Odious Debts - Iraqi debt debate

The Third World's Odious Debt

The South makes compelling moral arguments to cancel its foreign debts. But, it also has an indisputable legal case because the overwhelming majority of those debts are odious in law.

"If a despotic power incurs a debt not for the needs or in the interest of the State, but to strengthen its despotic regime, to repress the population that fights against it, etc., this debt is odious for the population of all the State."

- Alexander Sack, 1927

In 1927, Alexander Sack the world's pre-eminent legal scholar on public debts, defined the Doctrine of Odious Debts, which remains the ultimate legal source on that subject. The Doctrine of Odious Debts, though now 70 years old, helps bring clarity to today's complicated Third World debt situation, and fairness to a tragedy in which innocent Southern citizens pay, and corrupt and negligent borrowers and lenders get away scot-free.

News articles - Iraq

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Moscow Times, Russia June 26/2003

Iraqi debt debate

LISBON, Portugal -- Russia will not cancel Iraq's debt accumulated during the rule of ousted leader Saddam Hussein, the speaker of the State Duma, Gennady Seleznyov, said in remarks published Wednesday.

Russia "will not wipe out the debt," he told the Portuguese daily Diario de Noticias.

"We would love to discuss the total amount of the debt with the legitimate Iraqi government, but unfortunately that does not exist any more," he said.

"I am convinced however that we will reach an agreement in the future on how this debt is to be reimbursed," he added.

The debt built up during Hussein's rule is now estimated at some $8 billion.

http://www.themoscowtimes.com/stories/2003/06/26/061.html