Saleh's appearance underestimates the weight of foreign loans for a low interest rate
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    Saleh's appearance underestimates the weight of foreign loans for a low interest rate



    Dr.. Saleh's appearance underestimates the weight of foreign loans for a low interest rate and long repayment period

    2018/01/25 (00:01 PM) - Number of readings: 25 - Number (4120)

    Baghdad / Zahraa al-Jassim

    Despite the denial of some of the assurances of the Parliamentary Finance Committee repeatedly that the volume of Iraq's internal and external debt has reached 111.725 billion dollars, the indebtedness burdens the burden of Iraq and preoccupied with many specialists in economic affairs, as it affects the lifeblood of the Iraqi individual as a result of the reduction of expenses and increase Taxes and deductions from salaries of employees, with their negative effects on the economic development of the country.

    See how much of the financial resources we need annually to get rid of it? How can we get out of the "B" area, which is rated by international credit agencies and which is economically inconvenient, into the safe area of ​​A? (Range) addressed these questions to d. Appearance of Mohammed Saleh, financial adviser to Prime Minister Haider Abadi to answer.

    [Asharq Al-Awsat] (Q) How much is Iraq's debt now, including loans? How long can we get rid of the current debt?

    (A)For example, in the draft of the budget of 2018, more than 8 trillion dinars have been allocated to meet the internal and external debt service, and these services vary between the years according to the degree of maturity. Some debts pay the principal in installments, in addition to Interest is the same as that of Paris Club sovereign countries at present. Some debts pay only annual interest, but on maturity the debt principal is repaid once, such as the existing commercial debt as per the Paris Club agreement, which was paid for 80% 28, WA What is important is the availability of (fiscal space) in the budget to pay the annual dues with the ability to borrow when needed without increasing the accumulation of debt, which is called the financial enhancement.

    (Q)How much does this debt affect the economic development of the country and how much of the financial resources we need annually to get rid of it?

    (A)Which is good in the ability of Iraq to pay or meet the receivables of debt, and these optimistic indicators will lead to the improvement of the next credit rating provided that the approval of the budget of the House of Representatives in accordance with the requirements of the program of the International Monetary Fund in Iraq / credit readiness launched in July 2016 for a period of three Years, under which Iraq will get a financial umbrella of $ 18 billion, when needed to meet any economic and financial emergency, including $ 5.3 billion, the International Monetary Fund itself, and $ 3 billion from the World Bank to support the budget, and $ 4.5 billion, Of the seven major industrialized countries, and Other countries supporting Iraq in the face of terrorism, as well as the financial difficulties faced by the country since 2014, and most of these loans will be soft and the grant element is high for low interest and throughout the repayment period.

    (Q)The international classification made Iraq in Area B ", which is an uncomfortable area of ​​the Iraqi economic situation, according to some, when can we skip to the area" A "and how to access them?

    (A)Yes, indeed, Iraq is now recovering from the financial crisis imposed on it as the security crisis broke out, which ended with victory over the terrorist advocate, but we certainly look forward to the development of the levels of growth and stability of the country, in order to reach Area A in the future, Farat) in the London market, where the interest rate fell because of its high value to be today by about 5% instead of 6% in September.

    Iraq has a B / B rating from Standard & Poor's and Fitch, and has $ 2.7 billion in international bonds, which is due in 2028 with a 5.8 percent coupon and a current yield of around 9 percent. In November 2016, the Iraqi government announced it would issue Billion dollar bonds on global markets to help reduce the 2017 budget deficit, indicating that the bonds will be sold on two equal tranches of one billion dollars and that the US government will guarantee one, which will reduce the cost of borrowing.

    The government is suffering almost entirely from oil revenues to finance its spending since crude prices fell in 2014, the same year that elements of an organization seized on a third of the country's territory.

    Source



  2. #2

    Re: Saleh's appearance underestimates the weight of foreign loans for a low interest

    BGG ~ Interesting!! Thanks Loop!

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