The New "Smart" Sanctions on Iraq

A Commentary

June 8, 2001
HTML version prepared by CASI, 3 July 2001

by Dale Hildebrand

Director, Inter-Church Action


A new U.S. - British plan is proposing to overhaul the comprehensive sanctions that have been imposed on Iraq for nearly 11 years. Couched in the language of "smart" sanctions, the main change in the new proposal is to draw up a list of prohibited military items or items that have "dual use" (military and civilian use), instead of the current process in which imports are allowed into the country only if they are on a list of permissible goods. Proponents of the smart sanctions argue that this plan will increase the flow of goods into Iraq to help the general civilian population, while tightening controls on any import that could be used for military purposes. A key component of the new proposal is the retention of the UN escrow account into which all money from Iraqi oil sales is channelled.

This proposal requires careful analysis by those who have opposed the sanctions on humanitarian grounds. Some critics of the sanctions have called for a lifting of the economic sanctions while maintaining military sanctions on Iraq. Others have called for the complete removal of all UN sanctions against the country. In fact, the proponents of the new proposal, which include the U.S., Britain, and Canada, are positioning this proposal as ending economic sanctions while focussing more exclusively on military sanctions. The debates about the possibility of separating military from economic sanctions may therefore be tested if this proposal moves forward.

Inter-Church Action’s (ICA) own policy paper on Iraq issued in December 1999 argued that "military sanctions prohibiting the importation of military equipment to Iraq should remain in place until international human rights organizations have documented an end to major human rights abuses in Iraq." This is consistent with past calls from the Canadian churches to restrict military exports to those countries that are at war or have poor human rights records. As an important point of clarification, the ICA support for military sanctions against Iraq is disassociated from the rationale explicit in the UN sanctions which are related to the elimination of Iraq’s weapons of mass destruction and compensation to countries affected by Iraq’s invasion of Kuwait.

This disassociation is due to the fact that the UN itself makes no distinction between military and economic sanctions in its Security Council Resolutions of 661 and 687. The goals of eliminating Iraq’s weapons of mass destruction and long range missiles have been largely achieved, while 100% verification of their destruction is impossible and has become a rationale to retain sanctions against Iraq in perpetuity. The UN Compensation Commission has been discredited in terms of the highly irregular processing of claims where the Commission acts as both judge and jury, not to mention the impossibility of Iraq ever paying off the war reparations claims, which by October 2000 totalled US $320 billion. In summary, ICA supports the complete ending of the UN sanctions regime but calls for military sanctions against Iraq for different reasons related to human rights abuses (which are not mentioned in any of the UN Security Council resolutions relating to Iraq).

What is the motivation behind the "smart" sanctions?

It is important in any analysis of the proposed changes to the sanctions to examine their motivation since this may also reveal insights into how they might be implemented and what their effect may be. Since December 1998, when weapons inspectors were withdrawn from Iraq followed by intensive U.S. - U.K. bombing, support for the sanctions against Iraq, particularly from the so-called frontline Arab states, has steadily declined. The result has been an increase in trade that circumvents the UN sanctions, including Iraqi exports of oil to Syria, Jordan, and Turkey that have increased the Iraqi government’s access to cash not controlled by the UN escrow account. Jordan and other countries have relaxed border controls and have voiced support for a total elimination of the sanctions.

Increased opposition to the sanctions has been spawned mainly by a growing realization of their humanitarian impact. Sanctions proponents have been mostly unsuccessful in their attempts to pin the blame for suffering Iraqi civilians on the government of Saddam Hussein. The smart sanctions proposal is therefore largely an attempt to shift public opinion away from blaming the sanctions for the humanitarian crisis in Iraq. The motivation for the proposed policy change is best summed up in the words of one U.S. official tasked with selling it: "In reality," he said, "this is a change in perceptions. Most people think Iraqis are starving because the evil west is keeping medicines away...we’re taking the tool of sanctions as propaganda away from Saddam." Likewise Colin Powell, in recent comments to the Senate House International Relations Committee, boasted that by floating the new smart sanctions proposals, "we stopped the talking about Iraqi children, and instead are talking about weapons of mass destruction." There is no recognition that the humanitarian crisis has been real, only that the U.S. has a public relations problem to address.

If the primary purpose of the smart sanctions is to manage perceptions and regain support for containment of Iraq, they are unlikely to be designed to seriously address the root causes of the precipitous decline in living standards in Iraq since the imposition of the sanctions in 1990.

What would change?

Nevertheless, aside from the objectives behind the new proposals, they must also be examined based on their potential to end the suffering of Iraqis and restore Iraq’s standard of living to pre-sanctions levels. The key to this happening is acknowledged in the UN’s own report from a panel tasked to examine the humanitarian needs in Iraq. It stated in 1999 that the crisis in Iraq would continue to be dire "in the absence of a sustained revival of the Iraqi economy." The new proposals fail to address this fundamental need for reasons explained below.

