Policy Brief #5 (April 2001) by

by George A. Lopez

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In Brief The United States should seek to limit Iraqi designs to develop weapons of mass destruction by supporting a UN-sponsored ‘smart' sanctions mechanism. Smart sanctions would involve a tightened system of border monitoring and verification with an eye toward control of dual-use technologies. Financial controls through the UN escrow account should be retained to limit Iraq's purchasing abilities in the global marketplace. Private accounts of Iraqi elites should also be frozen to limit purchases of dual-use goods or expertise. The elimination of the blunt general trade sanctions, which are already leaking, would lift a considerable burden off the Iraqi people.

At the conclusion of his February trip to the Middle East, U.S. Secretary of State Colin Powell created a new moment in the tragic and puzzling quagmire of United Nations sanctions on Iraq by calling for smart sanctions. This pronouncement sparked a major foreign policy debate regarding what some consider U.S. impotence in dealing with Saddam Hussein.

The debate demonstrates that both the UN and the United States desperately need a realistic strategy to halt the current collapse of the comprehensive sanctions regime. This search has legitimacy because there remains justifiable concern about holding in check Iraqi designs to develop weapons of mass destruction. Smart sanctions constitute the strategy for stifling such weapons development.

Although the term smart sanctions is new in U.S. policy circles, defining its precise contours has been the subject of a number of UN expert meetings in recent years. Technical knowledge on these matters exists and can be mobilized to create a rather effective system for controlling the flow of expertise, material and monies which might be used for weapons development. But member states must authorize the Security Council to tap this knowledge base. Thus U.S. leadership on this issue is critical.

A Smart Sanctions Regime
Under a smart sanctions regime the Security Council would revamp the current embargo in favor of a modernized sanctions system aimed at two key targets: the control of financial resources generated by the export of Iraqi oil, and the prohibition of imports of weapons and dual-use goods.

Within this scheme Iraqi oil revenues and military-related imports would remain strictly controlled, but trade in civilian consumer goods would begin to flow freely. Pre-approved foreign investment would be allowed in certain Iraqi industries, most notably oil.

Neighboring countries and former trading partners would thus be offered an attractive bargain: the resumption of legalized civilian trade with Iraq, in exchange for their cooperation with tightened controls over oil revenues and weapons-related imports. Trading states would receive tax revenues that would be lost under either strict or porous sanctions and international assistance in halting black market operations that are criminalizing their economies. The region and the international community would receive greater assurances that Iraqi weapons development is rendered moot. Thus, sharpening the sanctions would facilitate a new convergence of interests, providing the glue for a viable coalition.

Under smart sanctions, all oil export revenues would be channeled through the existing UN escrow account. This would contribute to plugging the leakages that have opened in recent months. It also would undermine Iraq's attempts to collect kickbacks from oil purchasers.

The embargo on dual-use imports presents special but not insurmountable challenges. Among the tasks involved in a tightened import control system are:

developing a manageable list of the most troublesome dual-use goods to be controlled; creating a system of electronic tagging and end-use certification of dual-use goods; strengthening land-based monitoring by creating fully empowered and equipped Sanctions Assistance Missions, modeled on the UN sanctions experience in Yugoslavia, at major border crossings into Iraq.

Smart sanctions should also directly target Saddam Hussein and his support structure. As was successfully implemented by the European Union against the Milosevic regime, the Security Council should freeze the personal financial assets of Saddam Hussein and his family. The asset freeze must also include senior Iraqi military and political officials, and all individuals associated with Iraqi weapons production programs. The same targeted group should be subjected to a ban on international travel.

To ensure the effectiveness of such a system, some rather specific measures would need to be undertaken:

authorizing the use of escrow account monies to begin paying off Iraq's foreign debt and to assist neighboring states in complying with Security Council resolutions; creating a special investigative commission to track down and expose sanctions violators; assisting UN member states in establishing effective penalties for companies and individuals that violate the new sanctions system.

The strength of such a smart sanctions strategy is that no single component of this package stands alone in wielding coercive clout. Rather, these singularly-focused mechanisms reinforce and complement each other. When linked together such controls provide a tightened sanctions regime with sharpened teeth.

