UN Debates Continuation of Iraq Sanctions

Iraqis protest demands as Western members complain of lax compliance with cease-fire. IRAQ'S ECONOMIC FUTURE

THE United Nations Security Council kept the pressure on Saddam Hussein's government in its first periodic review of economic sanctions imposed on Iraq. But several ``nonaligned'' council members argued in a meeting Tuesday that political and legal positions should be tempered by moral considerations. Particular concern was expressed for Iraq's children.

Yemeni Ambassador Abdullah Al-Ashtal said there was ``an evolving consensus that something must be done - not lifting the sanctions altogether, ... but possibly a limited lifting.'' He suggested a limited sale of oil would enable Iraq to buy milk powder and other essentials.

But United States and British diplomats linked the sanctions to the tenacity of Iraq's leadership.

``Saddam Hussein is singularly unlikely to comply fully with the [cease-fire] terms of Resolution 687, and that could lead you to the view, therefore, that the lifting of sanctions is a remote matter,'' Sir David Hannay, Britain's ambassador, told journalists.

Western diplomats charged in Tuesday's closed-door session that Iraq has still not complied with the UN's cease-fire terms in several ways. They cited:

* The continued detention of nearly 3,000 Kuwaitis and holding of billions of dollars of stolen Kuwaiti property.

* Inadequate disclosure of Iraq's internally held assets.

* Inadequate disclosure of its weapons of mass destruction.

* Recent public comments by Iraqi Vice-President Taha Yassin Ramadan restating Iraq's claim to Kuwait.

* The summary trials and life sentences handed down to two British businessmen. (UN resolutions had ordered Iraq to release all third-country nationals.)

* The absence of any commitment to renouncing terrorism. (After Tuesday's meeting, Iraq's UN mission supplied a letter declaring it rejection of terrorism.)

Western delegates also said Baghdad hadn't done much to reassure civilians in the Kurdish north and Shiite south - or to guarantee the return of those who fled the postwar crackdown.

Iran's UN Ambassador Kamal Kharrazi circulated a letter citing ``credible evidence that the Iraqi Army is preparing for a general mopping-up operation in the south and south-east where close to 700,000 Iraqi citizens are contained.'' It warned that Iran ``is absolutely unable, with or without international humanitarian assistance, to attend to the needs of another influx of Iraqi refugees.''

French sources cited as positive developments Iraq's cooperation in establishing a six-mile demilitarized zone along the Iraq-Kuwait border, and in nominating a representative to the boundary demarcation commission.

Samir al-Nima, Iraq's charg'e d'affaires at the UN, insisted that Iraq had ``complied fully with whatever was required to meet our obligations as stated by Resolution 687.'' He contested the right of the US and Britain to decide the sanctions issue, and called on the UN Secretariat to issue an objective report about Iraq's cease-fire compliance.

``We believe Iraq has not been treated fairly,'' he said, citing recent news-media reports that predict Iraq faces ``an imminent disaster unless some step is taken to alleviate the hardship.''

UN Secretary-General Javier P'erez de Cu'ellar said in late May that no more than 30 percent of Iraq's income should go to the payment of war reparations. The UN chief said he set the figure on the basis of Iraq's estimate that it should be able to resume oil exports at its prewar level by 1993.

Mr. P'erez de Cu'ellar projected Iraq's income then would be $21 billion, if oil prices remain steady. Of that amount, he said, 48 percent would go for necessary imports, and 22 percent to service a foreign debt of $42 billion.

Arab diplomats say that without investment funds, Iraq's economy cannot recover. More important, they say, the proposal does not set a cap on Iraq's liability for war damages - and therefore does not limit the number of years Iraq would be required to pay 30 percent of its oil income.

The US State Department has called for a levy of 50 percent, and British sources say 30 percent is the lowest acceptable figure. But France, the Soviet Union, and China say 30 percent is high.

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