Italy and other European Community countries, at the risk of severe economic repercussions, are cracking down hard on Iraq with a series of punitive sanctions for its invasion of Kuwait.
They include an immediate total boycott of Iraqi and Kuwaiti oil, an embargo on arms and military equipment, and the suspension of military, technical and scientific collaboration with Iraq.
Iraqi assets in E.C. member states have been frozen and preferred trade status for Iraq suspended.
For the Europeans, this could well mean acute shortages of gasoline and other fuels, and galloping inflation.
The E.C. countries collectively rely on Iraq and Kuwait for about 10 percent of their oil requirements.
Some member states have a much larger stake. Denmark, for example, obtains 50 percent of its oil from Iraq and Kuwait.
Italy has extensive economic ties with the two Persian Gulf states. According to Foreign Minister Gianni de Michelis, Iraq owes Italy between $10 billion to $12 billion, including $2.7 billion to the National Bank of Labor alone.
The embargo will deprive the Iraqi navy of 11 frigates it ordered from Italy in 1980, which are now ready for delivery, the foreign minister said.
In addition, the Italian Cabinet voted to freeze Kuwaiti assets here, which could have serious consequences. The “Q8” chain of gasoline stations, one of the country’s biggest gasoline distributors, is Kuwaiti-owned.
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