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Australia has welcomed the lifting of a US government credit ban on an Australian wheat exporter under investigation over the Iraq oil-for-food scandal.

Trade minister Mark Vaile says Washington had agreed to lift the suspension of Australian Wheat Board (AWB) from US export credit programmes to allow for the completion of a domestic inquiry into alleged kickbacks paid to Saddam Hussein.

“We welcome this announcement,” Vaile says. “The Australian government has announced a judicial inquiry on this matter and it is common sense to let that process run its course.”

The inquiry, headed by former judge Terence Cole, is due to report by March.

Australia had earlier accused the US of prematurely punishing the country’s monopoly wheat exporter over the allegations.

The inquiry will investigate AWB’s involvement in the oil-for-food programme from 1996 to 2003, which allowed sanction-hit Iraq to export oil in order to pay for imports of humanitarian goods.

A UN-commissioned report by former US central bank chief Paul Volker named AWB, the largest humanitarian provider under the UN programme, as one of more than 2,200 firms that provided kickbacks to the then Iraqi government.

Volker found that while the company did not directly pay some US$220mn in bribes, some of its officers probably realised that the inflated transport fees they were being charged would be siphoned off by Baghdad.
The company has denied any wrongdoing, saying it was duped.