Who Calls the Shots: UN or Saddam? the US Claims the United Nations Is Appeasing Iraq, Allowing It to Cancel a US Firm's Contract to Ferry UN Troops along the Iraq-Kuwait Border

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FOR five years, Evergreen Helicopters Inc. has been flying United Nations peacekeepers around some of the world's hot spots. Now the McMinnville, Ore.-based company is at the center of a dispute between Washington and the UN over policy toward Iraq.

The big question is who's in charge: the UN or Saddam Hussein? US officials say the UN is letting the Iraqi leader dictate the operational terms for a UN monitoring force. The UN, which maintains the force to watch for new Iraqi military threats against Kuwait, denies the charge. The UN troops were deployed along the Iraq-Kuwait border after the 1991 Gulf war.

Keeping Saddam bottled up militarily, politically, and economically is a key US foreign policy goal. But other major powers, including France and Russia, have called for the UN to ease Iraq's international isolation. Saddam's success in influencing UN decisions could undermine US's goal.

The US-UN row began earlier this month when the UN decided to terminate Evergreen's contract to provide helicopter services to the UN Iraq-Kuwait Observation Mission (UNIKOM). The two-year, $4 million contract began Dec. 1. The UN says it has no choice but to cancel it because Iraq has refused to renew the visas of the two Evergreen pilots flying for UNIKOM. Their visas expire on June 30.

"Iraq has turned down the UN request to reconsider this decision," says Yasuhiro Ueki, a UN spokesman. "Evergreen will thus be unable to continue to provide helicopter transport and the UN is now trying to make other arrangements." Mr. Ueki says Evergreen's contract to transport UNIKOM officers on both sides of the Iraq-Kuwait border requires it to obtain Iraqi visas for its pilots.

But US officials and Evergreen say the visas are not needed. UN rules and resolutions and Iraq's original acceptance of UNIKOM's mission give UN personnel unrestricted access to Iraqi territory. Evergreen says it obtained the pilots' existing visas simply to accommodate Iraq and that its UN contract does not specifically require them.

Beyond the legal tangle, US officials say Evergreen's contract cancellation indicates the UN is acquiescing to Iraqi harassment of a US firm in exchange for good relations with Saddam.

"The United Nations should not put itself in a situation in which Iraq can dictate the terms of its presence," says a senior US official, speaking on condition of anonymity. "The UN force is there to monitor Iraqi action. You don't normally ask the person you are watching to set the rules of the game. …