The UN and Iraq
The UN is again at the centre of discussions about Iraq's future. Members of the Security Council are all in agreement on one central issue: that the Iraqis themselves need to be given a much greater role in restoring stability and in running the country. Agreement here means that the dynamic within the Security Council is sharply different from that of March 2003, when the issue of whether to resort to war was being hotly debated, and this is bound to ease ongoing efforts to reach a consensus on the future of the UN's role in Iraq. But several major obstacles and sensitivities need to be overcome along way.
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Dealing with Iran and North Korea
The US is again turning its attention to the proliferation challenges posed by North Korea and Iran. It is perhaps indicative of the extent to which Iraq posed an exceptional case – in terms both of US threat perceptions and the legal, political and military circumstances which led to war – that Washington's non-proliferation policy has shifted from military force and regime-change strategies back toward traditional multilateral diplomacy designed to alter Tehran and Pyongyang's behaviour. Nevertheless, prospects for diplomatic success in either case are plainly mixed.
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Paying for Iraq and the war on terror
On 7 September, 2003, President Bush announced that he would request that Congress appropriate an additional $87bn – including $66bn for ongoing military operations in Iraq, Afghanistan and elsewhere, and $21bn for reconstruction assistance in Iraq and Afghanistan. The request came on top of almost $70bn in additional funding for FY2003 that Congress approved last April, barely five months ago, for the war in Iraq and for homeland security. An intense and highly partisan debate has developed in Congress concerning the fiscal sustainability of the administration's policies and the degree to which the costs of the Iraq war in particular had been underestimated or downplayed by the Bush administration.
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Iraq's role in oil markets
The immediate challenge is to return Iraqi oil production and exports to pre-war levels. At issue for the medium and long-term, however, is what impact Iraq's gradual re-emergence as a major producer will have on global oil markets. Having benefited from higher prices caused in part by the loss of Iraqi supply for much of 2003, the return of Iraqi oil will in the first instance exacerbate the current pressures on OPEC caused by slowing global oil demand and strong supply growth from non-OPEC producers. Yet, within the next two years, OPEC may well conclude that propping up prices through further production cutbacks is untenable, and accept a period of low prices. Managing Iraq's reintegration into OPEC will continue to be a task of major importance.
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Crisis in Palestine
The Israeli cabinet's decision in principle to 'remove' Palestinian Authority (PA) President Yasser Arafat marked the latest crisis to hit a peace process that was already reeling from the breakdown of the Palestinian ceasefire – a development that on 6 September had led to the resignation of Mahmud Abbas (Abu Mazen) as Palestinian prime minister. The interlocutor preferred by the US and Israel in their attempts to undercut the entrenched Arafat, with whom he competed for power, Abbas was quickly replaced by Ahmad Qurei (Abu Ala). Abbas's departure has dealt a further blow to hopes that progress can be made on the US-sponsored 'Roadmap' and increased Israeli frustration with Arafat. But Arafat's forcible removal would only magnify the current crisis, rather than create conditions for its resolution.
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