17 July 2003

Weekly Update

(12-18 July 2003)

Oil-for-Food Supplies Worth $1.9 billion

 Prioritized for Early Delivery to Iraq    

Multi million dollar contracts for heavy equipment and spare parts for Iraq’s oil and electricity sectors have been prioritized for immediate delivery following consultations this month with the Coalition Provisional Authority (CPA), Iraqi representatives and UN agencies. 

The contracts, chosen from the Oil-for-Food Programme’s humanitarian pipeline are fully funded from pre-war oil sales and include items urgently needed for the rehabilitation of Iraq’s infrastructure. Regular weekly meetings of UN and Iraqi experts and CPA advisors have so far produced a list of 1,419 contracts with items totaling $1.95 billion, including the oil sector ($1.038 billion); electricity ($794 million); water and sanitation ($54 million); Youth and Sports ($19.4 million); Labor and Social Affairs ($11 million). Prioritized contracts listed by sector and country of origin will be posted on the OIP website.

Adoption of resolution 1483 by the UN Security Council on 22 May opened the door to a close working relationship between the parties to move urgently needed items from the Programme pipeline of fully funded contracts totaling some $10 billion. Delivery of these items into the country was interrupted by war on 20 March and resumed only partially with the adoption of resolution 1472 on 28 March giving authority to the Secretary General to prioritize the shipping of emergency humanitarian supplies only. Resolution 1483 expanded the menu of deliverable items from food, medicines and health, water and sanitation supplies to include goods and supplies deemed by all parties to have “relative utility” based on post-war assessments of immediate and longer term reconstruction needs.

The dimensions of this month’s list, with more items and sectors to follow, indicates the importance given to immediate needs in the electricity and oil sectors. The lists of contracts in each sector represent more than 70 per cent of the total approved and funded contracts contained in the Oil-for-Food pipeline for these sectors.

The relevant UN agencies and programmes will begin to work directly with suppliers concerned with the prioritized contracts to expedite shipments once locations have been identified for their delivery.

Emergency Deliveries

Deliveries under resolution 1472 now total $452 million of the $1.4 billion worth of prioritized contracts contained in the pipeline.  Most are in the food ($381 million), electricity ($47 million) and health ($13 million) sectors.

Local Procurement

A concerted effort is being made to encourage and expand local procurement as the most expeditious and cost effective way of providing the required goods and services.  Local procurement would also help to jump-start the economy and provide opportunities for gainful employment for the Iraqi people.   

Local procurement under resolution 1472, funded from the Iraq escrow account, so far includes: 1.25 million tons of wheat by the World Food Programme (WFP) at an estimated cost of $152.4 million; and 500,000 tons of barley worth $35.4 million by the UN Food and Agriculture Organization (FAO).  Another FAO project for the local procurement of wheat and barley seeds valued at $860,210 was approved this week.

Additional information is available from the website of the Office of the Iraq Programme. For further information please contact Ian Steele email: steelei@un.org