The United Nations has transferred administration of the Iraqi Oil-for-Food Programme to the Coalition Provisional Authority (CPA) and Iraqi officials.
The transfer shifts responsibility to the CPA and Iraqi authorities for humanitarian programmes funded by oil revenues, for assets ranging from schools to power stations and other infrastructure and for all contracts with infrastructure suppliers.
At a Security Council meeting on November 20, Secretary General Kofi Annan said, “we are closing the Oil-for-Food Programme, but we remain determined to continue helping Iraq’s long-suffering people in whatever ways are still open to us.”
The Security Council’s mandate “to assume temporary custody of Iraq’s oil exports and apply the revenue to a humanitarian programme is unprecedented in the history of the United Nations,” the secretary general recalled. The Oil-for-Food Programme was “one of the largest, most complex, and most unusual tasks it has ever entrusted to the secretariat – the only humanitarian programme ever to have been funded entirely from resources belonging to the nation it was designed to help.”
Under the programme, nine different UN agencies and programmes developed and managed humanitarian operations in Iraq to meet the needs of Iraqi civilians in 24 economic and social sectors, he said.
“We take pride in the fact that we have achieved an orderly handover of such a large and expensive programme, on time and in spite of the current insecurity in Iraq. Especially since the cruel loss of life and injuries to our local and international staff on 19 August,” Annan said.
The Security Council issued a presidential statement emphasising “the need to ensure the continuity of international efforts aimed at economic reconstruction of Iraq” and “took note with satisfaction of the statements made by the representatives of the United States and the United Kingdom on the measures which the Coalition Provisional Authority intends to take in order to conclude successfully the deliveries under the programme.”
The Security Council said that it will continue to monitor the United Nations role in Iraq, especially in the areas of humanitarian assistance, economic rehabilitation, reconstruction, and creation of conditions conducive for sustainable development.
During a private meeting with the Security Council on November 19, Benon Sevan, executive director of the programme, said, “I’m very proud of all my colleagues both here at headquarters and in the field. We did a good job under very difficult circumstances….”
“Despite of all the shortcomings of the programme…we did manage to make a big difference in the lives of the Iraqi people. The program was never meant as a substitute for normal economic activity and we did manage to mitigate the unintended consequences of sanctions,” he said.
“I’m very sorry that the then government of Iraq did hinder the international community by not cooperating early and fully and implementing Security Council resolutions, because had they done so, we could have avoided the nightmare they are going through yet again.”
The Oil-for-Food Programme, managed by BNP-Paribas until the toppling of Saddam Hussein, allowed the Iraqi government to sell oil under UN supervision while the country was under sanctions for the invasion of Kuwait. The major portion of the revenue was used to purchase food and humanitarian supplies. The remainder of the revenues was used to pay Gulf War reparations, finance the UN weapons inspection regime, and UN administrative costs. The UN administered the program in the three Kurdish governorates in northern Iraq. In the 15 governorates in southern and central Iraq, the programme was implemented by the former Iraqi government with UN monitoring to ensure the equitable distribution of supplies.
The Security Council established the programme in resolution 986 in April 1995, but Iraq did not accept the programme until May 1996 and it wasn’t until March 1997 that the first shipment of food arrived in the country. When sanctions against Iraq were lifted in May 2003, the programme became obsolete and the Security Council, in resolution 1483, gave the UN six months to wrap up the programme.
Over the course of the programme, US$65bn worth of oil was exported and more than US$31bn in humanitarian goods were delivered. Another US$8.2bn in humanitarian goods were in the pipeline at the time of the transfer with an additional US$3.6bn-worth of projects to be implemented by UN agencies. The United Nations has also transferred US$3 billion from the Oil-for-Food account to the Development Fund for Iraq and more funds will be transferred after the programme closes.
On November 17, US Ambassador Steven Mann, head of the CPA team overseeing the transition of the programme from the United Nations to the Iraqis and the CPA, met with the Security Council and reported that the CPA and Iraqi officials are prepared to carry on the programme for the next six months.
“The overall goal is to build the capacity and let Iraqi officials manage these programmes,” Mann said. “We are also going to be providing advisors to help with the details of programme administration, with contracts and procurement.”