VZCZCXRO6124
OO RUEHBC RUEHBZ RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUCNDT #1187/01 3532152
ZNR UUUUU ZZH
O 192152Z DEC 07
FM USMISSION USUN NEW YORK
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3371
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY
RUEHGG/UN SECURITY COUNCIL COLLECTIVE PRIORITY

UNCLAS SECTION 01 OF 02 USUN NEW YORK 001187 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV UNSC IZ
SUBJECT: SECURITY COUNCIL RENEWS MNF-I, DFI AND IAMB 
 
¶1. (SBU) Summary: On December 18, the UN Security Council 
unanimously approved the extension of the mandate for 2008 of 
the Multinational Force in Iraq (MNF-I) and the arrangements 
for the Development Fund for Iraq (DFI) and the International 
Advisory and Monitoring Board (IAMB).  The U.S., UK and 
Slovakia cosponsored the resolution, which is numbered 
Resolution 1790.  Prior to adoption, at Russia's request, the 
Security Council received a briefing by Warren Sach, UN 
Controller, on behalf of the IAMB.  Sach identified five 
major issues of concern in the handling of DFI monies (which 
are primarily revenues earned from petroleum exports). 
Following adoption of the resolution, the U.S, UK and Iraq 
Permanent Representatives spoke, emphasizing the steady 
transition of Iraq to full integration within the 
international community.  The Iraqi Perm Rep, Hamid 
al-Bayati, emphasized that the government of Iraq considers 
this extension of MNF authority to be its "final" extension. 
End summary. 
 
IRAQ RESOLUTION ADOPTED 
 
¶2. (U) Following final approval by Prime Minister Maliki of 
the MNF-I resolution text, the U.S. requested during the 
morning of December 18 that the resolution be put "in  blue," 
with a vote in the afternoon.  Despite the fact that the 
"blue" period normally lasts 24 hours, Council members agreed 
to this expedited process given the consenus on the text and 
the crowded Council calendar.  In an intervention after the 
vote, Ambassador Khalilzad noted that the decision to extend 
the mandate, coupled with recent decisions to extend the 
mandate of the UN Assistance Mission to Iraq (UNAMI) and to 
launch the Iraq Compact in May, "signal that the 
international community recognizes that what happens in Iraq 
has profound consequences for us all, and that the Iraqis 
striving to establish a stable, peaceful and prosperous 
democracy merit our support."  UK PermRep Sawers echoed this 
sentiment, and noted that the UK is determined to "fulfill 
its responsibilities and obligations to the Iraqi government 
and people."  Sawers said the UK's withdrawal from Basrah 
should not be considered the end of the UK's involvement in 
Iraq. 
 
¶3. (U) Iraqi PermRep Bayati said the Council,s adoption of 
the resolution was a "historic day" because it marked his 
government's request "for the last time" for MNF support.  He 
While describing MNF's assistance as "essential to accomplish 
the mission started with Iraq's liberation," he underscored 
several times the Iraqi government,s desire that this 
resolution be the last extension of the MNF-I mandate, noting 
that no country desires foreign troops on its soil and that 
MNF should not stay "one day longer than they are needed." 
Bayati delivered an update on the situation in Iraq, and said 
the government is focused on its efforts "to achieve national 
reconciliation, to ensure expanded political participation of 
all national political forces, guarantee respect for human 
rights and the supremacy of law, achieve economic growth, and 
to provide basic services for the Iraqi people."  He claimed 
Iraq had averted civil war and succeeded in rebuilding the 
ISF.  Bayati said the challenges ahead include defeating 
terrorism and al-Qaeda and its allies.  He said Iraq desires 
to play a role in advancing stability in the Middle East.  He 
ended his intervention by calling again on the Security 
Council to reduce or abolish the transfer of five percent of 
Iraq,s proceeds from oil export sales to the UN Compensation 
Commission set up to assist victims of Saddam Hussein,s 
invasion of Kuwait.  The official text of UNSCR 1790 is at 
http://www.un.org/Docs/sc/unsc resolutions07.htm 
 
IAMB BRIEFING 
 
¶4. (U) UN controller Warren Sach, the UN,s representative to 
the IAMB (comprised of the Arab Fund for Economic and Social 
Development, the IMF, the World Bank, the UN and the GOI), 
provided an update on IAMB activities before the vote at 
Russia's request.  Sach recalled that the IAMB had been set 
up as an audit oversight body for the DFI, which to date has 
held deposits of USD $70 billion in oil export sales, 10.2 
billion in transfers of Oil-for-Food monies, and $1.5 billion 
in transfers of frozen Iraqi assets.  He reported that the 
IAMB has met 21 times since October 2003.  In the judgment of 
the IAMB, "major issues" of concern related to the handling 
of DFI resources are the following: 1) the absence of a 
comprehensive oil metering system; 2) the use of barter 
transactions (especially those not reported to the DFI);,  3) 
inadequate controls over expenditures; 4) oil smuggling; and 
5) "certain" contractual practices.  He said these concerns 
had been corroborated by other independent audits, including 
those undertaken by the USG. 
 
¶5. (U)  Turning to the future, Sach reported that the IAMB 
was working closely with the board's Iraqi successor, the 
 
USUN NEW Y 00001187  002 OF 002 
 
 
Committee of Financial Experts (COFE), to prepare for the 
upcoming GOI takevoer of the IAMB function.  Russian DPR 
Shcherbak noted that the Security Council had not established 
the DFI or IAMB but had merely "noted" their establishment in 
Council resolutions.  He said Sach's briefing underscored the 
need for the Council to exercise its oversight over the IAMB 
and DFI.  To this end, he called for the IMF (as incoming 
chair of the IAMB) to brief Council members in Washington in 
January, in order that the Security Council might gain a 
better understanding of the state of play within the 
DFI/IAMB.  Shcherbak asked Sach to organize this briefing. 
Khalilzad