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News, 28/1­2/2/02 (1)

NEWS, 28/1­2/2/02 (1)

Although these are not divided into supplements as previously, I¹m sending
them in two batches on the possibility that some people¹s computers may have
problems with large mailings.

Titles of items I would recommend are given in CAPS:


*  Iraq Says Gulf War Bomb Kills Four Children
*  Iraq: Airstrikes Injured 7 People
*  U.S., British jets bomb Iraqi missiles
*  Iraq seeking reconciliation [extract, giving more details on missiles
*  Iraq's bitter British rift [an interesting article flawed by the
assumption that Iraq¹s memories of Britain prior to the Gulf War were all


*  Saddam has made two atomic bombs, says Iraqi defector
*  Cheney Accuses Iraq of Seeking Deadly Weapons
*  Ex-UN inspector says Iraq had Brucella biological agent


*  Iraq accuses UN over oil payments
important article, already circulated by Drew Hamre, which gives an
explanation as to why the Iraqis have been so slow in recent months in
putting in orders for food and medicine]
*  Iraq asks damages for its children for UN sanctions [it appears the
Iraqis will never learn the basic principle of the New World Order:  that
there are people who get compensation and people who don¹t get
*  UN Council Mulling Sanctions Plans [French proposals to  introduce a
carrot along with the stick]
*  WHO Seeks Fund for Forward Work on DU in Balkans, Iraq


*  Iraq, Syria plan to build new pipeline [positive view of Iraqi/Syrian
*  Iraq plots anti-Israel alliance [negative view of Iraqi/Syrian
*  Iraq invites Arab countries for mutual free trade zones
*  Iraqi refugees return back home from Saudi Arabia
*  Iraq seeking reconciliation with Kuwait, Saudi Arabia: Mubarak acting as
by Syed Rashid Hussain
*  Saddam about to bomb Israel?
*  Jordan: Time to change U.S. policy on Iraq
*  Iraqi conditions to establish a free trade with Jordan
*  Iraqi- Eritrean agreement on diplomatic representation
*  Indonesia calls for sanctions on Iraq to be lifted
*  U.S. Regrets Return of Turkish Envoy to Iraq


*  Russian energy minister flies to Baghdad
*  Russia submits list of firms to lift Iraqi oil

NEWS, 28/1­2/2/02 (2) [sent separately]


*  Britons see mid-air hijack attempt fail
*  Trial of Yemen Hijacker Starts in Sanaa
*  Yemen Hijacker Testifies in Trial
*  Yemeni hijacker gets 15-year prison term [Yemeni justice doesn¹t hang
about ­ PB]


*  Iraqi Foes To Get Aid From U.S.
*  Powell Expects Mideast, Iraq to Dominate U.S. Agenda [or maybe they won¹t
get aid from US]
*  IRAQI INTELLECTUALS ESTABLISH PARLIAMENT [indicates the possibility of an
Iraqi opposition interested in something other than large handouts from the
murderers of the Iraqi people]
*  U.S. gives $4 million to dissidents for legal case against Hussein [the
$4m is the sum already promised by Clinton. And does it really cost $4m to
prove Mr Hussein guilty of crimes against humanity? We were under the
impression that the case was already pretty well established. Are we wrong?]


*  Facing Up to Iraq [the Clinton legacy of softness has left a heavy burden
on America¹s future]
*  POWELL FACES DANGEROUS ALBRIGHT LEGACY [the Albright legacy of toughness
has left a heavy burden on America¹s future]
 *  THE NEW ORDER THAT SPLITS THE WORLD [excellent article by Simon Jenkins
defending the principle of national sovereignty]
*  Cook Wants to Cement British Ties with U.S.
*  It's Now the Smaller Arab States That Lead the Way


*  'Saddam has blood cancer, war for succession open'
*  From Russia with love: 5,000 copies of 'The Big Breach' [short extract on
MI6 proposal to infiltrate UNSCOM. But would that have been necessary?]
*  Hyundai Eng. soars on Iraqi payout
*  'Convicting Kuwaiti govt head will please Saddam' [trial of the Kuwaiti
head of state under the Iraqi occupation]
*  Iraqi girl to leave US after treatment
*  MuchMusic & War Child in Iraq



BAGHDAD (Reuters, January 28) - Four children were killed when a bomb
dropped during the 1991 Gulf War exploded in southern Iraq, the Iraqi News
Agency (INA) reported Sunday.

The agency, quoting a civil defense source in Dhi qar province, said two
sisters and two brothers were killed by a cluster bomb while tending sheep
in the al-Badiya area.

The source identified the children as Majida Hameed, eight, Majid Hameed,
six, Afrah Hameed, four, and Sabreen Hameed, one.

INA did not say when the incident happened.

Last week a nine-year-old child was reported killed by a bomb explosion in
the same area.

According to INA more than 7,000 missiles and bombs of different type were
dropped on Dhi qar province during the 1991 war over Kuwait.

U.S. and British planes patrol two no-fly zones over the north and south of
the country. They frequently bomb air-defense units which challenge the


BAGHDAD, Iraq (Associated Press, Mon 29 Jan 2001) ‹ Iraq said seven people
were injured by U.S. and British warplane airstrikes on civilian targets
Monday. The U.S. military said the most recent strikes came Sunday and that
civilians were not targeted.

``Seven people were injured when enemy warplanes bombed residential and
service installations in southern Iraq,'' the Iraqi military said in a
statement carried by the official Iraqi News Agency. It said the planes
attacked civilian targets in six provinces.

A spokesman for the U.S. Central Command in Tampa, Fla., said American and
British planes struck southern Iraq on Sunday, not Monday.

``We never strike any civilian targets,'' said Lt. Col. Mark Samisch. ``We
go to painstaking lengths to only strike military targets.''

On Jan. 20, Iraq said six people were killed and three injured in
airstrikes, but that its air defense units hit one of the aircraft. The U.S.
military denied any aircraft were hit.

Allied aircraft patrol no-fly zones over southern and northern Iraq,
established after the 1991 Gulf War to protect Shiite Muslim rebels in the
south and Kurds in the north from Iraqi government forces.

Iraq does not recognize the no-fly zones and has been challenging allied
aircraft since December 1998.

Samisch said Sunday's strikes were a response to Iraqi violations of the
southern zone, including surface-to-air missile systems placed south of the
33rd parallel.

UPI, Mon 29 Jan 2001

U.S. and British fighter jets bombed Iraqi surface-to-air missiles that had
been moved into a threatening position Sunday, according to U.S. Central
Command. U.S. forces have conducted five military strikes in northern and
southern Iraq this month, a significant uptick in activity in a region that
had been relatively quiet for about six weeks.

