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Iraq commits to paying debt owed to Iranian companies

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
Iranian Deputy Foreign Minister for Economic Diplomacy Mehdi Safari speaks to reporters after meetings with senior Iraqi government officials in Baghdad on February 6, 2023.

A senior Iranian official say the Iraqi government has vowed it would soon settle debts owed to Iranian companies for various infrastructure projects executed in the Arab country in recent years.

Deputy Foreign Minister for Economic Diplomacy Mehdi Safari said on Monday that he had received guarantees about the settlement of the debts during a meeting earlier in the day in Baghdad with Iraqi Prime Minister Mohammed Shia' Al-Sudani.

Safari quoted Sudani as saying that Iraq’s 2023 budget will also provide for the funds needed for completion of a key railway as well as a highway linking Iranian border cities to the Iraqi railway and highway networks.

Iranian firms have been a major supplier of technical and engineering services and equipment to Iraq in recent years amid efforts in the Arab country to recover from years of invasion and militancy.

However, Iranian contractors working for Iraqi government agencies and state entities have had problems receiving payments for their projects mainly because of US sanctions on Iran.

Safari, who also met Iraqi President Abdul Latif Rashid in Baghdad on Monday, said that Iran and Iraq had agreed to further boost their trade and economic ties.

He said the two countries would resume holding meetings under a key intergovernmental economic committee format years after the initiative was suspended.

He said a first meeting of the intergovernmental committee is expected to be convened within the next few weeks.

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