IRAQ: World leaders failed to reach agreement on how much of Iraq's debt should be written off, as the summit meeting of the Group of Eight industrialised nations drew to a close yesterday. Carl O'Brien reports from Savannah
The US had reportedly been pushing for almost all of the outstanding money to be written off.
Other countries, including France and Russia, were more reluctant, saying Iraq's oil revenues make it better able to repay money than some other developing countries.
Officials have suggested that at least 50 per cent of its debt burden will eventually be cancelled by G8 countries.
In a statement which avoided mentioning a specific figure, the G8 leaders said cutting the amount of money owed was the key to rebuilding the war-torn country.
It added it will be up to the so-called Paris Club of creditors, which includes Russia and France, to work out the remaining details.
"Debt reduction is critical if the Iraqi people are to have the opportunity to build a free and prosperous nation," the G8 said.
"We will work with each other, within the Paris Club, and with non-Paris Club creditors, to achieve that objective in 2004."
Meanwhile, President Bush sought to iron out differences with President Jacques Chirac of France yesterday about the role of NATO, which surfaced at the summit meeting on Wednesday.
The discord over the issue threatened to spoil the atmosphere of an otherwise upbeat summit, buoyed by this week's unanimous acceptance by the UN Security Council of a resolution recognising Iraqi sovereignty.
Mr Bush held a private meeting with Mr Chirac and told reporters afterwards they had discussed whether or not there was a continued role for NATO in Iraq.
"I assured the president that we will continue to consult closely. The point is we understand that the Iraqi people need help," Mr Bush said afterwards. "We understand the Iraqi people need help to defend themselves, to rebuild their country and, most importantly, to hold elections."
When Mr Chirac spoke to reporters later he did not mention the dispute over Iraq, but talked instead about how much he had enjoyed the G8 summit, particularly the food.
US officials say they hope to reach agreement on the issue before a NATO summit to be held in Turkey later this month.
The US has 130,000 troops in Iraq and, along with Britain, is seeking greater involvement by the other countries in dealing with the tense security situation.