Paris Club lenders complete Iraq debt forgiveness

PARIS — The Paris Club of creditor nations said Monday it has canceled a final $7.8 billion of Iraqi debt dating from the Saddam Hussein era.

The sum is the final tranche waived under a four-year-old agreement to reduce Iraqi debts to the group by 80 percent.

The sum represents 20 percent of the debt to the Paris Club of 19 member nations and follows a 60 percent cut in 2004 and 2005, the club said in a statement. The remaining 20 percent, also $7.8 billion, was not covered by the agreement.

The Paris Club said its decision followed the completion last week of a review by the International Monetary Fund of Iraq's economic reforms and its 2009 budget.

The group agreed in 2004 to write off some $32 billion of Iraq's Saddam Hussein-era debt, which once totaled $125 billion including debt owed to non-Paris Club members.

The Paris Club describes itself as an informal group of official creditors.

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