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Kuwait refuses to forgive Iraqi debt

April 26th, 2007 11:39 pm by Associated Press



KUWAIT CITY - Kuwaiti lawmakers' refusal to forgive Iraq's debt has shone a troubling light on the lingering bitterness many of its neighbors feel toward Saddam Hussein's rule - and their suspicion of Iraq's new Shiite-led government.


Iraqi Prime Minister Nouri al-Maliki struggled against those misgivings when he tried this week to persuade Kuwait to forgive most of his country' $15 billion debt.


Cancellation of Iraqi debt is expected to figure high on the agenda of the May 3-4 international conference on Iraq at Egypt's Red Sea resort of Sharm al-Sheik.


The United States has been strongly pushing for Iraq's creditors to follow its lead and write off Iraq's debt, as one way of helping the country get on its feet financially.


Al-Maliki ended his visit to Kuwait Wednesday with appeals to lawmakers in this small oil-rich nation to be "generous" and write off some of the debt.


But al-Maliki, a Shiite, is seen by many in Iraq's mostly Sunni neighbors as weak in clamping down on Iraqi Shiite militias that are supported by Iran and responsible for part of the sectarian violence ravaging the country.


Hamad al-Msailim, a 34-year-old civil servant, said he might be able to get over the memories of the Iraqi occupation and support a debt write-off when a different government takes over in Iraq.


"This is an Iranian government. It has no credibility," he said, sipping coffee at a seaside mall.


For seven months starting Aug. 2, 1990, Saddam's occupying forces rounded up Kuwaitis, executed them at the doorsteps of their houses, changed names of neighborhoods, hospitals and ports, and blew up some 700 oil wells. Hundreds who went missing before a U.S.-led coalition liberated the country in the 1991 Gulf War, are still unaccounted for.


Most of the $15 billion was extended to Saddam to finance his 1980-1988 war with Iran. The former Iraqi leader was considered a hero by many in Kuwait, until he shocked the nation by turning his guns on it and accusing it of stealing Iraqi oil from border wells.


Al-Maliki said he believed Kuwait was "no less generous" than Saudi Arabia, which is writing off 80 percent of a similar sum in debts. But Saudi Arabia, the world's largest oil producer, has no legislature.


Kuwait, a constitutional democracy with a ruling royal family, cannot make such a decision without approval of its parliament.


"Most Kuwaitis and parliament members believe that Iraq must pay," lawmaker Mohammed al-Mutair said. "A commitment is a commitment; we have suffered enough from that neighbor." In addition, taking a debt forgiveness bill to parliament is going to be difficult for a government that only a few months ago opposed legislation to pay off consumer debts owed by its own citizens to local banks and companies, as some lawmakers proposed. "Politically, it is very embarrassing for the Cabinet," said independent economist Jassem al-Saadoun. "It doesn't want to carry the burden of the political cost alone," and it will seek the largest majority vote possible before it tables the debt cancellation proposal, he said. Shamlan al-Issa, a political science professor at Kuwait University, said he sympathizes with Iraqis and their security and economic difficulties, but not with al-Maliki's "corrupt" government. "If I were a member of (Kuwait's) parliament, I would tell the Iraqi government, ‘Go get your act together and then we will talk about debt forgiveness,'" he said. "The Iraqi government is a failure ... it wants the debts canceled as a win to show to the Iraqi parliament and the Iraqi people." Al-Saadoun, the economist, believes a good way out for Kuwait would be to turn the debt into capital to finance projects in Iraq that would create jobs for Iraqis and profits for both sides. "We have to invent a creative solution that pleases both us and them," he said.

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