WASHINGTON (AP) – Leaders of the International Monetary Fund and the World Bank pledged yesterday to help provide billions of dollars to rebuild Iraq. But first, they were sending fact-finding missions to uncover the mysteries of an economy that has been shrouded in secrecy for more than two decades.
- Paul Wong
- AP PHOTO
Jordanian workers carry blankets outside the Jordanian capital of Amman Monday. The United States donated blankets and other items to aid Iraqi civilians.
A day after U.S.-led forces swept through Baghdad, the Bush administration moved quickly to demonstrate that the Iraqi people stand to gain substantial economic benefits from the toppling of Saddam Hussein’s government.
Treasury Secretary John Snow said he would use the spring meetings of the 184-nation IMF, which specializes in helping crisis countries, and the World Bank, the largest source of development loans, to begin gathering the resources needed to rebuild Iraq. Preliminary estimates of the cost of that effort have ranged from $20 billion per year for the first several years to as much as $600 billion over a decade.
Snow and Federal Reserve Chairman Alan Greenspan will lead discussions today among the finance officials from the world’s seven richest industrial countries – the United States, Japan, Germany, France, Britain, Italy and Canada.
In addition to lining up initial commitments from the IMF and World Bank, Snow said he would seek support among the G-7 countries for forgiving a part of Iraq’s massive foreign debt, estimated to be as high as $200 billion.
However, the G-7 discussions could prove contentious given that two of the nations – France and Germany – actively opposed the U.S.-led war effort.
They have also insisted that the United Nations take the lead in the reconstruction effort, an approach that is opposed by the United States, which is ready to install its own interim administration headed by retired U.S. Lt. Gen. Jay Garner.
World Bank President James Wolfensohn said yesterday that Iraq would need to have in place a U.N.-sanctioned government before his institution would be able to extend new loans to the country.
Both Wolfensohn and IMF Managing Director Horst Koehler said their boards, which include the United States and the other G-7 nations, would have to approve any new loan programs. That means the United States will need to resolve any disagreements over the reconstruction effort before it will be able to achieve IMF and World Bank backing.
However, both officials said they expected any disagreements to be resolved quickly. They said even before new loans began flowing, the two institutions would join to send fact-finding missions to Iraq to begin the process of gathering data on Iraq’s economy – although they will need to penetrate a veneer of secrecy imposed by Saddam’s regime.