Galbraith's Actions May Hurt Independent Advice

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Former U.S. ambassador Peter Galbraith denies there were conflicts of interest when he advised the Kurdish government about their constitution. He says the Kurds knew about the business relationship he formed with a Norwegian oil company a year later. Nonetheless, some experts worry Galthraith's actions will make it more difficult for Americans to give advice independently without the suspicion of profit.

RENEE MONTAGNE, host:

Weve been hearing from a former U.S. ambassador a lot lately. He was embroiled in a dispute over whether the U.N. had allowed fraud in the Afghan election.

Peter Galbraith, the former diplomat, is also a long-time advisor to the Kurds in Iraq, and now he is being accused of having a conflict of interest because of business interests he had in that region, even as he was offering advice to the Kurdish government.

NPR's Michele Kelemen has more.

MICHELE KELEMEN: The way Peter Galbraith tells it, there's nothing unusual about his business dealings with a Norwegian oil company that has a stake in an oil field in Kurdistan. He was an unpaid advisor to the Kurds and a private citizen at the time when his business dealings started, and his activities, he says, are consistent with his views on the region and with what the Kurds wanted - more say in the energy sector.

Mr. PETER GALBRAITH (Former U.S. Diplomat): There are interests, but what's the conflict? There is no conflict between the role and help that I provided to the Kurds on what was, again, their agenda, not my agenda, and the work that I did in helping to create an oil industry in Kurdistan which was, again, something that they themselves wanted and of course they were fully aware of my business arrangements.

Professor FEISAL ISTRABADI (Indiana University): That really doesnt withstand the giggle test.

KELEMEN: That's Feisal Istrabadi, a visiting law professor at Indiana University who was involved in drafting an interim constitution in Iraq. He's now raising concerns about current Iraqi law, because, as the New York Times reported yesterday, Galbraith had an ongoing business relationship with the Norwegian company throughout the negotiations on the constitution.

Prof. ISTRABADI: This is much bigger than Peter Galbraith. This implicates the legitimacy of the entire constitutional process in Iraq. You dont let Firestone draft the constitution of Liberia. You dont let Shell draft the constitution of Nigeria. We shouldnt have had an oil company drafting the Iraqi constitution.

KELEMEN: Peter Galbraith told NPR's ALL THINGS CONSIDERED that he was not involved in the negotiations, though he was advising Kurds at the time. One Kurdish official who asked not to be named also said that Galbraith was not at the negotiating table. That official added that the business dealings did not shape Galbraith's ideology. Galbraith himself told NPR that he's been a long-time advocate for more autonomy for Iraqi Kurds.

Mr. GALBRAITH: This goes back to the 1980s, when I traveled along the Iraq-Turkey border documenting the use of chemical weapons, and I was in Kurdistan during the 1991 uprising and the period thereafter, obviously with no thought to future business activity.

KELEMEN: One Iraq watcher, Reidar Visser of the Norwegian Institute of International Affairs, says that Galbraith promoted what's often called a soft partition of Iraq, an idea that gained support from influential people here in Washington, including the now-vice president, Joe Biden. And Visser believes that Galbraith even pushed the Kurds farther than they would've gone in demanding rights in the energy sector.

Dr. REIDAR VISSER (Norwegian Institute of International Affairs): So you get the impression that Galbraith had a radicalizing impact on the Kurds, and of course that is a problem for them today because they are locked in disputes with Baghdad precisely because of their maximalist demands related to the oil sector.

KELEMEN: Galbraith has his own dispute with the Norwegian oil company, a case that he says is in arbitration in London, though he didnt give details. Meanwhile, one U.S. expert who advised the Iraqis on the constitution said privately that he's worried about the long-term implications for other American citizens who advise governments and want to be seen as independent, not just after a country's energy resources.

Michele Kelemen, NPR News, Washington.

