PARIS — Seizing the initiative a day after the announcement of Saddam Hussein's capture, France said Monday that it would work with other nations to forgive an unspecified portion of Iraq's immense foreign debt.
The offer, as much a conciliatory gesture to Washington as a hand extended to Baghdad, came a day before James A. Baker III, a former secretary of state, was scheduled to arrive in Paris to ask the French for help in relieving Iraq of its crushing financial obligations. Washington is eager to lift the debt burden, estimated at more than $120 billion, excluding war reparations owed to Kuwait and Iran, because it will otherwise raise the cost of an Iraqi economic recovery beyond America's means.
"France, together with other creditors, believes there could be an agreement in 2004," the French foreign minister, Dominque de Villepin, told reporters after a meeting here with members of Iraq's interim Governing Council. He said if various conditions regarding Iraq's sovereignty and stability were met, his country "could then envisage cancellation of debts in line with Iraq's basic financing capacity."
Jalal Talabani, an Iraqi Kurdish leader and a member of the Iraqi delegation visiting Paris, called De Villepin's announcement a "gift."
But De Villepin's statements went little beyond France's past statements that as head of the Paris Club, it would treat Iraq's debt problems as it would those of any other overly indebted country. The Paris Club is an association of 19 industrialized nations formed in 1956 to coordinate the cancellation of debts for financially distressed countries.
He reiterated that there could be no deal until there was a sovereign Iraqi government in place with which to negotiate one — something that will not happen before June.
By announcing France's intentions to the Iraqis on Monday, though, De Villepin avoided the appearance of answering to Washington's call on Tuesday. "This way he can say, 'I'm not doing it because the Americans are asking for it but because I believe it's the responsible thing to do for the Iraqis,"' said Dominique Moisi, an expert in Franco-American relations at the French Institute for International Relations.
The French foreign minister, one of the diplomatic world's sharpest critics of Washington's Iraq policy, also seemed eager to strike a conciliatory note in the wake of Saddam's capture. Taking the lead on the debt-reduction issue is the quickest and easiest way for him to put France back in the Iraq reconstruction game on Washington's side.
"The arrest of Saddam Hussein constitutes a chance that we all must take advantage of," De Villepin said. "France is ready to play a full role in these efforts and to follow the action already undertaken on a bilateral basis as Europeans in the humanitarian domain, of course, and in the cooperative domain, whether it be education, health or even archaeology."
He brushed aside questions about whether debt forgiveness would be linked to participation in $18.6 billion in American-financed reconstruction contracts in Iraq. He said the two issues were separate.
Washington has excluded France and other past opponents of the war in Iraq from lead roles in such deals. France, Germany, Russia and other affected countries are studying whether the move violates rules governing global trade.
He did not, however, offer to send French troops to help secure Iraqi stability, repeating instead France's offer — so far ignored by the United States — to build a police school in the troubled country.
France has been slow to extend financial aid to Iraq as long as that country remains under U.S. occupation. France was not among those countries that pledged billions for Iraqi reconstruction at a donors' conference in October, and, until Monday, it had been silent on the question of Iraq's debt, about $3 billion of which is owed to France, not including interest.
Standing together with members of Iraq's Governing Council, including the current holder of its rotating presidency, the Shiite leader Abdul Aziz al-Hakim, De Villepin said that his country would work with the Paris Club to negotiate a debt reduction plan for Iraq.
The Paris Club includes the United States, France, Germany, Russia and Japan. In its most generous deal ever, it agreed to forgive two-thirds of Yugoslavia's debt after President Slobodan Milosevic was driven from power. The World Bank has suggested that the same percentage be applied to Iraq. Even then, the country's debt would be about three times its annual economic output.
Paris Club members collectively hold about $40 billion of Iraq's outstanding debt. Much of the rest of the country's $120 billion debt is owed to Arab states.
Japan, which is owed more than $4 billion, not including interest, has yet to indicate whether it would go along with a write-off.
Russia, which is owed nearly $3.5 billion, excluding interest, said Monday that it supported a Paris Club resolution to Iraq's debt problem. Germany, which is owed about $2.5 billion, excluding interest, said last month that it supported forgiving a portion of the debt.