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Iraq still faces shortages despite oil-for-food deal

Iraq - estimated cost of food imports for one year
Food stuffImport requirements
(thousand tons)
Import cost
(million US$)
Wheat flour2 260746
Coarse grains15332
Vegetable oil198168
Red meat133333
Poultry meat207207
Eggs (million)1 816242
Baby milk43129
Total cost of food imports3 106

The agreement signed by Iraq and the United Nations allowing Iraq to resume limited sales of oil will undoubtedly alleviate the present serious food shortages in Iraq, according to FAO's Global Information and Early Warning System (GIEWS). But oil sales allowed under the agreement will not generate enough income to meet food import needs, according to a special feature in the latest edition of the GIEWS publication Food Outlook.

The "oil-for-food" deal signed on 20 May permits the sale, under certain conditions, of US$2 billion worth of oil over a six months' period. Under terms of the UN Security Council resolution, substantial deductions will be made from this total to pay for war reparations, humanitarian programmes in the Kurdish areas in the three northern Governorates and other UN costs, including those to maintain the special commission for the elimination of weapons of mass destruction.

Assuming that the agreement were to be renewed on the same conditions for an additional six months, the balance of funds after these deductions would fall more than $1 billion below the estimated requirements of over $3 billion for food imports alone.

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