The New U.S.-Iraq Relationship

By Fred Axelgard

Later this month, when U.S. Ambassador-Designate to Iraq David Newton appears before the Senate Foreign Relations Committee for confirmation as the first U.S. envoy to Baghdad in nearly two decades, Capitol Hill will briefly focus on one of the least-studied aspects of U.S. Middle East policy: The growing American relationship with the once inimical Baathist regime of Iraq. This relationship was formalized last November by restoration of diplomatic ties between Washington and Baghdad after a hiatus of over 17 years, which had followed an extended period of expanded communications and trade between the two countries.

The timing of Ambassador-Designate Newton's confirmation is not without its ironic twist, however. For not with standing the resumption of formal relations and the ensuing "honeymoon" in U.S.-Iraq relations, Congress appears poised to jar this forward momentum by means of a possible vote to put Iraq back on the State Department's list of supporters of international terrorism.

In passing the 1979 Export Administration Act (EAA), Congress created this list as a way to exert economic pressure against regimes known to support international terrorism. In early 1982, then Secretary of State Alexander Haig removed Iraq from the list in the wake of general "positive signals" from Baghdad toward Washington. The move was taken without congressional consultation and provoked immediate protest, particularly from the House of Representatives. However, it appears that no effective counter-move was possible at the time because the FAA provided no clear guidelines for removing countries from the list.

The issue was raised, however, when the EAA came up for reauthorization before the 98th Congress. Late last year (just weeks before Washington and Baghdad restored diplomatic ties), as a result of amendments offered by Senator Alan Dixon (D-IL) and Congressman Howard Berman (D-CA), a House-Senate conference committee deliberating on the EAA agreed to language which could have put Iraq back on the terrorism list in 90 days unless President Reagan certified that Iraq was no longer supporting international terrorism. Only the fact that Congress adjourned before the conference committee could complete deliberations on the rest of the EAA amendments prevented enactment of this provision—which in retrospect could have upset seriously the delicate final stages of formal U.S.-Iraq rapprochement.

Since that time, the House and Senate have moved quickly to pass bills to reauthorize the EAA. The current House version contains the terrorism-related language agreed to by the conference committee last fall. The Senate bill does not. A House-Senate conference on the EAA is expected to convene and complete its work before Congress's July 4 recess begins.

As it did last year, the State Department is opposing this legislation. Discussions with sources on Capitol Hill and in the State Department provide a mixed picture of anxiety tempered with optimism that the provision may be dropped in conference. Senator Dixon's involvement in the matter has declined, although sources indicate that he is "not eager to reopen the issue" by proposing that it be dropped in conference. Nor is the Banking Committee Chairman, Senator Jake Garn (R-UT), reportedly prepared to get deeply re-involved in what amounts to a minor segment of the overall EAA bill.

Iraq's Retreat From Terrorism

As a result, hopes and efforts to have the provision withdrawn during the House-Senate conference depend on persuading its main proponent, Congressman Berman, to drop his support. To do so the State Department has provided Berman with intelligence briefings indicating that Iraq has severed completely its own terrorism connection, adopted a positive stance against international terrorism, and has cooperated in recent, specific incidents, some of which were not related to Iraq's own security.

The underlying argument being made by the Administration is that a congressional move to pin the terrorism-supporter label back on Iraq involves no benefits, only costs. It will not produce an Iraqi retreat from terrorism because this already has occurred. Nor, apparently, can forcing the Reagan Administration to certify Iraq's non-terrorist status be turned into a high-visibility political issue, since the certification would be done on a classified basis. As for costs, for Congress to push ahead with such a process now could upset relations and make future U.S.-Iraq cooperation against terrorism more difficult.

Therefore, one analyst suggests that should the EAA be enacted with the existing terrorism language intact "it should be possible to certify" that Iraq does not support terrorism. He also suggests that the present high level of concern over the amendment would shift quickly to statements deemphasizing its significance and that the issue "won't be a turning point in our relations" with Iraq.

A second issue in the renewed U.S.-Iraq relationship is the Iraqi desire to conclude a general trade agreement in order to facilitate U.S. trade with agencies of the Iraqi government besides the Ministry of Trade. (The Iraqi economy remains heavily dominated by the public sector.) The issue has been under discussion ever since Deputy Assistant Secretary of Commerce James Kelly traveled to Baghdad shortly after the resumption of diplomatic relations. Administration sources have stated that on June 5, after months of delay, Commerce Secretary Malcolm Baldridge initialed a draft of such an agreement. The document will be submitted to an inter-agency review process, which sources expect could take "only two or three days, once it gets started."

Baghdad to Review Agreement

After the draft agreement has been approved by the Reagan Administration it will be submitted for review to the Iraqi Government. The Iraqis have reportedly expressed concern that progress on the agreement was being delayed by political considerations in the U.S. Commerce Department sources discount this suggestion, indicating that the main difficulty was to overcome lack of knowledge and sensitivity about Iraq within the Commerce Department, since Iraq has been "an unknown entity" there for almost two decades. Once the Iraqi Government completes its review of the draft agreement, a U.S. Government delegation will travel to Iraq to complete the process. This could occur as early as July.

One final issue in U.S.-Iraq relations, that of technology transfer, involves serious long-term implications. Over the years, Iraq has expressed considerable interest in importing high technology items from the U.S. for use in activities ranging from oil exploration to control of cross-border immigration. However, such exports to Iraq are closely watched in Washington for various reasons, including concerns over East-West strategic trade, nuclear proliferation, and international terrorism.

As a result of the resumption of U.S.-Iraq relations and the hopes of American businessmen to play a substantial role in exporting to the Iraqi market, renewed efforts have been made to break the restrictive logjam on exports to Iraq. Approval may soon be given for two companies, Sperry and Digicon, to export computer technology to Iraq. These transactions would serve as a turning point in expanding U.S.-Iraq relations.

Fred Axelgard is a Fellow in Middle East Studies at Georgetown University's Center for Strategic and International Studies, and is the author of a new monograph on U.S.-Iraq relations.