Iraqi forces moved a group of surface to air missiles below the 33rd
parallel, the invisible boundary line below which Western forces have been
enforcing a no-fly zone for a decade, Maj. Jeff Blau, a spokesman for the
U.S. Central Command said. The missiles were in a better position to target
the U.S. and British war planes that fly almost daily missions over the
area, prompting the attack, he said.

This is not the first time Iraq has moved SAMs below the 33rd parallel,
according to Blau. On Jan. 1, U.S. forces bombed a radar installation in
southern Iraq, followed by anti-aircraft artillery on Jan. 15 and both
radars and artillery on Jan. 20. On Jan. 24 in the northern no-fly zone of
Iraq, U.S. forces dropped ordnance on components of the air defense system
after being targeted by both SAMs and anti-aircraft artillery.

According to Central Command, the Iraqi military has fired on U.S. military
aircraft almost 700 times and violated the southern no-fly zone more than
150 times since December 1998, after the United States led a four-day attack
on Baghdad in retribution for kicking out the U.N. weapons inspectors.

by Syed Rashid Hussain
Dawn, 30th January

[..... the beginning of this article is in the Iraqi international relations
section .....]

Agencies add: US warplanes attacked Iraqi surface-to-air missile (SAM)
systems in southern Iraq on Sunday in retaliation for the recent movement of
SAM systems into the no fly zone, a US military spokesman said on Monday.

Sunday's airstrikes marked the second time US warplanes have gone into
action against Iraq since President George W. Bush took office. US warplanes
based in Turkey struck Iraqi air defence positions in the north on Jan 24.

The attacks were carried out against SAM systems near Al Kut, 150kms
southeast of Baghdad, and An Nasariyah, 270kms southeast of the Iraqi
capital, said Lieutenant Colonel Joe Lamarca, a spokesman for the US Central

"They pre-positioned SAM systems below the 33rd parallel which are in
violation of international demarches and which directly violate UN Security
Council resolutions," Lamarca said.

"The targets that we struck are the targets that they moved," he said.

The United States cites UN Security Council Resolution 688 as authority for
enforcing the no-fly zones, which were imposed in northern and southern Iraq
after the 1991 Gulf War to halt Iraqi repression of minority Kurds and

Lamarca said UN Security Council Resolution 949, which was passed in 1994
following a threatening buildup of Iraqi forces near the border with Kuwait,
bars Iraq from moving SAMs into the southern no-fly zone.

Iraq has routinely defied the no-fly zones since December 1988, when the
collapse of a UN arms inspection regime precipitated a four-day US and
British bombing campaign.

Lamarca said Iraqi forces have fired anti-aircraft artillery and
surface-to-air missiles at aircraft patrolling the southern no-fly zone 30
times in the past month and seven times in the past week alone.

by Anton La Guardia in Baghdad
Daily Telegraph, 3rd February

AT weekends, the Commonwealth war cemetery in Baghdad comes alive with
barefoot boys playing football between the palm trees which line the central

One curls the ball with a thud against the improvised goal, a large white
memorial stone bearing the carved inscription: "Their Name Liveth
Forevermore." Someone still cuts the grass, a new fence has been erected,
and some fallen gravestones have been reset in fresh concrete. But hardly
anybody now arrives to visit the graves. The names are being forgotten.

More than a decade after the Gulf War, the rift between Iraq and Britain has
the bitterness of a family feud. The thousands of British expatriates who
once flocked to Iraq to share the oil riches of a country where alcohol was
not forbidden have disappeared. St George's Church, a place of worship
frequented mainly by Britons, stands empty. The cross on the rooftop tumbled
down years ago.

Britain carved Iraq out of the carcass of the Ottoman Empire, and for
decades after Iraq's independence Iraqis traditionally came to Britain to
further their education. For many, London was a second home. Now the
severance is the cause of bewilderment, anger and contempt.

"Iraqis feel hurt by Britain especially. They don't understand why England
is doing this to them. They are waiting for it to come to an end," explained
Lorna Al-Wazir, one of the last Britons in Baghdad. A schoolteacher who
married an Iraqi engineer, Mrs Al-Wazir moved from Basra to Bedford with her
husband to escape the political upheavals that followed the downfall of the
Hashemite monarchy.

When her husband died in Britain in 1994, Lorna went back to visit his
family in Baghdad. She decided to stay. She took a job as head teacher at
the Baghdad International School, she said, as a personal gesture of
"protest" about Western policy towards Iraq. Did she have trouble living in
Baghdad? On the contrary.

"It's a wonderful feeling," she said. "It has this history that just goes on
forever. I have never felt any hostility here, not once. But I definitely
find hostility from some people in Britain." Iraqis, she said, felt cut off
from the rest of the world by a decade of sanctions. "We have no internet or
email, and even making a telephone call is difficult. What is happening in
the world? We don't know."

These days several Western European countries have "interests sections" in
Baghdad that are the closest thing to full embassies. They are packed with
expatriate diplomats fighting for a share of reconstruction contracts. In
contrast, the large British embassy complex on the banks of the Tigris lies
desolate, with plastic bags snagged on its barbed wire perimeter.

Other so-called rogue states, such as Libya and Iran, have British envoys.
The political rupture with Iraq is complete, however. In the north and south
of the country, RAF aircraft patrol the skies alongside American jets and
play cat-and-mouse with Iraqi anti-aircraft batteries.

"The British will be losers in all this," said Prof Mohammed Al-Awsi, dean
of engineering at the University of Baghdad. "If they keep up such a policy
we will turn to other countries. We are getting education assistance from
France and Italy. Already some of the departments in the university are
considering making French, rather than English, the compulsory foreign
language that they must study."

He complained that the British Government had frozen the bank account that
he had opened as a student at Sheffield University in 1983. "It has £100 in
it. But the bank refused to let me withdraw the money," he said.

Salam Al-Amir, an Iraqi film director, encapsulated the mixed emotions of
many Iraqis. "Britain was an empire. It ruled half the world," he said. "Now
it's nothing. It's the servant of America. The big enemy, America, is being
clever. The smaller enemy, Britain, is just being stupid."

In the old centre of Baghdad, I tried to find the house of Gertrude Bell,
the British traveller who dedicated her life to the creation of Iraq. It is
said that "a great number of Arab sheikhs" turned out for the funeral of
Miss Bell, who died in Baghdad in 1927.

But in two days of searching through the alleyways of the souk and along the
muddy banks of the Tigris, I could find nobody who knew where the house was.
The name of Britain is, indeed, being forgotten.


by Jessica Berry
Daily Telegraph, 28th January

SADDAM HUSSEIN has two fully operational nuclear bombs and is working to
construct others, an Iraqi defector has told The Telegraph.

