By By Jo Bonner U.S. House of Representatives
A great deal of media attention in recent weeks has been focused on the controversy surrounding the administration of the United Nations oil-for-food program. As more and more information has been revealed regarding the tremendous lack of oversight and the flaws in the administration of the program, the calls for UN Secretary General Kofi Annan's resignation have increased.
The highest profile calls for Annan's departure have come from two members of the United States Senate, Norm Coleman (R-MN) and Carl Levin (D-MI). In letters to the secretary general and in an opinion piece written by Senator Coleman and published in the Wall Street Journal, the two have said that Annan's resignation is required because the extraordinary abuses of the oil-for-food program occurred during his watch.
The oil-for-food program has been in existence for 14 years, having been fully implemented following the conclusion of the Gulf War in 1990. To fully understand the circumstances involved in the current controversy, some background on the program and its function might be helpful.
Background of the program
The oil-for-food program was created by the UN Security Council in 1990 as a limited exception to the embargoes placed on Iraq one week after that nation's invasion of Kuwait. The program was designed to allow the Iraqi government to sell oil to approved overseas buyers in exchange for financial compensation that would be used to purchase goods and humanitarian supplies for the general Iraqi population.
The initial limit on the amount of oil which could be sold within any six-month period by Iraq was originally set at $1.6 billion, but over the next eight years that ceiling was increased to $5.256 billion. Ultimately, a resolution passed by the Security Council in 1999 eliminated the sale ceiling entirely.
Contracts for the sale of oil by the Iraqi State Oil Marketing Organization (SOMO) were monitored by a panel of contract overseers reporting directly to the UN Sanctions Committee. The proceeds from the sale of this oil were distributed into an escrow account maintained at the Banquet Nationale de Paris and monitored by the UN. Once the sale contracts were approved by the UN, the money was released to pay for the goods and services purchased by approved suppliers for distribution to the Iraqi people.
The supplies entering Iraq were inspected and monitored at several entry points by the Swiss firm Cotecno. Once in country, the distribution of the supplies to the general population was monitored by 158 workers from the World Food Program, the Food and Agriculture Organization, the World Health Organization, and UNICEF.
Of the money collected from the sale of oil, 59 percent was used to purchase goods for Baghdad-controlled Iraq, and 13 percent was used to purchase supplies for the three provinces in northern Iraq controlled by the Kurds. 25 percent was intended to be used for reparations payments to the victims of Iraq's invasion of Kuwait. Three percent was used to cover the program's administrative costs, and 1 percent was used to reimburse UN member nations which had provided funding to an earlier escrow account.
In theory, the program could have provided tremendous benefits for the Iraqi population at a time when they were suffering as a result of the international sanctions placed on their homeland. Unfortunately, the actual implementation of the program proved to be less than beneficial.
Fraud and corruption
At the present time, there are no fewer than six ongoing investigations into the oil-for-food program, including one by the Senate Permanent Committee on Investigations chaired by Senator Coleman. These investigations have exposed growing levels of corruption.
In the first instance, it is becoming apparent that Saddam Hussein himself benefited more from the sale of Iraqi oil than did the people the program was intended to help. Current estimates indicate that Hussein siphoned off $6.7 billion in revenues from the sale of oil, and earned an additional $13.7 billion in the illegal smuggling of oil in violation of the international sanctions.
Additionally, Saddam used part of these proceeds to bribe UN officials, journalists, and other foreign officials to "turn the other way while the Iraqi government circumvented the UN sanctions. In many cases, as the mounting evidence shows, representatives of such nations as France and Russia were fully aware of Hussein's activities and in some instances provided support. It has even been reported that Benon Savan, the former director of the UN oil-for-food program, received direct kickbacks from Hussein.
Additionally, Kojo Annan the son of the UN secretary general, was employed by Conetco until 1997, and yet continued to receive payments amounting to several thousand dollars each month from this program until earlier this year.
Finally, while Secretary General Annan has established his own investigation of the oil-for-food scandal headed by former Federal Reserve Chairman Paul Volcker, he has been extremely reluctant to allow any individuals or agency directors associated with the program to provide testimony or documentation to the Senate committee. In fact, the final report submitted at the end of Volcker's investigation must be submitted directly to Annan, and he alone has the discretion to determine what if any parts of it are released to the public.
This is indeed a troubling time for the UN, and it is unfortunate that a program designed to provide help for the oppressed people of Iraq has apparently done little more than make several individuals very wealthy. There will certainly be more on this in the time ahead, and undoubtedly other abuses of this program will be made public.
My staff and I work for the people of south Alabama. Let us know when we can be of service.
Jo Bonner respresents the First District of Alabama, which includes Escambia County, in the U.S. House of Representatives.