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Iraq’s financial situation is far from satisfactory. The Gulf states and Saudi Arabia have provided the country with something like $30bn but there are some signs of a growing reluctance to lend any more.

The third Gulf Co-operation Council Summit produced a great deal of congratulatory noises, both from officialdom and from the media of the six member countries, but beyond the expressed satisfactions the conference achieved rather less than had been promised or suggested.

IRAQ HAS ADMITTED A SETBACK in the renewed battles in the war with Iran. A week after Iran opened its latest offensive, Baghdad conceded that Iranian troops had penetrated Iraqi territory up to a distance of five kilometres. Iran claims their troops have pushed twice that distance into Iraq. Earlier, President Saddam Hussain told delegations attending the Baghdad International Trade Fair that the Iranian offensive had been 'crushed'.

The reconciliation agreement reached between Oman and South Yemen, signed in Kuwait at the end of October, brings to an end fifteen years of hostility by the two countries.

THE TOP LEVEL ARAB LEAGUE DELEGATION has ended its series of high-level meetings in Washington, which included sessions with President Reagan and Secretary of State George Schultz, having made some important clarifications of the overall Arab negotiating position regarding a Middle East peace settlement. The delegation, led by King Hassan of Morocco, and including the Arab League Secretary General and the foreign ministers of Syria, Jordan, Saudi Arabia, Tunisia and Algeria, were presenting, as Arab League Ambassador Clovis Haksoud put it, "for the first time, a collective peace plan endorsed by all the Arab states".

"Positive, constructive and successful" was how Yasser Arafat described his recent discussions with King Hussein of Jordan about a Jordan-Palestine federation. The Jordanians also appeared to be well satisfied with the talks. But both sides have been fairly cagey about their negotiations and such public statements as have been made have tended to cloud rather than clarify the issues.

THE INTERNATIONAL INSTITUTE FOR STRATEGIC STUDIES (IISS), the esteemed London-based institute, has issued the latest edition of its yearbook "The Military Balance, '82-' 83". This gives an up-to-date listing of almost every nation's military capacity from statistics gathered from publicly available sources and from questionnaires sent to governments.

The International Institute for Strategic Studies (IISS), the esteemed London-based institut, has issued the latest edition of its yearbook "The Military Balance, '82-83". This gives an up-to date listing of almost every nation's military capacity from statistics gathered from publicly available sources and from questionnaires sent to governments.

TEHRAN HAS MADE NO SECRET of its plans to renew the military assault on Iraq. Senior Iranian military commanders have been giving interviews on television and in the press, saying that the war has reached a decisive stage in which "we must engage the enemy on all fronts", and claiming that a renewal of the offensive is imminent.

King Fahd has given his pledge to do his best to end the Israeli occupation of West Beirut and the Lebanon. In three separate cables to the Lebanese President, Prime Minister Shafik al Wazzan and PLO Chairman Yasser Arafat, King Fahd expressed his resentment, shock and condemnation of the massacre of the Palestinian civilians in the refugee camps of Shattila and Sabra in the Lebanon. King Fahd pledged that Saudi Arabia will continue "a vigorous pursuit" to secure withdrawal of Israeli troops from the Lebanon and the protection of Palestinian refugees.

THE BASIC ACCORDS REACHED at the Fez Arab Summit may be more celebrated for what they represent, rather than for what they may achieve. After so long an opposite demonstration, the Arab countries have shown that they can come together in broad agreement over fundamental issues. Had the Arab leaders at Fez failed to do so, the credibility of the Arab case would have been so impaired as to seem almost counterfeit and the notion of a united Arab political position discredited beyond reasonable belief.

The merits and virtues of President Reagan's Middle East peace plan to the Arabs can, in some degree, be assessed in the light of Israel's reaction to it. Israel's out-of-hand rejection of and vehement opposition to the American initiative suggest that at least some elements of Mr. Reagan's plan could be of advantage to the Arabs. It is not unreasonable to think that anything Mr. Begin opposes so violently cannot be wholly bad for the Arabs.

Some three months ago, after the recapture of Khorramshahr, Ayatollah Khomeini and his Islamic Republic looked set for weeks of celebration to be followed by a period of stability and the entrenchment of fundamentalist rule over Iran. On a mixture of fanatical impulse and Khomeini's desire to see his system of rule spreading throughout the region, Iran invaded Iraq on 13 July and the situation has turned around to the point that they are now on the verge of snatching defeat from the jaws of victory.

The Syrian Deputy Premier and Foreign Minister, Abdul Halim Khaddam, recently paid a sudden and unannounced visit to Sadi Arabia's summer capital of Taif, where he had talks with King Fahd and Prince Saud al Faisal, the Foreign Minister. No details were released on the issues discussed or the purpose of Khaddam's trip, nor was there any commentary on the subject from Riyadh or Damascus. However, it needs no special insight to deduce that the talks would certainly have centred on the second stage of the war in Lebanon.

THE QUICKENING POLITICAL TEMPO in the Middle East, revolving around the crisis centres in the Lebanon and the Iraq-Iran conflict, is making itself felt in all the countries of the area. The plans for the evacuation of the Palestinian forces from Beirut are almost settled; the mediation of Algeria and the Islamic Conference Organisation in the Iraq-Iran war seems to be making some progress; and the Arab states are largely committed to holding an Arab summit conference.