Return to an Address of the Honourable the House of Commons
dated 18 July 1996 for the Appendices to the Report of the Inquiry into the Export of Defence Equipment and Dual-Use Goods to Iraq and Related Prosecutions laid before The House on 15 February 1996*

Volume One
Section D Arms and Defence-Related Exports to Iraq
Chapter 2 Applications of The Guidelines in the period
December 1984 to August 1988

Excerpt:
DEFENCE ATTACHE REPORTS

D2.52 The contents of the annual reports made by the Defence Attachés at the British Embassy in Baghdad provide a useful complement to the departmental records regarding defence sales to Iraq.

D2.53 On 22 September 1985 Colonel Eccles, the Defence Attaché submitted his annual report on the military situation in Iraq. *73 The report covered the period September 1984 to September 1985 and paragraphs 13 to 15 contained a review of “Defence Sales”. In paragraph 41, under the heading “Defence Sales and Supplies”, Colonel Eccles noted that there had been “a noticeable decrease in new interest shown by the Iraqis towards British defence equipment”, and identified two reasons for the decrease. First, he referred to “the ever more compelling financial strictures... hardening against unnecessary military expenditure”, coupled with the fact that Iraq was already “comprehensively equipped - perhaps even over equipped”. Second, he concluded that the Iraqis had learnt by experience “the practical implications of British defence sales policy” and “the sort of equipment and training that we are prepared to offer”. In paragraph 42, however, Colonel Eccles recorded that “although there is little new for defence sales and services in the offing, the established lines are proceeding as satisfactorily as can probably be expected, with some £164.5 million of export licences for defence-related equipment business being processed...” Colonel Eccles attached to his Report an Annex dealing with the state of the Iraqi Air Force. In paragraph 14 of the Annex, after commenting that Iraq was “a difficult market for several reasons, not the least being their lack of liquidity” and that “the French and the Soviets are particularly favoured suppliers of Air Force Equipment”, Colonel Eccles noted that “there are still openings available to us, particularly in the field of computers, navigation equipment simulators, radars and communications equipment”. He said that “It is in these areas that we are likely to be successful”. In paragraph 17 he concluded that “our defence sales to Iraq continue to be suppressed by HMG’s policy but there is still a lucrative market for defence equipment and training, which falls within HMG’s guidelines”.

D2.54 On 27 April 1986, after two and a half years in Iraq, Colonel Eccles left his post as Defence Attaché in Baghdad, and submitted a “Valedictory Report” reviewing, in particular, the period October 1985 to March 1986. *74 In paragraph 53 Colonel Eccles said that there was “nothing new ...worthy of note” since his last annual report, but that “lines of British defence equipment that are firmly established here are flourishing unspectacularly”.

D2.55 In a comment on Colonel Eccles’ Valedictory Report, the Ambassador to Iraq, Mr T Clark, noted that “Iraq, unlike Iran, still receives the weaponry and munitions it requires despite new economic constraints imposed by the drop in oil prices and value of the dollar.” *75

D2.56 Colonel Eccles’ Valedictory Report was followed by a Report dated 24 August 1986 from Wing Commander Marriott, the Air and Naval Attaché at the Baghdad Embassy. *76 Wing Commander Marriott, in paragraph 10 of his Report, referred to “two major defence projects, namely the sale of Nimrod AEW aircraft to the Iraqis and the establishment of an aircraft industry based initially on the local assembly of the Hawk training aircraft..., Project Saad 25”. Neither of the two projects materialised. The Hawk project, Saad 25, falls more conveniently into the post ceasefire period and I will refer to it in more detail later in this Report. The Nimrod aircraft project was barred by the government’s embargo on the sale of lethal equipment. The Wing Commander made some pertinent and important comments in paragraph 11: “In spite of the disappointment caused by the certain loss of one of these projects [Nimrod] and the indefinite delay of the other [Hawk], the British defence industry managed to sell at least £35 million worth of defence equipment to Iraq in 1985. This was achieved in the face of intense competition, a background of stringent Iraqi financial constraints and HMG’s restrictive policy concerning the sale of defence equipment to the protagonists in the Gulf War. It is unlikely that this figure will be repeated in 1986 because of Iraq’s acute lack of liquidity but it remains a country with enormous potential and a thirst for sophisticated military technology... It must, therefore, in the long term be one of the countries on which we should target our defence products”. Wing Commander Marriott appended an Annex to his Report containing “a list of defence equipment in which the Iraqis had shown interest and the sale of which had been approved by HMG”.

D2.57 The total value of the equipment specified in the list was put at £239,933,576. The listed equipment included communications equipment (“Tropospheric Scatter, Air Defence Training, Simulators”), Recovery Vehicles and Tank Transporters, Cymbeline Mortar detecting Radar (wrongly described as Mortar Bombs) and Night Vision Equipment. All of these items can be traced in the records of the AWP and IDC meetings. Two items require some explanation, one is “Armoured Vehicles” valued at £550,000. The other is “Gun Sound Ranging Equipment”, valued at £25,156,400.