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Adviser Sees No Conflict In Kurdish Oil Deals

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Former U.S. diplomat Peter Galbraith i

Former U.S. diplomat Peter Galbraith, shown here in 2007, is a longtime adviser to ethnic Kurdish leaders in Iraq. Galbraith is defending himself against accusations of a conflict of interest over a business deal he made with a Norwegian oil firm. Tony Talbot/AP hide caption

itoggle caption Tony Talbot/AP
Former U.S. diplomat Peter Galbraith

Former U.S. diplomat Peter Galbraith, shown here in 2007, is a longtime adviser to ethnic Kurdish leaders in Iraq. Galbraith is defending himself against accusations of a conflict of interest over a business deal he made with a Norwegian oil firm.

Tony Talbot/AP

Peter Galbraith, a former U.S. diplomat and longtime adviser to ethnic Kurdish leaders in Iraq, is defending himself against accusations of a conflict of interest over a business deal he made with a Norwegian oil firm.

Iraqi officials have criticized Galbraith for having a financial stake in Kurdish oil because he served as an unpaid adviser to the Kurdish regional government while it was involved in negotiations over the drafting of a new Iraqi Constitution. The Kurds control parts of oil-rich northern Iraq, also known as Kurdistan.

In an interview with NPR's All Things Considered, Galbraith acknowledged having a financial arrangement with DNO, a Norwegian oil company that has a stake in a promising oil field in Kurdistan, but denied any conflict of interest.

"When I was asked by them to advise them on the constitutional negotiations in 2005, they knew that I was being paid by DNO and by, in fact, other clients," Galbraith told co-host Melissa Block. "They knew of my business activities. They sought my advice anyhow."

He added, "There is no conflict between the role and help I provided to the Kurds on what was their agenda, not my agenda, and the work I did helping to create an oil industry in Kurdistan."

The New York Times reported Wednesday that Galbraith received rights to a large stake in at least one Kurdish oil field in 2004 after helping DNO negotiate a lucrative drilling contract. Galbraith told the paper that he maintained an "ongoing business relationship" with the company throughout the constitutional negotiations in 2005 and later.

Reidar Visser, a research fellow at the Norwegian Institute of International Affairs, has been following the developments since the Norwegian newspaper Dagens Naeringsliv first reported the business arrangement last month.

"That is new, the fact that he actually received payment from a Norwegian company at the same time that he was sitting in on key sessions related to the drafting of the Iraqi Constitution, from which, in fact, many Iraqi politicians were excluded," Visser told NPR's Michele Kelemen. "But Galbraith participated, with his ownership share, and that is quite scandalous, certainly if you look at this from an Iraqi point of view."

The draft constitution that Galbraith was helping with included provisions that he and Kurdish officials argue gives control of oil finds in Kurdistan to Kurdish leaders rather than to the central government in Baghdad.

Galbraith told NPR that he did not have an official role in the drafting of the constitution and that he was a private citizen at the time.

"I want to emphasize that I myself did not participate in the negotiations," Galbraith said. "I wasn't a negotiator. I provided advice to people who knew I had business interests."

The oil field, which is in the Dohuk region of Kurdistan, has proven reserves of about 230 million barrels, and The New York Times estimated that Galbraith's stake could be worth more than $100 million.

Galbraith said that he could not provide any details of his arrangement because of a confidentiality agreement, but he disputed the estimate of its value.

"I wished it were true," Galbraith said.

He did acknowledge a dispute over what he calls his "business arrangement."

"There's an arbitration that's under way in London," he told NPR. "It's a confidential process. The first round has been concluded, and now the arbitration is looking at damages."

Galbraith, 58, son of the prominent 20th century economist John Kenneth Galbraith, served for many years on the staff of the Senate Foreign Relations Committee, and from 1993 to 1998 as U.S. ambassador to Croatia.

He has also been in the news recently because of his role in Afghanistan. Peter Galbraith was fired in September from a senior post at the United Nations mission there after accusing his boss of ignoring fraud in Afghanistan's recent troubled presidential election.

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