Brian Love
Reuters
December 18, 2003

Paris: Iraq will need an internationally recognised leadership to sign a debt relief deal with the Paris Club group of creditor states, Paris Club President Jean-Pierre Jouyet said on Thursday.

Jouyet said Iraq’s total foreign debt was estimated at $115-120 billion and that he hoped a deal to ease the burden could be reached before the end of 2004.

Iraq’s needs would have to be assessed by the International Monetary Fund as well before a debt accord could be struck with the Paris Club, which includes 19 countries with claims of some $40 billion on the war-ravaged but oil-rich country.

“The sooner the authorities are in place, the sooner we can do this,” Jouyet told BFM radio in an interview, referring to the need for a sovereign Iraqi leadership capable of signing long-term debt deals.

“The Paris Club will agree a deal with Iraq as soon as there are Iraqi authorities in place, when they are internationally recognised and when the International Monetary Fund has analysed what scale of debt relief is necessary,” Jouyet said.

Jouyet is head of the Treasury department of the French Finance Ministry and doubles up as chairman of negotiations between creditors and indebted countries in the Paris Club.

He dismissed demands by non-governmental groups that Iraq’s debt be classified as “odious” debt contracted by an illegitimate leadership, a concept implying the debts would not even be considered as debts.

“That’s not quite the Paris Club’s view,” he said of demands voiced by groups such as the Jubilee Iraq campaign, a successor to the global Jubilee movement that fought successfully through the 1990s for big debt write-offs in the Third World.

He was speaking as U.S. envoy James Baker continued a tour of Europe that has led to public declarations by the United States, France, Germany and Italy of willingness to offer debt relief and seek a deal in 2004.