Iraq will need $5 billion from a planned meeting of international donors in October just to keep its creaking infrastructure going and basic services from grinding to a halt, a senior UN official said.
Ramiro Lopez da Silva, the UN humanitarian coordinator for Iraq, told a small group of journalists that Iraqi Finance Ministry officials estimate the cost of keeping the country's institutions and services running at $20 billion for 2004. That includes recurring costs covered in the annual budget.
On the revenue side, Mr da Silva said, Iraq could expect little income beyond what its ramshackle oil industry can earn, although debt forgiveness and the repatriation of seized and frozen funds may also help ease the burden.
Given Iraq's problems in cranking up oil exports, most estimates forecast total income of $15 billion or less in 2004 - leaving a gap of at least $5 billion that donors must fill.
"That is just to keep things going," Mr da Silva said. "If you want a qualitative leap, a quantum leap in living standards and conditions, you would need much more."
But donors may be reluctant to commit funds given the lack of security in Iraq and concerns about bankrolling a military operation. Even if money is pledged it may not materialise - much of the cash promised to Afghanistan has yet to arrive.
"How realistic it is to expect an inflow of $5 billion is something we will have to see in October," da Silva said.
Before the war many US officials said Iraq would quickly be able to pay for its own reconstruction, largely through oil revenues. Some UN officials say Washington was taken by surprise by the extent of disruption to the country caused by the war, and by the high cost of reconstruction.
Mr da Silva said the security situation in Iraq was a key concern for donors. If the current lawlessness persisted, few countries would be keen to commit funds.
"If we want to attract something close to $5 billion as support for Iraq next year, donors will have the present security environment very much in mind," Mr da Silva said.
Lack of security was having a "very serious impact" on humanitarian efforts in Iraq, he said.
"There are areas where we cannot allow staff to go," he said. Most of the no-go areas were in the "Sunni triangle" west and north of Baghdad, where support for Saddam Hussein is widespread and US troops have come under repeated attack.
Mr da Silva said the goal of restoring Iraqi living standards by the end of 2003 to the level they were at just before the US-led invasion was still achievable - if there was a swift improvement in law and order.
"You need to have a dramatic improvement fast," he said. But restoring living standards to the levels of the 1980s, when Iraq was reasonably prosperous, could take years.
The human and monetary cost of the US occupation of Iraq is mounting - 53 American soldiers have been killed since major combat was declared over on May 1, and the US bill for policing the country is running at some $4 billion a month.
Washington and its allies have said they may turn to the United Nations to persuade more countries to help. Some of the countries which opposed the war say they are willing to aid reconstruction only under a new UN mandate.
Mr da Silva said a new resolution was not necessarily needed to persuade donors to come up with $5 billion, but countries wanted the money to be administered by a fund run by a multilateral agency rather than the occupying powers.
The World Bank is working on its own assessment of Iraq's needs for 2004, which is due to be presented to the October conference. But Bank officials say lack of security and the difficulty of gathering of data are hampering their efforts.