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[Fwd: U.S. says some Iraqis get ``oil-for-food'' kickbacks]

By Anthony Goodman

UNITED NATIONS, Nov 17 (Reuters) - Some Iraqi officials are getting kickbacks
from companies supplying food, medicine and other humanitarian goods under the
U.N. ``oil-for-food'' programme, the United States charged on Wednesday. 

Deputy U.S. representative to the United Nations Peter Burleigh told reporters
one reason the United States has held up some contracts was because ``we have
problems with some companies which engage in what we consider to be illegal
trading activities with the government of Iraq -- percentages paid to
government of Iraq officials, for example.'' 

When the United States obtained such information, it explained to the relevant
governments ``why we are not going to approve contracts from those companies
which are involved in corrupt practices that benefit (Iraqi President) Saddam
Hussein and his immediate circle.'' 

Burleigh could not say how many contracts or how much money was involved in the
alleged kickbacks. 

Iraq has repeatedly complained that the United States and Britain are holding
up contracts in the Security Council's sanctions committee, which must approve
sales of civilian goods to Iraq under the ``oil-for-food'' programme. 

This allows Baghdad to sell oil up to a specified value every six month to
enable it to buy goods needed to ease the impact on ordinary Iraqis of U.N.
sanctions in force since Iraq's 1990 invasion of Kuwait. 

The Security Council discussed behind closed doors on Wednesday how to proceed
with the next six-month phase of the programme after the current phase expires
on November 20. 

The head of the U.N. programme, Under-Secretary-General Benon Sevan, told
council members that, as of November 15, the value of applications placed on
hold amounted to $1.042 billion compared with approved applications worth
$8.770 billion since the start of the programme three years ago. 

He said 17 of the 602 contracts on hold accounted for 43 percent of the total
value but gave no details. 

Sevan quoted officials of the U.N. Food and Agriculture Organisation (FAO) as
estimating that holds affecting food production items resulted in significant
reductions in the use of land for grain crops and the loss of as much as 20,000
tons of wheat production. 

The FAO also estimated that delays in the arrival of vaccines had resulted in
the loss of around seven million tons of meat, he added. 

If holds were released on contracts related to power generation, ``Iraq could
potentially achieve a 50 percent increase in electricity supply,'' said Sevan,
whose briefing notes were later made public. 

Burleigh cited Sevan telling the council that ``more than 50 percent of the
holds on contracts now'' were due to lack of full technical information from
the Iraqi government and its suppliers. 

Another reason for the holds, Burleigh said, was ``deep concern about dual-use
items ... and the end-use of certain equipment on the ground in Iraq, once it

He was referring to items that could be put to both commercial and,
potentially, military uses. Such items used to be monitored by U.N. weapons
inspectors, who have not been allowed back in the country for nearly a year. 

According to Sevan's notes, he also appealed to council members to find ways to
protect Iraqis ``against poor performance by some suppliers who, once paid in
total for the supplies reaching the borders of Iraq,'' felt no obligation
either to replace defective supplies or to reimburse the U.N. Iraq account
through which payments are made. 

While the U.N. is barred from involvement in commercial relations and
contractual disputes, ``we simply cannot wash our hands or hide behind rules
and procedures,'' he said. 

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