Iraqis blocking final oil-for-food shutdown -UN

UNITED NATIONS, Feb 1 (Reuters) Four years after the UN Security Council ordered the shutdown of the troubled oil-for-food program for Iraq, some Iraqi officials still appear intent on using it for illegal gains, it was disclosed.

The United Nations has been trying to close down the 64 billion dollars programme since the 2003 US-led invasion of Iraq, which ousted Saddam Hussein from power.

It stepped up its efforts after an outside investigation found evidence of mismanagement and corruption by UN officials, contractors and Saddam's government.

But a few outstanding contract and payment disputes have kept the last remnants of the programme alive, and the Security Council last year called on UN managers to resolve all outstanding issues so it could be ended definitively in 2007.

However, former Secretary-General Kofi Annan, in a December 8 letter made public yesterday, said that task had been complicated by allegations from two vendors that authentication documents needed to clear some of the last payments ''have been improperly withheld by authorities in Iraq.'' ''Furthermore it has also been alleged that payments have been requested from the vendors as a condition for authentication,'' added Annan, whose term as UN leader ended on December 30.

''These complaints have been shared with the Iraqi authorities but regrettably we have received no response,'' Annan said in the letter, addressed to the Security Council.

Russian UN Ambassador Vitaly Churkin, the council president for January, expressed the UN body's ''concern and disappointment'' over those allegations and said it had urged the Iraqi government to resolve the issues so the program could finally die.

The oil-for-food program was put in place in 1996 to soften the impact of UN sanctions on ordinary Iraqis by letting Baghdad sell oil to finance purchases of humanitarian goods.

The sanctions, including a ban on oil sales, had been imposed after Baghdad's 1990 invasion of neighboring Kuwait.

Reuters SBA VP0720