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No Agreement on Iraqi Debt Forgiveness
Leaders of rich nations made little progress this week towards a final deal on whether to forgive much of Iraq's foreign debt. The United States is pushing for a significant reduction in Iraq's $120 billion debt to give its war-shattered economy a chance to rebound. World Bank President James Wolfensohn said last year that the United States and other rich nations would need to forgive at least two-thirds of the debt burden for the country to have a chance at economic recovery. But the U.S. drive to get agreement on a specific amount of debt relief for Iraq faltered, in large part because of resistance from countries who think relief for Iraq should be accompanied with more generous debt relief for the world's poorest countries, many of them in Africa.
| Y'all want to forgive your debts, go right ahead. |
French President Jacques Chirac said Iraq's potential oil wealth would make debt forgiveness hard to explain to other poor debtor countries. "How would you explain to these people that in three months we are going to do more for Iraq than we have done in 10 years for the 37 poorest and most indebted countries in the world," Chirac said.
| You're the Frenchman, this should be easy. |
"That is why France - and we are not alone - has taken a clear position: cancellation, yes, substantial, yes," Chirac said. "What does substantial mean? For us it is around 50 percent. We do not want to go higher than that."
| Hokay, we'll take the 50. Memo to James Baker: visit Paris tomorrow, with briefcase, see how much more we can get. |
German Chancellor Gerhard Schroeder simply repeated earlier agreements to work on the issue through the Paris Club of wealthy creditor nations. "There really was no figure mentioned" at the summit, he said. Germany has agreed to substantial debt forgiveness for Iraq, on the condition that the U.S.-led coalition turn over control to an Iraqi interim government as scheduled on June 30.
| Looks like the Germans will ante up then. |
Japanese Prime Minister Junichiro Koizumi said he was prepared to "eliminate the vast majority" of the Iraq debt that Japan holds if other members of the Paris Club also do so, said Japanese delegation spokesman Jiro Okuyama. Iraq owes about $42 billion to the rich nations represented by the Paris Club. An additional $80 billion is owed to several Arab governments.
CancellingNegotiating the Saoodi debt ought to be easy. |
Posted by: Steve White 2004-06-11 |
