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Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

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    A report talking about the legacy of debt left to the Iraqi government and its depletion of the stat

    Rocky
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    A report talking about the legacy of debt left to the Iraqi government and its depletion of the stat Empty A report talking about the legacy of debt left to the Iraqi government and its depletion of the stat

    Post by Rocky Wed 14 Jun 2023, 2:31 pm

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    A report talking about the legacy of debt left to the Iraqi government and its depletion of the state treasury

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    21:57  2023-06-14  54  Arab and international reports 0



    The economic legacy burdened by the Diwan still has a significant impact on the steps of the Iraqi government, by limiting the country's economic promises today. The fiscal deficit also puts pressure on state coffers and affects the government's ability to address high poverty rates.
    The debt burden has exacerbated Iraq's over-reliance on oil by forcing successive governments to focus on repayment rather than creating a diversified economy based on agriculture, tourism, industry, and trade. And compounded over time, this meant that revenues from commodity exports continued to fund the bulk of government budgets, with oil sales making up nearly 96% of total income.
    Iraq has three types of debt, according to Mazhar Muhammad Salih, an economic advisor to the Iraqi federal government, according to a statement by the Iranian website Amwaj Media, which was translated: 
    First, there is $50 billion in domestic public debt, Saleh explained. The Iraqi expert explained that the Central Bank of Iraq owns 63% of this debt, and pays between 2% and 3% interest annually. The remainder of this type of debt is owned by state-owned commercial banks. It is repaid through the issuance of treasury money for a year, with interest payments coming from appropriations in the general budgets of the government.
    Secondly, the Iraqi Ministry of Finance maintains an external public debt of US$20 billion, which is owed to a variety of creditors, and is expected to be fully amortized by 2028. Another US$5-6 billion is owed to the governments of Japan and the member states of the European Union which He pledged funding for parts of the Iraq Development Program at the Madrid Donors Conference in 2003. However, these are long-term loans and have not yet matured.
    Third, there is also the so-called “non-existent debt,” which Iraq incurred when it borrowed from other countries to fight the 1980-1988 war with Iran or was partially written off as a result of the 2004 Paris Club agreement, and therefore is not expected to be paid. It is worth about 40 billion US dollars.
    Overall, by Salih's calculations, Iraq has about $116 billion in debt right now, though it only plans to settle $76 billion of the total.
    Can Iraq pay its debts?
    Iraqi economist Haider al-Rubaie said that the rise in global oil prices will generate more income and allow Baghdad to service larger amounts of debt on the one hand. On the other hand, last year's completion of war reparations payments to Kuwait, which resulted in Iraq's removal from the United Nations' Chapter VII sanctions program, eliminated significant expenditures.
    Al-Rubaie added that oil prices will likely continue to rise. As a result, Iraq will benefit from this unexpected wealth and will be able to pay off its debts quickly," noting that "the positive impact of the rise in crude oil prices on the Iraqi economy will pave the way for opening vital investment files by foreign companies."
    However, there are others who are less optimistic about Iraq's ability to pay all its debts in the near term.
    Looking ahead, if oil prices remain above the $70 per barrel set in Iraq's federal budget, the government has a chance to make significant progress on debt payments. However, other scenarios in which oil revenues may not materialize could dramatically change the prevailing calculations.
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