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Saint-Gaudens

West fears Iraqi oil revenue is out of control

Special to World Tribune.com
MIDDLE EAST NEWSLINE
Friday, March 9, 2001

WASHINGTON — The UN program to spend Iraqi oil exports on food and supplies for the Iraqi people is spiralling out of control.

U.S., British and UN officials said Iraq is diverting more of its oil exports away from UN supervision and using the revenue to purchase military equipment and components for nonconventional weapons programs.

The concern by United Nations that it is losing its grip over Iraqi oil revenue is shared by the United States and Britain.

Officials said Iraq has steadily reduced oil exports under the international program for Baghdad to buy food and humanitarian supplies for the Iraqi people. In December, the UN program allocated $5.556 billion for the current six-month period.

But UN secretary-general Kofi Annan said he was "very much concerned" that the revenue would not be available. Instead, a UN report said, Iraq would sell only $3.5 billion worth of oil, the lowest level since 1998.

"Given its proven capacity, I urge the government of Iraq to increase its daily average rate of oil exports under the program to at least the levels in the previous phase," Annan wrote.

The UN concern runs counter to Bush administration efforts to ease international sanctions on Iraq in an effort to win support to stop Baghdad's missile and nonconventional weapons programs.

Iraq began to reduce oil exports under UN supervision after Baghdad imposed a surcharge that would go straight to the regime of President Saddam Hussein. The UN objected and Iraq began pumping oil through the revitalized pipeline from Kirkuk to the Syrian port of Banyas.

Western diplomatic sources said up to 200,000 barrels a day are being pumped to Syria. The exports are not under UN supervision.

UN diplomatic sources said Saddam has also demanded that any company that seeks to export products to Iraq under the oil-for-food program must pay a surcharge in a secret account held by Saddam. The assertion has been confirmed by several Western envoys to the UN.

The result, Annan's report said, is that the Iraqi people have less money to purchase food. "The purchasing power has steadily declined and, while food items are readily available in markets, they are unaffordable to the average Iraqi citizen," the report said. "Thus, even though Iraq has a surfeit of vegetables, fruits and animal products, the majority of the Iraqis cannot afford to buy them."

Friday, March 9, 2001


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