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| Iraq-Jordan |
| Deal Time: Nations Agree on Iraqi Debt Write-Off |
| 2004-11-21 |
| PARIS (AP) - Major economic powers agreed on Sunday to write off billions of dollars of debt for Iraq in a deal that marked a significant step in U.S. efforts to help put the Iraqi economy back on its feet. Under the agreement, the Paris Club of 19 creditor nations will write off 80 percent of the $42 billion that Iraq owes them, the group's chairman, Jean-Pierre Jouyet said. The Paris Club includes, the United States, Japan, Russia and European nations. Iraq owes another $80 billion to various Arab governments. The United States had been pressing for up to 95 percent of the Paris Club debt to be lifted. Iraq has said that its foreign debt was hindering postwar reconstruction, already struggling amid the country's persistent insurgency. Iraq's finance minister, Adel Abdul-Mahdi, hailed what he described as a "historic agreement." "This money is needed for Iraq not only because Iraq is a ruined country but because Iraq is an important player internationally," he said after the deal was signed in Paris. "What will happen in Iraq will effect politically and economically the Middle East and the world." The deal represented a considerable concession from France, just as French President Jacques Chirac's government is pushing to rebuild ties with Bush's administration that were damaged by disagreements over the U.S.-led Iraq war. France opposed the invasion that toppled Saddam Hussein. Jouyet, at a news conference in Paris, said the debt reduction plan would work in three phases, with a first tranche of 30 percent to be written off immediately. Another 30 percent will be canceled when Iraq agrees on a reform program with the International Monetary Fund expected in 2005. The third and final tranche, representing 20 percent of Iraq's debt to the Paris Club, will be canceled in 2008, once Iraq has completed its 3-year IMF program, Jouyet said. Nuanced multilateralism at its best. US carves Germany away from France and France and Russia collapse 24 hours later. A great job by the negotiators. |
| Posted by:Mrs. Davis |