Reuters

March 16, 2004

Iraq’s ruling Coalition Provisional Authority has appointed accountants Ernst & Young to help trace Iraq’s loan contracts and reconcile who is owed what from the country’s estimated $120 billion debt pile, a senior treasury official told Reuters Tuesday. Speaking on condition of anonymity, the official said the Iraqis have so far been unable to trace loan agreements, especially controversial deals with Gulf Arab states such as Saudi Arabia, which the Iraqis say were grant aid rather than loans.

“The Iraqis’ loan figures are all mixed up between public debt and private debt; they do not have any paper trace,” the senior European treasury official said. “They (the Iraqis) say they cannot accept figures without a paper trail,” he said.

The International Monetary Fund is due to present its final debt figures for Iraq in April, which will form the basis for eventual debt reduction for Iraq, which is the world’s most indebted country per head of population.