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Iraq Report: February 15, 2002

15 February 2002, Volume 5, Number 6

SADDAM'S SON PRAISES 11 SEPTEMBER ATTACKS. The London-based Arabic language newspaper "Al-Sharq Al-Awsat" of 10 February says that 'Uday Saddam Husseyn, Saddam's eldest son, has praised the 11 September attacks in the United States, calling them "daring operations carried out by Arab Muslim youths and which caused the United States to take heed of Arabs and Muslims among other people." 'Uday made the statement during a meeting with Ali Kilani al-Qadhafi, who supervises Libya's radio stations.

He claimed that "these operations, which were carried out by 19 Arab Muslim youths, have restored respect for Arabs and Muslims." He also lauded "the heroic stand by six Arab brothers who barricaded themselves in a Kandahar hospital for 45 days and fought the U.S. occupation using God-knows-what weapons."

"Al-Sharq Al-Awsat" notes that this is the first time an Iraqi official has praised the 11 September operations. (David Nissman)

RUSSIA, U.S. CONSULT ON IRAQ. The Russian Foreign Ministry said on 8 February that it has held consultations with the United States on Iraq in Geneva, and that Russia insisted that proposed new rules on exports to Iraq help speed up the delivery of goods to Iraq, instead of tightening international sanctions against it, reported Interfax on 8 February.

The United States assured Russia that the sole purpose of the rules was to prevent dual-purpose goods from reaching Iraq. The Foreign Ministry said "certain progress was achieved in clarifying issues over which there remain some disputes and on which work still needs to be done to further narrow the sphere of disagreements."

The suspension by the UN Sanctions Committee of contracts between Iraq and Russian companies as part of the UN humanitarian program received special consideration. After receiving additional information from Russia, the United States promised to speed up consideration of the unblocking of such contracts.

It was later reported, in an article by Maria Pshenichkova for ITAR-TASS on 11 February, that Moscow and Washington are to hold a series of intermediate talks on Russian contracts blocked by the UN Sanctions Committee. In the Geneva talks, it was agreed between the two countries that the embargo would be lifted on Russian-Iraqi contracts worth $23 billion. The United States also promised to speed up consideration for other frozen projects totaling $600 million. (David Nissman)

SADDAM REJECTS ECEVIT RECOMMENDATION. A letter to Iraqi President Saddam Husseyn last week in which Turkish Prime Minister Bulent Ecevit urged Iraq to accept UN weapons inspections (see "RFE/RL Iraq Report," 8 February2002) was rejected by Saddam and elicited a letter in return from the Iraqi president. He wrote that Iraq has no weapons of mass destruction, and demanded that "America has to abandon its hostile policies of imposing the embargo and of continuous military aggression in the north and south of Iraq, and of interfering in Iraq's internal affairs," according to "The Wall Street Journal Europe" of 11 February.

Saddam claimed that "Iraq stands at the helm of those who demand that our region should be free of mass-destruction weapons" and that the inspectors had failed to submit "honest and fair" reports to the UN Security Council under the influence of the United States.

Saddam's response to the Ecevit letter provoked a meeting in Ankara chaired by Ecevit, and attended by Turkish Foreign Minister Ismail Cem and other Foreign Ministry officials, reported "Milliyet" on 9 February. Ankara viewed the Saddam letter and subsequent statements by Iraqi Vice President Taha Yasin Ramadan as an indication that Baghdad's policy would not change. Yet, Turkey has decided not to abandon its diplomatic initiatives towards Iraq. Although the meeting chose not to reveal the contents of the Saddam Husseyn letter, it was subsequently published in full in the "Turkish Daily News" of 9 February following its broadcast in full by Baghdad Television on 8 February.

One of the elements of the Husseyn letter is that Turkey should clarify its attitude on the subject of the policies Turkey will follow in the region, and "whatever the United States says in the region will not necessarily be for Turkey's best interests."

Iraqi Foreign Minister Naji Sabri al-Hadithi was expected to arrive in Istanbul on 12 February to attend the EU-Organization of the Islamic Conference. While there, he is expected to continue his contacts with top Turkish officials. (David Nissman)

IRAQ FORCING ASSYRIANS OUT OF KIRKUK. Emanuel Khoshaba, an official with the Assyrian Democratic Movement, said that "10 Assyrian families have been forced to move to...Baghdad since the beginning of the year," according to "Zinda" on 12 February. The deportation of these families is part of the arabization campaign spearheaded by the ruling Iraqi Ba'th Party.

