The US Export-Import Bank: No evidence of financing restricted chemical exports to Iraq

Abstract

The authors have reviewed U.S. Export-Import Bank (Eximbank) transactions involving chemicals exported to Iraq from January 1987 to August 1990. Specifically, the authors examined (1) whether there was any evidence that the Eximbank financed the export of dual-use chemicals to Iraq and (2) what the Eximbank`s role was in monitoring and controlling chemical exports. Results are based primarily on a review of documents provided to them by the Eximbank. They did not verify the Eximbank data or corroborate it with the records of the banks or exporters involved in the transactions. There was no evidence in the documents they reviewed to suggest that the Eximbank financed the export of dual-use chemicals (chemicals with both commercial and military applications that could be used for chemical weapons) -- as defined by the Department of Commerce -- to Iraq between January 1987 and August 1990. There were approximately 190 transactions between Iraq and the Eximbank during this period. They focused their review on the eight transactions involving pesticides and related products. The Eximbank has no responsibility or authority for monitoring or controlling the export of chemicals or any other commodities: the Departments of Commerce and State and the US Customs Service share those responsibilities. Nevertheless, the Eximbank has recently developed specific procedures to review applications for financing chemical exports. However, such procedures were not in place when the Eximbank approved the applications for seven of eight pesticide transactions that occurred between January 1987 and August 1990.