20 April 2003
OFFP: Vested interests vs. humanitarian interests
Below are a few articles very pertinent to OFFP (Oil-for-Food Program). OFFP
was supposedly established to mitigate the adverse effects on the Iraqi people
of the trade sanctions imposed since August 1990 by the international community
via the UN Security Council. The ex-regime prolonged sanctions by not complying
with its ceasefire obligations. It turned down an earlier oil-for-food program
in 1991. The current program began in March 1997 when the first goods arrived.
So what has happened with the program over the 6+ years of its operation? From
the "legal" sale of Iraqi oil some $64 billion has been deposited in commercial
bank accounts where unspent funds obviously earn interest. $46 billion has been
allocated for humanitarian goods and services for the Iraqi people. $16 billion
is for non-Iraqis, mostly Kuwaitis, in compensation for their losses caused by
$2 billion is for the UN to cover its costs of administering humanitarian
activities (2.2% x $64 billion) and for the weapons inspectors (0.8%). The UN so
far surrendered some $275 million to the ex-regime from the 2.2% account. Since
the weapons inspectors weren't inspecting for four years while their account was
being filled there must be tens of millions unspent in the 0.8% account.
The oil-for-food program is a public, not private, program administered by the
UN for the Iraqi people. Why the secrecy? Why the lack of public transparency
and accountability? Is there something to hide?
The UN Office of the Iraq Programme (OIP) manages the program and they have a
www.un.org/depts/oip/ where there is some information, but not enough to
give a complete and accurate picture of what's going on. There is some data,
but not all the data. For example, quantities of oil exports and amounts earned
are clearly listed. Then there are some figures pertaining to the value of
goods and services that have been delivered. There's a lot of verbiage and some
figures about allocations and contracts, but what good are allocations and
contracts at the family level just to say the check's (cheque) in the mail?
We need to focus more on performance, real performance. For example, from the
time funds are earned, how long does it take for them to be spent? In 6+ years
we have a lot of experience. We know it takes more than a year from the time
funds are available to decide, order, and receive simple half-inch water pipe to
provide clean water to needy families. Such pipe is readily available on the
street in Iraq.
The oil-for-food program is in its 13th phase. Why is it that for Iraqi
Kurdistan only 51% of the funds available for medicines in phase-2 have been
spent to date? This is according to WHO. Phase-2 began in June 1997 and ended
in December 1997, and the balance 49% ($14 million) has remained unspent since
At some point, we need to see, at least, a simple monthly statement, just like a
monthly bank statement, with opening balance, credits, debits, and closing
balance in each account. Here in Iraqi Kurdistan, for the 13% account we need to
know where we stand. We need to agree with the figures. We want to see the
correct share of the total proceeds from the sale of Iraqi oil under the program
- the full 13%. What about the interest? And pipeline fees? And why do
citizens of Iraqi Kurdistan pay a disproportionate share for the oil industry's
Of the $8 billion available in the 13% account, according to OIP data on their
website only $4 billion worth of humanitarian goods and services has been
delivered. How's that for performance?
The spending rate is a key factor in UN performance. But equally important is
how well the funds are being spent. Who benefits? How much does each benefit
in economic terms, and in humanitarian terms. Who is the program really for
anyway? (Russian TV equipment?! For whom??)
What needs to change? Will it be changed?
Humanitarian Affairs Advisor
Erbil, Iraqi Kurdistan