For Immediate Release
November 22, 2004
Paris Club creditors have agreed to reduce Iraq's official debt by 80
percent, demonstrating strong international support for Iraq's
reconstruction and integration into the world economy.
Iraq's $38.9 billion debt to Paris Club creditors will be reduced
to less than $7.8 billion in three stages: first, by 30 percent
immediately; second, by 30 percent in 2005, and third, by 20 percent
after three years of successful performance.
The final level of debt reduction is expected to be more than 90
percent due to the inclusion of the standard Paris Club discount on
Russian debt and additional reduction some creditors will provide
beyond the Paris Club terms. The United States expects to forgive 100
percent of Iraq's debt to it.
Iraq's total foreign debt is about $120 billion. Under the Paris
Club agreement, Iraq will seek at least comparable treatment from its
other official and private creditors. The U.S. encourages these
creditors to take action to reduce Iraq's debt as soon as possible.