PROSPECTS FOR IRAQ: SADDAM AND BEYOND

Created: 12/1/1993

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DATE;5

National Intelligence Estimate

Prospects for Iraq: Saddam and Beyond

S

This National Intelligence Estimate represents the views of the Director of Central Intelligence with the adrlce and assistance of the US Intelligence Community.

Prospects for Iraq: Saddam and Beyond

Scope Note

iltroughoulmale, we assume thai:

Husayn will not alter his basic domestic nnd foreign policy

to maintain his hold on power by any means necessary, to reimnosc full control over the country, to rebuild Iraq's military might including weapons of mass destructionto make Iraq the dominant regional power.

Saddam Husayn will not fully comply with t'N resolutions.

Maintaining full sanctionsoherent anti-Saddam coalition will be increasingly difficult.) ]

Our ability to estimate prospects for Iraq is hindered by the dearth of solid information about the activities and intentionsor players in

Key Questions

What are the prospects for the survival of Saddam Husayn's regime fur another year? For three more years?

What role do sanctions, and the attendant economic hardship and diplomatic isolation, play in determining Saddam's survival?

If regime change occurs, what will be the most likely means: assassination,puIar uprising, opposition overthrow, or other?

What would be the characteristics and policies of likely

successors?

are the prospects for political stability and Kurdish reintegration into Iraq after Saddam?

Key Judgments

Prospects for Iraq: Saddam and Beyond

The UN Sanctions: Saddam's Achilles' Heel

Saddam Husayn currently has sufficient economic and securityalong with the skillarshal and deploy them, to maintain his hold on power. Therefore, we judge thai, even if the UN sanctions remain in effeci, there ispercent chance that Saddam will be ousted during the next year.1-

Nevertheless, thethe near-embargo on oilwhich has reduced Iraq's annual oil earnings from the prewar highillion lo no moreebilitating Iraq's economy and exacerbating domestic security problems. The dearth of hard currency is helping to erode Saddam's ability to preserve his power base by distributing favors to supportive organizations and persons. The longer the sanctions remain in effect, the greater the riskim:

If the sanctions wereparticular, if the restrictions on Iraqi oil exports werepressure on Saddam would lighten, and his chances of surviving in office would be substantially enhanced.

If enforcement of ihe sanctions continues unabated, thereetter-than-even chance that Saddam will be ousted during the next three years:

Although sanctions by themselves will not directly topple Saddam, they have helped establish an environment thai threatens him. The shortage of money caused by drastically reduced oil revenueshis imagetrong leader, and keeps popular discontent high. We sec little prospect that Saddam can improve this security environment or his prospects for survival while sanctions remain in force.

International Support for the Sanctions Is Waning

Maintaining the sanctions intact will become increasingly dillicult. Inhe Security Council voted unanimously to keep ihcm in place for two more months; nevertheless, the consensus in favor of the sanctions is fraying. China, France, and possibly other Security Council members may press as early as the next review in January for an easing of the sanctions, especially for an end to the restrictions on Iraqi oil

Baghdad has been working hard lo reverse its pariah status and weaken international support for the sanctions:

In the past year, Iraq has decreased its harassment of UN inspectors and improved its cooperation with aspects of the UN resolutions related lo weapons of mass destructionraq recently even agreed to abide by the terms of UN Security Council, which calls for long-term UN monitoring of Iraq.

At the same time, though, Saddam's regime continues to (tout other aspects of the UN resolutions. Baghdad refuses to recognize tbe UN-demarcated border with Kuwait, harasses international reliefthroughout Iraq, and brutalizes rebellious Kurdish and Shia citizens. Evidently, Saddam believes Ihat continued intransigence in these areas will not detract from his efforts to end the UN sanctions.

Among other measures designed to enlist internationalaghdad has been enticing governments!

with prospects ot lucrative trade deals il ttiey witi help get the sanctions lifted. In addition, Iraq isajor propaganda effort designed to generate international sympathy for Iraq by exaggerating the extent to which the sanctions are harming the common people.[

UN Special Commission (UNSCOM) Chairman Rolf Ekeus believes that the sanctions should be maintained at least until an effective monitoring regime is in place and Iraq's cooperation has beenSome governments arc pressing to reward Iraq for its improved conduct.

t

Saddam Would React Violently to Extended Sanctions

Saddam's effort to assassinate former President Bush and the Amir of Kuwait demonstrates his penchant for seekingon his wartimehis willingness to risk reprisal in pursuit of hen-priority objectives. Therefore, we judge thai, should the UN dash Saddam's hopes by refusing lo lift or even weaken the sanctions during the coming year, he is likely to respond with another spate of hostile acts, such as:

Hnding cooperation with UNSCOM and resuming harassment of UN inspectors.

Testing enforcement of ihc no-fly 7ones.

Stepping up operations against the Kurds.

Intensifying challenges of the border with Kuwait.

Saddam May Change Tactics but Not Coals or Policies

Whether the sanctions remain in effect or not. Baghdad will pursue the following goals, objectives, and policies as long as Saddam remains in power:

will slop al nothing lo stay in power.

' Reestablishing his authority over ihe whole country. Saddam will work to erode international support for the two no-fly zones and Operation Provide Comfort. Once they no longer appear to be backedoalition military commitment. Saddam will use force to try lo recover the northern. Kurdish-controlled provinces.

Rebuilding Iraq's military might. Saddam will conlinuc rcconslilut-ing Iraq's conventional military forces, and he will take Mens to reestablish Iraq's WMD programs.

Making Iraq the dominant regional power and preeminent Arab country. Saddam will work to speed Iraq's reintegration into the Arab fold and reassert its claimeading role in OPEC. Baghdad might try topoiler role in the Arab-Israeli dispute, at least in propaganda terms.

Maintaining Iraq's claim to Kuwait. Saddam has not given upannexing the country. He will continue to reject Kuwait's claimsand step up efforts to subvert the Kuwaiti regimechallenge the UN-demarcated

Any Regime Change Would Be Sudden, Violent, and Fatal

If Saddam is overthrown, those responsible are likely to bemembers of the Sunni Arab establishment whoin the military or security services. They are the onlyaccess to weapons who also have access to Saddam.

