WASHINGTON: Two years after a deadly bombing caused the World Bank to pull its staff out of Iraq, bank President Paul Wolfowitz is considering sending it back, according to bank officials. The matter has taken on new urgency because the World Bank’s board last week approved a plan for using as much as $500 million in loans to the Iraqi government. An internal bank report outlining the plan warns that “there are high and unprecedented risks” to the bank’s work in Iraq, arising partly from the inability of bank experts to travel around the country and make sure that aid is being used properly and effectively.

Kevin Kellems, a senior adviser to Wolfowitz, wrote in an e-mailed statement on Saturday that no decision has been made on whether the bank’s aid operations “could be made more effective, safely, by establishing a presence inside Iraq.” The issue of the bank’s role in Iraq is particularly sensitive for Wolfowitz, the former deputy defence secretary who was a prime mover behind the US war on Saddam Hussein’s regime.

Any move seen as aggressively expanding the bank’s activities in Iraq could lead to criticism that Wolfowitz, who was chosen by President Bush in March to head the giant lender, is using his new post to further the Bush administration’s foreign policy aims. Wolfowitz has gone to great lengths to stress that in his new capacity he is an international civil servant and will give top priority to the bank’s mission of fighting poverty. If evidence were to emerge that the bank was allowing its aid to Iraq to be wasted or siphoned off by corrupt officials, Wolfowitz’s reputation and the bank’s could be tarnished.

The World Bank left Iraq after the August 2003 attack on the United Nations compound in Baghdad that killed 22 people, including the UN’s top envoy. The bank’s office was in the compound. Since then, the bank, which is administering projects worth about $360 million financed by donor countries through a trust fund, has operated in Iraq through an interim office in Amman, Jordan. It has used videoconferencing to talk to Iraqi officials and relied on a handful of Iraqi employees and consultants who remain inside the country.—Dawn/Washington Post News Service