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CORRECTION Year 2000 humanitarian revenues

a) Corrected figure for humanitarian programme revenues in 2000 - 
b) Corrected proportion of total oil revenues going to OFF 
humanitarian programme - 72 per cent.
c) In current conditions, around $13bn available for OFF every year.
d) Less than $10bn available for reconstruction of infrastructure a 
year, compared to (March 2000) estimate of $50bn - $100bn cost of 
infrastructure reconstruction.

Dear all

I made some significant errors in Part Two of my recent post. My 

(1) I made a serious error in adding up the oil revenues and therefore 
the humanitarian expenditure possible in the Year 2000.

When you go to the Basic Facts page for the UN Oil For Food 
programme, you find that revenues for Phases VII ($8,302bn) and VIII 
($9.564bn) actually add up to $17.866bn not $13.9bn as I suggested 
in Part Two of my recent posting. 

(2) The extra four billion dollars a year doesn't make as much of a 
difference to the argument as it ought to, because of a 
partially compensatory error that I also made (inadvertently). 

I wrote in the same para 15 that 79 per cent of OFF revenues goes to 
the humanitarian budget. Since the humanitarian programme in the 
Centre/South gets 59 per cent and OFF in the North gets 13 per 
cent of total revenues, the real figure should be 72 per cent (as 
Alexander Sternberg correctly stated in the post being criticised!).

(3) The Economist Intelligence Unit no longer has the 8 March 2000 
country report on public access, so the website address given in my 
post no longer exists. It may be that the report quoted is still available 
to subscribers.

A corrected paragraph 15 reads as follows:

15. On the infrastructure issue, the respected Economist Intelligence
Unit (a separate body from the Economist magazine) estimated on 8
March 2000 that ‘Once sanctions are lifted, Iraq will have to
undertake a reconstruction effort conservatively estimated at $50bn -
100bn just for essential infrastructural utilities, from a GDP base
which, even including the grey and black economies, is less than
$13bn in nominal terms.' 

Iraq's earnings from UN-monitored oil exports in the year 2000 were
$17.9bn. (See <> for Basic Figures.)

Under current procedures, 72 per cent of these revenues are made
available for humanitarian purchases (the bulk of the rest goes on
compensation for 1991 war damage claims, and a few per cent meet
UN and bank expenses). That means roughly $13bn a year for
humanitarian supplies. 

Roughly $2.62bn a year goes on food, food handling and health
nutrition. $600m a year goes on medicines and medical equipment for
the health sector, $200m on rehabilitation in the health sector.
(Figures based on the Distribution Plan agreed between the UN and
the GOI for Phase IX, the latter half of 2000.) 

Roughly $500m goes on supporting agricultural production in Iraq
including poultry production, to try to improve nutrition. Roughly
$500m a year goes on education. Another $700m or so goes on
housing. Iraq allocates $800m a year to telecommunications, which it
argues are essential to coordinating and implementing the
humanitarian programme. The UN and Iraq have agreed to make
$1.2bn every year available to the oil industry for spare parts,
rehabilitation and equipment. (Figures based on the Distribution Plan
agreed between the UN and the GOI for Phase IX, the latter half of

After immediate needs for food and health, then, there is less than
$10bn a year available for other humanitarian purposes. Some of this
must go on recurrent expenditure - on supplies for critical services
such as water purification, power generation, education, and so on,
which get used up and have to be replaced regularly. 

What is left is then available for capital investment in reconstruction. 

Compare this figure of significantly less than $10bn a year with the
figure of $50bn - $100bn needed ‘just for essential infrastructural
utilities.' There is clearly a massive gap between what oil-for-food can
provide and what is needed in Iraq just for reconstruction.


Milan Rai
Joint Coordinator, Voices in the Wilderness UK
29 Gensing Road, St Leonards on Sea East Sussex UK TN38 0HE
Phone/fax 0845 458 9571 local rate within UK
Phone/fax 44 1424 428 792 from outside UK
Pager 07623 746 462
Voices website

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