NEW YORK, June 24: The opposition to Iraq awarding no-bid contracts to four American oil companies namely Exxon-Mobi, Shell, Total and BP is growing in the US as well. The deal has provoked sharp international reactions. The companies from other countries were denied the contract.
Democratic Party's New York senator Charles Schumer has taken a tough stand over the deal. He has written to Secretary of State Condoleezza Rice asking her to stop the contentious contract. Schumar has threatened to stop all non-military assistance to Iraq if his urgings are not heeded by the state department. Democratic Party has a thin majority in the Senate. Schumar wields enormous influence.
No deals should be signed without bidding until Iraq enacts a law that would regulate country's oil resources. It is our fear that this action by the Iraqi government could further deepen political tensions in Iraq and put our service members in even greater danger, The New York Times quoted Schumar as stating in his letter. Schumar is being backed by Senator John Kerry, 2004 Democratic Party presidential nominee. The US companies reap rich harvest.
They have billion of dollars stashed in foreign countries where they have business. The US government had allowed the companies to bring home the money stashed in foreign countries providing them with tax relief.. More than 840 American companies accepted the offer and reaped $265 billion in tax break. The total amount brought home was bigger than earlier estimated.
Some of the giants in Corporate America like Pfizer pharmaceutical and Hewlett-Packard repatriated $37 billion and $14.5 billion respectively. Tax break allowed each company a tax deduction of $370 million. The government coffers was richer by $18 billion. The tax rate offered was 5..25 per cent.
The critics of the offer say there were very scanty evidence that the companies plough back the money creating new jobs. The tax break did not stimulate investment in America and the repatriated money was mostly used for stock repurchases, analysts said.
There are over 9700 American corporations operating in foreign countries. Only 843 corporations took advantage of the offer, with the pharmaceutical companies accounting for the bulk of the repatriated money.
Iraq oil deals provoke sharp int'l reactions
From Fazle Rashid | Published: June 25, 2008 00:00:00 | Updated: February 01, 2018 00:00:00
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