The Most Plausible Causes. Assassinationerson with access to Saddamilitary coup by officers he trusts appear to be the most likely ways in which Saddam would be overthrown:

The Iraqi military hasole in all seven of the major power changes in Iraqs well as in many unsuccessful coup

Conceivableoveoalition of senior military officers and civilian officials similar to the Ba'thist coups38 is also possible. The pervasive security measures in effect make it hard forroup to coalesce; less likely wouldalace coup by members of Saddam's immediate family or other insiders. Most of them are so closely linked to his regime that they probably believe they could not long survive his dcmisc.f-

Nonstaners. Among highly unlikely scenariosrovisional Constitutioneadopularpeople are cowed, disunited, and leaderlcssf

uccessor Regime Would Be Like

Because the most likely successors to Saddam come from the same broad political culture as he, Ihcy would probably hold many of the same views and goals as Saddam. They would agree with him about the threats to Iraqi interests posed by Iran, share Saddam's determination to reassert Baghdad's authority over the whole country, and achieve

military preeminence in the Persian Gulf. They, too, would want to end sanctions and inspections and press ahead with rebuilding the country's military forces and WMD programs:

The new regime is unlikely to be quite as brutal, lawless, and repressive as Saddam's regime.

The downfall of Saddam would doubtless ushereriod of domestic instability. The Kurds, for example, might be tempted to declare independence, while the Shias in the south would likely escalate their rebellion.!

Discussion

Under Pressure

Wc believe Saddam has sufficient security and economic resources and the skill to marshal these resources to maintain his hold on power for at least another year.UN sanctions are debilitating the Iraqi economy. Oil exports, which once netted5 billion annually, bring in no more0 million annually under sanctions. Widespread domestic security problemsto degrade the effectiveness of the government, the morale and resources of the regular Army, and the loyalty of some key tribes, clans, and individuals. The UNare Saddam's primary concern. An casing of sanctions, especially lifting of the oil embargo, would help to relieve these hardships, thereby enhancing Saddam's slaying power considerably J

Economic Decline. The longer UN sanctions remain in effect the greater the risk to Saddam. Iraq's economy is burdenedalling dinar, high inflation andand skilled labor shortages. The Iraqi dinarecord lowinarsS dollar in latefall of more thanercent sinceraqi emigre reporting indicates pricehave far exceeded wage gains,eroding purchasing power andeliminating meat and poultry from many people's diets. The average Iraqi makesinars monthly:

Wc estimate that prices are increasing more than twice as fast as wages. The costonth's worth of basic items is up

morewages have increased by onlyercent.

Wc estimate that unemployment in central Iraq has risenercent to aboutercent since the war.l

The economic distress of most Iraqis adds to the general pressure on the regime. The wealthy and those with hardparticularly USbuy almost anything they need, but emigres andreport the average Iraqi is struggling to make ends meet. Many Iraqis arc selling personal belongings and taking second and third jobs. The government-run rationis insufficient and offers little variety, forcing people to supplement their purchases on the expensive open market. Many Iraqis also are delaying necessary medical care because of the expense, although health problems and malnutrition are not as preva-lent as Saddam's propaganda has alleged.

Saddam's mismanagement compounds the country's economic problems. UN sanctions prevent Iraq from selling oil, except under limited exceptions, leaving the regime little economic maneuvering room. Baghdad tried to stem inflation and tighten control of the marketplace by clamping down on Iraqiin July42on charges of priceagain

Saddam's Prospects: How Have They Changed?

The National Intelligence Estimate on Iraq published in2 concluded that, although Saddam was significantly weaker than before the Gulf war, his position was gradually improving and that he would survive in power at least for another year. Despite the UN sanctions. Saddam was still able to maintain his core support group by providing gootts and services unavailable to the masses. At the time, the NIE posited that Saddambelieved Iraq had already withstood the brunt of the sanctions and thatsupport for the embargo was flagging.

In3 we still believe that Saddam is likely to survive at leastyear in power. Nevertheless, his overall position has become slightly weaker since2 under continued pressure from UN sanctions, ongoing internationaland persistent domestic security woes. He has been unable to stem the deep-seated discontent that gives rise to

coup and assassination attempts.

ability to shield sup-porters from the effects of sanctions has weakened slightly. Since Junewhich time most of Iraq's war-damaged infrastructure had beenSaddam's economic mismanagement has exacerbated the hardships induced by sanctions, causing an overall decline in the coumry's living standards. Price rises have outstripped wage increases, while the Iraqi dinar has lostercent of its value since

We do not anticipate receiving significant intelligence indicatorsuccessful coup Is imminent. Any group of anti-Saddam conspirators that cannot keep their plot secret from US intelligence is also not likely to keep it secret from Saddam's security services.

he crackdowns, combinedrohibition in2 on the import of many so-called luxury goods, drove many merchants out of the import business and exacerbated shortages of affordable goods in the markets. Inaghdad canceled allinar notes printed before tbe war in order to boost the value of the new dinars it has been printing. Ilic move further reduced confidence in the dinar, whichis trading at near-record lows. The

regime has taken some positive steps in recent months, including limiteda cut of the profits going to thea slight easing in the ban on imported luxury goods. These measures, however, areerious attempt to address Iraq's economic difficulties and may have been adopted simply to enrich Saddam's inner circleJ

SeVel

economy will continue to suffer as long as sanctions are in place:

The dinar's fall will continue, especially if Baghdad continues lo buy up dollars and print money to finance its operations.

Living standards for most Iraqis will slip further as inflation continues to outstrip wage increases, and daily necessitieseven less affordable.r

S^et

International Isolation. Iraq remains astate. Two years of intense diplomatic lobbying have resulted in promises of post-sanctions trade deals with some key UNRussia, China, and Turkey -but no major sanctions busting by them. Likewise, recent cooperation with the Uniled Nations Special Commission (UNSCOM)iplomatic andblitz have gained Baghdad sympathy from some UN Security Council members, but have not yet overturned the unanimous Security Council support for sanctions. Iraq's propaganda efforts in Europe and the Arab world have elicited sympathy for the Iraqi people but failed to sway opinion in favor of Saddam's regime. Nevertheless, it will be increasingly difficult to maintain sanctions in coming years]-

halting progress toward unity but is to dateinor irritant to the regime,

1 The icim Tikriti generally applies lo anyone who was twin in ihe Arab Sunniiles northwest of Baghdad- or in one of Ihc peripheral villages such us Al 'Awja'. where Saddam was actually born, that are economically dependent on Tikrit Saddam's Tikriti.

Domeuie Security Woes. Nearly three years after the Gulf war, Saddam's failure tocontrol over the entire country and his sagging support in central Iraq arcand visible reminders of hisHe is beset by his inability to regain control in the north and an insurgency in the south, as well as rising domestic crime and persistent squabbling among his family and closest supporters.serious- coup plots and other security incidents suggest nagging support among some key Arab Sunni tribes and within his own Tikriti clan and securityhe exiled opposition

Baled onO average per capita monthly

Iraq of flour, sugar, rice, ten, cfcgs. and lamb.