Khoshaba noted that more than 30,000 Assyrian families lived in Kirkuk before the 1991 Gulf War. Their numbers now are unknown. In addition, many oil company workers have been dismissed since the beginning of the year because Assyrian, Kurdish, or Turkmen names were selected for their newborn children. (David Nissman)

IRAQI CENTRAL BANK GOVERNOR INTERVIEWED ON ECONOMY. Dr. Isam Rashid Huwaysh, governor of the Iraqi Central Bank, was interviewed about the Iraqi dinar-U.S. dollar exchange rate and the economy as a whole in the 22-28 January issue of the Baghdad weekly "Al-Rafidayn."

The following steps were undertaken to improve the exchange rate of the dinar: restrictions on external transfers have been reduced, foreign currency has been allowed to circulate, restrictions on granting credit have been eased, and bank loans for investment have been encouraged.

"Al-Rafidayn" asked him what factors lie behind the current phenomenon of the declining dollar exchange rate against the dinar. He answered: "Lately, the trend has been to import goods for public consumption. Agencies of the Ministry of Commerce and Agriculture and other importing agencies have started to import goods and pump them into the market at much lower prices than those prevailing in the market. We know that an increase in the offer of goods leads to a decline in demand for foreign currency, and thus to an improved exchange rate for the national currency."

He continued, saying that the second cause is "the economic measures that were adopted to consolidate the economic situation in Iraq, including the free [trade] zone agreements with a number of Arab countries. This increased the goods on offer inside the country. The third factor is the growing confidence in the Iraqi economy...."

The Economist Intelligence Unit's "Country Outlook" on Iraq, issued on 4 February, is not quite as optimistic. At the outset, it notes, "Iraq's economic policy will remain, overwhelmingly, a matter of trying to maximize its illicit oil trade while countering U.S. and U.K. attempts to curtail this."

It points out that "it is safe to assume that Iraqi GDP growth will broadly track the changes in the country's oil production levels." GDP will probably expand by 6 percent in 2002 and 7 percent in 2003.

Inflation is expected to remain high as shortages of all goods persist. Although the official exchange rate remains at 0.311 dinars to the dollar, the black market rate stood at 1,900 dinars to the dollar at the end of 2001. The currency is expected to remain stable as long as foreign currency continues to flow into the country through smuggling activities. (David Nissman)

TURKEY TO BOOST BORDER TRADE WITH IRAQ. Turkish officials said recently that Turkey plans to increase the volume of Iraqi crude it imports from Kurdish Iraq by more than 50 percent, Reuters reported on 7 February. It aims to take 4 million tons, or 80,000 barrels per day (bpd) compared with 2.6 million tons, or 50,000 bpd last year, according to the general manager of Tupras, Turkey's largely state-owned refiner.

The trade is carried out under Turkey's foreign trade secretariat for refining by Tupras. Truckers are also bringing in 15,000 tons of diesel a month. Both forms of trade are breaches of the UN sanctions on Iraq, but Turkey's Western allies turn a blind eye to the business. The U.S. and Britain want to put a stop to the sanctions regime that would eliminate smuggled oil sales that provide cash directly to the government of Saddam Husseyn.

Huseyn Baskaya, the governor of the border province of Sirnak through which the smuggled goods come, said: "Around 100-120 vehicles are going through a day. We haven't had any problems for a month."

Turkish truckers also take food or household products into northern Iraq, where they buy diesel fuel from local Kurds for sale in Turkey at below market prices.

Baskaya said an average of 100 trucks meant 500 tons of diesel fuel a day entering Turkey. A separate trade in crude oil in larger tankers is carried out for Tupras bringing crude in from the Baghdad-controlled oil center of Kirkuk. The crude is bought directly from the Iraqi government.

The trade, important for Turkey's impoverished southeast region and the Kurdistan Regional Government, would be halted by conflict in Iraq. (David Nissman)

IRAQ DEMANDS AN OIL KICKBACK FROM INDIA. An Indian Oil Company (IOC) official has put off orders to buy large amounts of Iraqi crude after Baghdad requested a surcharge of $0.25-$0.50 a barrel to be paid outside the control of the UN. This is the first acknowledgement that a kickback system exists, according to the "Oil News Daily" of 8 February.

The official said that "the IOC is in no position to make a payment contravening UN sanctions."

