China denies Iraq military link

BAGHDAD, Iraq (CNN) -- China's embassy in Iraq denied Tuesday that Chinese firms were upgrading Iraq's military telecommunications as alleged by Pentagon officials.

"Do you think we would do that?" an embassy official asked CNN. "We are complying with U.N. resolutions."

He said most of China's telecommunications contracts had been held up or blocked by the U.N. sanctions committee.

The United States places the majority of holds on Iraqi contracts, usually citing concerns that the equipment could be used for military purposes as well as humanitarian ones.

The embassy official said work had not yet started on any of the telecommunications projects previously approved by the United Nations.

He said, however, that the embassy did not know of all the Chinese workers or firms in Iraq.

China, a security council member which has called for an end to sanctions against Iraq, receives a large share of contracts for Iraq under the U.N.'s oil-for-food program.

The United Nations said there were currently more than $200 million worth of telecommunications contracts on hold at the sanctions committee, most of the holds placed by the United States.

Iraq's telecommunications system was badly damaged by the Gulf War. The United Nations has said Iraq needs to rebuild it to maintain communications with hospitals and for other humanitarian services.

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