[lbo-talk] China considers abating Iraq's debts by a big margin

uvj at vsnl.com uvj at vsnl.com
Sat Jan 3 17:02:09 PST 2004


[People's Daily Online]

Opinion

Last updated at: (Beijing Time) Friday, January 02, 2004

China considers abating Iraq's debts by a big margin

James Baker, US president's special envoy for handling Iraq's debt issue, paid a visit to China on December 29-30, during which he met with Chinese President Hu Jintao and Premier Wen Jiabao respectively.

In meeting with Premier Wen Jiabao, Baker said that Iraq's reconstruction was conducive to world peace and stability, but if the country's debts were not reduced and exempted, it would be impossible to carry out Iraq's reconstruction. He expressed the hope that China and the United States would strengthen cooperation and, together with other creditor nations, properly solve Iraq's debt problem. Premier Wen Jiabao indicated that the Chinese government fully understood difficulties in Iraq's rebuilding and the situation of the Iraqi people. Proceeding from humanitarianism, China will actively consider "abating by a big margin" the debts Iraq owes China.

Various major media closely follow Baker's Asian journey, they are also greatly concerned about Baker's China visit. According to the British BBC estimate, the debts Iraq owes China should reach several hundred million US dollars, which are mainly loans to construction and petroleum projects owed by Iraq before the first Gulf War.

Foreign news agencies have noticed that the Chinese side did not disclose the concrete figures of debts it would abate and both sides did not reveal details about the talks after the meeting, but it appears that the talks between both sides proceeded quite well. Baker looked happy when he walked out of the Great Hall of the People after meeting with President Hu Jintao, and he said that the talks were quite good and quite fruitful.

Trust between the United States and China enhanced

The amounts of foreign debts Iraq owed before the war were enormous, said to be as high as 120 billion US dollars, how to properly handle this sum of debts is a primary question concerning Iraq's postwar reconstruction, it is also directly associated with Bush's future and the US image. For this reason, on December 5 Bush appointed James Baker, former US secretary of state, as the president's special envoy to tackle the Iraqi debt issue, Bush gave him great power and placed high hopes on his journey to write off debts.

Some US media pointed out that countries included in the name list of Baker's debt-related trips are US allies in addition to Russia and China. Due to the mounting anti-US sentiments in the Republic of Korea (ROK), Baker cancelled his ROK visit at the last minute before he started his East Asian tour, but he still came to China as scheduled, this shows the enhancement of the trust between the United States and China. Just as US Secretary of State Colin Powell recently said that US-China relationship is in its "best period" over the past 30 years. In his China visit, Baker aimed to reduce Iraq's debt burden, besides, he also hoped to win China's support for Iraq's reconstruction.

The debt-related journey is rewarding

As the saying goes, "When a veteran goes into action, he can do the job of two", 73-year-old Baker had not let Bush down. Just as he was in China, Baker's debt-related tour was rewarding in almost every country he visited. Europe was the first leg in Baker's trips abroad. On December 16, Baker paid whirlwind-like visits to France and Germany, at noontime he met with French President Jacques Chirac in Paris; in the afternoon he hurried to Berlin to meet with German Chancellor Gerhard Schroeder; in the evening, America, France and Germany issued a joint communiqu¨¦ of the three countries, in which they reached consensus on the issue of substantially reducing Iraq's debts within the Paris club framework in 2004. Later, Baker's visits to Italy and Britain, US close allies, were very smooth, the two countries both expressed full support for reduction of Iraq's debts.

Russia is Iraq's biggest creditor nation within the Paris club framework, it is also a difficult point in Baker's journey. Sensitive people have noticed that a day before Russian President Putin's meeting with Baker, the United States announced postponement of the competitive bidding for projects related to Iraq's reconstruction. Under the signal that there is still possibility for Russia to participate in Iraq's rebuilding, Putin readily indicated to Baker that Russia would quickly join negotiations on the Iraqi debt problem.

In Japan, Baker encountered a difficult problem. Japan is the country to which Iraq owes the most debts, reaching US$4.1 billion, which, plus fines and interest, adds up to US$7.76 billion; and prior to this, Japan had promised to provide US$5 billion in loans for Iraq's reconstruction, therefore it was somewhat reluctant to abate debts. But after Baker's talks with Japanese Prime Minister Junichiro Koizumi on December 28, Japanese Foreign Ministry issued a statement indicating its willingness to considerably reduce Iraq's debts on the condition that other members of the Paris Club also agree to do so. It is reported that the Japanese side also indicated to Baker its wishes that Iraq use the petroleum produced in future to pay off the debts.

The article relayed from Page 3 of the Global Times December 31, 2003 was written by the newspaper's guest correspondent Zhu Ji and translated by PD Online.

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