Privately, traders have often cited Iraqi demands for such surcharges, although no concrete evidence of such payments had yet been uncovered. Diplomats accuse the Iraqi government of skimming off millions of dollars from such kickbacks.

India and Iraq have close political ties, and Iraq has offered exploration blocks to India's state Oil and Natural Gas Corporation. Foreign investment in Iraqi upstream projects will only be allowed once UN sanctions are lifted. (David Nissman)

SYRIAN PRODUCTS FAIR OPENS IN BAGHDAD. The opening of the Syrian Products Fair in Baghdad on 10 February has occasioned a number of interchanges between top Iraqi officials and their Syrian counterparts. Syrian Minister of Supply and Internal Trade Bassam Muhammad Rustum and his delegation were met on arrival in Baghdad by Iraqi Trade Minister Muhammad Mahdi Salih and several ministry officials, reported Baghdad Television on 8 February. During the meeting of the two ministers, economic and trade ties between the two countries were discussed. Salih noted that bilateral trade reached $2 billion last year. Rustum noted that there were various areas in which joint action may be activated, and added that since the Free Trade Agreement had been signed between the two countries there have been "large and significant strides" toward building an integrated economy which would serve as a nucleus for the common Arab market.

Rustum also met with Minister of Transport and Communication Ahmad Murtada Ahmad, with whom he discussed boosting ties in the fields of transport and communications, reported INA on 9 February. Subsequently, he met with Iraqi Oil Minister Amir Muhammad Rashid and also discussed bilateral relations.

On 9 February Iraq and Syria signed an agreement for bilateral cooperation in industrial fields. The agreement was signed by Iraqi Minister of Industry and Mineral Resources Muyassar Raja Shallah and Syrian Industry Minister Isam al-Za'im. In addition, agreement was also reached to establish joint ventures within a period of 1 1/2 months. This includes a fertilizer project in Al-Qa'im, a glass factory in Aleppo, and a sodium bicarbonate project. (David Nissman)

TARIQ AZIZ MEETS AUSTRIAN RIGHT-WINGER. Joerg Haider, former leader of the Austrian Freedom Party and governor of Carinthia, was in Baghdad at the invitation of the Austro-Iraqi Organization for Friendship and Peace, according to AFP of 11 February. He was met at the airport by Iraqi Minister of Higher Education Humam Abdul-Ghafur.

He later met with Iraqi Deputy Prime Minister Tariq Aziz. The two men reviewed bilateral relations and stressed the need to continue cooperation between the Freedom Party and the Arab Socialist Ba'th Party.

Tariq Aziz briefed Haider on the "international plots led by the United States and Zionism against Iraq," reported Baghdad Television on 11 February.

The meeting was also attended by Dr. Harith al-Khishali, director of the Foreign Relations Bureau of the Arab Socialist Ba'th Party.

The secretary-general of the Freedom Party, Peter Sichrovsky, in Klagenfurth, said that "Mr. Haider is a highly respected politician in the Arab world, and the confidence he enjoys might be very helpful," reported Radio Oesterreich 1 on 11 February. (David Nissman)

IRAQ SEEKS PAKISTANI TECHNICAL ASSISTANCE. The Lahore "Business Recorder" of 12 February reports that Iraq is seeking technical assistance from Pakistan in the field of electricity generation and distribution. This was stated by Abdul-Rahman Jadaan Theab, director-general of the General Company of Electrical Energy Production, in Iraq on 11 February. He and his delegation visited Pakistan-Electron-LTD and Descon Engineering Ltd.

The objective of the Iraqi visit is to establish means of cooperation in transformer manufacturing plants, electricity generation and distribution, and other fabricated work. (David Nissman)

KURDISH LEADERS WANT TO KNOW ALTERNATIVE TO SADDAM HUSSEYN. The two Kurdish leaders Mas'ud Barzani, head of the Kurdistan Democratic Party (KDP), and Jalal Talabani, head of the Patriotic Union of Kurdistan (PUK), said in an interview with Al-Jazirah Satellite Television on 10 February that before talking about toppling Saddam Husseyn or participating in a U.S. scenario to strike Iraq, the alternative to the Iraqi president should be known.

Barzani stated that "we are not custom-made revolutionaries" and pointed out that "the situation here is completely different than that of Afghanistan." The Al-Jazirah interviewer asked him about the current status of his dialogue with Baghdad. He answered that there are no conditions for holding the dialogue, but, "as you know, the Kurds are unanimous on a federal solution to the Kurdish issue within a united Iraq."

