US confirms u-turn on Iraq reconstruction contract

French companies will be able to act as sub-contractors for the first wave of Iraqi reconstruction contracts and will be able to compete freely for future rounds, a spokesman for the French trade ministry said last night.

This represents an about-face for the US administration, who initially said that no companies from countries that had not participated in its military operations in Iraq would be liable to bid for contracts.

This policy caused fury in France and Germany, who both opposed the US-led invasion of Iraq.