Iraq, Kuwait airline deal resolves Gulf War-era dispute

Iraqi officials today said a breakthrough airline agreement has been reached with Kuwait that resolves a decades-long dispute over war debts and opens Kuwaiti airspace to Iraqi planes eager to fly abroad, reported Reuters. 

Prime Minister Nuri al-Maliki's announcement today has not been confirmed by Kuwaiti officials.

The Associated Press (AP) said no mention of it was made in the country's state-run press, but it comes during a visit by the Iraqi leader to the Gulf state.

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Iraqi Foreign Minister Hoshyar Zebari told AP that the agreement resolves Kuwait's decades-long demand for $1.2 billion in war reparations.

Maliki's media adviser, Ali al-Moussawi, told Reuters the $500-million deal would see Iraqi invest $200 million in a joint Iraqi-Kuwaiti airline venture, with the rest of the money going to Kuwait in cash. Kuwait is to lift the airspace restrictions on Iraqi Airways in return, said Reuters. 

The Gulf country has long insisted that 10 airplanes and millions of dollars were stolen from it during Saddam Hussein's invasion in 1990, said the BBC. 

The Iraq-Kuwait dispute led to an embarassing landing for Iraq's first transatlantic flight, which was grounded by Kuwaiti authorities in 2010, reported the BCC. The airline later declared bankruptcy. 

Baghdad has since been eager to resolve the flight issue. Kurdistan, Iraq's semiautonomous region that has been angling for political independence, opened its Irbil international airport in 2010, reported The Washington Post, with direct flights to Vienna, Dubai, Istanbul and Cairo.