Virtually all of Iraq's regular Army isagainst Kurdish and Shia areas. Some of the outlying Army units are poorly supplied, suffer from low morale, and have high desertion rates. In the north. Iraqi forces face Kurdish rebelsilometer front. In the south, Saddam is

tt

* Sanction* are reviewed every W) days.

"Data fur October arc fragmentary. Author estimate* were used where inhumation wat not available.

his grip on the marshes,ow-level insurgency continues lo inflict casual-tics among government forces. Troops in the soulh generally remain garrisoned at night out of fear of rebel ambushes.!-

Saddam's inability to rcsiore his authority over the entire country demonstrates that he is not as strong as he was before the Gulf

war. Iraqi air activity remainshd parallels. The Kurds control nearlyercent of theOpen-ended, pervasive, and intrusive long-term UN monitoring challenges Iraq's sensibilities about sovereignty and severely complicates reviving its banned weapons

also faces pressure from disaffected tribes, some of which play important roles io the military. Domestic turmoil since the end of the Gulf war hasesurgence of tribal identity and increased the importance of local shaykhs. Saddam continues to use money, gifts, and weapons lo buy offKurdish, Ai.il> Sunni, and Arab Shia shaykhs and uses them lo supplement local security efforts and to suppress dissident tribes. Government repression and Saddam's preferred treatment of his own Tikriti clan, however, have alienated some tribes,ihe risk of intertribal cooperation against the government and with the exiled opposi-lionj

brought together many disparate

opposition groups, organized its leadership and policy committees, and outlined aagenda. The INC includes keyand Shia groups and has weathered regional sponsors' attempts to manipulate it. Baghdad has tried in vain to lure the Kurds to leave the INC andeal with the central government. Saddam's repressive policies provide the opposition amplefor anti-Saddam propaganda, but they have been largely ineffective to date in spreading this material within Iraq.efforts over the last year to discredit, intimidate, or assassinate selected dissidents suggest he considers them atuisance and potential ihrcat-P

JKvcn tribes re-

ceiving stipends fromthus ostensiblyturn against Saddam if they believed his grip on power wasjust as many did during1 uprisings.^

Iraqi opposition activities add to the many pressures on Saddam. Notwithstanding its many shortcomings, the Iraqin umbrella organization found: cdinasf"

' The Jabburis (cotlcctlvcty Al Jubur) make up one ol Ii3q'i largeM tribal confederations, tt ruddling Sunni and Shia areai in western andslein Iraq, with cttimntcs of its size rangingillionillion. The Dulaymi iflarEC ArabSunni tribal confederation from weiiern Iraq. The Sham-mar ii Hoc of iheunni tribal confederal ions of the Arabian Peninsula. Many of in members in Iraq lite in the MmhI area. The Mashahidahowerful clan located between Baghdad and Tikrit. (u|

Saddam's only overt domestic opponents, the Kurdish and Shia rebels, face daunting odds in their quest to bring him down. Baghdad keeps both groups on the defensive with military and economic pressure, which il can sustain indefinitely. In the south,counterinsurgency and marsh-drying operations arc steadily grinding down Shia resistance and displacing thousands of marsh residents. In the north. Kurds too are focused on their own survival as they cope with Baghdad's economic blockade, shelling of Kurdish villages, cuts in electric power from central Iraq, and terrorist attacks.!

Saddam's Arab Sunni support base isSeveral serious security incidentsmembers of Saddam's Sunniduring the lastonths have

alarmed the regime./

t

[Despite his

systematic use of terror and the brutalof his security apparatus, he isto stem coup plotting. Although he has been able to intercept amy attempt so far, each successive incident and crackdown alienates more of Saddam's supporters and further erodes his shrinking power base.

Saddam's dependence on the smalt group of loyalists lhal include his sons, brothers, and cousins is growing, making the endemic squabbling within his family moreSecurity and economic pressures since the war may have deepened the bitterness between the family's rival Majid andbranches. The rivalry is especially acute between Saddam's cousins. Musayn Kamil al-Majid (Minister of Industry and Minerals and head of the Organization for Militarynd AH Hasan al-Majid (Defense Minister) on one hand, and Saddam's three ha If-brothers Sab'awi, Walban. and Bar/an Ibrahim al-Tikriti on the other J

Adequate Resources for Survival

Nevertheless. Saddam retains considerable capacity to withstand the pressureshis regime. Saddamuccess in holding out against economic sanctions, politicaland numerous internal security threats demonstrate his keen survival skills. He sustains his regime through fear, playing factions ngainsl one another, by skillfully balancing rewards and repression, and the preemptive capabilities of his pervasiveservices. He remains able to protect key supporters and strategic programs.the recent signs of diminishingsupport for sanctions helps himsupporicrs that ihc end of Iraq's difficulties is in sight. |

Saddam's Tight Security. Saddam's long experience in Iraq's volatile polilical culture hasrutal preemptive leadership style. Imprisonment, exile, years of danger-filled underground existence, and numerous assassination and coup attempts have honed his survival skills.ycar reign as Iraq's strongman has taught him self-reliance and wariness;^

Saddam's tactics for managing government and family affairs include:

Ruthless suppression of dissentet-them-beforc-lhcy-get-you response to any hint of disloyalty.

Frequent and capricious shifts between punishment and perquisites to keepin line and opponents olf balance.

Seyct

*

J. Thhuf Saddam't family, lahen fmietlme before ihr Calf woe. ihumt tome of ihr current atllori /refinerom left toright art: WlStSM Kamll al-Uajid.

Imint'r amd Mxntralt. Saddam

Kami al Uajtd. urn Im lam tad temor ttfktr In ihrfi Rama fUurf. Saddam t* Saddam Kan*meeoeum,

Delicate balancing of intrafamily rivalries to keep relatives dependent on him and competing for his favor.

