Cheap Labor for Private Security
By Jody Ray Bennett for ISN
As the US military weighs its use of external pagecontractors, the Obama administration has been somewhat unclear about the fate of private security companies deployed in an Iraq that will soon witness a military drawdown with a paralleled increase of forces to Afghanistan.
As new strategies for both countries unfold and materialize, the private security industry might soon begin to experience some fluctuation regarding its ability to continue to secure government contracts and maintain their current personnel. This was most recently highlighted by the announcement that the Iraq contract for Xe (formerly Blackwater Worldwide) would not be renewed after May 2009 and would be external pageawardedto a rival company, external pageTriple Canopy.
While Triple Canopy already had a contract in Iraq with the US Department of State, its ability to secure another contract ahead of DynCorp, the third of the “Big Three” private security companies in Iraq, is significant. Part of this success might have something do with its practice of employing low-cost labor in the form of local country nationals (LCNs) and third country nationals (TCNs), reducing operational costs and giving the company a competitive advantage.
Doug Brooks, president of the external pageInternational Peace Operations Association, the trade association for private sector participation in stability operations, told ISN Security Watch that the issue was one of simple economics:
“If you’re running Triple Canopy and you want to protect a warehouse, your basic American [security contractor] is costing you about US$30,000 a month - that’s including salary and flying him in and out - and if company X who is competing against you uses Iraqi [security contractors] which costs them around US$700 a month, who is going to win that contract?”
While the same logic can be applied to TCNs in Iraq that are still less expensive to transport, train and deploy compared to American security personnel, a recent study external pageasserts that “third-country nationals are made up of workers from around the world [who] are routinely paid about one-tenth of what their American counterparts earn. Host-country nationals (HCNs) tend to be paid wages commensurate with local jobs.”
According a February 2009 external pagereportby the US Central Command (USCENTCOM), the total number of armed private security personnel in Iraq totals 8,701: US/coalition forces (781), local/host country nationals (1,065) and third country nationals (6,909). In Afghanistan, armed private security totals to 3,184: US/coalition forces (12), local/host country nationals (3,154) and third country nationals (18).
“You have to think about this from an economic or competitive [view]. Americans are essentially your last resort because they are the most expensive guys you can hire,” said Brooks.
Brooks’ statement parallels recent coverage of thousands of external pageUgandans currently operating in Iraq as private security personnel, while thousands more undergo training in Uganda with the hope of being hired by a private security company. As salaries for Ugandan security contractors were external pagecut by more than half from roughly US$1,300 to US$600 last year, external pageDreshak International Limited, a private firm based in Kampala that recruits and trains Ugandans for deployment, stated that the Ugandan security labor market had become flooded, thus driving down salaries since contracts are awarded to companies that cost the least. After an April 2008 external pageannouncementby the Ugandan Labor Ministry that its nationals would earn no less than US$600 per month, Dreshak began to recruit in neighboring Kenya where nationals are willing to work for as little as US$500 or less per month.
Deborah Avant, professor at the University of California-Irvine, stated in an external pageinterview that “Third-country nationals see it as a good economic opportunity to go work in Iraq. But the public perception is that the US is sort of paying off these people to do the dirty work.”
The 'mercenary' conundrum
Despite the erroneous labeling of private security companies as “mercenaries,” some criticism has risen with regard to TCNs classification as “mercenaries” by their own native governments, some of which have previously passed anti-mercenary legislation. In 1998, South Africa passed the external pageRegulation of Foreign Military Assistance Act which effectively blocked South African employment as TCNs. However, in 2007, President Thabo Mbeki external pagesigned legislation that would distinguish South Africans employed as TCNs from its legal definition of “mercenary”:
“The intent of the Act is to prohibit mercenary activity, to regulate the provision of assistance or service of a military or military-related nature in a country of armed conflict, to regulate the enlistment of South African citizens or permanent residents in other armed forces, and to regulate the provision of humanitarian aid in a country of armed conflict.”
South Africa’s move from banning mercenary activity to restructuring and regulating those that would be recruited and employed as TCNs in Iraq could indicate that the security industry offers something that states and other private businesses find too valuable to pass up.
On the other hand, just a month before South Africa passed its reform, neighboring country Zambia external pagedeported two US citizens employed by the Special Operations Consulting-Security Management Group (SOC-SMG) for attempting to recruit local nationals to work as private security personnel in Iraq. The company allegedly violated national anti-mercenary rulings, despite SOC-SMGs defense that it had the prior approval of the external pageZambian government to do so.
Some companies in the industry have also been tapping central and Latin America to supply personnel for operations in Iraq. The company formerly known as Blackwater (now Xe) has used external pageGreystone Limited to recruit personnel from South America. Greystone external pageadvertises its services as supplying “the best physical security assets from around the world […] against diverse and complicated threats in today’s grey world where the solutions to your security concerns are no longer black and white.” The company was used to external pagerecruit personnel from “countries such as Chile, the Philippines, Nepal, Colombia, Panama and Peru.”
Blackwater later came under fire in 2004 when it was external pagereported that a number of its Chilean recruits had been transported from Santiago to its training facility in North Carolina and that some of those persons were external pagecommandos that had “trained under the military government of Augusto Pinochet.”
Earlier this month, the government of Liberia stopped Xe external pagefrom recruiting former combatants of its civil war that would have otherwise “prepared Liberians to work in any dangerous situation” for work in Iraq and elsewhere because the company failed to acquire proper licenses from the state.
Some of the negative coverage on TCN involvement in conflict has caused the IPOA to go on the defensive. In a May 2007 external pageissue of the Journal of International Peace Operations (JIPO), the IPOA offered responses to developing employment external pagescandals involving Latin American TCNs, attempting to distinguish the industry it represents from the unethical and illicit activities of TCN recruitment companies.
Brooks told ISN Security Watch that its next journal would focus on the TCN issue.
“The role and regulation of TCNs is the Achilles heel of this industry,” James Cockayne, senior associate of the external pageInternational Peace Institute (IPI), told ISN Security Watch.
“States will eventually realize that these multinational service-production chains are impossible for them to control unilaterally, and move towards a more sophisticated system of international regulation. That might involve supranational regulation, or it might just involved deeper harmonization of national regulation.
"Interestingly, many of the PMSCs themselves already see this need. They do benefit from regulatory differences in some ways, but those differences also create higher transaction and administration costs. And they make it easier for the ‘bad apples’ to stay in the barrel. That’s why many of them are pushing for thicker regulation.”