The defector, a military engineer who fled Iraq a year after United Nations
arms inspectors left the country, says that he helped to oversee the
completion of the weapons programme. He is currently in hiding in Europe.
International nuclear officials are investigating his evidence, which
contradicts recent reports that the Iraqi dictator's plans were still at a
preparatory stage.

Saddam's efforts to build atomic weapons were delayed by the UN Special
Commission (Unscom) inspectors who were forced to leave in November 1998,
but scientists resumed the work immediately after their departure.

According to the defector, who cannot be named for security reasons, bombs
are being built in Hemrin in north-eastern Iraq, near the Iranian border.
Last week, the defector said: "There are at least two nuclear bombs which
are ready for use. Before the UN inspectors came, there were 47 factories
involved in the project. Now there are 64." The information has alarmed
security experts, who were aware only that the area around Hemrin was well

The defector said: "The area is restricted to the Special Security
Organisation. Some of it is under the control of the military
industrialisation ministry which is in charge of building up Saddam's
weapons arsenal, but one area is entirely under the control of the nuclear
energy organisation. They are digging shelters there."

The nuclear programme is shrouded in secrecy. The chain of command leads
directly to the presidential palace and Saddam's closest aide, Abed Hmoud, a
Baath Party stalwart who runs the Iraqi dictator's private office. According
to the defector, General Raad Ismail, the head of the Committee for the Use
of Nuclear Weapons, answers directly to a Dr Khaled, the director-general of
the al-Athir factory, who oversees the final stages of construction of

The factory was attacked in air raids by Britain and the United States in
1998, but has since been rebuilt. Also involved is Awad al-Benck, who is
responsible for procurement in the presidential office. Involvement of such
senior men means that the programme is top secret. The defector says that
apart from the scientists, only four or five people know what is happening.
One security expert said: "This is vital information. The fact that General
Ismail is involved can only mean that the programme is complete."

Melissa Fleming, a spokeswoman for the UN-founded International Atomic
Energy Agency in Vienna, said that the IAEA was unable to confirm that the
Iraqi dictator was complying with Unscom resolutions. Mrs Fleming said: "I
will bring this to the attention of the members of the agency immediately.
We want to investigate this as soon as possible."

The fresh evidence comes only a week after President George W Bush took
office. In his inaugural address, he promised to confront weapons of mass
destruction, without mentioning Iraq. Under Anglo-US policy, any attempt by
Saddam to build nuclear or biological weapons could lead to military action.

Colin Powell, the US Secretary of State and a Gulf war veteran, and
Vice-President Dick Cheney are both known to favour a radical approach in
dealing with Iraq. General Powell said of Saddam last week: "His only tool,
the only thing he can scare us with are those weapons of mass destruction,
and we have to hold him to account."

The new White House spokesman, Ari Fleischer, said: "The President expects
Saddam Hussein to live up to the agreements he's made with the UN,
especially regarding the elimination of weapons of mass destruction."

by Jim Wolf

WASHINGTON (Reuters, 28th January) - U.S. Vice President Dick Cheney accused
Iraq on Sunday of seeking to develop weapons of mass destruction in
violation of the Gulf War cease-fire accord and said President Saddam
Hussein could again become a "threatening presence."

"Saddam's still, I think, very much a force for instability in the region,"
Cheney said during appearances on three network television news shows. "He
is still clearly looking for ways to develop weapons of mass destruction."

Conspicuous by its absence from his remarks was the notion that Saddam was
still "in his box," the refrain used by former president Bill Clinton and
his aides to describe U.S.-led efforts to isolate Saddam and keep him from

"He's a potential base for support for terrorist activities," Cheney said on
NBC's "Meet the Press" program. "Saddam needs to understand and not
miscalculate that this administration will take any effort on his part to
resume the kind of activities engaged in 10 years ago very seriously."

Saddam's forces are still "significantly weaker" than when he invaded Kuwait
on Aug. 2, 1990, Cheney said. The invasion led Bush's father, then-president
George Bush, to assemble an international coalition that drove Iraq from
Kuwait 10 years ago.

"He needs to be very careful," Cheney said, adding that the United States
would continue to insist on the return of United Nations inspectors to check
on suspected weapons-production facilities barred by the cease-fire that
ended the 1991 Persian Gulf war. Under that deal, Iraq agreed to scrap its
nuclear, chemical and biological weapons programs as well as long range
missiles to deliver such arms.

Since mid-1998, Saddam has barred virtually all inspections by U.N. experts
who, after the war, found and destroyed large quantities of banned weapons
and uncovered secret programs to build more.

Cheney, who confronted Saddam as U.S. defense secretary at the time, said he
had no knowledge of a report in the London Telegraph newspaper citing an
unidentified defector as saying Saddam had assembled two "fully operational"
nuclear bombs.

"We do know that he has in the past worked to try to develop weapons of mass
destruction," he said on ABC's "This Week."

"We knew he was working on nuclear weapons at the time of the Gulf War. He
had clearly not gotten there yet, but it was a technology he was seeking. I
don't have any reason to believe at this point that he has achieved that
objective, but I don't know," Cheney said.

Cheney told "Fox News Sunday" Bush's new National Security Council would
look at what the United States might do about Saddam and "many other issues
involving the Middle East, especially."

Bush, in a pre-inaugural interview with Reuters on Jan. 18, denounced Saddam
as a "big threat" and said he would use force against him "if we catch him
developing weapons of mass destruction."

Washington, Reuters, 3rd February

Iraq produced the Brucella bacteria as part of its weapons programme,
although Baghdad denied it and United Nations reports have never mentioned
it, a former UN biological weapons inspector said yesterday.

"They did have scientists who specialized in Brucella, and they did have
media imported that ... would be suitable for growing Brucella," said Rod
Barton, a former biological weapons inspector with the UN Special Commission
on Iraq (UNSCOM).

UN reports have stated that Iraq produced other deadly biological agents
including botulinum toxin, anthrax, and gas gangrene as part its weapons
programme, before and after the 1991 Gulf War. But Brucella was never

The bacteria in humans can create flu-like symptoms: fevers, chills, aching
joints and general feelings of malaise. The symptoms resemble some Gulf War
syndrome complaints by American troops who have suffered from mystery
illnesses after the Gulf War. But Barton and other experts say there is no
evidence that Iraq used biological weapons during the war.

He estimated Iraq had produced about 500 gallons (2,000 litres) of Brucella,
though Baghdad has always denied it. "Iraq claims they never worked on,
never weaponized (Brucella). We believe from the evidence we have there
could be 2,000 litres," Barton told a meeting at the Monterey Institute, an
arms-control think tank.

