http://www.chinaview.cn
November 22, 2004

Canberra: Australia will cancel 1.1 billion-dollar (858 million US dollars) debt owed by Iraq.

As a member of Paris Club, the Australian government has agreedthat 80 percent of the war-ravaged nation’s debt should be writtenoff, Australian Broadcasting Corporation radio reported.

The Paris Club, set up in 1961, is an informal multilateral group of official creditors whose role is to find coordinated and sustainable solutions to payment difficulties experienced by debtor nations.

Australia will start to receive payments on the remaining debt owed by Iraq by 2011, according to Australia’s Department of Foreign Affairs and Trade (DFAT).

DFAT said writing off Iraq’s debt will free up resources to assist Iraq recover more quickly.

“Relieved of much of its debt, Iraq has the potential to becomea stable partner for Australia in the Middle East, providing new opportunities for Australian exporters and investors,” it said.

According to statistics released by the International Monetary Fund, Iraq’s foreign debts totaled 120 billion dollars, including 42 billion dollars owed to club members.

The Paris Club consists of Australia, Austria, Belgium, Britain, Canada, Denmark, Finland, France, Germany, Italy, Ireland, Japan, the Netherlands, Russia, South Korea, Spain, Sweden, Switzerland and the United States.