WASHINGTON April 12 —
Finance officials from the seven richest industrial countries
agreed Saturday to support a new U.N. Security Council resolution as
part of a global effort to rebuild Iraq.
The deal settles a dispute that had threatened to delay postwar
help that the United States had insisted could go ahead without a
further U.N. resolution.
But the finance leaders, in a joint statement, endorsed a
resolution as part of a reconstruction plan that will involve the
International Monetary Fund and the World Bank.
"We recognize the need for a multilateral effort to help Iraq. We
support a further U.N. Security Council resolution," said the
finance ministers and central bank presidents from the United
States, Japan, Germany, France, Britain, Italy and Canada.
That was a concession by the Bush administration. U.S. officials
had argued that IMF-World Bank reconstruction efforts could begin as
part of an American-led rebuilding program without a further U.N.
resolution. The world body had failed to endorse the U.S.-led
military campaign to oust Iraqi President Saddam Hussein.
France and Germany, leading critics of the war, rejected the
administration's approach. They said the lending institutions should
not become involved in Iraq until there was a deal on the United
Nations' role in overseeing reconstruction.
"The IMF and the World Bank should play their normal role in
rebuilding and developing Iraq, recognizing that the Iraqi people
have the ultimate responsibility to implement the right policies and
build their own future," the Group of Seven countries said in the
The discussions were led by Treasury Secretary John Snow and
Federal Reserve Chairman Alan Greenspan.
After the meeting, Snow said the talks had begun the process of
finding a way for the IMF, World Bank and other institutions to
"work together to help the Iraqi people recover not just from 25
days of conflict but from 25 years of economic misrule."
Snow said the officials agreed the IMF and the World Bank would
begin providing technical assistance in Iraq and start preliminary
studies on what would need to be done to rebuild the country.
The countries did endorse a call by the United States to begin
discussions on forgiving a portion of Iraq's massive foreign debt
burden, much of it owed to Russia, France and Germany and built up
during Saddam's rule.
One participant in the G-7 discussions, Wim Duisenberg, the head
of the European Central Bank, said the talks were conducted without
any hint of the bitterness between the United States and France and
Germany over the war.
Duisenberg said all participants agreed "a new Security Council
resolution would be welcomed" and that "there should be a joint
effort to reconstruct" Iraq.
The finance officials also pledged to pursue greater cooperation
in efforts to deal with a serious global economic slowdown,
exacerbated by uncertainties surrounding the war.
"Growth in most of our economies has been subdued, though
uncertainties have diminished," the G-7 officials said.
"A strong and lasting recovery is essential for our own countries
and for the world," the joint statement said. "To this end, we each
commit to pursue sound macroeconomic policies that support sustained
As part of the effort to bolster growth, the officials also
released a plan that discussed the steps over the past year to
increase growth and improve the ability of the IMF and other
institutions to handle financial crises.
"We reiterate our commitment to strengthen crisis prevention and
resolution measures," the statement said.
The statement was silent on specific measures needed to stimulate
The administration has made President Bush's proposed $723
billion in new tax cuts the centerpiece of its economic
revitalization program. But several European countries have
questioned the advisability of pursuing further tax cuts in the
United States at a time that Washington's budget deficit is
|France' s Minister of the
Economy, Finance and Industry Francis Mer laughs with with
Eupean Bank Chairman Wim Duisenberg following the working
meeting of the G-7 Saturday, April 12, 2003, in Washington.
(AP Photo/Rick Bowmer)|
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