Skillful manipulation of propaganda and appeal to nationalistic and conspiratorial themes toelief in (he indispens-ability of his rule to Iraq's security and unity. P

The squabbling within Saddam's extended family does not immediately threaten his hold on power. Indeed. Saddam mighta certain amount of squabbling as desirable, because it keeps members of the inner circle from uniting against him. For the last five years Saddam has balanced

older son; Rathod Huuiyn.ldest daughter, marriedlmayn Kantl; FMU Abd al-Roshli. married lo Quia? Huiaya. Saddam'i younger ton, thief of Iraa's securtiy renters. On coach, from left lo right: All Kami) al-Mafld. toa ofllaiayn Kamll: Sajida lluiayn. life af Saddam: Saddam Huiarn: aad Halaounsett daughter]

family equities by assigning key security, political, procurement, and propaganda posts to relatives. He permits them to skim large profits from stale and private enterprises and to monopolize the importation andof some commodities. He uses family conferences to resolve disputes that might threaten the regime and to remind histhat their lives and fortunes depend on bis continued rule.ecent move to cement family ties, Saddam arranged for his older son Uday, infamous for histo marryyear-old daughter of his half-brother Barzan.l

Saddam's security apparatus, which consists of overlapping protective, intelligence, and military elements, continues to defend the regime effectively. The main protectiveare the Republican Guard, Special Security Organizationecuritynd Special Republicanincludes Saddam's personal bodyguards. In addition, there are three other intelligence services: the IraqiService, Directorate General ofand Directorate of MilitaryThe intelligence servicesast network of officers and informants toall levels of society and government, including one other. Together theseand intelligence services work to weed out real and imagined regime opponents and cow (he public. Saddam tries to ensure their loyally with high wages, advancedand training, and preferential access to goods and services. The effectiveness of this security network is evident in its continued ability to penetrate plots and respond quickly and ruthlessly to potential threats, even from within its own ranks]

Another mainstay of Saddam's security is his diligence in limiting the personal powerrivals can attain. Loyally to notthe main criterion for advancement to the senior levels of the government and military- Saddam frequently moves subordinates in and out of topbased on whim, short-term interests, or questions of loyalty. Since the Gulf war. he has overhauled his government three times, and reshuffled selected cabinet ministers on at least four other occasions. His "promote, transfer, retire, or execute" approach todiscipline keeps opponents off balance and popular officers from building anbase of power.

[Saddam routinely jails senior officials for even minorusually briefly--and micromanages theaffairs and contacts of others to keep them in linc.P

Some Economicven with Iraq's hobbled economy. Saddam controlseconomic resources and allocates them to buy the loyalty of key constituents and shelter them from the full impact of UNublic Revolutionary Command Council ruling last year rubbcrstampedauthority to raise salaries andat will. He has raised tbe salaries of selected military personnel, security andofficers. Ba'th Party war heroes, and government and defense workers by up toercenturing the same period, he has doled out land, money,and medals to numerous othermany of them Tikritis. Special hospitals are reserved foi use byankingI

Saddam has

in black-market

Dcca lorced to become more selective in doling out incentives for regime elites. Only the most senior officials now receive dining privileges at the palace or home foodannoying many less senior Army and Ba'th officials who previously received them. Many members of the elilc. particularly

Saddam's sons, activities.

Imports Are Crucial

Despite its considerable economic strengths, Iraq's economy is severely hampered by the cutoff of oil revenues and access to foreign

Saddam '$ Security Apparatus

Security around Saddam Ifusayn isand includes layers ofand intelligence services arrangederies of concentric rings around him.

The Presidential Bodyguard contingent consists of aboutlite SSO officers. It conducts all functions associated with Saddam's personal safety.

Iraqi Intelligence Service (IIS) inside

The Republican Guard forms theclosely monitors the other security

most ring. Four Republican Guardkeeps tabs on foreigners, and

sions are deployed around Baghdad,with the SSO and DGS to ensure

the regularlessloyalty of the Ba'th Party and armed

al- is deployed against the KurdishIt serves Iraqi interests abroad by

lican Guard members are almostArabare chosen for their loyalty and competence

Shia threats far from the capital,intelligence, conducting intelli-

The Special Security Organizationraq's premiere intelligenceoversees all aspects of Saddam's personal security. As head of the SSO. Saddam's son Qusay oversees the Specii Republican Guard and presidential bod) guards, as well as all other intelligence services.]

gence and terrorist operations against Saddam's enemies, and monitoring the activities of Iraqi students. It cooperates with the SSO to procure high-technolo. and military equipment

The Directorate General of Security (DGS) is responsible for Internal security. Itide array of securityof themthe IIS andand suppression of dissidents and opposition

elite Special Republican Guard

hose members are hand picked from the Republican Guard, was formed from the Presidemial Guard in2oup attempt led Saddam to purge and restructure palace security. SRGare stationed at each of Saddam's primary residences. They are the principal military forces in central Baghdad.

The primary mission of the Directorate of Military Intelligences to monitor and assess the military capabilities of Iraq's enemies. It also monitors theand loyalty of the military]

I

I

markets. Iraq has the second-largest proved oil reserves in the worldelative abundance of fertile soil and water. But the governmeni must import food, including wheat, or attempt to reduce consumption through rationing and high prices

Purchases goods with hard currency and gold.l

the CetUfal Bank ol Iraq sold0 millionillion of its gold reserves

has utilized all its procurementfront companies andonsiderable industrialAlthough many sectors of the Iraqiarc severely hampered by the cutoffrevenues, Baghdad has been able toa substantial volume of importsinfrastructure. In addition togoods, the regime has cannibalizedfrom large inventories of materialslo rebuild and sustain keyin the oil

Saddam's continued ability to import aof agricultural, consumer, and other goods relieves some economic pressure and enhances his security. Saddam uses an array of mechanisms to finance imports, including barter deals, credit, gold sales, and cash. In particular, Iraq:

Relics heavily on exchanging future oil deliveries at deeply discounted prices for goods. In this way Iraq may have gained access to as much0 million worth of goods since

Has obtained up0 million in loans using liens on frozen assets valued at up to three times the loan amount.

Pay* for as much0 million inper year from oil shipments and other exports to Jordan.

We do not know how much Iraq's assets were worth before the Gulf war, and there is conflicting evidence on how far Iraq has drawn down its overall financial reserves. These are key intelligence gaps that reduce our ability to assess the health of Iraq's economy. I-

Analysts of Iraq's foreign financialfrom0 through2 showed that Iraq was able to increase its financial resources by at4 billion through donations by other countries,for oil delivered before the Gulf crisis, and release of frozen funds. On the debit side, foreign banks have seized0 million in officially frozen Iraqi deposits.

Active commercial relationsumber of countries, largely through frontare also helping Saddam's regime weather sanctions. Although most foreign firms shut down their Iraqi offices after the imposition of sanctions, so far this yearoreign firms with Baghdad offices have been detected attempting to buy goods forprimarily industrial goods such as machine tools, steel, and electrical equipment. We have detectedraqi front companies, [operating during the first half of

T99X

The Impact of Sanctions If ihe UN sanctions continue to be enforced at the current levels, economic hardship in Iraq will increase, putting Saddam's regime at increasing risk. Although sanctions by themselves will not directly topple Saddam, they have helped establish an environment that threatens him. The shortage of money caused by drastically reduced oil revenues diminishes his ability to pamper keyundermines his imagetrong leader, and keeps popular discontent high. We see little prospect that Saddam can improve this security environment or his prospects for survival while sanctions remain in force.

