Turkey Shrugs Off U.N. Blockade of Iraq

Openly flouting the U.N. blockade against Baghdad, Turkey has introduced regulations that, in effect, legalize the import and sale of ever-growing volumes of Iraqi fuel smuggled into this country.

Under the new rules, outlined in separate circulars issued last month by the Finance and Trade ministries, thousands of Turkish truck drivers carrying cheap Iraqi diesel from Kurdish-controlled northern Iraq will now have to pay a 15% tax when they sell their merchandise in Turkey, thus bringing their trade under government auspices.

The measures also legalize overland imports of Iraqi crude via the Habur border crossing with Iraq. Retailers, once restricted to selling fuel products from Turkish refineries, are now allowed to sell Iraqi diesel as well.

“Nobody can call us smugglers anymore. Thanks to the government, this business is now completely legal,” said Ismail Ozgoren, a Kurdish oil tycoon who has been reaping handsome profits from the illicit trade.

Ozgoren has good reason to gloat. Last week, the government gave the company he formed with some friends exclusive distribution rights for the diesel, amid allegations of cronyism and kickbacks.

Waving a blue file containing copies of all the state regulations governing Iraqi diesel imports, including several circulars stamped “secret,” Ozgoren said the new measures have erased widespread fears that the trade would be abruptly banned, adding, “We can all relax now.”

He’s probably right.

Publicly, U.S. officials denounce the trade as a smuggling operation in breach of U.N. sanctions slapped on Iraq after its invasion of Kuwait in August 1990. But Western diplomats in Turkey say the Clinton administration has done nothing to stop the flow of contraband fuel because it benefits the Turks, key allies who have suffered enormous losses because of the blockade.

“The standing rule,” said a Western diplomat speaking on condition of anonymity, “is that the current trade is small enough and local enough that it doesn’t hurt our Iraq policy.”

But many Western officials privately admit that not only is the trade growing, it also is enriching Iraqi President Saddam Hussein and his sons, Uday and Osai, who are believed to control the Iraqi end of the smuggling.

There is concern that by placing the distribution of the diesel in the hands of a single company, the Turkish government will enable Hussein to profit further by dealing directly with the firm.

State Department spokesman James P. Rubin recently confirmed that talks were underway with Ankara to bring the illicit trade under a U.N. deal that permits Iraq to sell limited amounts of oil to buy food and medical supplies. U.S. officials say Turkey favors the move.

But a senior Turkish official said, “Any attempt to bring international supervision to the trade will be strongly resisted by Turkish traders, the Kurds and, above all, by the Iraqis.”

The rise in the newly legalized fuel business is evidenced by hundreds of rusty metal tanks littering the main highway between Iraq and Turkey. The tanks, once welded on the sides of trucks to smuggle in the diesel, have been cast off in favor of larger, translucent containers that can carry as much as 2,000 gallons of fuel.

Sehmuz Cor, a local trucker who has been doing the run since 1995, said that with temperatures soaring well above 100 degrees in the summer months, conditions are grueling.

“There is no cold water or decent food on the Iraqi side, and it’s not safe to leave your truck unguarded, so you have to sleep in it for days while waiting to load your diesel,” he said during a stop on his way back from the Iraqi border.

But the benefits reaped from the diesel trade are highly visible here in Kiziltepe, a bustling town about 90 miles northwest of the Iraqi border. Shiny new cars jostle for space with donkey carts in narrow streets that are dotted with jewelry stores boasting gold bracelets.

According to Mehmet Sahin, a spokesman for the local truckers association, one of every 10 people here is involved in the diesel trade. He said that before the trade began, widespread unemployment drove town youths into the arms of the Kurdistan Workers Party, a Kurdish rebel army that has been fighting for self-rule in Turkey’s mainly Kurdish southeastern provinces for the past 14 years.

“Now, instead of going to the mountains,” he said, “they go to Iraq.”