Iraq ready to pay off debt to Russia

Jul 04, 2002 02:00 AM

The new Iraqi ambassador to Russia said his country is ready to pay off its $ 8 bn debt to Russia, a long-standing sticking point that has prevented the two countries from improving economic ties. Abbas Khalaf also told that Iraq was prepared to allow Russian oil companies to help develop some of his country's oil fields, which is currently forbidden under UN economic sanctions imposed after Iraq's 1990 invasion of Kuwait.
"Iraq is ready to pay its debts," Abbas Khalaf, the Iraqi envoy to Russia, told. "Iraq can't pay Russia its debts because of the sanctions."

Iraq had very close ties to the Soviet Union and at one point about 70,000 Russian specialists, including engineers, construction workers, and aviation workers, were based in Iraq. Those close ties continued after the 1991 Soviet collapse, and Khalaf cited a Russian Foreign Ministry document that said Russia had lost $ 30 bn in trade as a result of the sanctions.
Russian oil companies, some of which are flush with cash, are eager to move into Iraq and develop fields to which they have rights. Khalaf said Iraq would welcome Russian participation in the restoration of its oil-producing capacity once the sanctions were lifted. Khalaf accused the United States and Great Britain of conspiring to deliver an economic blow to Russia by keeping the sanctions in place, thus preventing Russian companies from doing business in Iraq.

Although repeatedly slamming the West for its role in keeping the sanctions in place, Khalaf said he was optimistic about the new round of talks between Iraq and the United Nations that were starting in Vienna.
"Iraq has approached this dialogue constructively, with good intentions, in a good mood, with good will to resolving the issues between our two sides," Khalaf said. "I look forward to this dialogue with optimism."

Khalaf said the issue of the return of UN weapons' inspectors, which the United Sates and Great Britain say is crucial for any discussion of lifting the sanctions to succeed, did not depend on Iraq. In recent months, Russia has tried to act as an intermediary to help persuade the Iraqis to allow the inspectors to return. Khalaf said Iraq and Russia had an "intensive" dialogue but that there were "nuances" in their positions on a number of issues.
Asked whether Russia's shift toward closer relations with the West that occurred following the Sept. 11 terrorist attacks in the United States had had an impact on Iraq's relations with Russia, Khalaf replied: "We respect Russia's course and we don't intend to interfere in that."

Source: AP Worldstream
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