Trying To Change the InternationalBaghdad has been working to reverse its pariah status by selectively and partially complying with UN resolutions. Over the past year, despite several confrontations with the United Nations. Iraq has alwaysto an outwardly cooperativeespecially with UNSCOM and the International Atomic Energy Agencyor example, Iraq has decreased its harassment of UN inspectors, disclosed some new information about its weaponsand openly cooperated wilh recent teams. Iraqi leaders arc optimistic that an end of sanctions, and thus economic relief, is within sight. An Iraqi diplomatic campaign among potentially sympathetic UN members may bring further public relations gains. Baghdad continues back-channel contacts with perceived weak links in the coalition)

ftnd is dan-gling lucrative future economic Heals asto end the embargo.!

Although Saddam complies selectively wilh weapons and monitoring aspects of UNhe continues lo thwart otherhe judges will not sidetrack his overall efforts to end sanctions. In most instances he has tried to keep his actions below thethreshold of coalition retaliation.his attempts to assassinate former President Bush and the Amir of Kuwait show his willingness to risk reprisals to achieve an important goal: revenge on bis wartime enemies. In addition, Iraq refuses to recognize the UN demarcated border with Kuwait, harasses international reliefand personnel throughout Iraq, and brutalizes Iraqi Kurdish and Shia citizens, in violation of United Nations Security Council Resolutions. f

Despite Ihe unanimous Security Council vole in November to maintain sanctions, the anti-Iraqi coalition in the United Nations issome strain. Some Security Council members believe that Iraq's accession tolong-term monitoring) in late Novemberajor obstacle to full compliance with ceaMMire terms. Some;

| will press to loosen the sanctions and

remove ihe embargo on Iraqi oil sales,as soon as the next sanctions review in January. UNSCOM Chairman Ekcus insists thai sanctions cannot be lifted until aand effective monitoring regime is up and running and Iraq's cooperation isRut some governments arc pressing to reward Iraq for its

The Iraqis expect the United Natons to respond positively to its more cooperative facade in recent months and its acceptance of long-termN refusal to lift sanctions during the next year could result in another hostile Iraqi outburst, possibly including:

Ending cooperation with UNSCOM and increasing harassment of UN officials.

Challenging the no-fly zones.

Heightening activity against the Kurds.

Intensifying challenges of the Iraq-Kuwaiti border. |

Saddam's Longevity

If sanctions do not diminish during the next year, domestic opposition and economicwill mount, but we estimate Saddam would haveperccnt chance

Iraq's On-and-Off Cooperation With Iran

Sporadic improvements in Iran-Iraq reta- for steel, automobile spare parts, electri-tions bolster Saddam's security by reduc- cal appliances, and tires.

ing tensions with his primary

adversary and easing some economicOn-and-off-again talks are aimed at resolving outstanding issues from the Iran-Iraq war and other sources of tension:

Remaining Prisoners-of-War. TheCommittee of the Red Cross estimates thatraniansin Iraq, while0 Iraqis remain in Iran]

af Iraqi Planes. Baghdad wants Tehran to returnraqi combat and civilian aircraft that it flew to refuge in Iran during the Gulf crisisA

Support to Opposition Groups. IranIraqi Shia opposition and Shiain southern Iraq. For its part.to host and arm thedissident group

The most important aspect of Iraq-Iran cooperation is the small-scale prohibited trade between the two countries, begun inhe Iranians closed the borderesponding lopressure and bilateral tension. Before the closure, Iraq shipped dales, cement, fertilizer, and refined oil to Iran In return

Tehran and Baghdad benefit from limited cooperation and trade. Iran often suffers serious fuel shortages, especially during winter and in border areas, and welcomes cheap refined oil. Saddam views better relations wilh Iranhort-term lactic to ease the impact of sanctions, lessen Iraq's diplomatic isolation, and to get Tehran to reduce support to the Shias, whose activities in the south keep Iraqi troops tied up in counterinsurgency

Iraq and Iran remain enemies, however, and their steps to improve ties will fall short of reaching levels that wouldSaddam's prospects.

*

falling. Saddam's tight control overIraq and his ability to provide aflow of benefits and privileges to key supporters, as well as the discord among potential challengers, will likely outweigh general economic decline and otherSaddam does not appear to be nearing desperation. His economichis refusal to accept the UN's oil-for-food saleshe believes he can outlast the sanctions. Nevertheless, the risk to his regime may increase if he fails to deliver some short-term economic relief to meet the rising expectations generated by his diplomatic efforts and propaganda. Dashed Iraqi hopes could accelerate economicand worsen the public mood to the point where some erstwhile supporters might be motivated to plot against himJ

Three years of continued undiminishedwould substantially increase theto better thanSaddam's falling. Declining conditions would impair his ability to provide adequate goods and services to key supporters. If he became desperate, he might make some tactical shifts, bul more likely would resort lo well-tested methods:

He might allow international reliefgreater access and control over distribution etforts in the country.

After years of holding outetter deal, he might suddenly and unconditionallythe UN oil-for-food sales plan.

He mightleastimports of embargoed goods and import essential civilian commodities instead. Such refocusing would free up substantial money for other goods.

He might promise political reforms0 butor theof power to the Prime Minister and Cabinet. He would not, however, follow through with real reforms.!-

In the eventignificant erosion of his power base, Saddam would rely increasingly on force and violence to retain power and could well lash out against his enemies, possibly including additional attempts to kill coalition leadersove against Kuwait or the Kurds. I-

If Sanctions Are Kascd

We estimate that casing UN sanctions,lifting the oil embargo, wouldstrengthen Saddam's shori-term prospects for remaining in power. Even smaller changes in sanctions, such asIraq to import industrial goods, would strengthen theifting of allprobably would enable him to hold on to power indefinitely and strengthen histo retake control of the entire country. In the past, Iraqi economic markets and public confidence have responded quickly andto end-of-sanctions rumors and would likely do so again. While Saddam's supporters, the security services, militaryand other key enterprises would receive the lion's share of new oil revenues, other Iraqis would benefitrop in consumerore stable currency,ise in employment. Popular anger against the regime probably would decreaseas Iraqis focused on pulling their lives back together, just as they did aflcr the Iran-Iraq war. Saddam's policies and brutality would still provide ample motives for an

assassination plot, but his overall prospects for survival would improve significantly.

