Chinese companies could lose a lot of money as a result of the US-led war on Iraq, South China Morning Post said. They have been active in Iraq since the 1980s but the imposition of sanctions after the Gulf War has reduced the country's ability to pay. As a result, Iraq owes Chinese firms a total of US$1.35bn, of which US$880m is for construction contracts and US$466m for imports, according to official figures. The biggest creditor is China Construction & Engineering (CCE), which is owed US$500m for roads, ports and other work, carried out between 1982 and 1990. CCE has lobbied for repayment but has received only US$31m, in June last year.
Another potential casualty is China National Petroleum Corp (CNPC) which, with UN approval, signed a US$500m contract in June 1997 with the Iraqi government to develop the Al-Ahdab field. The project's future is uncertain, especially after Iraq threatened to tear up the contract if CNPC did not continue to honour it.