Iraq has agreed to cancel 80% of Mozambique’s bilateral debt, amounting to $256.13 million of a total of $320.16 million. The remaining 20% will be restructured over 15 years, with a grace period from 2029 to 2043. This debt was originally incurred in 1979-1980 for oil supply agreements and has grown significantly over the years.
Iraq has formally committed to forgiving 80% of the bilateral debt owed by Mozambique, amounting to a write-off of $256.13 million from a total of $320.16 million. This decision was communicated by the finance ministry of Mozambique, emphasizing Iraq’s willingness to assist in alleviating its debt burden. The remaining 20% of this debt will be subjected to restructuring over a 15-year period, which will include a grace period that spans from 2029 to 2043.
The original debt, which stemmed from oil supply agreements established during 1979-1980, initially totaled $60.26 million; however, due to various economic factors, it ballooned over time. The negotiations for this significant debt relief took place in Abu Dhabi from February 2 to February 6, 2025, involving high-ranking officials from Iraq’s Ministry of Finance, the Foreign Ministry, and the Central Bank. In addition, representatives from Mozambique’s Finance Ministry and its Economic and Commercial Advisor in Portugal and Spain participated in these crucial discussions.
In conclusion, Iraq’s decision to forgive a substantial portion of Mozambique’s debt highlights a significant step toward financial relief for the African nation. By forgiving 80% of the debt owed and restructuring the remaining amount, Iraq is not only supporting Mozambique’s economic recovery but also enhancing bilateral relations. The negotiations in Abu Dhabi mark a collaborative effort to address long-standing financial challenges resulting from historical agreements.
Original Source: shiawaves.com
