A South Korean presidential official said Friday that the U.S. special envoy and former American Secretary of State, James Baker, has cancelled plans to visit Seoul after South Korea showed reluctance to reduce the debt owed to it by Iraq.

Baker was scheduled to fly to Seoul on Monday after visiting Japan. His Asian trip, which will also include a stop in China, is aimed at persuading countries to reduce billions of dollars in debts owed by the war-torn Middle East country.

South Korean officials said Baker will still visit Tokyo and Beijing as scheduled.

The official, requesting anonymity, said Baker decided not to visit Seoul because of the government's current resistance to reducing the debt of US$65 million in loans owed to it by Iraq.

Besides the government loans, South Korean firms, including Hyundai Construction and Engineering Co., have yet to receive some $1.7 billion in outstanding bills for construction work performed in the Gulf state.

Japan has already agreed to slash a considerable portion of the $4 billion in debts owed to it by Iraq. However, U.S. requests for similar action fell on deaf ears in South Korea, which cited the estimated $200 million it will have to spend annually to deploy to the Arab nation some 3,000 soldiers in addition to 700 of its troops currently stationed there.