"That's based upon the bacterial growth media, that we know we have
documentation for, arrived in the country and cannot still be accounted
for," he said. Brucella was never mentioned in UN reports because, he said,
evidence about it only emerged in 1999 from old records. That was after
UNSCOM had left Iraq at the end of 1998 complaining that Baghdad was making
its work impossible.

"There is no evidence that they (Iraq) used biological weapons in the Gulf
War," Richard Butler, the former head of UNSCOM, told Reuters in a telephone
interview from Sydney. "Maybe they were planning to and maybe they did and
we don't know it. But one can only deal in hard evidence. And there is no
hard evidence that says they did use biological weapons in the Gulf War,"
Butler said.

"The problem we faced in knowing the exact quantities involved was a very
large one because it was in the biological area more than any other area
where Iraq had entered into the most elaborate forms of cheating, lying,
deception," he said. Both Butler and Barton said they believed Iraq and
continued its biological weapons programme in the two years that UN weapons
inspectors have been barred from the country.

Barton estimated that there were about three tonnes or more of unaccounted
bacterial growth materials in Iraq, saying he believes Iraq's main
motivation in retaining biological weapons was its fear of a potential
threat from neighbours like Iran.

"If that is the only motivation at this stage then they don't need a lot,"
Barton said. "My own view is I don't think they're into big scale
production." Since 1995, Iraq has been doing trials of the L-29, a remote
piloted aircraft of East European origin that appeared to have a range of
reaching Israel, Barton said. The aircraft can be fitted with cameras for
surveillance, but the way they were configured made that unlikely and they
could be used to deliver biological agents, he said.


by Nicole Winfield, AP
Independent, 30 January 2001

Iraq has accused the United Nations of squandering $1 billion of Baghdad's
revenues from the UN oil­for­food program through "inflated" salaries and
other perks to UN officials.

Iraq, which has been under sweeping trade sanctions since its 1990 invasion
of Kuwait, has earned about $40 billion in oil revenues from the UN
oil­for­food program.

The program lets the government export its oil provided the proceeds are
used to buy food, medicine and other necessary items for its people. But
nearly 30 cents of every dollar earned is diverted to pay for Gulf War
reparations and UN administrative and operational costs.

Foreign Minister Mohammed Saeed al­Sahhaf accused the United Nations of
squandering Baghdad's money in a letter Monday to the Security Council
complaining about the U.N.'s refusal to let Iraq donate $1 billion euros to
the Palestinians.

The council took no action on Iraq's request last week after the United
States and Britain insisted the money be spent caring for Iraqis suffering
under sanctions ­ not Palestinians. Other programs help the Palestinians,
ambassadors from the United States and Britain argued.

In his letter to the council, Al­Sahhaf admonished the two countries for
refusing to let Iraq help its fellow Arabs and declared that no one other
than Iraq had the right to decide how its money should be spent.

Al­Sahhaf said the United States and Britain were hypocrites in refusing the
Palestinian gift since already some $11 billion of its revenues had been put
into a fund to pay individuals, companies and governments who lost money
from the Gulf War.

In addition, more than $1 billion has been spent on UN operational expenses,
"mostly in paying the inflated salaries of its employees, the cost of their
first­class air travel and in buying cars and furniture for their grandiose
offices," al­Sahhaf charged.

He said the United States did nothing to prevent such waste and yet "weeps
crocodile tears over Iraq's financial assets," when Baghdad wants to help
the Palestinians.

UN officials said they hadn't seen the letter and couldn't comment on it.
There was no answer late Monday at the US mission.

by Peg Mackey
Dawn, 31st January

BAGHDAD: The UN humanitarian aid programme for Iraq is no alternative to
lifting UN sanctions but the scheme is meeting some success in improving
life for ordinary Iraqis, a senior UN official said on Tuesday.

"The oil-for-food programme is not without its shortcomings and it is never
going to be a substitute for normal economic life," Tun Myat, UN Coordinator
in Iraq, said in an interview.

"But when you take a long hard look at things, it's the only game in town,"
said Myat, nine months to the day in his post. "What else have the Iraqi
people got at this point in time?"

The UN official was optimistic that once sanctions, now a decade old, were
lifted, Iraq would get back on its feet with relative ease, thanks to its
enormous oil resources.

"They are probably better off than most developing countries will ever be,"
Myat said. "They've got this huge collateral under the ground that could be
used for investment that they would require."

While noting the inroads the UN aid scheme has made in the food and medicine
sectors, the UN official lamented the programme's shortcomings.

"Obviously there has been progress made in food and medicine as a result of
four years of oil-for-food," Myat said.

"But the impact still has to be felt in the critical areas of water,
sanitation, electricity, telecommunications, transport infrastructure,
housing and education."

Those sectors should soon get a boost from the huge influx of revenue
generated by sky-high world oil prices, he said.

"Because of the very large sums of money that have become available
particularly during 2000, the impact is beginning to happen and it will
continue to improve soon," he said.

Over the past few days Myat got to the bottom of Iraq's recent slow pace in
ordering supplies for health, education, water, sanitation and oil

"The real reason is nothing sinister," he said. It all boils down to a new
Iraqi law from last October which eliminates the role of middlemen in
supplying contracts to those sectors.

"Many ministries here took time to readjust their purchasing procedures,
sources of supplies and identification of suppliers," Myat said. "And this
is probably the main reason why some of the ministries have fallen very
badly behind."

The progress Iraq has made under sanctions owes much to the wherewithal of
its people, Myat, a native of Myanmar, said.

"There are few good things coming out of sanctions, but becoming more
self-reliant is certainly one of them," he said. The oil and agricultural
sectors stand out as prime examples.

Oil-for-food's extra revenue has meanwhile allowed Myat to escape the
frustrations which forced his two predecessors to resign over the impact of

"I did not have to oversee a programme that was hopelessly poor and
inadequate to meet the needs of the Iraqi population because of the
remarkable amounts (of revenue) available now."

The UN official was hopeful there might be some renewed momentum towards
lifting sanctions under the new US administration, despite the hard line
taken by the US.

"I believe that a strong conservative administration is usually better at
negotiating and arriving at hard decisions and solutions," Myat said.

"I hope it's possible for a resolution to be arrived at sooner rather than
later. This whole thing has gone on for far too long."

And he was optimistic that progress might be made at talks next month
between Iraqi and UN officials in New York.

Admired for his administrative skills while at the World Food Programme,
Myat wants to improve the efficiency of the oil-for-food programme.

