UAE retires Iraqi debt
posted at 7:33 am on July 7, 2008 by Ed Morrissey
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Has Iraq turned a corner in the Arab world as well? After years of inaction, the United Arab Emirates has forgiven Iraqi debt, and welcomed the Maliki government into the fractious band of what had been an exclusively Sunni club. The action’s impact goes beyond the $7 billion in write-offs:
UAE President Sheikh Khalifa bin Zayed Al Nahyan promised to “put out these debts,” appoint an ambassador to Baghdad, and “help Iraq building the holy shrines that were targeted by the terrorists,” al-Maliki said in a written statement.
Al-Maliki and the sheikh met Sunday, the first day of a two-day official visit. Al-Maliki was accompanied by the Iraqi ministers of Interior, Commerce and Industry. ….
Debt relief is a major issue for Iraq, and the United States has urged other nations to forgive Iraqi debt, most of which is held by Arab states, U.S. Deputy Treasury Secretary Robert Kimmitt said in late May.
Also, the UAE Cabinet on Sunday nominated Abdullah Ibrahim al-Shehhi to be the country’s ambassador to Iraq.
The Sunni nations have withheld full recognition of the Shi’ite government in Baghdad for several years, claiming security issues. Ironically, the UAE and Egypt pulled out in 2005 not because of Shi’ite militia activity against Sunnis, although that was a major stumbling block, but because of al-Qaeda attacks from nominally Sunni lunatics. Only Syria and Jordan have representation in Iraq, while the rest of the Arab world has waited to see how Iraq would survive.
The act of naming an ambassador and forgiving debt incurred by Saddam Hussein sends a signal to the rest of the region. With Maliki offering diplomatic resistance to Iran, the other Arabs can feel more secure in supporting Nouri al-Maliki, who started off his term looking like a lackey of Tehran. He has Moqtada al-Sadr almost completely marginalized, and the alliances with Sunni tribal leaders has built confidence in Maliki’s ability to work with Sunni nations as well.
Other Arab nations may soon fall in line. They mistrust the rise of Iran as a potential hegemon in the region, and need Iraq as a bulwark against the mullahcracy’s ambitions. If they all follow the example of the UAE, it will free Iraq to spend its money on reconstruction rather than debt relief, which will add to its stability and strength. In a few years, it could serve as both an example to the region and a serious counterweight to Tehran.
The UAE has seen victory in Iraq, and it just placed a $7 billion bet on Iraq’s future. Expect the other Arab nations to soon follow suit.
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And then expect Obama to claim credit. Hillary provided the template months ago when she claimed that Iraq would accelerate its development because its leaders knew that when Hillary got elected, Iraq’s “blank check” with the U.S. would end.
Anyway, this is a good sign, so three cheers to whoever talked the UAE into backing Maliki.
Outlander on July 7, 2008 at 7:45 AM
There’s an Iraqi debt that I’d like to see paid, not forgiven, namely the post-Saddam debt that Iraq owes to the American people. To be sure, it was in America’s national interest to depose Saddam and then to neutralize al Qaeda in Iraq, but the Iraqis owe us something.
I’d like to see a 5% royalty on every barrel of oil Iraq sells, paid to America over the next 20 years, or however long it takes to recompense us for direct costs of the military action and infrastructure rebuilding we have undertaken.
MrLynn on July 7, 2008 at 7:50 AM
To be fair Capt’n, UAE is a “Sunni” Arab nation in Name, only, so this is no surprise that UAE is first in taking this step.
The population of the UAE is less than 20% native born, the largest such imbalance in the world, and there are more Iranian born Shiites living there than native born Sunnis.
That is why the UAE politics are greatly influenced by Iran, and whatever the UAE does on the international scene, it takes Iran into account, first!
Bahrain is another such case; thought technically a “Sunni” nation (the ruling family, basically); 70% of Bahrain’s population is Iranian/Shiite derived.
Wouldn’t be surprised to see Bahrain follow UAE’s lead on this….next…
Dale in Atlanta on July 7, 2008 at 7:59 AM
While I doubt you’ll see oil royalties (nor would I want to because they’d be accompanied by screeches of “blood for oil” from the left), here’s an example of what you will see: A colossal $5.5 billion contract between Iraqi Airways and Boeing. While other carriers in the region are buying Airbus, the Iraqis bought big into Boeing. Would it have been different if France had been part of the coalition? Maybe, maybe not.
