Iraq's Odious Debts

Nations agree to cancel 80 percent of Iraq’s debt

Cato Institute
November 22, 2004

“The world’s leading industrial nations agreed Sunday to cancel 80 percent of the nearly $39 billion debt owed them by Iraq, a critical step in rebuilding the country’s devastated economy and an important precedent for its other creditors to follow,” the New York Times reports.

In “Iraq’s Odious Debts,” Patricia Adams, executive director of Probe International, writes: “Most debts created by Saddam Hussein in the name of the Iraqi people would qualify as ‘odious’ according to the international Doctrine of Odious Debts. This legal doctrine holds that debts not used in the public interest are not legally enforceable.”

Iraq’s debt was created by former dictator Saddam Hussein and the funds were used to oppress the Iraqi people or were otherwise not used in the public interest, Adams argues. “Deciding the disposition of Iraq’s debts by the rule of law, through a public judicial process that allows Iraqis, the domestic and international press, and anyone else to understand who lent how much to whom and for what purpose, would give Iraqis confidence that government can work in their interest,” she concludes.

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