Talabani believes that it is impossible to change the Baghdad regime from the inside by means of a coup. "First, the Iraqi army has become a large army that consists of tens of divisions. Second, moving any military unit requires the approval of a number of sides, including the military commander, the party official, the special security official and the intelligence official. Third, the military units move without ammunition. In addition, the present regime has its own guard, the Republican Guard. Therefore, I do not believe a military coup is possible."

In an earlier interview with NTV in Istanbul on 8 February, Barzani also made the point that if Saddam is to be replaced "the identity of the person who will replace Saddam is important. I can say this is the most important point for us. He also pointed out that if the United States decided to strike Iraq, there is nothing "we" could do. "Nevertheless, we will never become an orderly in the hands of the United States or any other force. Nor will we serve as a negotiating card or as a means of pressure to be used against Baghdad." (David Nissman)

IRAN TO DEFEND KURDISTAN? Jalal Talabani, leader of the PUK, in an official visit to Tehran at an Iranian invitation, was told that Iran has refused to close its borders with the Iraqi Kurdistan region, according to of 11 February. Iran also expressed its willingness to support the region in the event it would be attacked militarily by Baghdad.

Iraqi Foreign Minister Naji Sabri al-Hadithi had asked Iran to close its borders with Iraqi Kurdistan, said informed Iranian sources, and confirmed Iran's readiness to support the region in case of a Baghdad attack.

Talabani also met with Muhammad Baqir al-Hakim, the head of the Supreme Council for the Islamic Revolution in Iraq (SCIRI), and discussed current developments in the region and in the world. They also talked about activating joint committees for the good of the people of Iraq and getting rid of the dictatorship. (David Nissman)

MASS GRAVE DISCOVERED IN KURDISTAN. A grave containing six bodies was unearthed outside the city of Sulaymaniyah in the territory of the Kurdistan Regional Government, according to a report by Hiwa Osman broadcast over the BBC on 11 February. The Sulaymaniyah-based KurdSat TV reported that initial evidence indicates that the six men, who were wearing traditional Kurdish costume, were executed by firing squad in 1983.

Kurdish authorities in the region say that the grave was the fourth mass grave discovered on the ground of the former Sardaw military camp which was set up by the Iraqi army in 1982.

Bakhtiar Amin, head of the Washington-based International Alliance for Justice (IAJ) told the BBC that the discovery of this new mass grave is "additional evidence of Saddam Husseyn and his regime's crimes of genocide and crimes against humanity." The IAJ is an alliance of more that 260 NGOs from 120 countries and is calling for an expert commission under a UN mandate to study the available evidence and decide whether there is a case for crimes against humanity in Iraq.

Andreas Mavromattis, the UN Special Rapporteur on Human Rights in Iraq, is expected to arrive in Iraq shortly for an "exploratory mission."

"We condemn this atrocity and call upon Andreas Mavromattis to visit the mass grave and bring up the fate of the disappeared people with the Iraqi government."

A press release from the IAJ dated 12 February mentions several more mass graves in the vicinity. Since the 1980s over 200,000 Kurds have "disappeared" as a result of Iraqi army efforts. (David Nissman)

BARZANI ON TURKMENS. KDP leader Mas'ud Barzani spoke on the Turkmen issue in the context of relations with Turkey in an extensive interview with Istanbul's NTV on 8 February.

On the Turkmens, he said that he supports the Turkmens' demands for their rights, but adds that the group has failed to gain internal unity. Barzani noted: "We are not opposed to the rights of Turkmens, but the issue of the Turkmen Front is another issue. The front only represents a portion of the Turkmens, but on the basis of Turkey's support it is trying to impose itself on all the Turkmens. If all the Turkmens hold elections among themselves and elect the front as their representative, we will then accept the Turkmen Front as the sole representative of all the Turkmens and treat them as our respondent. However, if the front attempts to impose itself on all the Turkmens as well as on us, we will not accept this."

Barzani also issued an appeal to Ankara on this issue: "I am issuing a call on the Turkish Assembly and political parties. Let them come and study the situation of the Turkmens here on the spot. They will realize that the propaganda to the effect that we are applying pressure on the Turkmens is untrue. We are ready to assist such delegations in any way we can." (David Nissman)