Iraq, UN postpone launch of economic programme

BAGHDAD, July 18 (Reuters) The Iraqi government and United Nations have postponed the high-level launch of a major economic recovery programme for several weeks, officials said today.

Senior diplomats and officials of international institutions had been due in Baghdad on Thursday to launch the International Compact for Iraq but the senior Iraqi minister involved said the war in Lebanon obliged key participants to change their plans.

''It has been postponed because of difficulties in getting high-level people into Baghdad, especially because of what's happening in Lebanon,'' Deputy Prime Minister Barham Salih told Reuters. He denied there were any fundamental problems.

Israel pounded Lebanon for a seventh day today in response to the kidnapping of two soldiers by Hizbollah guerrillas, who have also fired rockets on northern Israel.

U.N. officials and Western diplomats closely involved in preparing the meeting confirmed the postponement, saying it could now take place in late August or early September.

The Compact is, broadly speaking, a five-year plan, involving Iraq's neighbours and wealthy foreign powers, to revive the potentially oil-rich economy after decades of war sanctions and now vicious communal bloodshed.

Among key initial goals is winning relief on debts run up by Saddam Hussein with Gulf Arab states. Western states have already forgiven Iraq much of its debt but Saudi Arabia and Kuwait, the biggest Gulf creditors, have been taking their time.

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