TEHRAN, 20 December 2004 — Iran is sticking by its demand that Iraq should pay substantial reparations for the war between the two countries, the Iranian Foreign Ministry said yesterday.

“The demand for war reparations and indemnities is one of our rights and there is no question of renouncing them at the moment,” Foreign Ministry spokesman Hamid Reza Asefi said when asked about a US decision to forgive $4.1 billion of Iraqi debt.

“Wiping off (war reparations) is not on the agenda,” Asefi said, estimating that Iran sustained $1,000 billion of damages as a result of the war. Tehran says that former Iraqi President Saddam Hussein started the 1980-1988 war against Iran and ordered the Iraqi military to use chemical weapons against Iranian troops.

Hostilities between the two countries have a long history, with many Iraqis still convinced that Iran is trying to undermine their country.

Relations came under further strain this week after Iraq’s interim Defense Minister Hazem Shaalan blamed Tehran for many of his country’s woes. Shaalan said that “Iran is the most dangerous enemy of Iraq and all Arabs” and that the “source of terrorism in Iraq is Iran”.

“Terrorism in Iraq is orchestrated by Iranian intelligence, Syrian intelligence and Saddam loyalists, in collaboration with Zarqawi,” Shaalan said of Iraq’s most wanted man, Jordanian Islamist fugitive Abu Musab Al-Zarqawi.

“The financing and training of the terrorists comes from Syria and Iran,” he added.

Iraq and the United States have frequently accused Iran of interfering in Iraq, where a majority of the population share the Islamic republic’s Shiite faith.