Jubilee Iraq
October 3, 2003

Paul Bremer said at a Friday press briefing at the Pentagon.”I have to say that it is curious to me to have a country whose per capita income GDP (gross domestic product) is about $800 – that’ll be Iraq (when oil begins to flow at pre-war levels) – that a county that poor should be required to pay reparations to countries whose per capita GDP is a factor of 10 times that for a war which all of the Iraqis who are now in government opposed. So I think there needs to be a very serious look at this whole reparations issue.” Bremer said he didn’t know if the Governing Coucil had raised the issue of reperations with Kuwait and Saudi. He said Iraq should have an income of $19-20bn in 2005 with a budget cost of about $15bn, leaving $4-5bn for reconstruction costs. But debt service at 6% would cost at least $7bn.

MP Yousef al-Zalzalah told al-Watan: “Demanding that Kuwait of its own accord give up its rights is something unacceptable because the reparations are part of the big losses of the tyrannical (Iraqi) invasion.”

MP Daifallah Buramiya told the Arab Times: “If Bremer is so concerned about per capita income he has to demand dropping all of the United States of America debts on poor nations where per capita incomes don’t exceed $30 a year.”

Islamist MP Khaled al-Adwa said: “The Iraqi occupation happened, so the past political leadership or the one that follows it must bear responsibility for that occupation.”

Islamist MP Walid al-Tabtabai said: “So how can such a (U.S.) call be made?” Tabtabai asked. “We will reject this call which robs the Kuwaiti people of what rightfully belongs to it.”

If response to the issue of whether US reconstruction funds should be loans not grants, Bremer said: “The problem with that argument is, at least if you look at it from my perspective, the Iraqis have more than $200 billion in overhang from debt and reparations. This is a big chunk of change. And although the reparations don’t carry an interest rate, if you just take the debt – it’s about 124, 125 billion (dollars); nobody’s quite sure – and if you assume that that debt carried an average interest rate of, say, 6 percent, which is the rate these days, that would mean a debt service amount of $7 billion a year.

Well, I just went through what the likely budget looks like in 2005, when we finally get our nose above water, and we’re only going to have $5 billion more than we’re going to spend. So the debt servicing, in other words, would bankrupt the country in 2005, if you just take my back-of-the-envelope calculations.

So it’s very difficult to see how a country which now has no means of repaying these debts should have more debt laid on it by the United States. And therefore, I’ve made the point that I think it’s a mistake to try to attach future revenues, to try to have a loan as part of this thing. It seems to me this will put an unnecessary burden on a country when what we’re trying to do is get this country stable and so it can go forward.

And again – I hesitate to repeat what I said often on the Hill – let’s not repeat the mistake of the Versailles Treaty in 1919, which laid very heavy reparations on Germany and which contributed directly to the morass of unrest, instability and despair which led to Adolf Hitler’s election.”

And also: “I said not a dollar (of US money) – not a dime was the suggestion of one congressman – should go to repaying those debts.”