November 5th 2005

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Articles from this issue:

COVER STORY: CANBERRA OBSERVED: 'A dangerous moment for our democracy ...'

EDITORIAL: 'Simpler, fairer' labour laws? You've got to be kidding!

SCHOOLS: Mathematics at mercy of trendy educators

INTERNATIONAL AFFAIRS: Oil for food - or was it for a Mercedes?

INTERNATIONAL TRADE: WTO negotiations falter on trade liberalisation

VICTORIA: Water bill spells disaster for farmers

STRAWS IN THE WIND: Too many bulls in the China shop? / Anti-corruption conference / Logging onto other people's forests / Report from (another) conference / Little social protection

ABORTION: Cutting Australia's abortion rate

EMBRYO EXPERIMENTATION: Government push to use super funds for embryo research

WESTERN CIVILISATION: What conservatives should champion

CINEMA: In Her Shoes: Is Hollywood finally tiring of sleaze?

Maternity payment could make difference (letter)

How democracies perish (letter)

Justice for the worker (letter)

BOOKS: THE DEATH OF RIGHT AND WRONG: Exposing the Left's Assault on Our Culture and Values


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Oil for food - or was it for a Mercedes?

by Max Teichmann

News Weekly, November 5, 2005
Hardly anyone has raised a protest about the overwhelming evidence that Saddam Hussein, before he was toppled from power, massively bribed politicians and journalists around the world, writes Max Teichmann.

I've been going through a list of approximately 270 individuals and entities who were beneficiaries of Saddam Hussein's oil voucher system.

The list was first published on January 25, 2004, by the Iraqi independent daily Al-Mada. The list was originally the property of the Iraqi State Oil Marketing Corporation which was responsible for marketing Iraqi petroleum.

Post-Saddam, this ministry was collating the information for submission to Interpol, which could then pursue the voucher beneficiaries.

The Iraqi Governing Council had been focussing on 46 foreign individuals and organisations included in the list, but primarily from neighbouring countries.

The London Arabic-language daily Al-Hayat (January 31, 2004) said it expected more names and details to soon be made public, and also anticipated the revelation of a scandal of vast dimensions, transcending countries and continents and implicating many prominent individuals and organisations.

Transnational bribery

This list paints a devastating picture of transnational bribery at the top, with Russian, Ukrainian and Belarusian politicians and parties involved; top French politicians and public servants; and senior UN people close to Kofi Annan and involved in UN decision-making concerning Iraq, the Oil for Food program itself, and in the proceedings of the UN Security Council.

All the Arab countries were targeted and influential people rewarded.

Palestinian leaders were greatly favoured. Many Egyptians, Jordanians and Lebanese were rewarded with vouchers to sell millions, or even tens of millions, of barrels.

The Socialist Party of Bulgaria had vouchers for 12 million barrels. George Galloway, the British MP, was down for 19 million barrels, and his name is mentioned a number of times in the Iraqi Governing Council lists. George denies it all, as do all the others, except for those who remain silent.

Chavez of Venezuela had 4.5 millions. Many key Iraqi "friendship" societies were bankrolled.

Megawati was down for eight million barrels. Another relative of former President Sukarno was worth two million barrels.

The Hungarian Interest Party had 4.7 million barrels, and the Indian National Congress vouchers for 4 million barrels.

Various Malaysians were able to dispose of 85 million barrels. A company controlled by the Nigerian ambassador got one million of the 22 millions allotted to Nigerian "businessmen".

The good ol' Romanian Labour Party got 5 million barrels. Mainland Chinese totted up 86 million barrels, while three Cypriots drew on vouchers for 30 million barrels. Some Italians raked in 60 million barrels.

But it is the Russians who really scored - enormously. (Perhaps they were short of oil?).

Communist Party companies got 137 millions. The office of President Putin got 86.9 million barrels. One million went to the Russian ambassador to Baghdad.

Our friend Vladimir Zhirinovsky, of the Liberal Democratic Party of Russia, was down for 86 million barrels. The Peace and Unity Party got 34 millions, while Romain Tetzenko, son of Russia's former ambassador to Baghdad, got 19.7 millions.

