But companies from the US and countries that participated in the war would only be allowed to bid for the contracts.

Retired Admiral David Nash, who is heading a new Baghdad-based office called the Program Management Office, also promised full transparency in the contracting process.

"We will have maximum transparency from the beginning to the end," Nash said on Wednesday.

The contracts relate to repairing electrical grids and public works projects to building police stations and prisons.

Nash said tenders would be announced on 5 December and awards for the new contracts would be announced by 3 February next year. Funding for the projects would come from the money appropriated by the US Congress.

Relaxed rules

Unlike many of the earlier contracts – some of which were issued even before the war with Iraq began - the new round of deals is expected to use full and open competition and companies from allied countries will be able to apply for the business.


"We will have maximum transparency from the beginning to the end"

Retired Admiral David Nash Program Management Office

The pledge to allow foreign companies marks a departure from the earlier practice, which enabled only US firms to bag all Iraqi projects.

Asked whether French or German companies, for example, would be excluded from the forthcoming contracts, Nash said his office was looking at what companies could be included rather than cut off from deals.

Nash said subcontracts would be open to all companies, adding that international laws and trade agreements had to be taken in account when hiring companies to do the work.

So far, the big reconstruction contracts in Iraq have been handled by the US Agency for International Development as well as the US Army Corps of Engineers.

Both USAID and the Army Corps of Engineers will now report to Nash.