June 28, 2004
Christian Aid

Fuelling Suspicion: The Coalition and Iraq's Oil Billions

The US-controlled coalition in Baghdad is handing over power to an Iraqi government without having properly accounted for what it has done with some $20 billion of Iraq's own money, says a new report published by Christian Aid.

An audit, reportedly critical, of the coalition's handling of Iraqi revenues is not going to be delivered until mid-July - after the coalition has ceased to exist.

Christian Aid believes this situation is in flagrant breach of the UN Security Council resolution that gave control of Iraq's oil revenues and other Iraqi funds to the Coalition Provisional Authority (CPA). . . .

Resolution 1483 of May 2003 said that Iraq's oil revenues should be paid into the Development Fund for Iraq (DFI), that this money should be spent in the interests of the Iraqi people, and be independently audited. But it took until April 2004 to appoint an auditor - leaving only a matter of weeks to go through the books. . . .

In October 2003 Christian Aid revealed that an astonishing $4 billion of Iraq's oil revenues and other funds were unaccounted for. That report, Iraq: The Missing Billions, called for much greater clarity and for a thorough audit - which even at that time was months overdue. . . .

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"U.S. Will Control 'Sovereign' Iraq," The Wisdom Fund, June 8, 2004

Jonathan Steele, "80% of Iraqis want US to stop patrolling cities," Guardian, June 29, 2004

[Insurgents are blowing up pipelines and police stations, geysers of sewage are erupting from the streets, and the electricity is off most of the time - but we've given Iraq the gift of supply-side economics.--Paul Krugman, "Who Lost Iraq?," New York Times, June 29, 2004]

James Glanz and Erik Eckholm, "Reality Intrudes on Promises in Rebuilding of Iraq," New York Times, June 30, 2004

[Professor Stiglitz wrote in a syndicated article that a quick privatization in Iraq, talked about briefly by the Bush administration before the recent explosion of violence took priority, would lead to results similar to those in Russia: a rich elite and a bitter populace. Beyond their many differences, he wrote, both countries are oil powers, have economies that are sagging after years of neglect and have extremely weak legal institutions.--Sabrina Tavernese, "Russians Look at Iraq, and See Their Reflection," New York Times, July 3, 2004]

[The seeds of the Vietnam war were sown by the US installing a client regime in Saigon. And unless Bush and Blair are stopped by the American and British peoples, a similar catastrophe is in the making in Iraq and the wider Middle East. . . .

Bush and Blair continue to peddle the myth, beloved of old colonialists, that Iraqis will start a civil war if the "benevolent" presence of the occupation forces is removed. But there is nothing benevolent about their troops or their stooges. Allawi is not only a former Saddam operative and CIA "asset", but also the leader of the Iraqi National Accord, an organisation composed of former Saddamist officers. His appointment, and the torture at Abu Ghraib, are part of a systematic US policy of building new Saddamist-style state structures.--Sami Ramadani, "America has sown the seeds of civil war in Iraq: It's not religious rivalry but the puppet regime that threatens stability," Guardian, July 3, 2004]

[The U.S. government has spent 2 percent of an $18.4 billion aid package that Congress approved in October last year . . . The U.S.-led occupation authorities were much quicker to channel Iraq's own money, expending or earmarking nearly all of $20 billion in a special development fund fed by the country's oil sales,--Rajiv Chandrasekaran, "U. S. Funds for Iraq Are Largely Unspent," Washington Post, July 4, 2004]

Erik Eckholm, "Occupation Authority Did Not Properly Monitor Spending of Iraqi Money, U.S. Audit Says," New York Times, January 31, 2005

[Two years after the fall of Baghdad, 80% of the $18bn earmarked by the US Congress for Iraq's reconstruction remains unspent.--"Iraq agency 'run like Wild West'," BBC, February 15, 2005]

Patrick Cockburn, "What has happened to Iraq's missing $1bn?," Independent, September 19, 2005