The 19-nation Paris Club announced an agreement to forgive 80 percent of the approximately $40 billion Iraq owes its members, and President George W. Bush called on creditor nations outside the group to offer Iraq comparable relief.
The reduction would be delivered in three stages over three years. About 30 percent of the debt would be cancelled immediately; another 30 percent would follow if Iraq satisfies conditions set by an International Monetary Fund program; a final 20 percent would depend on the program's overall results. If Iraq clears all three stages, its remaining Paris Club obligation would fall to roughly $7.8 billion.
France, Germany, and Russia had long resisted any cut beyond 50 percent, while the United States and Britain pushed for 95 percent. Bush had repeatedly argued that Iraq's total debt burden of around $120 billion diverts money needed for reconstruction.
Bush credited Secretary of State Colin Powell, Treasury Secretary John Snow, and special envoy James Baker with securing the deal. The president made his remarks in Santiago, Chile, where he was attending the APEC summit.
Iraq's interim government also confirmed that the country's first elections since the fall of Saddam Hussein would be held on 30 January.
Historical summary. TurkishPress restated this AFP wire report, first published in November 2004, in its own words.