Iraq: Security Council extends 'oil-for-food' programme for five months

Determined to improve the humanitarian situation in Iraq, the Security Council voted unanimously today to extend its Iraq "oil-for-food" programme for a new period of 150 days, beginning at 00.01 hours Eastern Daylight Time on 4 July 2001.

The programme authorizes Iraq to sell oil with a portion of the revenue used by the United Nations to buy food, medicine and other essentials to help Iraqi civilians affected by the 11-year old sanctions against the country.

By the terms of the resolution, the Council decided to conduct a thorough review of all aspects of the implementation of this resolution 90 days after the entry into force and again prior to the end of the 150-day period. It expressed its intention to consider favourably renewal of the provisions of this resolution as appropriate, providing that provisions are being satisfactorily implemented. To this end, the Council requested the Secretary-General to provide a comprehensive report on the resolution's implementation 90 days after the date of entry into force and again at least one week prior to the end of the 150-day period.

The Council also decided that the effective deduction rate of the funds deposited in the escrow account to be transferred to the Compensation Fund in the 150 day period shall be 25 per cent, and further decided that "the additional funds resulting from this decision will be deposited into the account established under paragraph 8 (a) of resolution 986 (1995) to be used for strictly humanitarian project to address the needs of the most vulnerable groups in Iraq." It expressed its intention to establish a mechanism to review, before the end of the 150-day period, the effective deduction rate in future phases, taking into account the key elements of the humanitarian needs of the Iraqi people.

The Council requested Secretary-General Kofi Annan to continue to enhance as necessary the UN observation process in Iraq to provide assurance to the Council that the goods produced in accordance with this resolution are distributed equitably and that all authorized supplies, including dual usage items, are utilized for the purpose for which they have been authorized, including in the housing sector and related infrastructure development.

The Council urged all States, and in particular the Government of Iraq, to provide their full cooperation in the effective implementation of this resolution, and called upon the Government of Iraq to take the remaining steps necessary to implement paragraph 27 of resolution 1284 (1999). That paragraph refers in part to timely and equitable distribution of humanitarian goods and full cooperation with the United Nations Office for Project Services mine-clearance programme in the three northern Governorates of Iraq.

Meanwhile, the Office of the Iraq Programme announced today that as of the end of last week, approximately 1.77 billion euros ($2 billion) in uncommitted funds were available in the UN escrow account for Iraq for the purchase of humanitarian supplies, oil spare parts and equipment. An additional $10.6 billion worth of supplies, including $1 billion worth of oil spare parts and equipment, under already approved contracts, is in the production and delivery pipeline.

Also over the past week, in what the Office hailed as a "groundbreaking move," the Security Council committee monitoring the sanctions against Baghdad lifted from hold five telecommunications contracts worth over $18.6 million, including a single contract for nine digital exchange systems valued at $15.5 million. Also released from hold were two meteorological contracts, comprising an agro-meteorological weather observation system and a short-wave single-band radio station.

Despite these developments, by the end of last week, the total value of contracts on hold was up by some $100 million, now standing at $3.3 billion, the Office reported.

There have been no Iraqi petroleum exports since 4 June under the oil-for-food programme.