Finance officials promise to help lower Iraq's debt

MORELIA, Mexico -- Finance officials from the European Union and 19 countries, including the United States, wrapped up a two-day meeting Monday with promises to help Iraq lower its debt load and restart global trade talks that collapsed last month in Cancun.

Officials from the Group of 20, meeting in the mountains of western Mexico, were upbeat about the world economy, saying in a declaration that "while risks remain, a global economic recovery is under way."

They also discussed identifying and sanctioning countries that refuse to cooperate in the fight against terrorist funding, though possible sanctions were not outlined.

Mexican Treasury Secretary Francisco Gil Diaz said officials must combat the "lack of cooperation from the famous tax havens," but he didn't name the offending countries.

U.S. Treasury Secretary John Snow arrived at the meeting from Spain, where he was able to secure at least $13 billion to help rebuild Iraq. However, most of the money came in the form of loans and Snow spent much of his time in Mexico looking for pledges to restructure Iraq's debt.

He said countries, including France, responded favorably, adding he had a "clear sense of urgency to move on the debt."

Snow said he believed countries were "ever more committed to pressing forward" on World Trade Organization talks that collapsed in Cancun, where WTO ministers failed to agree on reducing agricultural and other subsidies. German Finance Minister Hans Eichel said the Group of 20 was disappointed by the setback.

"The world economy cannot rest on one engine," Snow said.

Eichel agreed, saying: "We want to lay the foundation for different types of growth in different parts of the world."

The Group of 20 is made up of the European Union and 19 countries -- Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, Britain and the United States. Their economies account for about 80 percent of global income, and their people make up more than 60 percent of the world's population.

On the Net:

G-20, http://www.hacienda.gob.mx/g20-2003/background.html