Iraq issue international bonds to finance the salaries and infrastructure projects

First Published: 2015-11-18
Oil revenues decline because of the wave of falling prices paid Baghdad again to search for the collection of revenue through one investment pools.

Middle East Online

BAGHDAD - The governor of the Iraqi Central Bank on the Keywords Wednesday, said his country plans to issue a Eurobond two billion dollars in 2016 to guarantee from the World Bank for up to half that amount.

The move comes after the higher-yielding government was forced to stop the bond issue earlier this year.

Governor and expected to be the new bond yields "a lot less" than 11.5 percent of the revenue that investors request during a promotional tour in Europe and the United States in September / September but did not speculate further.

And he said: "value will be two billion dollars but the World Bank and will ensure the transfer of 40 or 50 percent more .. it will open a wider market and make it to attract more investors."

He added that Baghdad and placed the bonds in their accounts for the 2016 budget to finance the deficit is estimated at $ 21 billion.

The extremely revenues rise by investors request to issue bonds in two billion dollars earlier this year, it will impose a heavy financial burden on the OPEC member Iraq.

Baghdad, said the organization, which is battling an Islamic state and suffering from shrinking oil revenues due to lower crude prices, it needs to bond proceeds to pay wages and the financing of infrastructure projects in the oil, gas, electricity and transport sectors.

Iraq and appointed three major international banks to arrange the release are Citigroup, Deutsche Bank, JP Morgan Chase, but many institutional investors were reluctant because of the risks.

A source close to the process, the government had asked the banks themselves arranging a promotional tour for the issuance of respect to the year 2016.

He is harmful to the benefit of the great economic advisor to Prime Minister Haider al-Abadi that the return will depend on the extent of the involvement of the World Bank.

He explained that the guarantee of 75 percent, for example, the revenue will come down to five or six percent. He gave no estimate to ensure the 40 to 50 percent mention.

The Iraq last week agreed on a program of the International Monetary Fund, which monitors the economic policies of Baghdad in preparation for a possible financing program in 2016.

And it will use the proceeds of a bond issue in international finance salaries and infrastructure projects in the oil and gas, electricity and transport sectors.

The Iraqi Finance Ministry announced in September that Baghdad is seeking to raise up to six billion dollars through the issuance of dollar bonds series is expected to be the first version about a third of this amount.