Moody’s International expects a sharp upward reversal in the financial sector in Iraq – urgent

32 translated reports تقارير 2021/07/08 13:45
Baghdad today – Translator
Today, Thursday, Moody’s International Agency expected a sharp upward reversal in the Iraqi financial sector during the current year 2021.
Moody’s Investors Service confirmed Iraq’s rating with a grade of ( Caa1 ), any country that has good bonds of stability, but involves credit risks for non-payment), and maintained its stable future outlook for the country .
The agency said, in a statement published by “the international” and translated (Baghdad today): “The confirmation of the rating reflects the credit challenges posed by Iraq’s economic and financial dependence, which is heavily dependent on oil, the restriction of the government’s ability to respond to external and domestic shocks, and the low competitiveness of the Iraqi economy.” .
Iraq, the second largest producer in OPEC, relies heavily on oil to cover 90 percent of its spending .
Moody’s predicted: “a sharp upward reversal in financial sector metrics in 2021” with higher oil prices, but “progress in economic diversification remains slow and hampered by the weak business environment and investment climate in Iraq.”
And maintained the rating agency, its stable view of the country, as the Iraqi government continues discussions with the International Monetary Fund to obtain financial support .
“Ongoing discussions with the IMF suggest the possibility of a supported adjustment program that would serve as a pillar of policy and the financial sector, but the country’s poor track record regarding its past commitments to the IMF limits a potential credit rally,” the agency added.
She pointed out that “the government’s plans to double the production capacity of oil will support economic growth and strengthen Iraq’s financial and external situation.”
And she continued, “However, Iraq’s plans are constrained by the uncertain outlook for global oil demand and the ongoing challenges to the government and political stability in Iraq that discourage investment in the oil and gas sector. “
Moody’s noted, “rising risks to political stability and a deeply fragmented political landscape will continue to impede progress on institutional and economic reforms.”

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