07MOSCOW523, RUSSIA: IRAQI DEBT RELIEF UPDATE

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Reference ID Created Released Classification Origin
07MOSCOW523 2007-02-06 15:50 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

VZCZCXYZ0000
OO RUEHWEB

DE RUEHMO #0523 0371550
ZNY CCCCC ZZH
O 061550Z FEB 07
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7237
INFO RUEHGB/AMEMBASSY BAGHDAD PRIORITY 0172
RUEHRL/AMEMBASSY BERLIN PRIORITY 1886
RUEHFR/AMEMBASSY PARIS PRIORITY 1767
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY

C O N F I D E N T I A L MOSCOW 000523 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EUR/RUS WARLICK AND EB/IFD/OMA DETWILER 
TREASURY FOR LEE AND BAKER 
NSC FOR GRAHAM AND MCKIBBEN 
 
E.O. 12958: DECL: 02/06/2017 
TAGS: EFIN IZ KTIA RS
SUBJECT: RUSSIA: IRAQI DEBT RELIEF UPDATE 
 
REF: STATE 11880 AND PREVIOUS 
 
Classified By: Ambassador William J. Burns for reasons 1.4 (b/d). 
 
1. (C) Summary.  On February 5, reftel concerns about delays 
in the signing of Russia's bilateral debt agreement with Iraq 
were raised with Kremlin Foreign Policy Advisor Prikhodko and 
Deputy Finance Minister Storchak.  Prikhodko told the 
Ambassador that the GOR was not linking the final signature 
on the agreement to new conditions, and suggested that the 
issue would be resolved soon.  Storchak relayed a similar 
message to Economic Minister-Counselor, adding that it was 
possible Finance Minister Kudrin would be in a position to 
report Russia's willingness to move forward on the debt deal 
in his meeting with Treasury Secretary Paulson this weekend. 
End Summary. 
 
2. (C) The Ambassador approached Kremlin Foreign Policy 
Advisor Prikhodko February 5 to urge a speedy conclusion to 
Russia's bilateral debt agreement with Iraq.  Prikhodko 
stated the debt deal was not linked to Russian commercial 
contracts in Iraq, but noted deep concern at senior GOR 
levels that Russian firms were not being accorded equal 
access to commercial opportunities in Iraq.  The Ambassador 
emphasized the priority placed by the USG on closing the debt 
chapter in Iraq, to which Prikhodko suggested that the matter 
might be settled soon. 
 
3. (C) In a separate approach February 5 to Deputy Finance 
Minister Storchak, Economic Minister-Counselor emphasized the 
danger Russia's behavior posed to the integrity of the Paris 
Club process, and Russia's responsibility as a member of the 
Paris Club to help lead other creditors outside the Club 
toward favorable treatment of Iraq.  Economic 
Minister-Counselor highlighted the upcoming Paulson-Kudrin 
meeting on the margins of the G-7 Finance Minister meeting in 
Germany as an ideal opportunity to signal GOR readiness to 
close the Iraqi debt deal. 
 
4. (C) Storchak expressed understanding for USG concerns 
about the Paris Club process, and reiterated that Kudrin and 
the Ministry had been careful not to link the final signature 
on the debt deal to any new conditions.  He confirmed that 
the agreement is ready for signature and that there are no 
outstanding technical issues.  Final approval for signature 
from the Kremlin, however, was still not forthcoming. 
Storchak agreed that the upcoming meeting with Paulson would 
be a good target date to lay this issue to rest, and said he 
would work with Kudrin to see if they could get the necessary 
Kremlin go-ahead in the days remaining before he would see 
Paulson. 
BURNS

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