Though quickly dismissed by Washington as a tactical ploy, Iraq’s decision to allow the return of United Nations’ weapons inspectors was cautiously welcomed by many around the world on Tuesday.
The announcement’s first and most tangible impact was in Asia, where it helped lift financial markets that have been weighed down for weeks by fears of war.
In Tokyo, stocks rose substantially and the dollar strengthened against the yen in early trading. Traders said Iraq’s acceptance of the inspections boosted the markets, but added that, with many details yet to be worked out, concern remained strong.
Share prices were buoyed in Sydney and Hong Kong as well, but the gains were smaller on both of those markets and traders said the Iraq news was diluted by other technical factors.
Initial government statements were optimistic, but also guarded.
”On the face of it, without wishing to be locked into this position, it does sound like a promising development,” Australian Foreign Minister Alexander Downer told Southern Cross radio.
In a letter to UN Secretary-General Kofi Annan, Iraqi Foreign Minister Naji Sabri said Baghdad would allow the return of weapons inspectors to ”remove any doubts” it still has weapons of mass destruction.
The White House quickly issued a statement writing off the offer as ”a tactical step by Iraq in hopes of avoiding strong UN Security Council action.”
”As such, it is a tactic that will fail,” representative Scott McClellan said in the statement.
Not all leaders were as quick to question Iraq’s motives.
New Zealand Prime Minister Helen Clark called the announcement ”a triumph of diplomacy” and said her country is prepared to send weapons inspectors to Iraq as part of any UN mission.
”If the weapons inspectors are allowed to get back in and finish the job, hopefully we can put the issue of Iraq behind us as a threat to the world and get the focus back on some of the other outstanding problems, like Israel and Palestine, which needs the goodwill of the Arab world to be resolved,” Clark said.
The announcement quickly sent ripples through the oil-producing world.
The offer pushed crude oil futures lower on Tuesday, taking some of the pressure off the Organisation of Petroleum Exporting Countries to raise production. Opec ministers were gathering in the western Japan city of Osaka this week Analysts say the price of oil has been inflated by $2 to $4 per barrel on a ”war premium” that developed on the belief US President George Bush could mount an attack on Iraq to try to remove President Saddam Hussein from power.
Still, Opec Secretary-General Alvaro Silva Calderon was unwilling to be drawn into any predictions about how the market will react to Iraq’s more conciliatory stance.
”It is very fresh news,” Silva said on Tuesday, reiterating his view that the crude oil market is adequately supplied at present.
”We will just have to wait and see the final impact it will have on oil prices.”
Elsewhere, concerns were expressed not only with Iraq, but with Bush’s hard-line stance.
In Italy, though not made in response to Iraq’s offer, an influential cardinal expressed firm opposition to the waging of a ”preventive war” against Iraq – a clear swat at Bush.
Cardinal Camillo Ruini, president of the Italian Bishops Conference and a close adviser to Pope John Paul II, said on the same day as Iraq’s offer that a preventive war would have ”unacceptable human costs and grave destabilizing effects” in the Middle East.
His position could signal a potential lack of public support for the government if it is asked to join any such military action. – Sapa-AP