Episode 2: Saddam Proposed a ‘Secret Summit’ with Assad in 1996 to Confront ‘Israel’s Aggression’ against Lebanon

Asharq Al-Awsat Publishes Secret Letters between the Syrian, Iraqi Presidents in the mid-1990s

Former Iraqi President Saddam Hussein. (Getty Images)
Former Iraqi President Saddam Hussein. (Getty Images)
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Episode 2: Saddam Proposed a ‘Secret Summit’ with Assad in 1996 to Confront ‘Israel’s Aggression’ against Lebanon

Former Iraqi President Saddam Hussein. (Getty Images)
Former Iraqi President Saddam Hussein. (Getty Images)

The first episode of the secret messages between Iraqi President Saddam Hussein and his Syrian counterpart, Hafez al-Assad, focused on the beginning of talks after years of mistrust, disappointment and conspiracies between Damascus and Baghdad.

Today’s episode talks about the resumption of relations, the reactivation of the oil pipeline between the two countries, and making Syria a gateway to implementing the “oil-for-food” agreement with the United Nations in the mid-1990s.

Asharq Al-Awsat is revealing letters between Saddam and Assad, which are part of the many documents that late Syrian Vice President Abdel-Halim Khaddam carried from his office to Paris when he left Syria in 2005. Phone and text interviews were conducted with Iraqi Ambassador Anwar Al-Qaisi to verify the authenticity of the documents.

Al-Qaisi said that Saddam called him in the spring of 1996 during the Israeli aggression against Lebanon, and told him to inform Syria that all of Iraq’s capabilities were at Damascus’ disposal.

That year, Saddam had a growing concern about the policies of Jordan’s King Hussein, as he wrote to Assad again in March 1996, saying: “The recent statements of King Hussein prior to his visit to Washington confirm the information available to us that he was accelerating the pace to push the United States, and behind it the Zionist enemy, for the conclusion of a military agreement that leads to the formation of a new regional alliance in the region, of which Israel and Turkey will be the backbone, and which is certainly directed against Iraq and Syria.”

An Arab envoy, who transmitted the “messages”, spoke of a conviction in Baghdad that Hussein Kamel (Saddam’s son-in-law) returned to the Iraqi capital as part of King Hussein’s plan, so he was liquidated.

Khaddam recounted that on the first of March 1996, he met with Al-Qaisi, who conveyed the following message: “President Saddam sends his greetings to his brother, President Hafez, and to you. He expresses his satisfaction with the congruence of views, whether in seeking to open a new chapter in Arab life, beginning with the resumption of fraternal relations, or in identifying the nature of the American-Zionist scheme, which Jordan has become a part of.”

According to the minutes of the meeting, Saddam expressed concern that the recent statements by King Hussein prior to his visit to Washington confirmed information that he was pushing the United States to conclude a military agreement that leads to the formation of a new alliance in the region.

Thus, he underlined the need to take urgent steps, saying: “Iraq, for its part, will announce the resumption of diplomatic relations, and then Syria will welcome the initiative; moreover, the two countries will hold security talks at the level of the heads of the security apparatuses.”

Saddam also proposed the opening of the borders within controls agreed upon by the two parties, adding that his country, in its discussions with the United Nations, would adopt Syria as an outlet for the export of its oil, if an agreement was reached over the “oil for food and medicine” program.

In response to the Iraqi proposal, Khaddam replied: “The truth is that there are some circumstances that have delayed our move... We are keen to achieve Arab contacts so that the situation does not become more complicated.”

He said he was keen to inform the Iraqi ambassador about the communication with the Iraqi opposition, “due to our agreement with Iran to hold a conference for the Iraqi opposition, so that they do not interpret our move with Baghdad as a maneuver.”

Khaddam recounted: “At the end of the meeting, I told him that I would present the letter to President Hafez.”

He continued: “On March 3, 1996, I received Al-Qaisi and told him that we did not have the opportunity to make contacts for the reasons I mentioned in our earlier meeting: King Hussein’s tour to Arab countries, the Emir of Kuwait’s trip to Washington, the Iranian Vice President’s visit to Damascus, the visit of the President of Sudan…”

The Syrian vice president also told his interlocutor: “We believe that direct contacts and meetings would create opportunities to improve Arab relations and facilitate the realization of our visions, whether with regard to the general Arab situation or confronting the American-Israeli plot... We believe that this path is the least harmful, because if we surprised them with any direct step, the situation will get more complicated. We will contact you to set a date for the meeting.”

Yahya Bakour, Director General of the Arab Organization for Agricultural Development, submitted to Khaddam a report on his visit to Baghdad between May 31 and June 4, 1996.

