Identifier
Created
Classification
Origin
03AMMAN4098
2003-07-07 07:16:00
CONFIDENTIAL
Embassy Amman
Cable title:  

JORDANIAN ACTION ON IRAQI ASSETS

Tags:  ECON EFIN PREL PTER IZ JO UNSC 
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C O N F I D E N T I A L AMMAN 004098 

SIPDIS

E.O. 12958: DECL: 07/04/2008
TAGS: ECON EFIN PREL PTER IZ JO UNSC
SUBJECT: JORDANIAN ACTION ON IRAQI ASSETS

REF: A. STATE 186972

B. STATE 173353

Classified By: Ambassador Edward W. Gnehm. Reasons 1.5 (b) and (d).

C O N F I D E N T I A L AMMAN 004098

SIPDIS

E.O. 12958: DECL: 07/04/2008
TAGS: ECON EFIN PREL PTER IZ JO UNSC
SUBJECT: JORDANIAN ACTION ON IRAQI ASSETS

REF: A. STATE 186972

B. STATE 173353

Classified By: Ambassador Edward W. Gnehm. Reasons 1.5 (b) and (d).


1. Summary. According to a senior Jordanian finance
ministry official, the GOJ -- using an April 24 law under
which the GOJ took ownership of $463 million in funds frozen
in Iraqi bank accounts -- is working hard to reimburse
private Jordanians who have submitted claims for unpaid
deliveries of goods to Iraq before the new Parliament meets
July 15. The ministry had not received Secretary Snow's
recent letter, but will examine it closely and reply. End
Summary.


2. (c) Econ/C called on Finance Ministry Secretary General
Moh'd Abu Hammour July 2 to discuss Jordan's actions and
intentions vis a vis official Iraqi assets frozen in
Jordanian banks. Abu Hammour, who is the number two official
in the Ministry of Finance, said that he had not seen the
letter from Secretary Snow to Finance Minister Marto (ref a).
He read the letter carefully and said he would discuss it
with Minister Marto. It was Jordan's highest priority, he
said, to comply with all UN Security Council resolutions.


3. (c) Abu Hammour said that he had been put in charge of
the inter-ministerial technical committee that is
implementing the April 24 law (text of law emailed to
NEA/ARN) under which the Government of Jordan took ownership
of Iraqi assets frozen in Iraqi banks. Other members of the
committee come from the Central Bank, Ministry of Industry
and Trade, Ministry of National Economy, and Ministry of
Planning. Abu Hammour said the total amount of frozen assets
was JD 328 million ($463 million). The funds were for the
most part held in commercial bank accounts in the name of
Iraqi embassy employees, not official GOI institutions or
high-level officials. Nevertheless, it was clear that the
accounts had been managed on behalf of the Saddam Hussein
government.


4. (c) Approximately, 60-70% of the frozen accounts were in
the Jordan National Bank, the Amman branch of the Rafidain
Bank, and the Housing Bank. The remainder was spread among
smaller banks. Abu Hammour said that the largest Jordanian
bank, the Arab Bank (of which he is a board member) did not
have any such accounts and had been careful to avoid doing
business with Iraq.


5. (c) Under the terms of the April 24 law, approximately
130 private Jordanians have submitted claims to the technical
committee for reimbursement out of the frozen funds. These
claims amount to 60-70% of the JD 328 million total. These
claims were for goods that had been delivered to Iraq under
the terms of the bilateral oil for goods protocol, but for
which payment had not been authorized by the Iraqi government
(acting through the embassy employees) before the accounts
were frozen at the start of the war. The committee is moving
quickly to validate claims and make reimbursements before the
new Parliament comes into session July 15, after which he
feared political interference by deputies.


6. (c) Abu Hammour also noted that the April 24 law
entitled the Central Bank of Jordan to submit claims against
the frozen funds. However, it was Abu Hammour's feeling that
the CBJ's JD1.1 billion claim should be dealt with
multilaterally along with other official claims under Paris
Club procedures. (Indeed, Abu Hammour was personally worried
-- please protect -- that paying private claims under the
April 24 law would expose the Jordanian government to claims
by a future Iraqi government.)


7. (c) Comment. As shown by Jordan's cooperation with the
Treasury-led interagency team that came to Amman to track
Iraqi assets, Abu Hammour is undoubtedly correct that Jordan
does not want to get on the wrong side of the United States
or UN resolutions on this subject. It does not seem,
however, that the April 24 law has been examined in light of
the UNSCR 1483 requirement to turn frozen GOI funds over to
the Development Fund for Iraq. The Jordanians might be able
to argue that the April 24 law constitutes a "prior judicial
judgment" under para 23(b) of the resolution (which the
Security Council approved May 22). Post would be pleased to
facilitate further communications with the Jordanians on this
subject.
GNEHM