Iraqi authorities have taken charge of reconstruction projects along with military operations in southern Iraq, establishing a major test of their ability to effectively manage the large sums of money involved.
The transition, which follows Britain's turnover of military responsibility in the Basra area in mid-December, wraps up more than four years of British- and U.S.-funded reconstruction in southern Iraq worth more than $500 million.
The initial prospects are promising, with surging oil exports, sustained high oil prices and improved security permitting a growing stream of investment into the region.
Baghdad allocated $300 million for reconstruction in the south last year, and Deputy Prime Minister Barham Saleh has promised an even greater amount this year.
However, the transfer of civil and military authority to the Iraqis limits the ability of the British to check on existing projects.
Downtown Basra is off-limits to British personnel, including the specialized civil-military liaison officers who oversaw reconstruction projects in the city last year.
Similarly, officials from the Foreign and Commonwealth Office who were once based in the heart of the city are now located at an air station miles from town, and do not have the daily contact with Iraqi authorities that they once enjoyed.
One official, speaking on background, said Iraqi bureaucrats routinely bring him budget plans to solicit his advice. But he has no way of knowing how successfully the budgets are executed and to what extent corruption — a perennial problem in Basra — has leeched away funds.