We do nut expect Saddam to change his basic policies. His primary goals will be to end all sanctions and recover front the effects of the Gulf war debacle and reestablish direct control over all areas of Iraq. His aims include:

Reasserting his authority both in the North and the South.

Removing the two no-fly zones. OnceComfort ends or no longer appears to be backedoalition militarySaddam will reoccupy the northern provinces.

Rebuilding Iraq's conventional military' forces, Saddam's primary instrument for intimidating neighbors and internal opponents.

Ending or reducing UNSCOM's intrusive long-term monitoring so that he canIraq's weapons of mass destruction (WMD) programs.

Rebuilding trade tics, stressing clandestine WMD program procurement networks.

Exacting revenge on his wartime enemies.

Speeding Iraq's reintegration into the Arab fold, establishing hegemony in the Persian Gulf, and seeking preeminence in the Arab world.

Reasserting Iraq's claimominant role in OPEC and aggressivelyarger oil market share.

Reasserting its traditional spoiler role in Arab/Israeli politics, at least interms.

Stepping up efforts to subvert Kuwait while continuing to reject its sovereignty and independence.1

How Saddam Might Fall

If Saddam is removed from power, theis almost certain to be sudden, violent, and fatal. We believe that any coup would be dominated by Arab Sunnis because tbey hold all key positions in the military, security services, and government; have access to Saddam and po>ncss weapons. The following scenarios for regime change are listed in descending order of probability.

Assassination. Saddam's elaborate personal protection measures, pervasive andsecurity services, and efforts to buy the loyally of key constituents have notoccasional attempts on his life. Saddam's brutal leadership style protects himegree, but also breeds many Iraqis who long to kill him.]

The greatest threat to Saddam is anattempt by members of his security network. Members of these security elements have the most frequent access toreater awareness of his personal security practices, and the opportunity to carry wcap-ons in his presence.!

Iraq's Military Forces

military, although devastated by Desert Storm, remains one of ihe largest in the Middle East and retains sufficient capabilities to mount simultaneousagainst the Kurds in the north and the Shia in the south, Iraq's military hasen, armedperational tanks,fly ableaircraft, andield artillerythan half its prewar size.

Iraq's ability to project power, however, was severely diminished by Desert Storm, and UN sanctions impede Iraq's efforts lo reconstitute this capability and prevent it from importing weapons. Althoughtraining has improved defenses, Iraq can conduct only limited offensive cross-border operations. It would have great difficulty supporting forces far from logistic nodes within Iraq.^

Iraq has consolidated its ground forces fromnderstrength divisions. Supply of nonlethal essentials such as tires, spare parts, and rationserious problem, eroding morale among the troops and hampering training and operations. The air defense forces were heavily damaged by Desert Storm and are only slowly recovering. The Air Force lost more than half its best inventory, and most Iraqi pilots have poor basic skills. The Iraqi Navy was obliterated}

cud missiles, chemical and biological agents and ordnance, and key production equipment and technology: Iraq is determined, and retains theand expertise, to revive its weapons of mass destruction programs onceare gone. With significant foreign technical assistance and supply, Iraq couldirst nuclear device in as little as five to seven years, but effective long-term monitoring could delay theprobably has the largest pool of sclcnti/ic talent of any Arab state, and larger than

Once sanctions are lifted any Iraqi regime will give high priority to rebuilding and refurbishing the military. Althoughconstraints will limit the pace of rearmament, the Iraqis probably will first try io buy essential support gear,spare parts, trucks, tires, andequipment, and then look for modern combat aircraft, artillery, and tanks. Iraq's procurement strategy also willheavily on equipment and materiel io supportdevelopment programs to compensate for deficient comentlunal forces. Iraq will also emphasize expanding its own military-industrial production and assembly capabilities to reduce reliance on foreign suppliers]

is holding on to important portions of its WMD programs, including as many as

Saddam's brutal purges during the past two years of security officers whose loyalty he questioned may have temporarily dissuaded some plotters, but each successive incident and crackdown risks alienating more key supporters. Republican Guard or SpecialGuard officers hold key advantages in conspiring against Saddam, including their deployment around Baghdad, theirtraining and equipment, and their possible access to intelligence about Sad-dam's movements.j

Military-Political Cabal. Saddam could be removedoalition of senior civilian officials and military officersove reminiscent of the Ba'thist coups3oup participants could include many Ba'thist and Ttkritis who believe Saddam's policies threaten their interests andthat reportedlyTikriti plotting inany Ba'th Party loyalists resent Saddam's systematic reduction of the Parly'sin politics and decisionmaking, and might see his ousterirst step toward reasserting Party control over theolitical-military coalition might try loon the widespread hatred of Saddam's immediate family and members of his inner circle lo attract support for their cause.

Saddam's Family or Advisers. Another, rather unlikely possibility wouldalaceouster by selected members of his family or inner circle. For the most pari these regime insiders are so closely-linked to Saddam and his brutal policies that many assume lhal if he goes, ihey go also. If, however, some concluded that Saddam's

SeVret

rule endangered their fortunes, influence, and lives, some might try to force him out in favoress controversial regime insider.!-

The following scenarios arc nonstarters:

preeminent

]

Constitutional Succession. The succession process dictated by the0 probably will have little effect on how real power would be distributed if Saddam were suddenly removed from the scene. Under the Constitution,Command Council (RCC) vice chairman Izzat Ibrahim would be first in line ofSaddam's systematic concentration of power in his own hands, however, has reduced the RCCubber stamp for his decisions and reduced the chances the body could again become Iraq's preeminentbody.

Popular Revolt.ycar reign hasowed society,opular revolt an unlikely means of regime change. Even immediately after the Gulf war, when Saddam was at his weakest, concurrent and widespread Kurdish and Shia revolts were unable to bring him down. Brutaland purges since then have driven public discontent underground, and there is no opposition figure popular enoughIraq to rally citizens against Saddam. Public anger against the regime remains high, but the regime's successes in reimpos-ing its control over most of the country after the war mutes public commentary against Saddam. Although wcopularwould not directly topple Saddam, it couldatalyst for mutiny by more powerful elements of socicty.f"

Exiled Opposition Takeover. The Iraqi National Congress (INC) does not have the political and military clout needed to bring Saddam down or to play an important roleost-Saddam government.

Hlhe INC is plagued by competing pohlical, ethnic, and religious agendas, personal rivalries, meddling by Iraq'sSyria, Iran, and Saudilacks credibility inside Iraq. Most Iraqi citizens are not yet aware of the INC. Many who arc deride thelack of broadly known or respected political and military leaders and its close tics to the West.I-

To significantly increase pressure onthe exiled opposition would have toapability toustainedof political violence againsi the regime inapability it is seeking but has not yetubstantial upsurge of political violence would press Saddam to try harder to assassinate oppositionand less likely, to move againsi the north.!

