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World Bank: Loan may have to wait

By Times Wires
© St. Petersburg Times
published July 31, 2003

BAGHDAD, Iraq - The president of the World Bank, James Wolfensohn, suggested Wednesday that the bank would lend money for the reconstruction of Iraq only after the country wrote a constitution and conducted national elections. He also said that an indeterminate number of the country's state-owned industries would have to be shut down or restructured.

Wolfensohn's comments may put more pressure on Iraq's new Governing Council to accelerate deliberations about its own leadership and other decisions. On Wednesday, the 25-member council appointed Ibrahim Jafari, the official spokesman of the Islamic Dawa Party, a Shiite political group that had been banned by Saddam Hussein, as the first of nine presidents who will serve rotating one-month terms. But the council still has not selected any Cabinet officials and has taken little substantive action on other matters. It is expected to take at least a year to draft a new constitution.

Ex-POWs can't be paid from frozen accounts

WASHINGTON - Reluctantly siding with the Bush administration, a federal judge ruled Wednesday the government can prevent 17 Americans detained during the 1991 Persian Gulf War from collecting $653-million in damages from frozen Iraqi assets.

The former POWs, who won the compensatory damages this month, contended they were entitled to some of the money from Iraqi assets in a special Treasury Department bank account.

Justice Department lawyers countered that President Bush has the authority to determine how the money is spent. The president wants the funds to help pay for rebuilding Iraq.

U.S. District Judge Richard W. Roberts wrote that the administration's position that "the POWs are unable to recover any portion of their judgment as requested, despite their sacrifice in the service of their country, seems extreme." The judge noted that the POWs had offered to settle the case for less and the government declined.

The account has about $1.7-billion in Iraqi assets that were frozen shortly after Saddam Hussein ordered troops to invade Kuwait in 1991.

Blair defends his record amid criticism over war

LONDON - British Prime Minister Tony Blair, in a combative mood, brushed aside questions Wednesday about whether he would resign if prohibited weapons are not uncovered in Iraq, and hinted strongly that he would seek a third term in office.

In his first news conference since the suicide of a Defense Ministry arms expert plunged his 6-year-old government into its worst crisis, Blair repeatedly refused to say whether he would step down.

Instead, the prime minister emphasized his administration's achievements at improving Britain's health, education and transport systems, which he said voters would use as their main yardstick in the next election, expected in 2005 or 2006.

Blair acknowledged opinion polls showing he faced a steep decline in public trust after accusations that his government exaggerated intelligence claims about Iraq's weapons.

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