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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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Established in 2006 as a Community of Reality

Many Topics Including The Oldest Dinar Community. Copyright © 2006-2020


    International bond between the snare of debt financing

    day dreamer
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    Posts : 3197
    Join date : 2012-12-19
    • Post n°1

    International bond between the snare of debt financing Empty International bond between the snare of debt financing

    Post by day dreamer Mon 12 Oct 2015, 9:56 pm

    International bond between the snare of debt financing

         

     10/13/2015 0:00


      Dr..     Acer Yassin
         Much-discussed in the past months since the global decline in oil prices on the importance of Iraq and the dangers of borrowing cash from abroad in order to cover part of the general budget and the functioning of the government deficit.
    And among the opponents of the project borrowing from abroad and supporters, stand first prominent obstacles, a high interest rate for this external borrowing of up to 11.5 percent of the amount will not exceed a billion and a half billion dollars, which is fraught with financial and political commitments far outweigh the effect desired effect. That is synonymous with the decisions of investment funds can not be that there will be investment without financing, and financing here may be externally or internally, or both, if were not internal sources of financing, which is the saving mandatory or optional sufficient or the government in a particular country is unable or     unwilling to take the decisions that are required for the high level of these savings to the level commensurate with the requirements of economic development, they resort to external sources of funding to support internal sources.
    In spite of our awareness of the importance of external financing and the proceeds of the importance of capital as one of the main production through which an investment of economic resources available, because the capital available unevenly between the countries of the world, whether for cash capital or in-kind factors so the flow of capital from the relevant areas     low demand to high-demand areas represents a transfer of purchasing power of recipient countries allow her to this process in the trade of goods and services required financing.
    Despite all that, but this funding carries with it the danger of a return Iraq to square zero, which began it before more than ten years of processors to the problem of indebtedness which cable by forced during the period following the second Gulf War, the fact that the external public debt is the cumulative total of loans     Foreign plus interest on those loans, continued to multiply until Iraq's debt stood at $ 39 billion is classified to four categories Paris Club debt and the debt of countries outside the Paris Club debt and the debt of Gulf states and trade creditors.

    Paris Club debt

     Iraq has been able to during those years of walking strides in stages pay off previous debts, leaving only a fraction of them after he has fulfilled its obligations to creditors as the total debt has been settled for countries outside the Paris Club exceeded $ 16 billion after it was up to 18.33 billion dollars     in 2004 by offering creditors to settle the debt through cash tender offer, an offer to buy a way of religion to religion.
    The external borrowing in the current phase of the immediate risk carries the potential of excellence in which those inflationary pressures that arise from the use of foreign capital, which will be on the most part to finance the expenses of the Consumer as it is in the case of Iraq advantages. It is also in the current situation of global oil prices and the nature of the rentier Iraqi economy, also carries a stop paying debt service risk as in the case of foreign loans and the resulting accumulation of debt signed by the country in the problem of the external debt crisis, which could feast Iraq to reschedule debts of negotiations     New and in respect of the non-economic effects, whether political or
         Social.
          Such as those that result from the application of the economic adjustment policies which conditionality international institutions for the purpose of developing countries to obtain the necessary funding to address the imbalance in the balance of those countries.

    The effects of foreign loans

     So In this sense, it can not touch the positive effects of foreign loans at this stage and the opposite is true, because the increase in debt to finance public expenditures which acquires operating expenses and which of up to 82 percent meant a reduction of the forces of the overall width through the decrease of available resources through debt service     in this way is the annual fair, which could contribute to the expansion of economic activity and growth rates
     Economic.     In this case a real lost opportunities for economic growth spearheaded the investment process as the increase in operating expenses in a position such as the current situation in Iraq makes the budget is unable to create the dynamic level of economic growth, which requires a huge investment needed
         Country.
    And that in the case of Iraq's inability to pay its debts, this will send out negative messages to foreign investment that call into question the fact that investors and international financial institutions, the financial reality of Iraq, and will lead to a weakening of Iraqi banks dealings with foreign counterparts.

    Iraqi academic




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