The current proposals would allow a broader range of goods into the country, although the extent of the increase is dependent upon details not yet released. It has been reported that some lists of prohibited goods have been drawn up. One report referred to a 23 page list of items but as only one of four categories of proposed banned goods. The list of explicit military hardware such as tanks and guns is likely to be uncontentious but key to the new proposals is the continued ban on so-called "dual use" goods. In the early days of the sanctions, dual use items included everything from baking soda to truck tires. What will be the criteria employed for dual use? Will the list be open to interpretation and contain imprecise lines such as, for example, "any good that might be used for chemical weapons", which would again allow hardliners on the 661 sanctions committee to continue to ban a wide range of goods at their own discretion?

Some critics argue that in modern economies, it is extremely difficult to separate goods that can be used in a military capacity from those that have a purely civilian purpose. For example, computer technology is now an essential component of an economy but it is also indispensable to a modern military capacity. An American official involved in drawing up the new lists of banned items said that the new plan is designed to prevent Iraq from acquiring weapons of mass destruction, missiles, and the technologies to build them.

The latter emphasis is important because in effect, preventing military capacity from developing requires the widespread suppression of whole industrial sectors, such as chemical and mechanical engineering, biotechnology, and others. Many researchers, professionals, and technicians in western countries move easily between the private sector and military contractors because their skills can be employed equally for civilian and military uses. Thus the concept of dual use, when applied not only to specific physical goods but also to capabilities and technologies, can quickly become a pretext for blocking development of large segments of the civilian economy. Depending on how dual use is defined, Iraq may be in little better shape under the new proposals in terms of rebuilding its economy than under the existing sanctions regime. The London based International Institute for Strategic Studies estimates that up to 85% of civilian goods are already allowed into the country under the existing sanctions. This underscores that there are other key factors contributing to the malaise of the Iraqi economy.

Indeed, one of the main flaws in the Oil-for-Food program and much of the thinking about restoring the health of the population of Iraq is the idea that an increased flow of goods into the country can solve the problem. In reality, there are several elements of economic life without which a modern economy cannot function properly. The smart sanctions still prohibit foreign investment and the granting of trade credits to Iraq. As an example of the importance of the latter, one need only look at Peru which in 1973 declared a moratorium on its foreign debt payments resulting in the cutting off of all credit to the country. The economy nosedived and poverty increased dramatically.

The new proposals do not allow Iraq to resume normal exports. While it is true that Iraq’s main export is oil, there are other components to Iraq’s export economy that have been devastated as a result of the sanctions. Before 1990, Iraq was the largest exporter of dates in the world. Thousands of workers once employed by this industry are now unemployed and a large percentage of the date palms have been neglected given the lack of export markets. Even from a disarmament perspective, there is no reason to limit Iraq’s exports and these restrictions should be abolished.

Sanctions have blocked most rebuilding of the country’s civilian infrastructure destroyed in 1991 and damage to the electrical, sanitation, transportation and communication sectors is estimated at $200 billion. Without huge re-investment and normal trade relations, Iraq will not be able to generate the level of economic activity needed to restore employment levels and reduce hyper-inflation, both factors that have made daily life extremely tenuous for the Iraqi people.

Even The Economist, no bastion of radical thinking, calls the British proposal "an aspirin where surgery is called for." It goes on to say that to rebuild Iraq’s infrastructure and make a complete recovery from the past 11 years, "Iraq needs the freedom, and overseas investment, of a huge reconstruction effort."

The escrow account

The maintenance of the UN escrow account into which all oil revenues must be deposited has been a key tool to contain and control Iraq’s economy. Regardless of the criteria in place to have goods approved for import by Iraq, the bottom line is that representatives on the sanctions committee can block any purchase by Iraq at any time. Nearly all the holds on contracts to be paid by the escrow account have been instigated by the U.S. or Britain, highlighting those countries’ role in continuing a long history of colonialism related to its strategic resource of oil.

The retention of the escrow account signals continued delays and bureaucratic red tape that will hamper the functioning of the economy. Furthermore, up to 30% of all revenues (currently 25%) will be diverted to pay for UN salaries and more compensation claims, an amount of money that Iraq can ill afford to pay given the massive needs of the country. In fact, U.S. officials have also warned they will use Iraq’s oil money to pay compensation to Iraq’s neighbours who currently are heavily reliant on cheap Iraqi oil, should Iraq decide to retaliate against those who cooperate with a new sanctions regime, as it has threatened to do. Such a concept amounts to theft, given that the funds arise solely from Iraq’s own national resources. Amidst all the tools at its disposal, the escrow account is the lynchpin allowing Iraq’s opponents complete control over the country’s economy. Unfortunately, it is also a major obstacle in allowing Iraq to reestablish some semblance of normal economic life. The escrow account must be abolished.

Moving the goalposts again

One of the characteristics of the past 11 years of sanctions developments has been the shifting and changing of objectives in Iraq. Some of these have been clearly outside of the UN framework, such as past U.S, assertions that sanctions will exist until Saddam Hussein is deposed from power. "Regime change" was never a part of the UN sanctions objectives. Controlling Iraqi air power through the no-fly zones is another example of non-UN objectives, despite U.S. claims that existing resolutions authorize the zones.

