Food Programme

Oil-for-Food Programme

The Oil-for-Food Programme was established by the UN in 1996. Its purpose was to allow Iraq to sell oil the world market in exchange for food, medicine, and other humanitarian needs of ordinary Iraqi citizens who were affected by international economic sanctions, without allowing the Iraqi government to rebuild its military in the wake of the first Gulf War. Under UN auspices, over $65 billion worth of Iraqi oil was sold on the world market. Officially, about 46$ billion was used for humanitarian needs. Additional revenue paid for Gulf War reparations through a Compensation Fund, UN administrative and operational costs for the Programme (2.2%), and the weapons inspection programme (0.8%).

The programme was discontinued in late 2003 amidst allegations of widespread abuse and corruption. The former Director, Benon Sevan of Cyprus, was suspended and then resigned from the UN, as an interim progress report of an UN-sponsored investigation concluded that Sevan had accepted from the Iraqi regime, and recommended that his UN immunity be lifted to allow for a criminal investigation.

Among the other people and organizations implicated in the scandal was Kofi Annan’s son Kojo Annan and the Australian Wheat Board. Kojo Annan was alleged to have illegally procured UN Oil-for-Food contracts on behalf of the Swiss company Cotecna. India’s foreign minister, Natwar Singh, was removed from office because of his role in the scandal. The Australian government set up the Cole Inquiry in November 2005 to investigate whether the Australian Wheat Board breached any laws with its contracts with Iraq during the Oil-for-Food Programme. AWB paid Saddam Hussein’s regime almost $300 million, through a front company called ‘Alia’, to secure wheat contracts to Iraq. The Cole Inquiry reports its findings in November 2006.