British newspaper: Iraq plans to borrow 18 billion dollars

Time: 7/21/2020 08:49:53

(International: Al Furat News) A British newspaper said that the Iraqi government plans to borrow $ 18 billion.

And the Financial Times published a report for her correspondent in the Middle East, Chloe Corniche, entitled “Iraq Warns that Economic Problems May Raise Insecurity.”

The title of the report is a phrase quoted from a speech by Finance Minister Ali Allawi, who said that “the issues that were buried because of the rise and growth of oil revenues are taking shape now”, referring to the inflated expenditures and a monthly wage bill of $ 5 billion, and this includes payments for an estimated 300 thousand of “Ghosts” or fictional employees, according to the author.

The writer says that the financial situation in Iraq, the second largest oil producer in OPEC, is receiving a devastating blow after the drop in crude oil prices by more than half compared to last year.

The author is based on the Oxford Institute for Energy Studies when referring to the decline in Iraqi revenues from oil exports, from $ 6.1 billion in January to its lowest level at 1.

The author returns to Allawi, who says that Baghdad is no longer able to rely on current oil prices.

And Chloe quoted Allawi as saying that Iraq “has been holding regular and very intense discussions with the International Monetary Fund for some time now,” adding that Baghdad “may apply for some budget support.” “There is now a growing recognition that we are moving to an environment with relatively low oil prices. We really have to find an alternative to restructure our public finances, to take account of this new normal,” he says.

The country’s poverty rate is expected to rise to 31.7 percent this year, from 20 percent in 2018, as the Corona epidemic is pushing 4.5 million Iraqis to fall below the poverty line, according to a new joint assessment by the government, the United Nations, the World Bank and Oxford University.

The writer says that low oil prices leave the government with little room to maneuver.

The author relies on the words of analysts who said that the government can take advantage of $ 68 billion in foreign reserves to cover dollar bills, such as imports and debt service, and is expected to borrow $ 18 billion from home and abroad to cover government wages for the next few months.

Ammar Al-Masoudi


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