According to the report, Al-Qaisi visited Bakour and stressed “the importance that Baghdad attaches at this stage to restoring relations with Damascus, in response to the attack that America and Israel are plotting in cooperation with Jordan and Turkey, against both Iraq and Syria.”

Al-Qaisi said Saddam called him “during the aggression against Lebanon, and requested him to inform Damascus that all of Iraq’s capabilities were at Syria’s disposal, and that they wanted a sign in this regard.”

The Iraqi president reportedly called him again before the Eid holiday, to try to arrange a meeting with Assad. Saddam, according to the Iraqi president, was “confident that the mere holding of the meeting would lead to the resolution of all outstanding issues…”

The Iraqi ambassador to Qatar revealed that Saddam contacted him to inquire about the reasons for the US chief of staff’s visit to the region, and that he saw “a letter signed by President Bill Clinton, in which he asks him to agree to the formation of a Middle Eastern Security Council, including Turkey, Jordan, Israel, Qatar, Egypt and other countries, whose mission is to combat terrorism, arrange the affairs of the region and punish countries that support terrorism.”

According to Bakour, “on the second day, the program included meetings with the minister of agriculture. The undersecretary of the ministry informed me that Professor Tariq Aziz was waiting for me. The meeting was held at his office in the sole presence of Mr. Anwar Sabri Abdel Razzaq.”

Bakour said in this regard: “[Aziz] emphasized that there was a major conspiracy against the region, not only targeting Iraq, but also Syria and Iran. He said that America will single out the Arab countries separately…”

Aziz added, according to the report: “Iraq tried to build bridges with the Iranians and improve relations with them, and they took good steps in opening borders and developing trade relations based on the exchange of Iranian goods with oil derivatives and other Iraqi merchandise. This was in the interest of both countries. But the problem with the Iranians is that their leadership lacks a unified stance, and this is reflected in their behavior and opinions in every meeting.”

Bakour added: “Aziz believed that the establishment of cooperation between Iraq and Syria would improve the work environment in the region, give hope to the Arab populations and thwart the current conspiracy targeting Syria, Iraq and Iran together.”

The director general of the Arab Organization for Agricultural Development also recounted a meeting with then-Iraqi Foreign Minister Mohammed Saeed al-Sahhaf, who was enthusiastic about improving relations with Syria.

Bakour’s account also revealed a meeting with Saddam, in the presence of al-Sahhaf: “At 10 am on Monday, June 3, 1996, Anwar Sabri informed me that al-Sahhaf would be with me to meet Saddam. After arriving at the president’s residence, we entered directly into the main hall […].”

Saddam started by sending his regards to Assad and Khaddam, and said: “We are familiar with all the previous contacts and their details, which are positive and confirm keenness to confront difficult circumstances and conspiracy against the two countries… We look for the establishment of a relationship between Syria and Iraq on new foundations, which are based on trust […]”

He continued: “King Hussein is very mistaken for his association with the foreigners. I had advised him to be free in his relations and to act according to his country’s interests, and not harm Iraq, but he chose the opposite […]”

The Iraqi president noted that the transfer of oil through Syria was a strategic matter for his country.

“I hope you will inform our brothers that we are ready to cooperate in this field, and to send a delegation to complete the necessary formalities, as well as to study the technical matters and requirements for preparing the pipeline. We hope to receive an answer quickly,” Saddam was quoted by Bakour as saying.



To Get Their Own Cash, People in Gaza Must Pay Middlemen a 40% Cut

A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)
A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)
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To Get Their Own Cash, People in Gaza Must Pay Middlemen a 40% Cut

A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)
A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)

Cash is the lifeblood of the Gaza Strip’s shattered economy, and like all other necessities in this war-torn territory — food, fuel, medicine — it is in extremely short supply.

With nearly every bank branch and ATM inoperable, people have become reliant on an unrestrained network of powerful cash brokers to get money for daily expenses and commissions on those transactions have soared to about 40%.

"The people are crying blood because of this," said Ayman al-Dahdouh, a school director living in Gaza City. "It’s suffocating us, starving us."

At a time of surging inflation, high unemployment and dwindling savings, the scarcity of cash has magnified the financial squeeze on families — some of whom have begun to sell their possessions to buy essential goods.

The cash that is available has even lost some of its luster. Palestinians use the Israeli currency, the shekel, for most transactions. Yet with Israel no longer resupplying the territory with newly printed bank notes, merchants are increasingly reluctant to accept frayed bills.

Gaza’s punishing cash crunch has several root causes, experts say.

