BERLIN – Germany’s Finance Minister Hans Eichel said Saturday he and U.S. Treasury Secretary John Snow had agreed on a proposal to write off as much as 80 percent of Iraq’s debt, capping a U.S. push for debt forgiveness.

Eichel said the agreement “created the basis on which the forgiveness of Iraqi debt can be settled mutually in the Paris Club,” a group of creditor nations owed about US$42 billion (euro32 billion) by Iraq.

“We agreed that there should be a write-off of debts in several stages amounting to 80 percent in total,” Eichel told reporters on the sidelines of a meeting of finance officials from the Group of 20 industrial and developing countries.

German Chancellor Gerhard Schroeder later stressed that “there is no final outcome — there are discussions, particularly with France,” which opposed last year’s U.S.-led war in Iraq and has been calling for a lower level of debt relief.

Still, the German-U.S. agreement was being discussed Saturday by the Paris Club and “our expectation is that it will be accepted,” said Eichel’s spokesman, Joerg Mueller.

Eichel said 30 percent of Iraq’s debt would be written off immediately, another 30 percent in a second stage “tied to a program of the International Monetary Fund” and a further 20 percent “linked to the success of this program,” he said.

“Within this framework, the necessary decisions can now be taken in the Paris Club,” Eichel said. He did not elaborate and took no questions.

The United States has been pushing for a generous debt write-off for Iraq, trying to win support for wiping out as much as 95 percent.

However, other governments, including Germany, have questioned whether a country with rich oil reserves should benefit from huge debt reduction. France has previously proposed that the Paris Club write off just half of the debt, postpone debt service for three years and revisit the issue when Iraq’s economy is in better condition.

Schroeder appeared to suggest that the write-off could at some point be reassessed.

“If the situation in Iraq improves fundamentally — Iraq is a rich country with respect to its oil reserves — we should be able to talk about it again,” he told reporters at the meeting.

Iraq has said its overall foreign debt of US$122 billion (euro94 billion) is hindering postwar reconstruction.

The Paris Club of creditor countries includes Austria, Australia, Belgium, Britain, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, Norway, Russia, Spain, Sweden, Switzerland and the United States.

Iraq owes another US$80 billion (euro62 billion) to various Arab governments.

Eichel was keen to stress that the planned Iraqi debt write-off “is not a precedent for any other case.”

“We only see a special situation for Iraq,” he said.