The UN "Oil-for-Food" program was launched in 1996 in a bid to alleviate the genocidal sanctions imposed on Iraq after the 1991 Gulf War. On 29 September this year, the Executive Director of the UN Office of the Iraq Programme (OIP), Benon Sevan said that the terrorist bombing of UN headquarters in Baghdad, the resulting reduction in international staff and tardy action by the US-run Coalition Provisional Authority (CPA) dealt a "major blow" to Sevan's timetable for ending the Oil-for-Food programme that fed most Iraqis during Saddam Hussein's regime. In his progress report to the Security Council, Sevan said that "Despite the enormity of the tasks involved, the United Nations remained confident, subject to security conditions, of meeting the challenge for an orderly termination of the programme by 21 November". He warned that without much speedier action by the CPA, difficulties could become insurmountable.
The UN Oil-for-Food programme was to be phased out by 21 November and transferred to the CPA under Security Council resolution 1483 of last May. "After a very slow start, the CPA has finally taken steps to increase its staff capacity for the transfer process," Mr. Sevan reports. "Regrettably, however, CPA's efforts coincide with the heightened insecurity and drastic reduction in the number of UN international staff in the three northern governorates." The UN Steering Group on Iraq earlier in Spetember authorized the minimum number of 115 UN international staff required for the transfer, but Sevan said "However, unless CPA increases most expeditiously the number of its personnel involved in the transfer process, the difficulties faced there may become insurmountable irrespective of the number of UN personnel in the three northern governorates". Just prior to the US invasion of Iraq, the UN Security Council had adopted a resolution to allow the resumption of humanitarian aid for Iraq through its existing "oil-for-food" scheme, which would run for 45 days under the resolution. At that time, about 60 percent of the Iraqi population of 22 million depended on the "oil-for-food" program for daily supplies. The program had been suspended on March 18. The resolution was promptly rejected thereafter by Baathist Information Minister Mohammed Said al-Sahhaf on the ground that "Only Iraq can administer this program". An international consortium of financial institutions led by J.P. Morgan Chase & Co. has been aiming to run a Trade Bank of Iraq enabling the Iraqi government make large purchases from other countries, the creative policy idea being, as a spokesman said, to run "a commercial type of program''. The contract for the international consortium of banks has been projected to last a year with a renewal option for another two years, paid for by Iraqi revenue from oil or "other financial assets". The trade bank's employees and its top executive are projected to be Iraqis who receive training and guidance from J.P. Morgan Chase and the consortium. Initially, a total of 13 banks were included in the consortium, namely J.P. Morgan Chase, Australia and New Zealand Banking Group, Melbourne, Australia; Standard Chartered PLC, London; National Bank of Kuwait SAK, Safat, Kuwait; Bank Millennium SA, Warszawa, Poland; Bank of Tokyo-Mitsubishi Ltd., Tokyo; San Paolo IMI S.p.A, Turin, Italy; Royal Bank of Canada, Toronto; Credit Lyonnais, Paris; Caja De Ahorros Y Pensiones De Barcelona, Barcelona, Spain; Standard Bank Group Limited, Johannesburg, South Africa; and Banco Comercial Portuges, Lisbon, Portugal. Later, however, it was reported that five groups led by U.S. banks, including Bank of America Corp., Wachovia Corp., Bank One Corp., Citigroup Inc. and J.P. Morgan Chase & Co. were on the list of finalists to manage the new Trade Bank of Iraq Wachovia leads the largest group with about two dozen member banks. The bank could command some $500 million a month, at least if Iraq's oil industry recovered. Joseph Stiglitz commented recently that "The problem is that Iraq today is encumbered by huge debts - with estimates totaling anywhere from $60 billion to the hundreds of billions, which includes reparations imposed on the country after the 1991 Gulf War, earlier debts incurred because of ammunition purchases, and obligations assumed under contracts signed during Saddam Hussein's regime. As Iraq's oil starts to flow again, much of the revenue it generates may go directly into the hands of international creditors, greatly impeding reconstruction efforts. Iraq needs a fresh start, and the only real way to give it one would be to free the country from what some call its "odious debts" - debts incurred by a regime without political legitimacy, from creditors who should have known better, with the monies often spent to oppress the very people who are then asked to repay the debts. Most of Iraq's current debt was incurred by a ruthless and corrupt government long recognized as such - although complicating the matter is the fact that the Iraqi regime appears to have received some support from the United States under Ronald Reagan. Debt relief in Iraq will not be simple." He further commented: "The United States is slowly learning the costs of unilateralism." See http://www.odiousdebts.org/odiousdebts/index.cfm?DSP=content&ContentID=8577 Jurriaan