Profile and Policies of likely Successors' The most likely successors to Saddam come from the same broad political culture and share his views on threats to Iraqi interests and almost certainly would be Arab Sunnis. Political stabilityew regime's near-term survivability would depend on how

' Identifying specific uiccessort to Saddam il complicated by the constantly changing fortunes of Baghdad's political and military leadership. Suspicionubordinate is earning popularity is ground* for immediate demotion, transfer, or imprisonment. Many longtime Ba'th Party associates, advisers, and technocrat* have been shunted aside as key security, military, and cabinet post* went la Saddam's relatives who tccituche* are subject to realignment and occasional

change occurredew leaders ability to quicklytrong base of military,and popular support. Many of thexenophobic, and Pan-Arab themes lhat pervade Saddam's policies and propaganda resonate with the Iraqi public and probably would be used by likely Arab Sunni successors as well. Thesetrong belief in Iraq's historic greatness and commitment to achieving Iraqi dominance in the region, disirust of the West, fear of Iranian domination, and determination to retain sway over Iraq's majority Shias and Kurds. In addition, possible successors would likely share Saddam's long-term goals of rebuilding the country's military might-particularly weapons of mass destruction and of reasserting Iraq's claims to Kuwaiti territory. No successor is likely to officially recognize the UN-demarcated border with Kuwait.I-

ew regime might publiclyitself from Saddam's aggressivepolicies to relieve UN and Western pressure on Iraq and obtainparticularlyTo broadensupport it might promise political reforms and elections and offer someopportunities to Iraqitactic the Ba'thists used in thepossibly to selected members of the opposition. Few successors, however, would hesitate touell popular unrest

or eliminate rivals.

The first economic priority of any post-Saddam regime would be to induce the United Nations to lift sanctions and then to return oil production and oil exports to pre-Gulf war levels. Oil dominates Iraq'saccounting for approximately half of gross national productnd almost

all of the country's foreign exchangeand will be vital to the new regime's long-term viability, f

S<Vet

Superficial steps to improve livingfor average Iraqis, including restoring some social services andc-torics to increase employment.

A military-dominated government would share Saddam's view of foreign and domestic threats lo Iraq and in lime wouldpursue rebuilding the country's militaryweapons of massprogramsnother topwould be to restore the influence of the military in Iraqi political affairs thaihad systematically eliminated:

The military would resort more readily than other post-Saddam regimes to harsh measures to quell civil unrest andTheoyal Sunni officerspressed Saddam to take even more aggressive measures to retake control of Ihcilitary regime might not wait for the departure of Provide Comfort forces to expand ground operations against the Kurds.

Economic policies would put the military first. Trade priorities would lie withthat could supply military equipment andthey would receive first priority in debt repayments.!

power bases, and court the loyalty of division and brigade commanders who directlytroops and weapons. Moreover, conflict between the regular Army and Republican Guard could be sparked by Army resentment over the Guard's privileged status.l

A political-military coalition government, particularly one that included some of the technocrats of Iraq's current political and foreign policy establishment, might be more inclined than Saddam to make concessions on the domestic and foreign policy fronts to expand its base of Iraqi support and relieve international pressure. For example, senior diplomats have led Baghdad's moreapproach to the United Nations and the Unitedoalition governmentwould pursue less repressive economic policies than Saddam's:

Improving civilian livingthrough expanded public employment projects, infrastructure improvements, and encouragement of privatewould receive higher priority.

Restoring Iraq's international financial credibility and making downpayments on debts owed to other nations would be given serious

the military has the power to topple Saddam, wc believe it is ill-prepared to administer the nation. Years of tight regime control, purges, and patronage have undermined institutional loyalty andubservient officers corps that would be ill-equipped toyriad of serious political, economic, and foreign policyEffective leadership could beby turmoil within senior ranks as rival officers vie for control, try to build their own

Its domestic policies might also be less repressive;

Internal policies toward the Kurds and Shia might include efforts to improveconditions by creating employmentand reintegrating the north and south into Iraq's economy.

Nevertheless, if domestic unrest began toolitical-military coalitionby Arab Sunnis would still beto use military force and secret police tactics lo maintain order and prevent the partition of Iraq.l

A recent Rand study holds more hope than we do that, beyondemocratic and federal Iraq couldew wave of political reform and modernized politics in the Middle East. The Rand studythat an Iraq that explicitly recognizes ethnic and religious differences couldthe model for the future in the region, buttate would require outsideto emerge, (v)

Sanction* Arc Key

As long as the UN sanctions remainIraq's weakened military andsecurity concerns will limit Saddairfs capability to pursue policies that menace US interests. Without the oil embargo, Iraq would have money to entice many trading partners to sell materiel or technology for its conventional and nonconventional military arsenals, even if an arms embargo remained in place. Once the oil embargo is lifted, compliance with remaining sanctions will diminish as the perception builds that the entire sanctions regime is ending.

foes. Iraq retains important elements of its extensive prewar WMD programs and the expertise to rebuild (hem if UN inspections and sanctions end. In addition, (he end of sanctions could cause international attention to the plight of Iraqi Kurds and Shias to wane, allowingreer hand to repress them.P

Iraq's reentry into the oil market would increase competition among major OPEC producers for export quotas, potentiallythe political and financial dynamics that contributed to0 Gulf crisis. Iraq could begin exportingillionof oil per day almost immediately after the embargo was lifted. Resumed Iraqi oil exports would increase the downwardon worldwide oil prices, weakening Iraq's key rivals in Ihc Gulf. Saudi Arabia, Kuwait, and

would accelerate efforts to rebuild Iraqi intelligence networks around (he world to procure WMD components and toif not assassinate Saddam's Gulf war

Annex

Outsider's View 5

The continued existence of Iraqnitary state is deeply threatened; it may not survive intact into the next decade. Longstanding problems in Iraq, exacerbated by twoof an exceptionally harsh and brutal regime, two wars of its own making,against its Kurds, ruthless suppression of its Shi'itehave conspired to raise fundamental questions about the ability of the state to survive in its present form and to live in harmony with its neighborsa'th regime. Ironically, it may in fact only be external intervention that could nowsave the unity of Iraq, sinceof the present Ba'th regime is surely rendering the deep ethnic and religiousinside Iraq permanent and virtually irreconcilable. (u>

