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A losing campaign

Published : Mar 11, 2005 00:00 IST

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U.N. Secretary-General Kofi Annan.-DON EMMERT/AFP

U.N. Secretary-General Kofi Annan.-DON EMMERT/AFP

A U.N.-appointed panel that inquired into charges of corruption in the Oil for Food Programme for Iraq blames a few officials of the organisation but makes no mention of Secretary-General Kofi Annan, who is being targeted by the U.S.

THE interim report of the Independent Inquiry Committee that went into the $70-billion United Nations Oil for Food programme for Iraq was submitted on February 3. The three-member committee - headed by Paul A. Volcker, former Chairman of the United States Federal Reserve, it had Richard Goldstone and Mark Pieth as the other members - was appointed by U.N. Secretary-General Kofi Annan in April 2004. The committee, which inquired into allegations of corruption in the programme, is expected to submit its final report by the end of the year.

The aim of the programme, which began in 1996, was to help the long-suffering Iraqi people, who had borne the brunt of the U.S.-sponsored international sanctions against their government. It allowed Iraq to sell its oil on the world market. The contracts were vetted and approved by the U.N. The programme continued until the lifting of the international sanctions against Iraq in 2003, at the urging of its new occupying power, the U.S. More than a million Iraqis, many of them women and children, perished as a result of the draconian sanctions, which lasted more than 12 years.

Before the report was formally released, Western media carried reports that the close relatives of Kofi Annan and his immediate predecessor, Boutros Boutros-Ghali, had profited from the programme. Sections of the U.S. media aligned to the right wing spread stories about the involvement of Kojo Annan, the U.N. Secretary-General's son, in some of the programme's lucrative contracts. However, to the apparent dismay of many in the George W. Bush administration, the 240-page Interim Report made no serious charges against the U.N. Secretary-General's office and focussed mainly on the working of the U.N. Secretariat. The report criticised the role of the other state actors. It said: "The major source of external financial resources to the Iraqi regime resulted from sanctions violations from outside the programme's framework."

The report noted that the violations mainly related to the "illicit sales" of oil by the Iraqi regime to Turkey and Jordan when the programme was in operation. It speculated that kickbacks on the programme might have amounted to less than $2 billion, far less than that generated by oil smuggling, condoned by successive U.S. administrations. "United States law requires that assistance programmes to countries in violation of U.N. sanctions be ended unless continuation is determined to be in national interests. Such determinations were provided by successive United States administrations," the report said. The U.S. government looked the other way when its allies were profiting from the smuggling of Iraqi oil. The Financial Times had reported that in the late 1990s U.S. Vice-President Dick Cheney, as the chief executive officer of Halliburton, oversaw oil contracts worth $23.8 billion through two subsidiaries of the company.

The report criticised Benon Sevan, a senior U.N. official and a native of Cyprus, who ran the programme. Most of the allegations against him pertain to the handing out of lucrative contracts to certain Arab businessmen close to some West Asian governments. One of them is alleged to be a close relative of Boutros Boutros-Ghali. Boutros-Ghali has denied the allegations (see interview on page 55). Kofi Annan said that he would take disciplinary action against Sevan if he were formally charged. Sevan, who has denied the allegations, has been kept on the U.N.'s payroll on a token salary of $1 a month so that he is available for further questioning. Another U.N. official, Joseph Stephanides, former head of the U.N. sanctions branch, has been placed under suspension, pending disciplinary proceedings.

Observers have compared the U.N.'s handling of the affair with that of the Bush administration's record in dealing with far more serious allegations against its top officials. Reports in the U.S. media say that companies blacklisted by the Bill Clinton administration are now among the leading companies doing business in Iraq. In late 2004, U.S. auditors reported that the $8.8 billion the U.S.-led Coalition Provisional Authority (CPA) gave to various Iraqi Ministries was unaccounted for. The CPA managed the occupation of Iraq from April 2003 to June 2004. The auditors suggested that $500 million earned from the sale of Iraqi oil was illegally diverted to pay for the occupation.

IT is no secret that the George W. Bush administration was targeting Kofi Annan after being voted back to power in November 2004. Annan angered the Bush administration by his principled stand against the invasion of Iraq. Before and after the invasion, Annan publicly stated that the U.S. had no justification to invade Iraq and violate its sovereignty. He reiterated this belief when Bush was staving off a spirited electoral challenge from the Democratic presidential nominee, John F. Kerry. Besides, the U.S. Right, to which Bush belongs, has always considered the U.N. an impediment to the country's global aspirations.

A senior Republican Senator, Norm Coleman, wrote in The Wall Street Journal in November 2004 calling for the removal of Kofi Annan for "covering up" the mismanagement of the Oil for Food Programme. Coleman even went to the extent of claiming that a committee which he had set up was gathering evidence to prove that Saddam Hussein gave millions of dollars from the programme to "terrorists and terrorist organisations".

Kofi Annan, in an interview with the British Broadcasting Corporation (BBC) broadcast on February 13, acknowledged that "concessions" were made to Saddam Hussein to win his agreement for the programme because of international concerns that the Iraqi people would starve without it. He said that it was "a political arrangement" intended to force Saddam Hussein to comply with the harsh requirements the U.N. Security Council had demanded from Iraq. Annan reiterated that he had no plans to resign as Secretary-General.

However, commentators noted, the Oil for Food Programme was crafted by the U.S. The U.N. Security Council, dominated by the U.S., determined how the funds generated from the programme were to be disbursed. In April 2004, the General Accounting Office (GAO), the investigative agency of the U.S. Congress, charged that the government of Saddam Hussein had made $10.1 billion from the sale of smuggled oil. It conveniently forgot to add that most of the smuggled oil went to the close allies of the U.S. in the region - Jordan and Turkey, whose economies have been traditionally dependent on Iraqi oil. The U.N. multinational force mandated to stop smuggling in those days exclusively consisted of ships of the U.S.' Fifth Fleet.

It is pointed out that the U.S. did not object to any of the contracts that were signed under the programme, preferring to turn a blind eye to the rampant smuggling of oil out of Iraq. At the same time, Washington used to block routinely the export of yoghurt makers, ambulances, children's vaccines, water purification equipment and electrical generators to Iraq. Scott Ritter, the former U.N. Arms Inspector in Iraq, wrote recently: "The corruption evident in the Oil for Food Programme was real but did not originate from within the U.N., as Norm Coleman and others are charging. Its origins are in a morally corrupt policy of economic strangulation of Iraq implemented by the United States as part of an overall strategy of regime change." Ritter, who quit the inspection team Unscom in 1998, has emerged as one of the most perceptive analysts of U.S. policy in West Asia.

(This story was published in the print edition of Frontline magazine dated Mar 11, 2005.)

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