UK firms scramble to share in spoils of war

British firms scrambling for contracts in the reconstruction of Iraq were told yesterday that the Government would ensure they got a "fair chance" to grab a division of the spoils.

As protesters waved placards and chanted "vultures, vultures", the first steps in the slicing of one of the biggest commercial bonanzas in history took place in London yesterday.

The initial business deals for rebuilding Iraq's infrastructure amount to $1.1bn (about £687m). But this could increase to $100bn under the rapid recalculations being carried out.

Yesterday British, European and Asian firms gathered at a seminar in London organised by the Bechtel conglomerate. Later, the British contingent attended one held by Trade Partners UK, an arm of the Department of Trade and Industry.

Bechtel, which has close and controversial ties with the US administration, has been awarded the biggest contract so far - $680m - by the US Agency for International Development (USAid). The company has said that as much as 90 per cent of the work would be passed on in sub-contracts.

Patricia Hewitt, the Secretary of State for Trade and Industry, said: "We have got outstanding British companies ... and of course we are backing them. [But] there should be a level playing field and companies should be chosen on the basis of what they can contribute to the redevelopment of Iraq."

Bechtel, which has awarded 14 sub-contracts so far, worth an average of $500,000, insists the tenders will be judged on merit, even from countries which opposed the war. Lindsey Holbrook, Bechtel's manager of engineering, said: "The competition is open to everyone."

Among the Iraqi firms taking part is the Iraqi Reconstruction Group. Its representative, Abbas al-Husseini, said: "We don't want Bechtel to be a centre of hate. Please don't do it for the Iraqi people but with the Iraqi people."