DATE=12/05/00

TYPE=CORRESPONDENT REPORT

TITLE=U-N / IRAQ / OIL PROGRAM (L)

NUMBER=2-270084

BYLINE=BRECK ARDERY

DATELINE=UNITED NATIONS

CONTENT=

VOICED AT:

INTRO: The United Nations Security Council has unanimously granted another six-month extension of the Iraqi "oil-for food" program. But - as V-O-A Correspondent Breck Ardery reports, approval came only after hours of wrangling about the wording of the resolution.

TEXT: A particularly-contentious section of the proposed resolution directed U-N Secretary-General Kofi Annan to prepare a report on Iraqi oil sales outside the U-N program - so-called "oil smuggling." Under strong objections from China and Russia, that section of the resolution was dropped.

A compromise was apparently reached on a plan to release more than 500 million dollars to Iraq to upgrade its oil industry. Britain and the United States went along with that in exchange for language that allows more of the humanitarian funds to be used for goods produced in Iraq. In another apparent compromise, the council said it may consider allowing Iraq to use some of the oil money to pay its arrears to the United Nations. If that payment were made, Iraq would regain its vote in the U-N General Assembly.

American representative James Cunningham told the council there are sufficient oil resources to meet the humanitarian needs of the Iraqi people, through the U-N program. But, he said the Iraqi government is not attempting to maximize those resources.

///CUNNINGHAM ACTUALITY///

Indeed the government of Iraq has given up almost 300 million dollars in converting currency from dollars to euros. And, according to O-I-P (the U-N Office of the Iraq Program) will give up some 500 million dollars by stopping the flow of oil. This means that some 800 million dollars will be sacrificed which could have benefited the people of Iraq.

/// END ACTUALITY //

Other speakers said that, although the oil-for-food program is a worthy project, the best solution would be the complete lifting of economic sanctions against Iraq.

There is still no word on when Iraq will resume its oil exports. The United Nations has rejected Iraq's proposed oil pricing formula for December and negotiations to resolve that matter continue.(Signed)

NEB/UN/BA/WD