US details Iraqi economic reconstruction tasks

01 May 2003
Peter McPherson, the man appointed by the US Treasury Department to co-ordinate the reconstruction of the Iraqi economy, on 29 April laid out some of the steps to be taken. Speaking to reporters, McPherson said that one of the first priorities would be to establish a sound national currency to replace the three currently in circulation - the Iraqi dinar, the so-called Swiss dinar and the US dollar - and to establish a new central bank. A federal budget would have to be drawn up and a system of financial institutions, with a regulatory structure, put in place, McPherson said. US treasury officials are already assessing Iraqi financial workers for their closeness to the previous regime, to determine whether they are suitable to serve the new one. McPherson said that his team would solicit donations and support from the international community. 'The Iraqi people are clearly going to need some [debt] relief,' he said. 'How it's negotiated is a very complicated process.' His officials will first attempt to determine exactly how much Iraq owes.

US Treasury Secretary John Snow echoed McPherson's words the following day, emphasising the magnitude of the task. 'We are not dealing with two weeks of conflict but two decades of misrule.' He said that economic reconstruction could be partially paid for by the $1,700 million of frozen Iraqi assets in US banks, and that he had contacted international finance ministers requesting that they take similar action to seize assets. Snow also called for international creditors to consider debt relief.

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