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Shh ... Iraq (US) owes
$200bn war debt
By Ian Williams
There
has been a lot of discussion of debt forgiveness for
Iraq, but there have also been some interesting, almost
forbidden, topics in the debate. Perhaps the least
mentioned issue is the reparations of US$200 billion
that Iraq allegedly owes, mostly to Kuwait and Saudi
Arabia, from the first Gulf War of 1991.
As US
envoy James Baker toured the world asking countries like
France, Bulgaria Germany and Russia to forgive Iraqi
debt, neither he nor Washington has made much noise
about the reparations issue, even though, according to a
report just submitted by the Congressional Budget
Office, in addition to its external debts of up to $128
billion, Iraqi also owes $199 billion in reparations for
the invasion of Kuwait.
Last week, Baker did
raise the issue with the Kuwaitis, who indignantly
rebuffed any suggestion that it would waive its
compensation claims. Indeed, Kuwait Foreign Minister
Sheikh Mohammad refused even to discuss the issue. With
little publicity outside the country, it seems that the
Kuwaiti parliament passed a law last year forbidding any
relaxation in the reparations, which was assessed at
that time at $98 billion. Under the old regime of Saddam
Hussein, American diplomats pursued the claims against
Iraq with considerable and vindictive vigor, but now the
US taxpayer is footing the bill, they are less keen.
Reparations are an old fashioned idea. Most
historians see German reparations after World War I as a
significant cause of the second. Kuwait seems prepared
to live with potential Iraqi resentment and maybe even
some American disgruntlement.
So far, Iraq has
paid $18 billion in compensation, with the bulk going to
Kuwait. The cash came from oil revenues under the United
Nations' oil-for-food program. The original cut was 30
percent, reduced then to 25 percent, but after the
American occupation the Security Council reduced the
amount to 5 percent of oil revenues. However, the
Compensation Commission has already agreed on another
$30 billion in compensation, once again mostly to
Kuwait.
The 5 percent levy remains, according to
Security Council resolution 1483, "unless an
internationally recognized, representative government of
Iraq and the governing council of the United Nations
Compensation Commission, in the exercise of its
authority over methods of ensuring that payments are
made into the compensation fund, decide otherwise, this
requirement shall be binding on a properly constituted,
internationally recognized, representative government of
Iraq and any successor thereto."
In their more
aggressively hawkish mode last year, American leaders
were demanding that Russia, France and Germany in
particular write off all Iraqi debts. It was unfair, the
Americans claimed, that the suffering Iraqi people
should have to struggle to pay off debts incurred by the
tyrant who oppressed them.
Of course, the same
people had shown no compunction in insisting on
repayment of the billions lent to Nigerian and Zairean
kleptomaniacs at Washington's behest, let alone the
South Africans repaying the bills run up by the
apartheid regime to keep blacks in the townships and
Bantustans. But they never mentioned the Kuwaiti
reparations, since American tax payers, and the creditor
countries together, may want to know why, having
liberated Kuwait, they should subsidize the oil rich
emirate now.
It is easy to see why there is not
much publicity about this unique instance of reparations
actually being paid. The US, for example, simply refused
to recognize the World Court judgment against it for
mining Nicaraguan harbors, although it eventually came
to a settlement with the pro-American government that
replaced the Sandinistas.
The precedent it sets
is dangerous for the region. There is a definite chance
of laying a trail for future conflicts between Iraq and
Kuwait, but also with Iran. As part of the ceasefire
agreement between Iran and Iraq under UN resolution 598,
then UN secretary general Perez de Cuellar appointed a
commission to determine who started the war.
Giandomenico Picco, who was the UN official in charge of
it, remembers that the commission was composed of three
European historians, who, as well as wanting to remain
anonymous, for reasons of personal safety, decided
unequivocally that Iraq was the aggressor.
The
report was released, very, very quietly, in December
1991. It was inconvenient, not just because Tehran was
no one's favorite regime at the time, but also because
the Security Council had just ordered Iraq to pay
compensation for damages incurred in the war on Kuwait.
Picco points out that the 598 commission did not mention
compensation, so he is not sure that its results implied
reparations. However, nor are the reparations that Iraq
is paying the result of any judicial legal process. They
result from a decision that the Security Council made,
under heavy and vindictive American pressure.
If
the Iranians had been less isolated, or had had friends
to put their case to, they could surely have argued that
they had a claim for reparations, which was both earlier
and more ethical than Kuwait's. After all, the $100
billion that the Gulf states now claim for debt from
Iraq was spent on attacking Iran.
Saddam's
attack on Iran in 1980 was, of course, supported in
various forms by Britain, France and the US. The
Iranians are aware of this, and recently members of
parliament have mentioned sums of $200 billion in
reparations. They have a very good claim, legally, and
certainly a very embarrassing one for the US, and for
Kuwait.
Ironically, as Picco points out, almost
the only world leader to reinforce the 1991 commission's
finding that Iraq had committed aggression against Iran
was one George W Bush. In his speech to the UN in
September 2002, the president very clearly put
aggression against Iran in the litany of charges against
Saddam, to the joy, albeit temporary, of President
Mohammad Khatami of Iran, who was sitting in the
audience.
While not shouting about the
reparations issue, it would appear that Baker at least
has it in hand. One suspects that, whether the Kuwaitis
like it or not, some part of the final UN resolutions
recognizing and admitting a new Iraqi government will
abolish the Compensation Commission and renounce any
outstanding claims.
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