"The system was devised for food and medicine and it's now being applied to
a programme far bigger than anything that was ever envisaged at its
inception," he said.-Reuters


UNITED NATIONS (Reuters, 1st January) - Iraq said Thursday that U.N.
sanctions imposed after its 1990 invasion of Kuwait were "a flagrant
violation" of the human rights of its children and urged prosecution of
those responsible.

In an unsolicited report to the U.N. Security Council and Secretary-General
Kofi Annan, Baghdad also said its children should be paid damages for their
suffering under the embargo.

The report called the sanctions "a weapon that is no less dangerous than
weapons of mass destruction," citing unspecified estimates that they have
killed between 500,000 and 1.5 million Iraqis, most of them children.

Baghdad did not spell out where or how the alleged violations of
international law should be tried. Nor did it say precisely who should be
tried, though it singled out Washington for its strong support for the
sanctions regime.

The report was the latest charge in a broad public relations campaign
launched by Iraq to pressure the Security Council to weaken or lift the
sanctions, which include an oil embargo.

Baghdad argues the sanctions should be ended because it has fulfilled its
obligation under council resolutions to eliminate its weapons of mass

But the 15-nation council, at the urging of the United States and Britain,
insists Iraq must first let weapons inspectors return to verify its claims.

The new U.S. administration of President Bush has vowed to breathe new life
into the sanctions.

The report said, "The social fabric of the Iraqi family and of the community
has been torn apart, and children have been deprived of their right to life,
health and education."

It alleged the sanctions violated the Security Council's own resolutions as
well as the U.N. Charter, the Geneva Conventions on the conduct of war, the
Universal Declaration of Human Rights and the U.N. Convention on the Rights
of the Child.

The report made no mention of the council's oil-for-food program, which
since December 1996 has allowed Baghdad to sell oil to buy food, medicine
and other humanitarian supplies for its people.

But U.N. officials have reported that impoverished Iraqis have bartered or
sold food rations to buy clothing and other necessities.


UNITED NATIONS (Associated Press, Fri 2 Feb) ‹ Facing mounting criticism
that its sanctions hit innocent civilians the hardest, the U.N. security
council is considering changing the way it imposes such punishments.

The proposals include time limits, a partial easing of embargoes to reward
good behavior and U.N. punishment for countries that trade with countries
under sanctions.

The recommendations are contained in a draft report obtained Thursday by The
Associated Press from a council committee that has been working since April
to try to improve the effectiveness of sanctions.

Ambassadors decided to launch the reform effort to answer critics who say
decade-old sanctions on Iraqis are hurting innocent civilians. They are also
reacting to reports of large scale violations of diamond embargoes against
rebels who sell gems to fund their wars in Angola and Sierra Leone.

The draft report is still under negotiation, and the United States has made
clear it has problems with several of the most dramatic changes suggested ‹
apparently fearing that they could undermine the hard-line U.S. position on
Iraq, diplomats say.

The draft dated Wednesday proposes that sanctions always be imposed for
limited periods of time and that the council take action to ease sanctions ‹
short of suspending or lifting them ‹ to reward partial compliance with U.N.

France has been a driving force behind both recommendations, arguing that
there must be a ``carrot and stick'' approach to make sanctions work.

France reasons that Iraq hasn't fully abided by U.N. resolutions requiring
it to get rid of its weapons of mass destruction because Baghdad believes
that no level of disarmament will convince the United States to lift

French Ambassador Jean-David Levitte has also proposed that decisions in the
council's sanctions committees be taken by majority vote. Currently,
decisions require consensus among all 15 ambassadors.

If adopted, that proposal could prove most divisive in the Iraq sanctions
committee, where the United States and Britain are frequently at odds with
most of the other 13 members and would be outvoted.

The report also recommends that the council consider applying so-called
secondary sanctions on countries found to have violated embargoes.

That proposal was first made by a panel of outside experts who last year
accused the governments of Burkina Faso and Togo of violating an arms,
diamond and fuel ban against Angola's UNITA rebels.

The council currently is considering a U.S.-drafted resolution that would
impose a diamond, arms and timber embargo on Liberia for allegedly trading
diamonds for arms with Sierra Leone's rebels.

Other proposals in the report are not as controversial.

The draft calls for the United Nations to develop guidelines for often
complicated financial sanctions against heads of state who may have hidden
bank accounts overseas.

And it calls for the council to consider a permanent way of evaluating the
success of sanctions, instead of creating ad hoc panels.

People's Daily, 2nd February

The World Health Organization (WHO) on Thursday appealed for close to US$2
million to support activities concerning the possible effects on human
health of depleted uranium (DU) used in munitions in the Gulf War and
Balkans conflicts.

A press release from WHO said the fund will be used over the next six months
to strengthen its epidemiological expertise to develop or conduct field
surveys with standard protocols, provide technical support and equipment as
needed to strengthen national surveillance and registry of non-communicable
diseases including cancers and deploy toxicologists, radiation and chemical
experts in support of national capacities for diagnosis and treatment of non
communicable diseases.

This initial US$2 million appeal will eventually form part of an estimated
US$20 million appeal which would cover WHO's work in this area for the next
four years, the agency said.

According to WHO, that money would allow it to undertake in- depth
epidemiological and toxicological studies into the possible health effects
of depleted uranium and other possible environmental effects on human beings
in the Balkans and the Gulf.


Times of India, 28th January

BAGHDAD: Iraq and neighbouring Syria plan to build a new oil pipeline
because the existing pipeline built in 1953 is no longer usable, Oil
Minister Amer Rashid said in an interview published on Saturday.

"We have a project with our Syrian brothers to build a new pipeline because
the old one, which has a capacity of 1.4 million barrels per day, is
useless," the minister told Al Jumhuriya newspaper.

He said the new pipeline would be built in two phases, starting with the
section inside Syria.

"For the Iraqi section, we will provisionally use a part of the old oil
pipeline before building a new one when our financial situation improves,"
said Rashid, whose country has been under UN sanctions since its 1990
invasion of Kuwait.

He said repairs to the old pipeline, which was abandoned for almost two
decades, would "not be easy because of leaks, problems in the old pumps, and
the unavailability of spare parts."

Syria closed the pipeline linking northern Iraq's Kirkuk fields to the
Syrian port of Banias on the Mediterranean in 1982 after siding with Iran in
its 1980-1988 war against Iraq.

In defiance of the sanctions regime, the pipeline was reopened in November,
according to the Middle East Economic Survey. But Iraq denied the report,
saying only tests had been carried out.

Iraq and Syria, ruled by rival branches of the Baath party, broke off
diplomatic relations in 1980, but began to normalise links in 1997 through
economic cooperation, opening their border to businessmen and government

All Syrian citizens will be able to travel to Iraq starting in November, the
Syrian interior ministry said on January 4.

