Saddam's illicit oil trade
was no secret to U.S. officials
News-Leader.com
By Ken Guggenheim
The Associated Press
Published December 13, 2004
Washington — Saddam Hussein was dead broke, the result
of U.N. penalties. Or so it was thought.
So where did he find the money to pursue missile technology
from North Korea, air defense systems from Belarus and other
prohibited military equipment?
The CIA's top weapons inspector in Iraq said Saddam carried
out much of that trade with proceeds from illegal oil sales to
Syria, one of three Iraqi neighbors that bought oil from Baghdad
in defiance of the United Nations.
Trade with Syria, Jordan and Turkey was the biggest source of
illicit funds for Saddam, more so than the much-maligned U.N.
oil-for-food program, according to investigations of Saddam's
finances.
Though considered smuggling, most of the trade took place with
the knowledge — and sometimes the tacit consent — of
the United States and other nations.
With Republican-led congressional committees investigating
allegations of oil-for-food corruption, some Democrats are
pressing for answers about why the United States did little to
stop the smuggling. The issue is among broader questions these
lawmakers have about what U.S. officials knew about Saddam's
overall illicit finances.
"I am determined to see to it that our own government's
failures and oversights or mistaken judgments and decisions
should also be exposed," said Rep. Tom Lantos, D-Calif.
Some Republicans are promising to hold hearings on the matter
next year.
"I believe the smuggling issue is huge," said GOP Rep.
Christopher Shays of Connecticut, chairman of the House
Government Reform subcommittee on national security.
During the dozen years between the two Iraq wars, Saddam's oil
sales were supposed to be limited to those permitted under the
U.N. oil-for-food program. From 1996 to 2003, the program allowed
Iraq to sell oil and use proceeds to buy food, medicine and other
necessities.
That program has come under scrutiny because of allegations
that Saddam received kickbacks and bribed U.N. and foreign
government officials. Besides the congressional inquiries, U.N.
Secretary-General Kofi Annan has appointed former Federal Reserve
Chairman Paul Volcker to head an investigation.
Former State Department officials said the United States had
little choice but to allow some of these sales to Iraq's
neighbors.
Jordan was desperate after the 1991 Persian Gulf War. The U.N.
penalties against Iraq cost Jordan a major trading partner. Iraq
owed Jordan money, but couldn't repay without selling oil. Jordan
needed oil, but couldn't import from other producers, angry that
Jordan supported Iraq in the war.
"We realized that the Jordanian economy and the Jordanian
state would collapse" if it didn't get access to oil, said David
Mack, deputy assistant secretary of state for Near East Affairs
at the time.
The United Nations formally acknowledged Jordan's oil dealings
with Iraq in May 1991, without approving or disapproving.
Turkey had an important role in containing Saddam: Its
Incirlik air base was used by U.S. military planes.
"With Turkey, it was plain illegal. It was smuggling, but
everybody just said, 'Oh well, geez, it was too hard to try to do
anything about that,"' Mack said.
Syria was another matter.
Allen Keiswetter, deputy assistant secretary of state for Near
Eastern Affairs in 2000-01, said U.S. officials were aware that
Syria was buying oil from Iraq through a pipeline.
"We objected to it mightily and often, but there did not seem
any good way to stop it short of military action," he said.
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