Iraq's Odious Debts

Russia will write off 90 percent of Iraq debt: Putin

November 25, 2004

The Hague: Russian President Vladimir Putin said on Thursday that Moscow had committed itself to writing off 90 percent of Iraq’s debts, more than the 80 percent of forgiveness agreed by the Paris Club of sovereign debtors.

“In the framework of the Paris Club we have undertaken . . . writing off of Iraqi debts to us,” Putin told a news conference after a summit with European Union leaders.

“When entering the Paris Club we have obliged ourselves to write off 60 percent plus new agreements, and totally that will amount to 90 percent of writing off Iraqi debt to Russia.”

The Paris Club agreed last Sunday, after Russia came on board, to cancel 80 percent of the $38.9 billion debt Iraq owes its members.

The deal, which will slash Baghdad’s debt to Club creditors to $7.8 billion, ended a dispute between Washington and leading opponents of the U.S.-led Iraq war over how much debt to cancel.

Russia opposed the invasion of Saddam Hussein’s Iraq, and its firms had signed billions of dollars worth of oil contracts with the former government of the country.

Putin said that on Wednesday he spoke with Iraq’s interim prime minister, Iyad Allawi, who will visit Moscow shortly.

“We will discuss the entire complex issues before us,” he said, confirming a Kremlin announcement which said that the talks would be held next month.

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