countries have laws against such things, but the Russians consider it just another cost of doing business. Russia blamed the cancellation on the Americans, who remain, since 2003, the largest supplier of arms to Iraq. Before that it was Russia. Now the Russians are insisting that the cancellation had nothing to do with corruption and was simply the Americans throwing their weight around to hold on to a valued customer.

Iraqi prime minister Maliki led the Iraqi delegation to Russia and supervised the final negotiations and signing of the deal. But once back in Iraq Maliki found himself under heavy criticism for buying weapons Iraq did not need (like 30 Mi-28 helicopter gunships). Maliki critics pointed out that the biggest security problem Iraq had right now was Islamic and Sunni nationalist terrorists. Nothing in the Russian deal did anything about that. Moreover, not all details of the contract were made public and this usually meant that the prices were higher than they should be, to pay for the large bribes. Maliki apparently believed he could not win this one and just cancelled the contract.