Also on the oil export front, Rashid said that Baghdad would not be able to
afford to construct the Iraqi section of a planned pipeline to Jordan until
after the lifting of sanctions.

"The launch of this project in Jordanian territory will start but the Iraqi
part will be built after the lifting of the embargo," he said, adding that
tanker trucks will continue to be used.

Last week, Jordan set up a committee to prepare a feasibility study and a
memorandum of understanding with the Iraqi government and the firm to be
selected for the project.

Jordan depends on Iraq for its entire oil needs and will import five million
tonnes of crude in 2001 under an agreement between the two countries, up
from 4.8 million tonnes in 2000.

The oil is transported by tanker trucks across the desert from western Iraq
to the Jordanian refinery at Zarka, northeast of Amman. The 750-kilometre
(465-mile) pipeline is estimated to cost 350 million dollars. (AFP)

by Uzi Mahnaimi, Taba, Egypt
Sunday Times, 28th January

SADDAM HUSSEIN'S youngest son, Qusay, visited Syria earlier this month to
discuss military co-operation in the event of a war with Israel,
intelligence officers in Tel Aviv have warned.

The Syrian army is also said to have redeployed anti-missile batteries,
despite a message of peace conveyed to Damascus on Israel's behalf by Martin
Indyk, the American ambassador to Israel.

News of a growing rapprochement between Syria and Iraq came as it was
announced yesterday that Yasser Arafat, the Palestinian leader, would meet
Ehud Barak, Israel's prime minister, in Stockholm on Tuesday or Wednesday.
The talks amount to a last-ditch attempt to conclude a peace agreement
before Israeli elections nine days away.


One remaining option may be to precipitate a crisis that would allow him to
use the military. It is a scenario the Syrians and Iraqis have anticipated.
"There is definitely a closer relationship between Baghdad and Damascus,"
said Dr Ofra Bengio, of Tel Aviv University.

She and other observers believe co-operation between the armies has reached
a level that has not been seen since the 1973 war, when Iraqi divisions were
sent to assist the Syrians. Qusay and his Syrian counterparts are said to
have agreed to set up a joint command and control centre, with two Iraqi
armoured divisions - the Republican Guards and the 10th Armoured Division -
primed to cross into Syria should the Israelis attack across the Golan


Times of India, 28th January

BAGHDAD: Iraq called on all Arab countries to enter free trade agreements
with it, like the ones Baghdad recently signed with Egypt and is to conclude
soon with Syria.

"We welcome, without exception, all Arab countries entering the free trade
accord signed between Iraq and Egypt and which will be concluded between
Iraq and Syria," Commerce Minister Mohammed Mehdi Saleh told the Qatari
satellite television network al-Jazeera.

"I think that countries like Jordan, Lebanon and the United Arab Emirates
will join this agreement," he added.

The Egyptian-Iraqi agreement, signed January 18 during a visit by Iraqi Vice
President Taha Yassin Ramadan to Cairo, calls for an end to all customs
barriers between the two countries.

Saleh said Ramadan would lead a delegation next week to sign a similar
agreement in Damascus.

The signing of such agreements was seen as a further sign of the erosion of
the strict UN sanctions imposed on Iraq after its invasion of Kuwait in
1990. (AFP)

Arabic News, 29th January

Some 38 Iraq refugees returned back last week to their country in the
framework of the voluntary return back program supervised by the UNHCR for
the Iraqi refugees affairs in Saudi Arabia.

The Saudi daily al-Watan said on Sunday quoting well-informed sources at the
UNHCR that a sum of 380,000 Saudi riyals, of 10,000 riyals for each Iraqi
refugees who decided to return back to Iraq.

At the meantime some 5273 Iraqi refugees so far remained in North Saudi
Arabia out of 30,000 Iraqi refugees who entered Saudi Arabia during the Gulf

Dawn, 30th January

RIYADH, Jan 29: During the visit of Egyptian President Hosni Mubarak to
Riyadh earlier this week, the two sides discussed an Iraqi offer for
reconciliation with Saudi Arabia and Kuwait, the influential Arabic daily
Asharq Al-Awsat said on Monday.

Egyptian President Hosni Mubarak was carrying an Iraqi offer, to bring the
views of Baghdad, Riyadh and Kuwait closer, sources were quoted here as

Saudi Interior Minister while talking to reporters did not deny the report
but said the leaders must have discussed the Iraqi issue. "It was an open
discussion and must have covered all Arab issues. Iraq is part of the Arab
world and they must have discussed the Iraqi situation," he said when asked
about Egyptian mediation for a possible Saudi-Iraqi rapprochement.

The reconciliation offer was first made by Iraq's first Vice President Taha
Yasin Ramadan when he visited Cairo recently. The Iraqi leader had
apparently requested Cairo to play a role in narrowing the differences
between the two Gulf states and Iraq, it was reported here.

The Saudi response to the mediation effort was not no known. However, Prince
Naif was quoted as saying that the meeting between the Egyptian President
and the Saudi leadership would have tremendous impact on relations at
bilateral and Arab levels.

No official statement was made about the subjects discussed between the
leaders during their meeting. But informed sources said the visit was also
aimed at coordination between the two countries ahead of the next Arab
summit scheduled to be held in Amman in March.

The United Arab Emirates was also reported trying to bring about a
reapproachment between Iraq and its Gulf neighbours, Saudi Arabia and

[..... the continuation of this article is in the Iraqi relations with
theUS/UK section .....],1113,2-10-35_973127,00.html

News 24 (South Africa), 30th January

Baghdad - Iraq's heavy artillery is ready and awaiting orders from President
Saddam Hussein to start bombarding Israel, the artillery corps chief warned
on Tuesday.

"Iraq's heavy artillery is totally ready to carry out at any moment the
orders of the president and bombard the positions of the Zionist enemy,"
General Yassin Taha Mohammad told the weekly Al-Rafidain newspaper.

"Units of the Iraqi artillery have the necessary equipment to control the
firepower, and artillery cannons have been modernised and their range
extended to more than 40 kilometres," the general said.

"The modernisation has focused on the need to hit enemy targets," he added.
"Despite the embargo (imposed on Iraq after its 1990 invasion of Kuwait),
Iraqi artillery pieces have been modernised to reach objectives accurately."

In support of the Palestinians, Saddam threatened on the January 17
anniversary of the 1991 Gulf War over Kuwait to bombard Israel every day for
six months.

"Could Israel resist uninterrupted artillery shelling for six months?"
Saddam asked. Baghdad alone could carry out the barrage, "even if the Arabs
just encourage Iraq saying, 'We support you'".

