Economists: the government 's policy of borrowing will lead to the bankruptcy of the country


09/25/2016 (0:01 pm) - The number of readings: 234



Baghdad / Ibrahim Ibrahim

Criticized by a number of economists, on Saturday, the government policy of relying on domestic and foreign loans to bridge the fiscal deficit without working on maximizing the financial resources of the state in spite of the availability of the necessary ingredients, citing the need to preserve the central monetary country reserve according to international levels to address the financial crisis.

The governor of the central bank on the Keywords confirmed on Sunday (September 11 2016), Iraq's commitment to the pledges made to the International Monetary Fund Ptoukatadtha specific, especially as it is consistent with the orientations and objectives, noting that the Fund was surprised to be Iraq's reserves of foreign currency more than its forecast of about ten billion dollars.

The economist said Maytham Laibi in an interview for the "long", "The way of spending pursued by the government in various stages led to the worsening of the financial exchange to a large degree as a result of employment in the public sector operations in addition to increasing the recreational allowances are obscene."

"The lack of oil imports to less than half and the direction of the government to sell the dollar to cover the salaries and expenses of the state had triggered a clear shortfall in cash flow."

He said the "government's policy followed in the process of selling the dollar through the daily currency auction, which sapped billions of dollars as a result of corruption, which monopolized by speculators in the market and put the country's economy on the brink of bankruptcy."

He Laibi "The foreign reserves at the Central Bank amounted to nearly $ 48 billion through the end of last August and is expected to decline after reaching in early 2017 to $ 35 billion, prompting the International Monetary Fund to build expectations according to my pessimism for the economy of Iraq scenario for next year if it does not oil prices rise to the level of $ 80 a barrel. "

He pointed out that "lack of access to imports staggering oil that entered the state coffers between 2010 and 2014, and then rotate it through the restructuring of the industrial and agricultural sectors and find other supporting financial resources to contribute to the building of a strong and flexible economy faces global crises."

In turn, the economic expert Bahadli Abbas said in an interview for the "long", that "the successive governments since 2003 have failed in the leadership of the Iraqi economy and to promote it and make it a strong economy commensurate with the extent of potential owned by the country."

He added that "despite the money and tangible factors and human of manpower and expertise accumulated provide, in addition to developing and decimal five-year plans and others that did not leave the paper it's written on throughout the 13 years that have passed."

Bahadli said that "the government's policy to get out of its crisis and financial direction to external borrowing and the procedure for the functioning of the state will lead to overburden the budget and ending the public treasury bankrupt even if high oil prices."

He said the "next few years will see the debt of foreign and domestic loans borrowed by the government, which exceeded $ 30 billion in addition to the benefits of it will create a state of paralysis for local economic movement pay entitlement."

He Bahadli that "the country needs to packages of reforms (real, not media) paint a range of scenarios in the field of monetary, financial and industrial, agricultural and service policies .... for the purpose of adopting economic strategy a success stems from the Iraqi reality with the benefit from the experiences of countries that have passed economic setbacks similar ".

Parliamentary Finance Committee revealed that the central bank reserves decreased to less than $ 50 billion, and while confirming that the central bank does not talk about reserves "for fear of creating new crises", she pointed out that the government has turned to internal borrowing from a bank Rafidain and Rasheed, "without returns these amounts. "

He said the Parliamentary Finance Committee member Hossam punitive in an interview with (long-Presse), said that "the amount of the Iraqi Central Bank reserves reached to below $ 50 billion," noting that "the central bank does not talk about the size of reserves for fear of creating a new crisis."

Punitive and added that "the Iraqi government headed domestic borrowing by government banks and private bank Rafidain and Rasheed during the years 2015 and 2016, estimated at $ 15 billion without the return of these funds with the benefits of the two banks."

As confirmed committee member Majda al-Tamimi, said that "internal and external debt of Iraq is estimated at $ 85 billion, noting that" the Iraqi government is negotiating a new loan would put particular strain of the financial burden on the state. "

Tamimi said in a press statement that "the government to find alternatives, and not rely on lending Ktfiel productive sectors and sectors where substantial imports of the state."

Iraq and delivered by mid-July 2016, about $ 634 million, representing the first installment of the IMF loan, immediately after the IMF Executive Board approval, in (the seventh of this month), on the standby credit agreement with Iraq, noting that the term of the loan is five years low annual interest rate of one and a half percent (1.5%), and that the number of payments is 13 batch stretches over 36 months.

The United States of America, confirmed in (the twentieth of April 2016), that the economic reforms the Iraqi government began to show the effects of an increase of non-oil imports, indicating that the Iraqi government's success in reducing the budget deficit means obtaining a loan from the International Monetary Fund worth billions of dollars.

The appearance of Mohammed Saleh, said in an interview to the (long-Presse), in the (26th January 2016), that Iraq has agreed with the International Monetary Fund for long-term soft loans for the implementation of development projects, noting that the fund is among other conditions, government expenses, and modified some procedures related to economic policies, while counting economist that "the most important" of those loans is to know the amounts that will be obtained during the year 2016.

The International Monetary Fund agreed in the (13 January 2016), to finance the deficit of the Iraqi budget through clouds of hard currency reserves, which led to the reduction of those reserves from $ 59 billion October 2015 end, to 43 billion during the current year 2016.

Link