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United Nations sanctions were first imposed in August 1990 following Iraq's invasion of Kuwait. In 1991, the Security Council established sanctions to stop Iraq from acquiring or developing biological, chemical, and nuclear weapons. To achieve this, the Security Council prohibited all nations from buying Iraqi oil or selling the country any commodities except for food and medicine. It further established a weapons inspection regime to ensure that Iraq destroyed its weapons of mass destruction and stopped its weapons programs. Concerned about the humanitarian need of the Iraqi people, in 1995 the Security Council established a controls program for Iraq's oil sales that allows for the purchase of food, medicine, and essential civilian goods (the oil for food program). With international support for the sanctions eroding, in 2001 the Security Council passed a new sanctions resolution to address humanitarian concerns while keeping Iraq from rebuilding its weapons systems. Although the U.N. controlled $51 billion of Iraq's oil revenues from 1997 to 2001, Iraq earned an additional $6.6 billion in illegal revenue from oil smuggling and surcharges during the same time. Further, although the sanctions prohibit Iraq from obtaining goods not approved by the Security Council, Iraq is able to buy unapproved goods with its illegal revenue. The U.N. Security Council also requires weapons inspections to verify that Iraq is not rebuilding weapons of mass destruction, but Iraqi actions forced the U.N. to withdraw its weapons inspectors in 1998. As a result, the U.N. cannot ensure that Iraq has stopped programs to develop chemical, biological, and other weapons. Moreover, there are indications from multiple sources that it continues to develop such weapons. In design, U.S. licensing standards for exports to Iraq are more restrictive than U.N. requirements. In practice, however, U.S. and U.N. requirements are almost identical because the United States plays a substantial role in the U.N. approval process for exports to Iraq. Consequently, almost all U.S. exporters who get U.N. approval are also granted a U.S. export license. A new sanctions agreement, due to take effect at the end of May 2002, changes the contract screening process and could make the sanctions more effective in allowing imports of humanitarian and civilian goods to Iraq. The new sanctions allow Security Council members to hold only items on a controlled list, which includes dual-use items. Further, the new sanctions have provisions to single out an objectionable item from a shipment of goods. These expected changes should make it easier for Iraq to import goods to rebuild its civilian economy. However, the new agreement has no provisions to deter oil smuggling and illicit trade or to reintroduce weapons inspectors. Prior Security Council resolutions address weapons inspections but Iraq is not complying with them. Until these problems are addressed, the sanctions cannot provide assurance that Iraq has stopped trying to acquire and build weapons of mass destruction.

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