Point 4 is substantially wrong. Much of the Iraqi debt is not owed to the US and UK. Certainly some money is owed to those countries, but far more to the major Iraqi arms suppliers such as France and Russia. However, these debts are insignificant when compared to the money owed to Arab countries. There is also few signs of any of these countries offering debt relief. There are also difficulties estimating the actual amount that Iraq owes.

Here is an article from 'The Business' magazine this week which follows Paris Club negotiations, etc:

'THE world's most powerful nations face their worst disagreement since the Anglo-American invasion of Iraq this week when France, Germany and Russia this week reject American demands to write off Iraq's $150bn (£90bn, E129bn) of foreign debt incurred during Saddam Hussein's dictatorship.The clash will come at the Iraq donors' conference in Madrid on Thursday, when the major powers are also likely to refuse to donate as much money for the reconstruction of Iraq as the United States wants.

The row will shatter the recent truce between the Bush administration and top European leaders. Leading Republicans in Washington began this weekend to turn up the pressure on Europe.

They accused France, Germany and Russia of wanting to condemn Iraq to 100 years of debt-induced poverty and raised the spectre of Germany after the First World War, where a new democratic system was strangled by punitive measures, such as reparations and huge debts incurred by its predecessor.

President Bush is under pressure to increase demands on fellow donor countries to release Iraq from its debt burden after the Senate unexpectedly defied him on Thursday by converting $10bn of his proposed $20.3bn Iraq rescue package into a loan that would only be forgiven if other countries cancel their debts.

The American attitude to Iraq's debt hangover is based on the concept of "odious debt", a view that a new government and its taxpayers should not be held responsible for the sins of a previous dictatorship.

Pressure from the US at the recent G7 meeting in Dubai has prompted the German finance minister, Hans Eichel, to say: "We do not only expect to get our money back; we will get our money back."

Estimates of the debt incurred by the Saddam regime, mainly prior to the 1990 invasion of Kuwait, stand at around $150bn, though if reparations from the invasion of Kuwait are included, the figure rises to about $350bn. The most prolific lenders were the neighbouring Gulf states ($30bn), Japan ($9bn), Russia ($8bn), France ($8bn) and Germany ($4.3bn)

Edward Truman of Washington's Institute for International Economics, calculates Iraq will only be able to service interest on $80bn of its debt, or 60% less than it owes. This is believed to be roughly the amount the Paris Club, the key group of creditor nations, will accept.

Some creditors are said to be calculating that delay in finalising the repayment package may be in their interests; a partially recovered Iraq may be able to afford more.

The Paris Club nations, including the US and Britain, have agreed to freeze debt discussions pending an improvement in Iraq's security and infrastructure - envisaged at the end of 2004. As always with Iraq, diplomacy, the important discussions are taking place behind the scenes.

The Iraq debt issue has produced an unlikely coalition of interests between White House hawks and traditional Paris Club opponents such as Jubilee, the British campaign for debt relief.

Having presented extensive research into the sufferings inflicted on his people by Saddam's irresponsible borrowing, Jubilee is demanding that an independent international body be set up to administer Iraq's debt problem, in which creditors are barred from setting the terms.

Much of last week's Congressional resistance to President Bush's Iraq reconstruction package, which totals $87bn with provision for military operations, has been directed at Iraq's other creditors.

In the House of Representatives and in the Senate, there was anger that billions of US taxpayers' money is being poured into Iraq while countries that opposed US intervention exert pressure to extract money.

While donors are expected to pledge more money for Iraq, the conference has little hope of raising more than a small part of the $36bn the World Bank, the United Nations and the International Monetary Fund claim is needed over the next four years to revive the Iraqi economy.

Spain pledged $300m of aid to Iraq on Friday, Japan will hand over $1.5bn soon, the UK has promised $912m and the European Union (EU) a mere $200m.

The row over Iraqi reconstruction comes at a time when fears are already mounting in Washington about efforts by the European Union (EU) to set up an independent military structure outside Nato. Nicholas Burns, the US ambassador to Nato, last week called an extraordinary meeting of the militarty organisation to challenge the EU plan, concocted by France and Germany.'


A couple of other links:

 http://www.heritage.org/Research/TradeandForeignAid/em871.cfm
 http://www.odiousdebts.org/odiousdebts/index.cfm?DSP=content&ContentID=7066

The debt should be cleared, as it is obviously a burden on the Iraqi people - and it is true that the US/Britain do not have quite as much money pending as other countries. However, I would ignore the conservative "think-tank" Heritage link and see the US' moral quest to cancel the debt for what it is. As they pile up contracts in Iraq for favoured US firms they do not want to have to worry about the debts of Saddam. I mean, how can they properly bleed the country dry if they have all that debt hanging over them?
Also the contracts Bush is handing out to his paymasters and pals may not stand in law as they contravene Iraq's laws against foreign ownership. These laws can only be changed by the will of the Iraq people, not by the administration put in place by invading forces.
So where can we get camp X-ray boiler suits as we prepare to give the un-elected draft-dodger war-monger the welcome he, and Tony poodle Bliar, deserves?