PARIS, Nov 18: The Paris Club of creditor nations failed to bridge a trans-Atlantic rift on Thursday over how much of Iraq's $125 billion in debt to forgive, but agreed to meet again on Friday for more talks aimed at closing a deal.
"The work will continue tomorrow," a source close to the Paris Club said.
The 19 countries are trying to close a gap between the 90 per cent to 95 per cent write-off Washington has pushed for and France's proposal that the leading creditors should initially cancel half of Iraq's debts and then review the situation after three years.
A dispute over the issue at a meeting of finance ministers from the Group of Seven (G7) rich countries last month revived lingering tensions between Washington and Paris over the US-led war in Iraq, which France opposed.
The G7 countries - the United States, Japan, Germany, Britain, France, Italy and Canada - are all Paris Club members.
France argues that Iraq has the world's second-largest oil reserves and should not be treated like impoverished African nations without such natural resources.
The United States says Iraq needs enormous debt relief to get back on its feet and become economically viable.
Officials at the Paris Club, an informal grouping that seeks solutions to the payment difficulties of debtor countries, say they are aiming to reach a deal by the end of the year. France backed that aim this week.-Reuters