Kafir on July 7, 2008 at 8:06 AM
This is certainly good news, but, Ed, whenever you sound so upbeat about Iraq, it scares me.
burt on July 7, 2008 at 8:09 AM
Good idea.
Better.
I would also like to see an American friendly Iraqi media and government acting like another true ally for the US in the middle-east, along the lines of Israel. Diplomatic and normal relations with Israel would be nice for Israel, Iraq, and us too.
JiangxiDad on July 7, 2008 at 8:12 AM
Would it have been different if France had been part of the coalition? Maybe, maybe not.
Kafir on July 7, 2008 at 8:06 AM
Kafir, I’ll tell you a funny story about that.
During the Gulf War, the French had NO INTENTION of joining the Coalition in helping to free Kuwait from the Iraq Invasion…NONE!
Mainly of course, because the Americans and the British were taking the lead, of course, and because of their instinctive, Anti-American nature.
Sometime late in the forces build-up of Desert Shield, the senior French Miitary officer in the French Embassy in Riyadh, asked for a “tour” of the American & British forces.
After seeing exactly what as going on, he hurriedly sent a cable back to Paris where he said in part; We need to get invovled in this, and involved fast, and on the side of the Americans, British, Saudis and Kuwaitis; what I’m seeing here is unprecedented in modern military history, and if we don’t get on the same side, we’ll never sell another thing to the Arabs for the next 50 years.
Shortly thereafter, the French “joined” the coaltion, and offered to send troops.
C’est la vie..
Dale in Atlanta on July 7, 2008 at 8:17 AM
Sorry for just seeing the negative…but all I see is more bad news for the Democrats and Obama…I mean, there number on campaign item is being taken off the table. Now they have to revert back to; no health care, abused senior citizens, and starving children.
It just isn’t fair…
right2bright on July 7, 2008 at 9:15 AM
An historic first. An Arab oil-producing nation actually doing something positive with its wealth.
It’s too bad they still have money left over to by more private 747s, mega-yachts, European hookers and jihadist madrassas.
Cicero43 on July 7, 2008 at 9:24 AM
I would settle for a discount rate on oil sales to the United States, instead, on a short-term basis to (hopefully) lower the price of fuel and bump up the economy. AND….also a repayment plan as you mentioned above.
Dr.Cwac.Cwac on July 7, 2008 at 9:25 AM
News like this must be devastating to all those within our own country who were betting on and in fact doing what they could to ensure Iraq would be a disaster.
Yakko77 on July 7, 2008 at 9:50 AM
I like the thought of this, the UAE is one of our actual allies in the region, hopefully our others like Bahrain will follow suit.
Squid Shark on July 7, 2008 at 9:58 AM
Uhh, the less Iraq is talked about in the Presidential campaign the better the chances for Obama and the lesser for those of McCain on ascending to the White House.
If McCain and Obama have to talk about health care, senior citizens, and starving children then you can all but wrap up President Obama right now.
gabriel sutherland on July 7, 2008 at 10:02 AM
Oops, wrong again. Wrong on their message, wrong on their analysis, wrong on their predictions. Being wrong, a Democrat tradition during times of war.
fogw on July 7, 2008 at 10:12 AM
McCain stands no chance. He’s just too much of a pussy with way too much baggage to stand a chance against His Holyness.
Darth Executor on July 7, 2008 at 1:11 PM
Sure it is. Michelle’s Children have to grow up sometime.
BillH on July 7, 2008 at 1:19 PM
Great news! Now, if we can only keep Obama from ruining the advances…
KarmiCommunist on July 7, 2008 at 1:58 PM
Hey, are those Iraqi Dinars going to be worth something someday after all?
EJDolbow on July 7, 2008 at 5:24 PM
Sunshine. Lollipops. Rainbows.
Islamic based democracy is the new fashion, Sharia and Stripes edition.
Thank God (A.K.A. Allah) our leadership tells us the straight dope on the religion of peace and those separate unconnected disaffected shadowy mad hijackers who stain it’s escutcheon with confusing regularity.
Islamic terrorism will just be a cost of doing business in the world like it has since Moops first took a nickel of tribute/jizya/aid from the victims of their violent extortion.
BL@KBIRD on July 7, 2008 at 10:47 PM