Resolution 1284 was another example of moving goalposts where Iraqi compliance with weapons inspections, as stipulated in the original UN resolutions, would now be rewarded with a suspension of sanctions, rather than their elimination. The new smart sanctions proposals may introduce yet another new element if recent statements by U.S. officials are any indication. These officials now talk openly about the sanctions’ objective of preventing Iraq from rebuilding certain military capabilities. "There is consensus on the Security Council," claimed an American official on May 25th in reference to this new concept.

This is a very significant shift and throws into doubt the possibility of ever ending the sanctions. Whereas Security Council Resolution (SCR) 661 (3 April 1991) makes clear reference to the "destruction, removal, and rendering harmless" of Iraq’s prescribed weapons, and contains a clause that states the sanctions would have "no further force or effect" once this was completed, the objective of military capability prevention is open-ended and further solidifies what sanctions opponents have always feared, particularly after the "suspension" language of SCR 1284: a rationale for continuing the sanctions--in whatever modified form to make them more palatable to world opinion--indefinitely, or until the U.S. and its allies construct the kind of political regime in Iraq that will be acceptable to them.

The bottom line

The acid test for any changes to UN sanctions against Iraq is the ability to restore the health of the society and population. On the basis of UN relief agency data there is no indication that rates of acute child hunger and mortality have improved from the appalling levels recorded by UNICEF in 1999. Given the depth of the civilian catastrophe caused by sanctions, the burden of proof is on those who argue this proposal will solve the disaster. It is painfully obvious from the comments of those proposing new smart sanctions that concern for Iraq’s men, women and children is at best peripheral to their objectives and at worst, irrelevant.

Not surprisingly, given the lack of results from previous adjustments, the current smart sanctions proposals are being portrayed as a significant shift and departure from anything done so far. While the exact details have not been released to the public, the main elements of the plan are known and in this estimation, will not lead to a resolution of the problem in Iraq.

New restrictions in arms sales to Iraq must be formulated in relation to regional plans for disarmament and security for the Middle East as a whole, as well as in reference to the Iraqi government’s human rights abuses. This is not to imply that a lifting of the current sanctions will be a panacea for peace and human security for this troubled country. As indicated earlier, international pressure must be brought to bear upon the Iraqi government to comply with international human rights agreements. However, this pressure should not be led by the U.S. nor the Security Council. The former’s human rights record, particularly in its historical support for brutal dictators (General Suharto in Indonesia, Ferdinand Marcos in the Philippines, Augusto Pinochet in Chile, Rios Montt in Guatemala, Mobuto Sese Seko in Zaire, Saddam Hussein in the 1980s, to give just a short list) does not put it in a credible position to lead the campaign for human rights in Iraq.

The elimination of all weapons of mass destruction and disarmament objectives in other military weaponry are goals worthy of support, not only in Iraq but everywhere.. The fact that the U.S. has positioned itself as leading the campaign to rid Iraq of these weapons ought not to blind others to the fact that the U.S. possesses these same weapons and that its powerful military and military industry, whether used in actual conflicts involving the U.S. (Yugoslavia, 1999; Afghanistan, 1998; Sudan, 1998; Iraq, 1991-99; Panama, 1989; Libya, 1986; Grenada, 1983; Guatemala, 1967; and Cambodia, Vietnam, Laos, 1961-73 to go back just forty years), or through the provision of such weapons to countries/armed factions who have waged war on their own people or aggressive wars against other countries (El Salvador, Nicaragua contras, Peru, Colombia, Turkey, UNITA in Angola, Israel, and Indonesia, to name a few), has resulted in hundreds of thousands of deaths and untold suffering. The point is, there are many double standards and contradictions at play when it comes to arms control and defending human rights. The situation in Iraq encompasses many of these.


In conclusion, any steps which will immediately lessen the suffering of Iraqis from the sanctions should not be rejected outright. However, this analysis has led to reservations about the smart sanctions ability to address the humanitarian crisis in Iraq with any significance, especially in the long term. While the proposed changes may lead to some improvements for the people in Iraq–and when more details of the plans are released this can be better ascertained–it is apparent that they do not equate to the radical changes in policy towards Iraq that are needed to address one of the most serious humanitarian and political crises in recent history.

One final question: if these sanctions are "smarter" than those in place since 1990, why did it take the international community over a decade, during which period over a million Iraqi men, women and children died, to realize that the current sanctions are horrendously blunt, and by implication, not so smart?

Inter-Church Action (ICA) is a coalition of Canadian churches and church agencies working together for development, relief and justice in Africa, Asia-Pacific, Caribbean-Latin America, and the Middle East. Iraq has been one of the focus areas of ICA over the past several years.

This commentary reflects the views of the author and is offered as a contribution to the discussion about smart sanctions. It does not necessarily reflect the views of the member churches and is not an official policy document of Inter-Church Action. Responses and critiques are welcome.

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