WORLD

Shades of Helms-Burton

Washington targets Iran and Libya over terror

SCOTT STEELE August 19 1996
WORLD

Shades of Helms-Burton

Washington targets Iran and Libya over terror

SCOTT STEELE August 19 1996

Shades of Helms-Burton

WORLD

UNITED STATES

Washington targets Iran and Libya over terror

To many business and political leaders overseas, America’s latest antiterror measure was infuriating and futile. But in the United States, a nation searching for answers, the timing was critical. Last week, with scuba divers still seeking clues in the wreckage of doomed TWA Flight 800 off Long Island, N.Y., the FBI’s investigation of the bloody pipe-bombing at the Atlanta Olympic Games in a slow crawl, and intelligence agents gathering wisps of information on June’s deadly terrorist attack on a U.S. military base in Saudi Arabia,

President Bill Clinton was at least doing something Americans could get a handle on. Flanked by past terror victims, the President signed into law a Republican-sponsored bill imposing tough unilateral sanctions on foreign companies doing business with Libya and Iran, nations he assailed as “two of the most dangerous supporters of terrorism in the world.” Later, in a speech clearly designed for foreign consumption, Clinton flatly declared: “The United States cannot and will not refuse to do what we believe is right. Terrorism is the enemy of our generation and we must prevail.”

Far from gaining international support, however, the new U.S. law provoked widespread condemnation.

Predictably, Iran and Libya, who deny they support terrorism, lambasted Clinton for trying to impose American hegemony on the Islamic world and bowing to domestic political pressure in the campaign for the U.S. presidential election in November. But even several of Washington’s staunchest allies— already outraged by earlier U.S. legislation targeting foreign companies doing business with Communist Cuba—opposed the move. Canada was among them. “While we share the concerns of the United States and other countries on international terrorism and place a high priority on finding ways to combat it, this is not the way to proceed,” said Foreign Affairs Minister Lloyd Axworthy, echoing a sentiment expressed by the 15-nation European Union, Japan, Australia and others. International

Trade Minister Art Eggleton denounced another “attempt by the United States to dictate trade policy to its allies” and vowed that “Canada will continue to defend its interests against the extraterritorial application of such legislation.”

Under the terms of the so-called D’Amato bill, named for its sponsor, Republican Senator Alfonse D’Amato of New York, the President can, at his discretion, impose sanctions on foreign enterprises undertaking new investments worth more than about $55 million—$40 million (U.S.)—in

oil or gas projects in either Libya or Iran. As punishment, Clinton can bar such foreign firms from doing business with the U.S. government, from exporting products to the United States, from receiving goods that require U.S. export licences or financing, from borrowing more than $10 million (U.S.) from American financial houses, or from dealing in U.S. bonds.

But unlike similar legislation aimed at foreign companies dealing with Cuba—the Helms-Burton Act, which Clinton delayed implementing last month under foreign pressure—the latest law is unlikely to have any major impact on Canadians. No Canadian businesses currently have more than $55 million invested in Libya. The biggest Canadian player in the north African coun-

try is PanCanadian Petroleum Ltd. of Calgary, which in May signed a five-year, $ 17-million deal to conduct oil exploration there. The American law “doesn’t affect us,” said PanCanadian spokesman Rick Jeffrey. Canadian investment in Iran is virtually nil. Iran-Canada trade last year totalled just over $543 million. But more than $421 million of that was made up of Canadian exports, mostly wheat. Canadian trade with Libya—subject to a limited UN trade embargo since 1991 for failing to extradite two suspects in the 1988 bombing of a Pan Am jet over Lockerbie, Scotland—totalled just over $66 million. That was limited almost exclusively to exports of Canadian wheat and milk powder. ‘They are humanitarian exports, not an aid to terrorism,” said foreign affairs spokesman Charles Larabie.

While Canada thus opposes the measure largely on principle, European countries have a lot more at stake. Libya and Iran account for 25 per cent of all the oil imported into the European Union, and several firms in the region have major investments there. France’s Total SA oil company, for instance, has an $820-million contract with Iran to develop offshore oilfields. In response, the EU threatened retaliation, even as officials tried to play down Washington’s initiative. Italian Foreign Minister Lamberto Dini, whose country is Libya’s largest trading partner, called the U.S. measures merely “symbolic.” Added German Foreign Minister Klaus Kinkel: “Part of what is going on in America has to be seen as part of the election campaign.”

Clinton, although leading Republican rival Bob Dole in opinion polls, sought to appear tough on terrorism. But he did nothing to address the mysteries still haunting the U.S. public. Some officials suspect Iran of backing the Saudi attack, but Washington has yet to provide any direct link between Tehran and the truck bombing. While FBI agents pressed their investigation of security guard Richard Jewell, long the primary suspect in the Atlanta bombing, at week’s end they had yet to lay any charges. The agency denied a report it planned to apologize to Jewell. And in the absence of any hard evidence pointing to a bomb in the TWA explosion, investigators refused to rule out the possibility of mechanical failure. Until all the questions are answered, any relief Americans may have felt last week seems likely to prove fleeting.

SCOTT STEELE with LUKE FISHER in Ottawa

LUKE FISHER