To curtail Hamas’ ability to purchase weapons and pay its fighters, Israel stopped allowing cash to enter Gaza at the start of the war. Around the same time, many wealthy families in Gaza withdrew their money from banks and then fled the territory. And rising fears about Gaza’s financial system prompted foreign businesses selling goods into the territory to demand cash payments.

As Gaza’s money supply dwindled and civilians’ desperation mounted, cash brokers' commissions — around 5% at the start of the war — skyrocketed.

Someone needing cash transfers money electronically to a broker and moments later is handed a fraction of that amount in bills. Many brokers openly advertise their services, while others are more secretive. Some grocers and retailers have also begun exchanging cash for their customers.

"If I need $60, I need to transfer $100," said Mohammed Basheer al-Farra, who lives in southern Gaza after being displaced from Khan Younis. "This is the only way we can buy essentials, like flour and sugar. We lose nearly half of our money just to be able to spend it."

In 2024, inflation in Gaza surged by 230%, according to the World Bank. It dropped slightly during the ceasefire that began in January, only to shoot up again after Israel backed out of the truce in March.

Cash touches every aspect of life in Gaza

About 80% of people in Gaza were unemployed at the end of 2024, according to the World Bank, and the figure is likely higher now. Those with jobs are mostly paid by direct deposits into their bank accounts.

But "when you want to buy vegetables, food, water, medication -- if you want to take transportation, or you need a blanket, or anything — you must use cash," al-Dahdouh said.

Shahid Ajjour’s family has been living off of savings for two years after the pharmacy and another business they owned were ruined by the war.

"We had to sell everything just to get cash," said Ajjour, who sold her gold to buy flour and canned beans. The family of eight spends the equivalent of $12 every two days on flour; before the war, that cost less than $4.

Sugar is very expensive, costing the equivalent of $80-$100 per kilogram (2.2 pounds), multiple people said; before the war, that cost less than $2.

Gasoline is about $25 a liter, or roughly $95 a gallon, when paying the lower, cash price.

Bills are worn and unusable

The bills in Gaza are tattered after 21 months of war.

Money is so fragile, it feels as if it is going to melt in your hands, said Mohammed al-Awini, who lives in a tent camp in southern Gaza.

Small business owners said they were under pressure to ask customers for undamaged cash because their suppliers demand pristine bills from them.

Thaeir Suhwayl, a flour merchant in Deir al-Balah, said his suppliers recently demanded he pay them only with brand new 200-shekel ($60) bank notes, which he said are rare. Most civilians pay him with 20-shekel ($6) notes that are often in poor condition.

On a recent visit to the market, Ajjour transferred the shekel equivalent of around $100 to a cash broker and received around $50 in return. But when she tried to buy some household supplies from a merchant, she was turned away because the bills weren’t in good condition.

"So the worth of your $50 is zero in the end," she said.

This problem has given rise to a new business in Gaza: money repair. It costs between 3 and 10 shekels ($1-$3) to mend old bank notes. But even cash repaired with tape or other means is sometimes rejected.

People are at the mercy of cash brokers

After most of the banks closed in the early days of the war, those with large reserves of cash suddenly had immense power.

"People are at their mercy," said Mahmoud Aqel, who has been displaced from his home in southern Gaza. "No one can stop them."

The war makes it impossible to regulate market prices and exchange rates, said Dalia Alazzeh, an expert in finance and accounting at the University of the West of Scotland. "Nobody can physically monitor what’s happening," Alazzeh said.

A year ago, the Palestine Monetary Authority, the equivalent of a central bank for Gaza and the West Bank, sought to ease the crisis by introducing a digital payment system known as Iburaq. It attracted half a million users, or a quarter of the population, according to the World Bank, but was ultimately undermined by merchants insisting on cash.

Israel sought to ramp up financial pressure on Hamas earlier this year by tightening the distribution of humanitarian aid, which it said was routinely siphoned off by militants and then resold.

Experts said it is unclear if the cash brokers’ activities benefit Hamas, as some Israeli analysts claim.

The war has made it more difficult to determine who is behind all sorts of economic activity in the territory, said Omar Shabaan, director of Palthink for Strategic Studies, a Gaza-based think tank.

"It's a dark place now. You don't know who is bringing cigarettes into Gaza," he said, giving just one example. "It's like a mafia."

These same deep-pocketed traders are likely the ones running cash brokerages, and selling basic foodstuffs, he said. "They benefit by imposing these commissions," he said.

Once families run out of cash, they are forced to turn to humanitarian aid.

Al-Farra said that is what prompted him to begin seeking food at an aid distribution center, where it is common for Palestinians to jostle over one other for sacks of flour and boxes of pasta.

"This is the only way I can feed my family," he said.