WSJ: U.S. and Europe Expect to Reach Pact on Iraq Debt by End of Year

Wall Street Journal ^ | September 20, 2004 | MICHAEL SCHROEDER

[OESY]

U.S. and European officials said they expect to hammer out a deal by year-end to forgive most of the loans Iraq owes industrialized nations, giving a big boost to the new Baghdad government's ability to sort out its tangled finances.

At recent meetings..., the group of 19 wealthy nations known as the Paris Club edged closer to a deal involving the more than $21 billion in loans they are owed by Iraq and a like amount in interest. The issue is expected to be a high priority at a series of meetings among the World Bank, the International Monetary Fund and the Group of Seven major industrialized countries in early October.

The U.S. is urging the cancellation of at least 90% of the Paris Club debt, while Britain would prefer an 80% write-off. Other nations are holding out for a more-modest package. Russia has offered to cut 65% contingent on certain Saddam Hussein-era contracts with Russian interests being honored, and France has urged a 50% reduction.

France argues that Iraq, with its vast energy resources, shouldn't get better treatment than the world's poorest nations. As a way to entice Paris, the U.S. recently proposed that poor nations in Africa, Asia and Latin America should also get debt relief comparable to Iraq's.

The U.S. took that position after an intra-administration dispute among the Treasury Department and White House security and budget advisers. Some administration officials worry that writing off too much poor-nation debt will reduce fiscal discipline in borrower nations....

A Paris Club agreement, which applies only to Iraq debt owed to wealthy nations, would be the first step in a wide-ranging process to reconfigure Iraq's more than $150 billion in debt. Iraq hasn't paid any of its debts since before the first Gulf War more than a decade ago....

[OESY]

What Iraq Owes

Debt, including interest, owed to Paris Club nations

Japan ....... $4.11 billion

Russia ...... $3.45

France ...... $2.99

Germany .. $2.40

U.S. ............ $2.19

Italy ............. $1.73

Other ......... $4.14

[Shermy]

That doesn't begin to cover the oil rights variously promised by Saddam to TotalFinaElf, France and Russia. How those resolved, don't know. Or how much "oil for Food" cash is still in abeyance.

[Willie Green]

So who's gonna forgive OUR debt???

The Outstanding Public Debt as of 20 Sep 2004 at 11:06:57 PM GMT is:
$7,384,138,444,573.38
The estimated population of the United States is 294,325,648
so each citizen's share of this debt is $25,088.33.

The National Debt has continued to increase an average of
$1.69 billion per day since September 30, 2003!