Temporarily freezing Iraq's debt repayment is one option being considered by Japan to help rebuild the war-ravaged country, a senior Finance Ministry official said Tuesday.
"As far as the current situation is concerned, it is possible" to freeze repayments for a certain period, the senior official said on condition of anonymity. "It is clear that Iraq has repayment problems."
The comment means Japan -- one of Iraq's major creditors, with loans worth 500 billion yen -- is ready to go a step further. The government said earlier that it would agree only on debt rescheduling.
The United States has called for an 18-month break on such payment demands.
The official also said reconstruction efforts in Iraq would not be a major topic at the two-day Group of Eight meeting of finance ministers to begin Friday in Deauville, France. The nations will have to wait for the International Monetary Fund and the World Bank to first investigate the situation in Iraq, he said. , adding that it will take more time for the Paris Club of major creditors to complete debt restructuring talks.