More work needed despite progress on Iraq’s export-revenue mechanism – UN official

A senior United Nations official reported today that some progress has been made to enable Iraq to fully manage its own export revenues and channel them towards its development needs, while encouraging the Government to undertake further steps.

Briefing the Security Council on the Development Fund for Iraq, UN Controller Jun Yamazaki said that the interim audit over the first half of 2010 by the newly-appointed external audit firm PricewaterhouseCoopers had included a review of the installation of a comprehensive oil- metering system.

Some 51 per cent of the intended oil meters had been installed, he told the 15-member body, as he presented Secretary-General Ban Ki-moon’s latest report on the issue.

Despite this, and as pointed out by the Secretary-General in his report, Mr. Yamazaki noted that the audit showed that the implementation of the installation plan is “behind schedule.”

He encouraged the Iraqi Government to make every effort to implement the metering plan on schedule, as envisaged in the time-bound action plan the Government presented to the Council.

In addition, he encouraged the Government to make every effort to address the further steps recommended by PricewaterhouseCoopers, which includes appointing a technically qualified independent party to verify the implementation of the plan, as to its completeness, effectiveness and efficiency based on the best practices of the petroleum industry.

The Development Fund was set up in 2003 following the United States-led invasion of the country to facilitate the payment of revenue derived from Iraq’s sale of oil, gas and other resources for its humanitarian needs and economic reconstruction.

It replaced the Council’s Oil-for-Food programme, under which a sanctions-bound Iraq was allowed to use monitored oil sales revenue for humanitarian purchases.

Mr. Ban stated in his report that it is for the Council to assess the proposal of the Iraqi Government that the Development Fund – due to expire by 31 December – be extended for a further year, taking into consideration current conditions in Iraq and the lack of an agreement on the formation of a new Government.