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Iraq tests waters with request for extension of oil-for-food programme

Friday November 20, 9:42 PM

Iraq tests waters with request for extension of oil-for-food programme

BAGHDAD, Nov 20 (AFP) - Iraq was seen as testing the waters at the United
Nations Friday by seeking a two-month extension of the oil-for-food
programme that would avoid a commitment to at least six more months of

Iraq's ambassador in New York, Nizar Hamdoun, told AFP that Iraqi
authorities wrote to the current UN Security Council president Peter
Burleigh on Thursday "to extend the current phase ... for another two

But "nothing has been heard officially from the government of Iraq," said
George Somerwill, spokesman for the UN humanitarian programme in Baghdad
through whose office any such request would have to be passed on to New

Hamdoun said Iraq wanted the extension rather than a rollover of the
six-monthly programme "because we have not exhausted all the money that
was supposed to be allocated" for the current, fourth phase. 

The current phase, which allows Iraq to export limited quantities of oil
in return for imports of humanitarian goods, expires on November 25. Each
renewal of previous phases has been complicated. 

The 15-member Security Council had been working this time on the
expectation that the programme, launched in December 1996 to ease the
hardships of sanctions, would simply go ahead for a further six months. 

But ahead of a UN "comprehensive review" of sanctions, expected to start
next month and on which Baghdad is pinning hopes for a lifting of the oil
embargo, a rollover would mean at least six more months of sanctions. 

The sanctions have been in force ever since the 1990 invasion of Kuwait
and are linked to Iraq's disarmament. 

Commerce Minister Mohammad Mahdi Saleh said on November 10 that talks had
been taking place with the United Nations on a renewal of the oil-for-food
accord but that the programme is "not satisfactory." 

At present, the deal provides for Baghdad to export up to 5.2 billion
dollars worth of oil in return for badly-needed food and medicine. 

However because of the poor state of its oil infrastructure and the
collapse of world oil prices, Baghdad has been unable to meet an agreed
target of 4.5 billion dollars. 

Iraqi exports since the current phase began in June are projected to have
generated 3.3 billion dollars by next Wednesday, Somerwill said. 

He pointed out that the average price of a barrel of Iraqi crude has this
week slumped to nine dollars, a fall of 2.5 dollars a barrel over the last
four weeks alone. 

Regarding the spare parts Iraq needs to revamp its oil installations,
Somerwill told AFP that the UN sanctions committee has now approved
contracts worth almost one third of the 300 million dollars allocated to
such imports. 

Seven more contracts were given the go-ahead in the past week, raising to
139 the total number of approved contracts since June and their overall
value to 97.5 million dollars, Somerwill said. 

The total number of contracts put on hold, worth another 45 million
dollars, has reached 96. 

None of the spare parts has yet arrived, at least partly because they have
to be customized, Somerwill said. 

"Even when clearances come through, it takes a long time for the parts to
be made and to come into the country," he said. 

Meanwhile the backlog of goods waiting to enter Iraq from its borders with
Turkey, Syria and Jordan that built up during the crisis over UN arms
inspections has been cleared, said Somerwill. 

The evacuation of Lloyds imports monitors last week, at the same time as
UN weapons inspectors and most UN humanitarian staff before the threat of
US military strikes subsided, led to a three-day suspension of imports. 

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