D2.58 The “Armoured Vehicles” referred to in the Wing Commander’s report were “Stormer Armoured Personnel Carriers” manufactured by Alvis Limited. On 2 April 1985, Alvis submitted an AWP application for clearance to supply one of these vehicles to Iraq for demonstration and promotion purposes. The vehicle was to be supplied unarmed, but was to be fitted with a 25mm Hughes Chain Gun (not from the UK) on arrival in Iraq. AWP clearance was granted and Alvis applied for an export licence (1A/1760/85). The application was approved, at a meeting of the IDC on 9 May 1985, on the basis that the supply would not constitute a significant enhancement of capability. The licence was granted on the understanding that “the company were left in no doubt that this equipment could not be supplied until hostilities had ceased.” *77

D2.59 The Gun Sound Ranging Equipment was to be supplied by Plessey UK Limited, in a contract worth £15,000,000. The export licence application submitted by Plessey (1A/4254/85), was considered and approved at a meeting of the IDC on 27 June 1985. The basis for the approval was that the equipment would not constitute a significant enhancement. *78 The Inquiry was told by the MOD that “Sound ranging dates from around World War One and is a relatively simple method of establishing the location of enemy guns so that they can be fired at in a counter bombardment role.” *79

D2.60 Colonel Eccles’ successor as Defence Attaché was Colonel B. Aldridge whose first Report was submitted on 21 May 1987 and covered the period April 1986 to April 1987. *80 In paragraphs 61 to 64 Colonel Aldridge dealt with “Defence Sales and Training”. In paragraph 61 he commented that “Over the past year the Government guidelines for the sale of Defence- related equipment continued to have a depressing effect on what could be a lucrative market”. Colonel Aldridge attached to his Report an Annex G containing a list of “defence sales made between May 1986 and April 1987” the total value of which was put at £33.2 million and an Annex H containing a list of “Possible Future Defence Sales given Clearance for Promotion and Supply” with an estimate of £30 million for the cost of the listed equipment. None of the items in Annex H requires particular comment. Annex G, however, contains an item described as “Weapon Spares” with a value of £100,000. The spares were exported by Dince Hill (Holdings) Limited for use in repairing a 25 Pound ceremonial gun. The export licence application (1A/1529/85) was considered at a meeting of the IDC on 10 December 1985, and approved on the basis that the supply would not constitute a significant enhancement. *81

D2.61 In June 1988 Colonel Aldridge submitted his second Report covering the period April 1987 to June 1988. *82 The Report was written against a background of considerable Iraqi military successes in the war against Iran and of atrocities committed by the Iraqis against the Kurds. Colonel Aldridge referred (in paragraph 12) to “Iraq’s widespread razing of Kurdish villages, expulsion of Kurdish people from the mountains guerrilla areas in the North East, including extermination by chemical weapons of those who refused to leave”. He referred also to the “best kept secret of the war”, namely, Iraq’s deployment of a “home produced long range missile”, test fired in August 1987 and “reportedly first fired in anger on 29 February 1988.” *83 In paragraphs 32 and 33 Colonel Aldridge dealt with “Defence Sales”. He prefaced his remarks by quoting the Arabic proverb: “The man who does not visit me in time of war will not be welcome in time of peace”, and concluded by warning that: “we will have a long and difficult struggle at the end of the war in both Iraq and Iran to regain lost military markets. The Arabic proverb merits serious consideration.” *84

D2.62 In paragraph 32 Colonel Aldridge criticised the manner in which the Guidelines were being applied. He criticised, too, the grant of temporary licences for promotional purposes which, he said, provided “another loophole”. He commented “It is not surprising that such equipment goes astray after promotion”. In paragraph 33 he commented: “In such a jungle of bureaucracy, indecision and delay, business in the margins becomes attractive to the UK entrepreneur and the credibility of UK Defence Sales sinks to a low point”.

D2.63 The Ambassador, Mr Clark, commented on Colonel Aldridge’s “barbed comments on defence sales” which “show the military man’s frustration at not being able to exploit for Britain the very lucrative opportunities that exist here”. He added “We all know the policy constraints which preclude us.” *85

D2.64 Shortly after his 1987/1988 Report, Colonel Aldridge was replaced as Defence Attaché in Baghdad by Colonel Cochrane, whose Reports provide a useful insight into the state of defence sales to Iraq after the ceasefire. I will refer to them in detail later.

Endnotes
*73 - see FCO/510.1

*74 - see FCO/510.50

*75 - see Mr T Clark’s Despatch entitled ‘Iran/Iraq: War Prospects’, CO/510.84 at paragraph 6

*76 - see MOD/705.2.(3)

*77 - see FCO/2.4.67 at paragraph 9(iii)

*78 - see MOD/8.2.219 at p. 223

*79 - see the letter from the MOD to the Inquiry dated 12 October 1994 - MOD/1010

*80 - see FCO/510.91 and MOD/705.2.(Folio 4)

*81 - see MOD/9.1.1 at p. 13

*82 - see FCO/510.142

*83 - paragraph 20 of the Annual Report, FCO/510.142

*84 - paragraph 33 of the Annual Report, FCO/510.142

*85 - see FCO/510.140

* The Full report is available from The Stationery Office Ltd., PO Box 276, London, SW8 5DT.