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World: Donors Promise About $37.5 Billion to Rebuild Iraq

Reuters
October 24th, 2003

MADRID, Oct 24  - Governments and international agencies pledged around $37.5 billion in aid and loans to help rebuild war-ravaged Iraq on Friday as the results of a donors' conference came in well above initial low expectations.

 

Promises of aid and loans poured in on the final day of an international conference aimed at raising funds towards the $56 billion the United Nations and World Bank say Iraq needs to rebuild over the next four years.

 

The pledges came in a confusing mixture, including humanitarian and reconstruction aid, export credits and project finance, and covered different time periods.

 

But a Reuters calculation showed total pledges of aid and loans totalling some $17.5 billion over a maximum of five years in addition to the $20 billion promised by the United States. Further pledges were trickling in.

 

"The Iraqi people will long remember the assistance we'll provide them at this critical moment of challenge and hope," U.S. Secretary of State Colin Powell told the conference.

 

"A strong showing of support from this conference will speed reconstruction and hasten the day when Iraqis can assume full responsibility for their nation."

 

Iraqi Governing Council President Iyad Allawi said the reconstruction effort would establish a beacon for democracy in the region and spell an end to the violence that has plagued the country since U.S.-led forces toppled Saddam Hussein in April. The conference has struggled against scepticism from critics of the Iraq war, but intensive U.S. lobbying helped wring more aid from reluctant governments.

 

The World Bank said it would make between $3 billion and $5 billion available through to 2008, while the International Monetary Fund promised support of between $2.5 billion and $4.25 billion over three years.

 

Japan's government made the largest offer after the United States, pledging a further $3.5 billion in medium-term loans to bring its total promised aid to $5 billion.

 

Saudi Arabia -- one of the richest and most powerful of Iraq's neighbours -- announced a $1 billion financing package, split equally between project finance and export credits.

 

The European Union said its combined aid for rebuilding Iraq in 2004 had risen to some 700 million euros ($826 million), overtaking its contribution to Afghanistan last year despite widespread opposition to the U.S.-led war.

 

"Whatever the disagreements earlier this year...we have now all come together with a shared determination to work with the people of Iraq to build a better future for them and for their region," EU External Affairs Commissioner Chris Patten said.

 

Total pledges from the EU community budget and member states from now until 2007 stand at 1.3 billion euros, a figure that will rise when the bloc considers a multi-annual offer from its community budget next spring.

 

Iraq received a wide-ranging offer of help from its former bitter enemy Iran, against which Saddam fought a war between 1980 and 1988.

 

Iranian Foreign Minister Kamal Kharrazi promised a credit facility of up to $300 million, offered cross-border electricity and gas supplies and said it would allow Iraq to export oil through Iranian terminals.

 

France, a vocal opponent of the invasion of Iraq, repeated its regret that a recent U.N. Security Council resolution did not set a clearer timeframe for political transition in Iraq, saying this could have formed the basis for greater international support for reconstruction.

 

French Trade Minister Francois Loos announced no new aid, but described several ways in which France was helping Iraq and said Paris might envisage other types of help in future.

 

Russia Deputy Foreign Minister Yuri Fedotov pledged no government aid, but said Russian companies were ready to invest up to $4 billion in the Iraqi economy.

 

 





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