Identifier
Created
Classification
Origin
08BAGHDAD1538
2008-05-19 12:06:00
CONFIDENTIAL
Embassy Baghdad
Cable title:
JORDAN'S OFFER TO FORGIVE IRAQI DEBT
how-toVZCZCXYZ0005 RR RUEHWEB DE RUEHGB #1538 1401206 ZNY CCCCC ZZH R 191206Z MAY 08 FM AMEMBASSY BAGHDAD TO RUEHC/SECSTATE WASHDC 7425 INFO RUCNRAQ/IRAQ COLLECTIVE
C O N F I D E N T I A L BAGHDAD 001538
SIPDIS
E.O. 12958: DECL: 05/19/2018
TAGS: ECON EFIN EAID PREL IZ
SUBJECT: JORDAN'S OFFER TO FORGIVE IRAQI DEBT
REF: AMMAN 1428
Classified By: Economic Counselor Todd P. Schwartz for reasons 1.4 (b)
and (d)
C O N F I D E N T I A L BAGHDAD 001538
SIPDIS
E.O. 12958: DECL: 05/19/2018
TAGS: ECON EFIN EAID PREL IZ
SUBJECT: JORDAN'S OFFER TO FORGIVE IRAQI DEBT
REF: AMMAN 1428
Classified By: Economic Counselor Todd P. Schwartz for reasons 1.4 (b)
and (d)
1. (C) Reftel refers to the Government of Jordan's (GOJ)
offer to forgive Iraqi debt, which is believed to amount to
approximately USD 1.3 billion. Based upon our conversations
with Iraqi Ministry of Finance officials, including Minister
Bayan Jabr and Advisor (and principal debt negotiator) Azez
Hassan Jafar, the GOI considers this offer a non-starter. The
GOJ offer would cancel interest (30 percent of total claims)
and reschedule principal payments, which does not meet the
standard of the "comparable treatment" clause in Paris Club
agreements. Therefore, moving forward on this basis would
trigger re-negotiation of all Iraqi agreements with its Paris
Club creditors. Iraqi Finance Ministry officials are unsure
whether the GOJ proposal is an opening bid or a serious offer.
2. (C) As a previous recipient of Paris Club relief, the GOJ
is familiar with the "comparable treatment" clause. Iraq's
Paris Club deal calls for an 80 percent discount (as measured
by the Paris Club) if paid over time, or 10.25 percent
discount if paid immediately in cash (as was recently
concluded for Bulgaria and a few Balkan states). The GOJ must
make a comparable offer for negotiations with the GOI to
progress.
CROCKER
SIPDIS
E.O. 12958: DECL: 05/19/2018
TAGS: ECON EFIN EAID PREL IZ
SUBJECT: JORDAN'S OFFER TO FORGIVE IRAQI DEBT
REF: AMMAN 1428
Classified By: Economic Counselor Todd P. Schwartz for reasons 1.4 (b)
and (d)
1. (C) Reftel refers to the Government of Jordan's (GOJ)
offer to forgive Iraqi debt, which is believed to amount to
approximately USD 1.3 billion. Based upon our conversations
with Iraqi Ministry of Finance officials, including Minister
Bayan Jabr and Advisor (and principal debt negotiator) Azez
Hassan Jafar, the GOI considers this offer a non-starter. The
GOJ offer would cancel interest (30 percent of total claims)
and reschedule principal payments, which does not meet the
standard of the "comparable treatment" clause in Paris Club
agreements. Therefore, moving forward on this basis would
trigger re-negotiation of all Iraqi agreements with its Paris
Club creditors. Iraqi Finance Ministry officials are unsure
whether the GOJ proposal is an opening bid or a serious offer.
2. (C) As a previous recipient of Paris Club relief, the GOJ
is familiar with the "comparable treatment" clause. Iraq's
Paris Club deal calls for an 80 percent discount (as measured
by the Paris Club) if paid over time, or 10.25 percent
discount if paid immediately in cash (as was recently
concluded for Bulgaria and a few Balkan states). The GOJ must
make a comparable offer for negotiations with the GOI to
progress.
CROCKER