Quitting over oil-for-food 'not on cards' says Annan

UN Secretary-General Kofi Annan has ruled out resigning over the Iraq oil-for-food scandal that is clouding his organisation's global prestige.

In an interview with the BBC, Annan also said he still saw a role for the United Nations in Iraq despite his opposition to the US-British invasion and occupation.

"Resignation is not on the cards for me at the moment," Annan said of the probe into alleged abuses of the oil-for-food programme that has led to the suspension of its former director.

UN members understood the complex nature of the investigation and backed him, Annan said. "I'm carrying on with my work - with their full support, by the way."

The United Nations has suspended ex-programme head Benon Sevan, and Joseph Stephanides, who helped set it up in 1996, pending a probe into the scheme allowing former dictator Saddam Hussein to sell oil despite sanctions to fund food for Iraqis.

Sevan has been accused of steering an Iraq oil allocation to a cousin of Boutros Boutros-Ghali, who was UN secretary-general from 1991 to 1996. Stephanides, who like Sevan is a Cypriot, is alleged to have colluded with a UK envoy to steer a major contract improperly to a British company.

Both officials have denied wrongdoing.

"We have an investigation going on ... and I think they are going about it in a very methodical way, and I think they should complete their work. In the meantime I have lots of work to do," Annan told BBC TV's Breakfast With Frost.

"I think when the report comes out the public will begin to understand how complex this scheme was ... It was a political arrangement, a transaction intended to force Saddam Hussein to comply with inspection requirements, disarmament requirements, and in the process concessions were also made to him."

Annan said those concessions had to be made because Saddam was resisting the scheme while Iraqis were suffering from malnutrition. "In retrospect one may criticise it but at the time because of the urgency and the need to help the Iraqi people some concessions were made," he said.

In the best-documented figures to date, Saddam's government earned close to US$2 billion ($2.85 billion) from illicit trade and surcharges through the programme, according to CIA adviser Charles Duelfer.

But he said the Iraqi government earned more than US$8.5 billion outside the oil-for-food programme, mainly through illegal oil trade to Jordan, Syria, Turkey and others which was known to UN Security Council members.

Annan ruled out UN peacekeeping troops in Iraq. But he said there was far more the body could do helping build institutions, train government officials and support reconstruction.

"It does imply ability to be able to move around very freely and get the job done," he said, noting the dire security situation.

- REUTERS