Despite the general's eagerness, Israel is way out of reach of his guns in
Iraq, and even of his missiles, whose range post-war UN resolutions limit to
150 kilometres, putting Israel out of range.

During the Gulf conflict, Iraq launched 39 Scud missiles at Israel, killing
at least one person and wounding hundreds of others, as well as causing
serious damage.- Sapa-AFP

UPI, Wed 31 Jan 2001

Jordan's foreign minister Wednesday said it was time for the United States
to change its policy toward Iraq. Speaking at the Center for Strategic and
International Studies, Abdel Eleh Khatib said, "We must change the sanctions
regime against Iraq with a view to lifting all measures that hurt Iraqi
civilians." He was speaking after a meeting with Secretary of State Colin
Powell. Khatib said there was "growing trade between all countries in the
region and Iraq, growing anger in Arab public opinions, and growing pressure
to ignore them."

He said he was "alarmed by the impact of sanctions on the Iraqi civilian
population." Khatib said it was "important to distinguish between the need
to contain Iraq's capability of producing weapons of mass destruction and
threaten its Gulf neighbors and sanctions that only hurt Iraqi civilians,
especially in the fields of education and health." The foreign minister told
the audience this was the consensus at recent Arab and Islamic summit

As for WMDs, he said Iraq was not alone with such ambitions in the region.
"I am not only referring to Israel's capability," he said. "There are
others." A recent CSIS study said Algeria, Libya, Sudan, Egypt, Syria, Iran
and Iraq are also developing WMDs.

Arabic News, 1st February

Well-informed Jordanian economic sources said that Iraq has put several
conditions for setting up a free trade zone with Jordan.

The Jordanian sources explained that among these conditions laying trade
restrictions that prevent the entry of production of factories in which an
Israeli capital takes part.

Baghdad also asked for the lists of names of Jordanian companies and
investors and others who are establishing relations with Israel.

Baghdad also called for returning back the Iraqi planes existed at the
International airport of Queen Alia since 1990 after making necessary
maintenance for them at the expense of the Iraqi government.

The sources added also among the conditions is to cancel the inspection role
played by Lloyds company at al-Aqaba port. This step was earlier implemented
by the Jordanian government two months ago.

Arabic News, 1st February

Well-informed sources said that Eritrea and Iraq have reached a final
agreement which prepares for the establishment of bilateral diplomatic
representation. The sources added that according to this agreement Iraq will
open an embassy in Eritrea within two months.

The source continued that the engineer of this agreement is the chairman of
the Middle East department at Eritrea's foreign ministry Hamid Hamad who
presided over the Eritrea's negotiation team to restoring back the Sudanese-
Eritrean relations to what they had been before.

Hamad had met with the Iraqi foreign minister Muhammad Saeed al-Sahaf and
the two sides reached an agreement according to which an Iraqi embassy will
be opened in Asmara, whereas supervising the interests of Iraq in Eritrea
was assigned to the Iraqi embassy in Sanaa until arrangements are completed
to open the new embassy.

Times of India, 1st January

JAKARTA, Indonesia: Indonesia on Wednesday called for the lifting of
international sanctions on Iraq and said it would look for closer ties with
the Arab state.

"The president supports the lifting of the economic sanctions on Iraq
because they have not had a positive impact on the people there," Foreign
Minister Alwi Shihab said.

In the past, head of state Abdurrahman Wahid has expressed his support for
the easing of the U.N embargo, which was imposed shortly after Iraqi leader
Saddam Hussein invaded Kuwait in 1990.

Wahid canceled a planned trip to Baghdad last year after U.S pressure not to
go. His pro Iraqi stance has angered Washington, which is seeking to
maintain the country's isolation.

U.N. sanctions against Iraq can only be lifted once international weapons
inspectors certify that Iraq's biological, chemical and nuclear weapons and
the missiles used to deliver them have been destroyed.

Critics blame the sanctions for Iraq's economic decline and an increase in
malnutrition, disease and deaths, especially among children.

Speaking to reporters after a meeting between Wahid and the Iraqi Foreign
Minister Mohammed Saeed al-Sahhaf, Shihab said an Indonesian delegation
would visit Baghdad on Feb. 24.

Shihab said he hoped Indonesian Trade and Industry Minister Luhut Binsar
Panjaitan would be present to "look at other possibilities of increased

Shihab quoted Wahid as saying that if Iraq can resolve its problems with its
neighbors then he would encourage Indonesian business people to visit the
country. (AP)


WASHINGTON (Reuters, 2nd February) - The United States said on Friday that
it regretted the return of a Turkish ambassador to Iraq but hoped that
Turkey would take the occasion to tell Iraq to ``live up to its

New Turkish ambassador Mehmet Akad presented his credentials in Baghdad on
Jan. 19, upgrading the level of diplomatic relations between the two
countries after about 10 years below ambassadorial level.

State Department spokesman Richard Boucher said: ``We don't think it's a
good idea to send envoys of that level to Baghdad and we regret that the
Turkish government has decided to do this.''

``At the same time, we think it's very important for people to be telling
Iraq to live up to its obligations to the international community, and we
would hope that the Turks would take this opportunity to make that point to
Iraq,'' he added.

Turkey and the United States are NATO  allies, and it is from a Turkish air
base that U.S. warplanes patrol northern Iraq to deter any attempt by the
Baghdad government to attack the Kurds in the autonomous northern region.

But Turkey complains that it does not receive adequate compensation for
economic losses arising from U.N. sanctions against Iraq. Iraq was Turkey's
top crude oil supplier and third largest trading partner before the Gulf War
in 1991.

*  Saddam's enemy is not the American President, the British Prime Minister
or Kuwait, but Time.
by Dr Ghazi Al Gosaibi.
Ain al Yaqeen "Asharq Al Awsat", 2nd February
[A curiosity in which the Ambassador of the Kingdom of Saudi Arabia to the
United Kingdom and Ireland appears to be reproaching Iraq for not allowing
equality between men and women, full freedom of the press, democratic
accountability of the government and access to the benefits of the Internet
and of genetic engineering]

OIL SUPPLY Russian energy minister
flies to Baghdad


MOSCOW, Jan. 29 (UPI) -- Russian Energy Minister Alexander Gavrin flew to
Baghdad Monday for talks with Iraqi officials on boosting oil cooperation.

Gavrin, who heads a large delegation of officials and businessmen, said he
expected to hold extensive talks with Iraqi Oil Minister Amir Rasheed.

Subjects on the talks agenda include development of the West Qurna oilfield
in southern Iraq by Russian companies.

