UNITED NATIONS, May 7 — The United States has begun circulating a draft resolution to lift sanctions in Iraq. The measure, which Secretary of State Colin L. Powell said he “expected” to be introduced this week, would make a few concessions to Russian and French interests but leave the major political and financial levers of the future Iraqi government in the hands of coalition forces and the interim authority being formed with their approval.
The resolution would allow for a partial payout of the existing $10 billion in approved contracts for food, medicine and industrial goods authorized by the United Nations before the war. It also would allow for a United Nations special representative who would act as a nominal partner in the political reconstruction of Iraq, Security Council diplomats said today.
The two moves seem designed to solicit Russian and French support — Russia’s because of the roughly $1.5 billion in outstanding approved contracts Russian companies held with the Iraqi regime, and France’s with the offer of a United Nations role that the Secretary of State Colin L. Powell continued to call “vital” today.
The resolution’s language, which talks of a United Nations special coordinator working with coalition forces, gives this person some latitude to advise the parties and coordinate humanitarian activities. But it provides little or no explicit authority to control the formation of Iraqi political and civil institutions, the diplomats said. American officials suggested today that the coordinator would have some latitude to define his own role, based on his ability to work with the various parties.
The draft resolution also envisions a role for multilateral financial institutions like the World Bank and the International Monetary Fund on an international advisory board monitoring the use of Iraqi oil revenues. But, as in the political arena, the resolution cedes little if any explicit control to the multilateral institutions, whose membership includes countries that had bitterly opposed the U.S.-led war.
As Mr. Powell was flying to New York to meet with the United Nations secretary general, Kofi Annan, the treasury secretary, Jack Snow, announced in Washington that the Bush administration was suspending many of the sanctions the United States had placed on Iraq in 1991, in the aftermath of the first Persian Gulf war. The move allows American companies to begin exporting many goods to Iraq, and it allows people who live in the United States to send up to $500 a month to each Iraqi household, Mr. Snow said.
The timing of Mr. Powell’s trip and Mr. Snow’s announcement suggested that the administration was sending a two-pronged message to its Security Council colleagues, showing it was willing to work with them but just as willing to act on its own.
Security Council diplomats predicted that the unveiling of the draft resolution would begin a new round of tough negotiations. France and Russia will square off against the United States and Britain, they said, with the former seeking to use whatever leverage it has in existing Security Council resolutions to avoid being shut out of the politics and profits of the new Iraq.
The most contentious issue in the upcoming negotiations, one diplomat predicted, would be control of future Iraqi oil revenues. “I think it will be long and hard,” one Security Council diplomat said. “I think people will try and be a bit careful with the vitriol this time and try and make it constructive.”
For all the politics involved, part of the upcoming negotiations will be purely financial. Russian companies had approved contracts to supply as much as $1.5 billion worth of bulldozers, trucks, pipeline construction materials and other goods to Saddam Hussein’s government before the war began. Currently authorized French contracts amount to about $300 million, according to United Nations documents.
On Monday, a senior state department official, speaking on condition of anonymity, said that “there’s no principle here that with the change of regime that valid contracts are suddenly invalid.”
The financial implications of unraveling the seven-year-old oil-for-food program — which had put much of Iraq’s economic activity under United Nations oversight — have helped make Russia the leading obstacle to the United States push for a quick decision to lift sanctions by June 3, when the current phase of the oil-for-food program runs out.
Russian diplomats have been insisting that the Council adhere to the letter of the existing resolutions that placed sanctions on the government of Iraq during the rule of Mr. Hussein. This would make international weapons inspections certifying Iraq free of weapons of mass destruction a prerequisite for any Council decision to lift sanctions.
British and American diplomats argue that it was just Mr. Hussein’s regime that needed to be contained. When it fell, the need for the sanctions evaporated.
In the past month, the question of appointing a special United Nations representative became another source of friction. Mr. Powell, the British prime minister, Tony Blair, and others urged Mr. Annan to put a representative into the mix, but he resisted, saying that recruiting a top-flight person would be difficult without a precise job description.