Iraqi Debt: Parliamentary Question and Answer

Harry Cohen: To ask the Chancellor of the Exchequer if he will match the United States' commitment to top up the Paris Club deal in respect of Iraq's debt by a bilateral agreement taking the debt write-off to 100 per cent.; and if he will make a statement.

Mr. Timms: The UK has been at the forefront of efforts to help rehabilitate Iraq's economy. The UK fully supported a generous debt treatment for Iraq at the Paris club meeting of 21 November at which it was agreed to write off 80 per cent. of Iraq's debt in order to provide a robust exit from debt unsustainability. Under the Paris Club deal, no payments are due from Iraq to Paris Club creditors until 2008. In addition to supporting the IMF and World Bank in providing assistance, the UK has pledged £544 million in direct aid over three years to March 2006, of which over £331 million has been committed. These funds are bringing immediate benefits to the Iraqi people. We continue to keep options to support Iraq's economy under review.