Iraq warns Arab States against toeing U.S. line

By Kesava Menon

BAGHDAD, MAY 7. In warning its neighbours that they could lose lucrative trade agreements if they played along with U.S. plans to re-cast economic sanctions, Iraq appears to have trumped Washington's moves even before they got fully underway.

Iraq believes that the U.S. move to replace the current scheme of generalised sanctions with what are referred to as ``smart sanctions'' will be cleared by the U.N. Security Council. But Baghdad has already identified the weakness in the still-to-be- crafted scheme and has zeroed in very swiftly.

Since taking over office, the U.S. Secretary of State, Gen. Colin Powell has spoken of the need to re-cast the economic sanctions that have been imposed on Iraq from the end of the 1991 Gulf War.

Over the past decade it has become abundantly clear that these sanctions have achieved little in terms of their perceived objective - the weakening of the Baghdad regime - while causing untold suffering to the Iraqi people.

The continuance of the sanctions in the existing format has become extremely problematic since international support has withered to the point of nothingness. Moreover, the Arab allies of the U.S. in the region have become extremely restless about supporting a sanctions regime that incenses the Arab masses and other global power centres are weary of arrangements that prevent them from undertaking profitable trade with Iraq.

For these reasons, among others, the U.S. administration is currently working at, and trying to draw support for a re-cast sanctions regime.

Although its details have yet to be spelt out, the initial indications are that the U.S. is working on a scheme whereby Iraq will be able to import consumer goods freely while materiel that can help sustain the regime of the Iraqi President, Mr. Saddam Hussein or strengthen it will be subjected to stricter interdiction.

Under this scheme, goods intended for export to Iraq will be permitted to be loaded only in a few selected sea and air ports worldwide and will have to be transported through one of its neighbouring countries.

U.N. inspectors or U.N.-contracted inspectors will inspect these goods at the point of despatch and during transit through the neighbouring countries.

Not much trade into Iraq is expected to pass through Iran, Kuwait or Saudi Arabia, three of Iraq's neighbours on land.

The U.S. diplomatic efforts are therefore focussed mainly on the other three, Jordan, Syria and Turkey.

These three countries are being sought to be persuaded to allow U.N. inspectors to examine Iraq-bound cargo within their territories.

Financial incentives are also being offered to these three countries to persuade them to come on board the scheme. Before this scheme for ``smart sanctions'' can come into operation, the U.S. has to get the rest of the Security Council to approve it.

Although Russia, China and France have been increasingly critical of the sanctions regime, analysts in Baghdad believe that they will approve the ``smart sanctions'' plan because it ostensibly gets rid of the anti- humanitarian aspects of the existing scheme.

Iraq does not believe that the ``smart sanctions'' plan will be any more beneficial to the vast majority of its public than the current scheme is.

The catch in the whole plan is that the ``dual use'' clause is likely to be retained and the payments for Iraqi imports will still be made through the U.N. escrow account under the new scheme as in the old.

Under the existing scheme, items that can have dual uses - which can be used for both military and civilian purposes - are not allowed to be transported to Iraq.

The dual-use provisions are most certainly going to be retained in the re-cast scheme and thus any benefits that the new scheme will bring are likely to be chimerical. (For instance, the dual- use provisions have been used to prohibit Iraq's import of pencils on the grounds that the graphite in the pencils can be also used in Iraq's weapons of mass destruction programme).

Secondly, if Iraq has to continue looking to the U.N. sanctions review committee to approve release of funds from the escrow account to pay for its purchases, the delays and difficulties will continue to persist.

Trying as it is to get rid of the sanctions regime altogether, the Iraqi Government has warned its neighbours that they will lose lucrative trade agreements if they went along with the ``smart sanctions'' plan. This is not a threat that any of Iraq's neighbours can take lightly.

As they like to say in Baghdad, Jordan's economy rides on the back of an Iraq which provides it with half of its oil requirements free of cost and the other half at 50 per cent of the world price.

Syria too gets cut price oil from Iraq which it then re-exports to great benefit. Perhaps the most sustainable way in which Turkey's troubled economy can be made to revive is if it can resume untrammelled trade with its south-eastern neighbour.

There is hardly a chance that the U.S. can offer such financial compensation as will offset the real economic losses these neighbours are likely to suffer if Iraq refuses to trade with them.

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Section  : International
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