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UK's Clare Short: Iraq's war reparations to Iran need restructuring

Britain's International Development Secretary Clare Short has suggested that one of the reforms to carry out in post-Saddam Iraq will be the country's reparations owed to Iran for its eight-year war in the 1980s, IRNA reported from London on Tuesday.

"Iraq has high levels of debt and significant reparation bills related to Iran and Kuwait. That will all have to be restructured or Iraq would be in the same position as Germany at the end of the first world war," Short told parliament on Monday.

Iran has tabled reparations claims against Iraq of up to Dlrs 100 billion for the 1980-88 war, which was approved in principle by the then UN Secretary General, Javier Perez de Cuellar, in 1990, but reports have previously suggested it may never be paid.

A lesser amount estimated to be up to Dlrs 70 bn has been claimed by Kuwait for the subsequent 1990-91 war, of which just over Dlrs 16 bn has already been paid.

Short, who has recently returned from talks with UN Secretary General Kofi Annan on the post-war reconstruction of Iraq, said that the structuring of the debts and the reparations were an "important issue and we will have to prepare for it."

She also reported that plans were for a phased reconstruction of Iraq that would include economic reform and re-organising the country's state oil industry after a fresh UN resolution was secured.

"The entire currency needs reforming, as do the Ministry of Finance and the various regulations," the International Development Secretary told MPs.

She said that "expert advice will have to be sought on the oil sector, which relies on very old technology and needs new investment, but that would be properly done later."

After getting the existing oil-for-food programme up and running again, Short said the next stage would be to "introduce the reform agenda, rebuild a modern economy and give proper consideration to how the oil industry should be re-organised."

She did not say whether plans would be to privatise Iraq's oil industry but insisted that "all contracts will be transparently and properly let."

"There will be no misuse of any influence on the part of the UK or, I am sure, of the US," the British minister said. "The IMF and the World Bank will be crucial to this reconstruction and they would not permit it," she said.

... Payvand News - 3/25/03 ... --

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