Why Opt for Smart Sanctions?
Some critics of smart sanctions claim that they amount to a reward to Saddam Hussein for defying and outlasting the existing sanctions. Others charge that smart sanctions constitute a weak policy compared with more pro-active measures, such as arming the Iraqi opposition. Skeptics question the effectiveness or untested record of smart sanctions. Each group is dangerously short-sighted.

Whatever the individual fate of Saddam Hussein, or even the success of those who aim to overthrow him, constraining the government of Iraq's ability to buy or trade in goods that lead to weapons development is still the immediate objective. The medium to long term objective, consistent with UN Security Council Resolution 1284 adopted in December, 1999, is to have inter-national inspectors verify Iraqi compliance with the UN mandate to disarm. The incentive to Iraq to embrace this is the promise by the UN that such inspections will end the sanctions.

But in the absence of any current Iraqi interest in meeting the dictates of Resolution 1284, the United States and other Council members are left with focusing on the immediate objective. This task does not at all depend on Saddam Hussein's actions. Rather, it depends on restoring the viability of a coalition of states who are willing to enforce such economic controls. To be successful, smart sanctions need a new commitment from front-line nations and Council members, such as Russia and France, who have long supported a relaxation of conventional trade restrictions on Iraq.

This re-commitment is first based on a critical recognition of the realities of Iraqi sanctions over the past decade. In a blunt, crude, and often inhumane manner, these comprehensive sanctions did produce the desired outcome: The Iraqi leadership still does not have resources sufficient to rearm. And Iraq will acquire these resources only if front-line nations and irresponsible trading partners operate free of constraints or guidelines. Such trade restrictions must and can now be more shrewd and more finely targeted to achieve the same goal. And they can garner the support of a very diverse set of actors, most of whom no longer support the current sanctions regime.

Smart sanctions also carry other benefits. With the commencement of general trade and a controlled level of foreign investment, the UN and the United States would no longer be enforcing an embargo against innocent civilians whose plight has given Saddam Hussein propaganda victories and which sways the sentiments of the region. In a short time, smart sanctions would enable the UN - and its Security Council members - to recapture most of the moral high ground regarding Iraqi policy.

Finally, smart sanctions can be designed and implemented in a rather short time-frame. Moreover, they are sustainable - practically and politically - over the medium to long term. They would continue to prod the Iraqi regime to fulfill its arms inspection obligations and they could remain in effect until Iraq complies fully with UN Security Council Resolution 1284.

Final Observations
Few controversies within the UN have been as bitter as that surrounding the continuance of Security Council sanctions against Iraq. Often called the 'mother of all sanctions resolutions' UN Security Council Resolution 687 of April, 1991 extended the earlier Resolution 661 of August 1990 to impose the most comprehensive and economically devastating set of multilateral trade and financial restrictions in history. Resolution 1284 is the current operative framework for these sanctions.

But in the minds of many, particularly Great Britain and the United States, this economic strangulation has not produced the desired political compliance from Baghdad. Other Council powers, especially France and Russia, have joined dozens of member states in trying to find a compromise to ease sanctions that does not appear as capitulation to Saddam Hussein's stubbornness, but which also reinvigorates the success a decade of sanctions has produced in control-ling Iraq's alleged weapons programs.

This debate has produced a general sanctions fatigue within the Council. Such exhaustion has undermined UN work in a number of related areas, especially regarding humanitarian concerns within Iraq. Because they focus on weapons development, smart sanctions provide the Council with an opportunity to strengthen the elements of the ailing embargo - money and technological goods - that truly matter.

And they provide U.S. strategists with the tough, but fair, approach toward Iraq which they have sought for a long time. The U.S. stake in UN-sponsored smart sanctions could not be more clear.

About the Author
George A. Lopez is director of policy studies at the Joan B. Kroc Institute at the University of Notre Dame. With David Cortright and Alistair Millar, President and Vice-President of the Fourth Freedom Forum, he is co-author of the report, Smart Sanctions: Restructuring UN Sanctions on Iraq. Lopez and Cortright co-director the Sanctions Project, which explores various issues associated with the increased use of economic sanctions by the United Nations and other international actors.

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