MercoPress. South Atlantic News Agency

IMF, EU add weight to G7 debt demands.

Rodrigo de Rato, managing director of the 184-nation IMF, and EU members added their voices to Friday's demand by the Group of Seven most industrialized nations urging the government of President Néstor Kirchner to strike a deal as soon as possible.

De Rato also called on the government to do its homework so the multilateral lender can complete the third review of its programme with Argentina.

"It will be critical for Argentina to advance on structural reforms in order to bolster economic recovery," Rato said in his opening remarks to the IMF-World Bank annual assembly, "including renegotiating public service concessions and concluding an agreement with creditors on the debt restructuring process."

The US and its major economic allies, meanwhile, struggled yesterday to resolve deep differences over how best to relieve the heavy debt burden for Iraq and the world's poorest countries topping the IMF-World Bank committee meetings' agenda.

US Treasury Secretary John Snow pushed a plan by President George W. Bush's administration that essentially would mean the poorest countries would not have to repay existing loans. New loans, though, would be cut by the amount of increased debt forgiveness those countries received.

A competing proposal from Britain would pay for expanded debt relief by revaluing the IMF's gold reserves according to world prices and by getting wealthy nations to commit more money.

??There is a growing consensus that multilateral debt relief has to be dealt with as soon as possible,'' said Britain's Chancellor of the Exchequer, Gordon Brown, chairman of the IMF's policy-making committee.

In contrast to his strong statement were vague promises in a communiqué by the committee saying it ??looks forward to further consideration of outstanding issues in the proposed framework for debt sustainability, before it is made fully operational, and of further debt relief, including its financing.''

Max Lawson, a policy adviser to Oxfam, an international relief group, said France and Canada were moving toward the British position and that the US, Germany, Japan and others were likely to come around.

On Iraq, the US tried to rally support for erasing as much as 95 percent of the country's $120 billion in foreign debt.