UN reassures Kuwait over Gulf war compensation

27 June 2003
The UN on 24 June reassured Kuwait that compensation due from the 1990-91 Gulf war would continue to be paid, seeking to allay fears that the new UN Resolution 1483 on the oil-for-food programme provided insufficient guarantees. The resolution cut the proportion of Iraq's oil revenues going to settle approved compensation claims to 5 per cent from 25 per cent. At a three-day session of the UN Compensation Commission (UNCC) , a plan was unveiled for an account to be set up at the Federal Reserve Bank of New York into which oil revenues will flow and from which 5 per cent will automatically flow to the UNCC.

The commission also approved a further $2,270 million in compensation claims, bringing to $46,300 million the total awarded, of which $16,700 million has been paid. Total claims are about $300,000 million. Settlements will inevitably be much slower given the smaller proportion of revenues devoted to them and the dilapidated state of Iraq's oil infrastructure. According to figures quoted in London's Financial Times, the UNCC expects to receive about $600 million in 2003 compared with $3,000 million in 2002. The UNCC 24-26 June meeting looked at how to prioritise claims given these changed circumstances, and is understood to have decided that small claims should be settled first.

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