Officials in Moscow told United Press International that Russia oil
heavyweight LUKoil has sent its vice president, Ravil Maganov, to Baghdad,
and that representatives of state-owned Zarubezhneft and Mashinoimport
companies were also accompanying Gavrin.

In 1997, LUKoil signed a $3.5 billion contract with Iraq to develop West
Qurna, a field holding reserves of almost 8 billion barrels of crude.

But LUKoil has been unable to begin development of the field because of
international sanctions imposed against Baghdad by the United Nations
following Iraq's invasion of Kuwait in 1990.

Moscow has repeatedly pushed for the lifting of sanctions by the United

Russia would like to resume trade with Iraq as soon as possible, and is
particularly interested in Iraq's economic recovery as Baghdad still owes
Moscow some $8 billion for past military supplies, and has offered to repay
the debt in trade.

Russia has already tested the U.N. commitment to the air embargo against
Iraq, sending dozens of flights to Baghdad's newly reopened Saddam
International Airport.


BAGHDAD, Jan 29 (Reuters) - Russia has presented Iraq with a shortlist of
companies to lift Iraqi crude oil during the current ninth phase of the
United Nations oil-for-food deal, Russian Energy Minister Alexandre Gavrin
told Reuters.

"We submitted our proposals for oil contracts through diplomatic channels,"
Gavrin said. "We are recommending that the Iraqi oil ministry deal with
certain companies put forward by our ministry."

Russian companies have accounted for the lion's share of Iraqi oil contract
volume during previous phases of the U.N. oil-for-food programme. But nearly
two months into this six month tranche, Russia has so far negotiated little

A source close to Russian oil producer Zarubezhneft, previously one of the
biggest volume lifters of Iraqi barrels, told Reuters that Zarubezhneft
would not sign an Iraqi oil contract while Baghdad continued to demand a
surcharge payment above its official selling price be paid outside U.N.

That condition has stopped other major companies from Europe and the Far
East from signing direct contracts with Iraq.

But the Russian Energy Minister said the final decision over oil contracts
signed with his country and Iraq would come down to bilateral relations
between individual companies and the Iraqi ministry of oil.

"Our recommendations are based on the history of the companies' involvement
in Iraq and their level of responsibility in implementing previous
contracts," Gavrin said. "The Russian Ministry of Energy has finished its

Moscow has asked for slightly less volume than in the previous six-month
phase of the U.N. oil-for-food deal, but Gavrin declined to state the
specific amount.

The Russian energy minister was speaking just ahead of a meeting with Iraqi
Oil Minister Amir Mohammed Rasheed and other senior Iraqi oil officials.

CNN, February 1, 2001

BAGHDAD, Iraq (Reuters) -- Iraq has devised new challenges to a decade-old
United Nations sanctions regime in a bid to regain direct control over even
a fraction of its oil export revenues, industry sources said on Thursday.

Baghdad's efforts since November to get oil lifters to pay a fee outside the
U.N.'s control has been the most overt means of trying to claw back some

But Iraq has also discovered more subtle ways of nibbling away 10-year-old
Gulf War sanctions.

Over the past few weeks, Baghdad has been working through diplomatic
channels -- contacting all foreign representatives here and requesting that
their countries ask the United Nations to apply Article 50, sources in
Baghdad said.

Article 50 of the U.N. charter says any country "confronted with special
economic problems" due to U.N. sanctions has the "right to consult the
Security Council with regard to a solution."

Oil sales revenues under Article 50, so far only in effect for neighboring
Jordan, go direct to Iraq rather than to the United Nations escrow account
that holds oil-for-food proceeds.

Russia so far is the only country to have met the Iraqi request, the
industry sources said.

"But if other countries start responding, then Iraq will have found yet
another means of provocation," said an analyst in Baghdad.


Iraq's efforts do not stop there. Iraqi ministries, including oil, have been
attempting to collect 10 percent from import contracts under the
U.N.-authorized oil-for-food deal, according to sources in Baghdad.

The fee surfaced at precisely the same time as Iraq's late-November
surcharge request to oil lifters.

Whereas many companies have balked at meeting Baghdad's oil surcharge
request, the authorities may have had some success on the import contract
side, analysts said.

Iraq's Trade Minister Mohammed Mehdi Saleh said recently that companies were
paying a small percentage directly to Iraq, with the knowledge of the United
Nations, to cover local expenses.

"This effort has been more covert than the oil surcharge and companies might
be more willing to engage," said a source in the Iraqi capital. "They're
just refunding some of Iraq's own money."

A U.N. official said the United Nations has received reports from importing
companies that Iraq is requesting payments but the U.N cannot act on it
unless firms formally bring the issue to the attention of the Iraq sanctions

"The companies are reluctant to formally bring it to the attention of their
governments because they risk forfeiting future contracts," the official

Iraqi officials have harshly criticized what they view as the trickle down
effect of the oil-for food scheme, which lets Iraq sell unlimited amounts of
oil under U.N. control in exchange for food, medicine and other humanitarian

The Iraqi trade minister said recently that Baghdad had sold oil worth $40
billion in the past four years within the oil-for- food programme, but had
received goods worth only $9.6 billion.

And having signed U.N.-authorized oil spare parts contracts worth nearly $2
billion, Iraq so far has received only $500 million worth of gear, industry
sources said.


Iraq has meanwhile eased its oil surcharge demand considerably from an
initial 50 cents per barrel over the official selling price, but the Iraqi
government is by no means backing down from its policy.

Indeed, industry sources said Iraq has softened its cash request in a bid to
reflect market conditions.

"Retroactive to December 1, lifters to Europe must pay 25 cents a barrel and
lifters to the United States must pay 30 cents per barrel," said an official
in the Iraqi capital. "Some customers have paid the 40 cents and they will
be reimbursed the difference."

Despite Iraq's apparent moves at market responsiveness, some of Iraq's
steadfast customers have refused to cough up the fee in what they regard as
a clear violation of sanctions.

"The Iraqi oil ministry knows some European companies are having trouble
with this condition," an Iraqi analyst said.

Some companies now lifting Iraqi crude oil have escaped the cash payment,
but are repaying the Iraqi oil ministry by offering technical and other
services, the analyst said.

The reluctance of some firms to purchase Iraqi barrels has left export sales
patchy since December, when Baghdad's cash demand surfaced.

During November Iraqi oil sales were running at about 2.3 million barrels
daily. Exports via the U.N. have averaged less than a million barrels a day
since December.

Those exports are topped up by unauthorized sales, where revenues go direct
to Baghdad, to Syria by pipeline of about 100,000 bpd and additional volumes
trucked over the border to Turkey, international oil traders say.

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