It is the Kurdish question--not thethat above all challenges the long-rangeof Iraqnitary stale. There is nothing in the history of Kurds in Iraq that suggests the Kurds truly seek integration into the Iraqi body politic. Iraq will be lucky to retain Iraqi Kurdistan as part of Iraq. It cannot be held by force indefinitely and will not voluntarily remain under conditions of anything less than full autonomy under some kind ofondition to past Baghdad regimes. (U)

' tiiccrpt!and Note /'my in ihr Next Decade: mil Ira*nitlhe nuihor of (he par*'.

ormer Vice Chairman of <hc National liuiCitcncr Coaacilmc time Mafdb Utt

TaM eacnpi at printedibe lonera of ibe Raad

Corporation, (i*

If the Kurds threaten the territorial integrity of Iraq, il is the Iraqi Shi'a who pose the greatest threat lo the political and social stability of the state. The Shi'a arc deeply resentful and alienated by virtue of their near systematic exclusion from power in Baghdad, despite the fact that theyan absolute majority of the country's population -betweenndercent. The Shi'a. contrary to popular fears in many policy circles, have no intention of separating from Iraq; on the contrary, they wish to exert the dominant voice in the state lhal their demographic majority argues they should. Time is furthermore on the side of the Shi'a: any gradual move toward democracy in the future can only strengthen their position and serve to dislodge the monopoly of political and social powerunni Arab minority of onlyerceni of the state's population. Only repression will keep the Sunni Arab majority in permanent, dominant control of the stulc. H)

Nearly all future alternatives for Iraqa stale Ihat is inherently brittle and increasingly less capable of projecting power in the region than it has been in recent decades. Only the secular authoritarianmodel (like Saddam) will be able to garner the temporary strength to preserve the unitary state and to project regional political and military power. While that kind of stale can be highly dangerous to the region, as the world has witnessed,ocused authoritarian state will also always

remain prey to debilitating internalthat will exhaust and weaken it over the longer run. (u)

No political solution to Iraq's currentcan realistically include retention of the Ba'th Party in power. If the state and the region are to return to any tranquillity and normalcy, the Ba'th Party must go when Saddam goes, (u)

Any successful post-Saddam successionis entirely dependent on the military. Saddam's physical elimination is most likely to come at the hands of some trustedothers can get near him. But in the end, the military is likely lo take advantage of Saddam's death and the confusion of any transition; only the military has the power to remove Saddam's mechanisms of power and the Ba'th Party, (u)

The military could attempt toeformed Ba'th without Saddam, butthe political characteristics of the Ba'th is to the liking of few people inside or outside the country. The officer corps' key concern will probably be the retention of power by the Sunni Arab minority, but there arc few political vehicles available to this end. The military will also wish to keep Iraq strong and unified, and hence might decide to keep power within its own ranks, free of the Ba'th politicians who have so damaged the country. (u>

The prospectsemocratic outcome are not encouraging without externalIdeally, the military itself could attempt to establish some kind of more democratic rule, either by inviting elements of theopposition to share power following an

anti-Ba'th coup, or by holding elections.the external opposition, workingever greater unity, but still lacking consensus on many key questions about the future, does not possess the means to come to power by itself. But the question of future Sbi'ite dominance still remains.ruly farsighted military leadership couldthe inevitable forces al work in Iraqi society, acquiesce to them, and facilitate their innovation. <u)

The Shi'itc south will not separate from Iraq under almost any foreseeable circumstances, although it could conceivablyrief periodaciic by which to weaken the central government and toa negotiating cardew power-sharing agreement, (u)

The Shi'a themselves are divided intodemocrats, pro-Iranian Islamists, and independent Islamists. Even those Islamists with some sympathies for Iran's clericalare Arabs, however, and will notdomination fromhi'ite Iraq will more likely tend to be 'Iraqi-firster' in outlook, (u)

Any future Iraqi regime will be economically constrictederiod by massive debt to the West, the need to overcome extensive and damaging economic sanctions, and by the extensive costs of reconstruction after two devastating wars. Iraq nonethelessromising long-term economic future based on its possession of the second-largest oil reserves in the Middle East, its extensive water sources that canowerful agricultural base, and adequateunlike the rest of the Gulfmeet its agricultural and induslrial needs, (u)

(the longer run. the Iraqi economy will

be able to support extensive militaryif that is the route that its leadership chooses. Its oil policies will obviously be aimed at maximizing its income over the shortopposition to general Saudi policies, which traditionally favor moderate prices and now desire to constrain Iraqi development in the future for securitythe Iraqi political system should be transformed and adopt trulypolicies, (u)

In foreign policy. Iraq is highly constrained by several geopolitical realities:

First, Iraq lacks significant access to the Persian Gulf.

Second. Iraq is entirely surrounded by hostile states except for Jordan.

Third. Iran almost surely represents Iraq's

permanent geopolitical rival. Although it is possible that Iranundamentalist Shi'itc Iraq could adopt parallel foreign policieshile, fundamentalrivalry between Baghdad and Tehran militates against that over the longer run.

The political evolution of Iraq will thus be unstable and stormy, in part alfecting the stability of the entire Gulf. Only transition to some kind of more representative andrule will bring Iraqlate of greater stability, and it wiltinimum require Iraq's transformationederal state, perhaps even losing the Kurdish(u(

US policy thusreat deal at stake in its handling of Iraq over the next decade. (IT)

Beyondemocratic and federal Iraq couldew wave of political reform and modernized politics in theEast. An Iraq that explicitly recognizes ethnic and religious differences within the state, and proceeds to build the political and social institutions to reflect that diversity, could be on the way toward establishing the model for the future. Many Iraqis are ready for this kind of change, especially after living through the alternative vision that has so dominated and despoiled the country for overears. But lacking enlightenedfrom the outside, it is hard to sec how the vicious circle of the past can readily be broken.(u)

a

Warning Notice

National Security information

mailable as of3 mi*in the preparation of ChU National Intelligence Eillniltc.

The following Intelligence organiration* participated in the preparation of this Estimate:

The Central Intelligence Agency

The Defense Intelligence Agency

Tbc National Security Agency

Tbc Bureau of Intelligence and Research,

Department of Suie

The Office of Intelligence Supporl.

Department of the Treasury

also participating;

The Deputy Chief of Staff for Intelligence,

Department of tbe Army

The Director of Naval Intelligence.

Department of tbe Navy

The Assistant Chief of Staff, Intelligence.

Department of ihe Air Force

The Director of Intelligence,

Headquarters, Marine Corps

This Ultimateapproved for publication by the National Fore tun Intelligence Board.

is Unclassified.

Original document.

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