“SHARM EL-SHEIKH, Egypt (Reuters) - Iraq won a trickle of debt relief pledges at a big international conference in Egypt on Thursday”
Does that mean the US is repaying loans to bankers? Or other national treasuries?
Who has been loaning the money?
And who is paying?
Does Congress have to approve this as an expenditure?
Usually, debt relief means one country forgives loans made to another country. In this case, it’s the government itself which owns the debt, not private bondholders.
Seems to me there should be some way for Iraq to simply defer all debts for 10 years or so.
Sitting on the 3rd largest oil reserves has to be a good basis for extended credit.
Sure, countries can tell their creditors to go screw, and there’s not much the creditors can do about it. That’s the trouble with lending money to a country, there’s no legal recourse if the country decides to default
The only trouble is that this means they would have a hard time finding people willing to risk lending them money for the next decade or so.
Although there’s considerable precendent in the 20th century and before of countries being invaded or having foreign troops “intervene” when they have been bad debtors. I think Haiti and the Dominican Republic are a couple of examples, and I’m sure there are more.
I’m not aware of any recent examples, but I wouldn’t put it past happening again at some point in the future. There may also be more subtle levers - foreign aid, sanctions, actions by the World Bank - that make outright invasion or intervention less likely these days.
The French occupation of the Ruhr is another.