And so on and on it goes, with the Russians, the French, the Chinese and the UN on a wonderful scam which they wanted to last forever.

Oil for Food scam

But how did this Oil for Food scam start?

Well, when the winners of the First Gulf War turned away from going to Baghdad or from removing Saddam Hussein and his régime, or allowing the Kurds and Shi'ites their freedom, they had virtually no policy left other than to contain Saddam by imposing a blockade and trying to protect the Kurds and Shi'ites by no-fly zones and Anglo-American fly-overs, plus introducing weapons inspections.

The blockade of oil sales was to stop Saddam from rebuilding his forces.

Right through the 1990s, France and Germany and the left media right throughout the West - including of course here - campaigned for the quota to be given up or, alternatively, to be increased.

They argued, during all this time, that its effect on the Iraqis, especially the children, was catastrophic.

So, Clinton and Blair, fighting at every step, saw the quota rise to 500,000 barrels a day, then a million, then two million and, finally, three million barrels a day.

After the recent US-led invasion of Iraq, it became clear that the monies received by Saddam for the oil sold had not gone to his country's people, let alone to its children, but to him, his régime and his overseas friends.

And that the actual plight of the Iraqis had been systematically exaggerated by the Franco/Russian/German propaganda machine, backed by Saddam's friends in the UN and Western journalists.

Let's face it, these creatures never had it so good while Saddam stayed on.

It beats Russian, Chinese or Pyongyang gold, does it not, Comrades Manqués?

What happened to this list of Saddam's beneficiaries, though?

Just as the new Iraqi Government was settling in to investigate it, and to prepare charges, the Americans, under Paul Bremmer, took over the list and it has finished up with the US and the UN.

Raging battle

There, a battle seems to be raging as to how much should be made public, and whether the total facts about UN Secretary-General Kofi Annan (who knew about the scam as early as 2001) and about Annan's relatives and many important people outside Iraq, should be aired.

Or just filtered out, as happened with the de-Nazification of postwar Germany. There the world's Jews had to wait over 20 years for the relevant files to be returned to Germany.

Germany and Japan had been too important as Western allies in the Cold War to be destabilised, so the story went.

I doubt if this thing is going to happen in the Food for Oil scandal, for too many of the facts and too much of the detail are already out - for example, in News Weekly.

  • Max Teichmann

How the Oil for Food scheme worked: the voucher transactions method

In general, the vouchers were given either as gifts or as payment for goods imported into Iraq in violation of the UN sanctions.

The voucher holder would normally tender the voucher to any one of the specialised companies operating in the United Arab Emirates for a commission which initially ranged from $0.25 to $0.30 per barrel, though it may have declined in later years to as little as $0.10 or even $0.05 per barrel because of the oil surplus on the market (Al-Mada (Baghdad), February 7, 2004.).

In other words, a voucher for 1 million barrels would have translated into a quick profit of $250,000-300,000 on the high side and $50,000-100,000 on the low side - all paid in cash. According to Al-Mada, Jordan will seek to tax the illicit profits of citizens who benefited from the sale of the vouchers.

One of the common arguments by recipients of vouchers was that the vouchers paid for goods provided in the framework of the UN-administered Oil for Food program.

However, under the Memorandum of Understanding governing the program, oil allocations were intended for "end users", meaning those with refineries. Most of the voucher recipients would be considered "non-end users".

Moreover, if vouchers were used to pay for goods, it would suggest that these were not authorised by the program and should be considered illicit since all contracts approved by the UN were reimbursed from the trust account where the oil revenues were kept, at a French bank, at Iraq's insistence.

According to the United Nations:

"The oil buyer had to pay the price approved by the Security Council Sanctions Committee into a UN escrow account, and the UN had to verify that the goods purchased by Iraq were indeed those allowed under the program.

"But the UN had no way of knowing what other transactions might be going on directly between the Iraqi government and the buyers and sellers." (Letter to the Wall Street Journal, February 18, 2004.).

  • Extract from: Dr Nimrod Raphaeli, "The Saddam Oil Vouchers Affairs", The Middle East Media Research Institute (MEMRI), Inquiry and Analysis Series, No. 164, February 20, 2004.

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