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 IMF: High 64% of Iraq 's debt and low cash reserves and processors reasons ..

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RamblerNash
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PostSubject: IMF: High 64% of Iraq 's debt and low cash reserves and processors reasons ..   Mon Mar 20, 2017 9:54 am

IMF: High 64% of Iraq 's debt and low cash reserves and processors reasons ..

March 20, 2017


The IMF announced on 18 / March / 2017, on Iraq's debt rising from 32% to 64% of GDP in the period 2014-2016, slowing credit growth and rising non-performing loans to the government banks, with low cash reserves by $ 7 billion a year.

Held by the Iraqi authorities and experts of the International Monetary Fund (IMF) discussions in the Jordanian capital Amman during the period 5-17 March 2017 on Article IV in 2017 consultations, there will be a second review of the agreement to prepare the credit (SBA) with Iraq, amounting to a 36-month, which approved the Executive Board of the international Monetary Fund on July 7 2016.

In this context, the IMF prevents its staff from traveling to Iraq and manages all of its offices in the Jordanian capital, Amman, and depends entirely on the figures and statements of the Iraqi state, issued by the Ministry of Finance, Financial Control Yuan, the central bank.

It aims to prepare the credit agreement to correct the fiscal balance and the balance of the external position, and improving public financial management, while protecting social spending. And the completion of the first review under the standby credit agreement on 5 December 2016.

Head of the IMF mission Christiaan nut said in a statement links for Research and Strategic Studies Center obtained a copy of the Iraqi economy suffered significant damage due to the double shock caused by the organization Daesh attacks on the one hand and lower oil prices on the other hand; thus putting pressure on the country's resources, and the occurrence of new waves of internal displacement, where the number of internally displaced more than 4 million people, and about 10 million poor people in need of humanitarian aid, which is about 27% of the population of Iraq.

According to the Fund's statement. In 2016 there was a real growth not total GDP by 11%, supported by a substantial increase in oil production, which benefited from previous oil investments, while the non-oil economy has shrunk by 8% due to conflicts and administrative corruption.

The International Monetary Fund expects to keep the activity of the Iraqi economy in 2017 is idle, because of shrinking oil output 1.5% under the Organization of Petroleum Exporting Countries Agreement (OPEC), and the modest recovery of the non-oil sector.

The statement said the consequences and implications of lower oil prices on the Iraqi economy, including low cash reserves from 53.7 to 46.5 in 2015-2016, and the increase in large financial pressure as the government deficit of 12% in 2016 arrived, due to continued weakness in oil prices, rising humanitarian and security spending. "

He said Joe to high public debt from 32% to 64%, in 2014-2016, gross domestic product, and the balance of external total represents the ratio of net foreign cash flows (entering -aforeigh) to gross domestic product, is relatively reassuring mode, The convenient indicators of Iraq, described by the Fund!

Economists stressed that the balance of payments and budget revenues are facing a major financial crisis as a result of the sharp decline in oil prices, due to its large adoption on oil revenues.

And that the foreign reserves of the Central Bank of Iraq covers 8 months only, imports under the continued decline of the reserve through the window of corruption in the auction of the dollar, and imports that are not subject to censorship, which inevitably lead to imbalances in financial stability, and threatens the collapse of the Iraqi dinar exchange rate.

But the biggest challenge is the accumulation of internal and external debt in light of the increasing economic obligations, which led to the growth of credit and rising non-performing loans slowing the state-owned banks and private banks in 2016.

The Government has taken many correct financial policies focused mostly on reducing capital expenditures that lack efficiency while protecting social spending, and the provision of funding, stressing that the continued peg to the US dollar, provides a fundamental pillar of the economy.

Economic expert and adviser to the prime minister the appearance of Mohammed Saleh, believes that the reform policy of the government at the present time and period ago, particularly in the pressure of expenses were the reasons for the collapse of the cash balance of the central bank, and is proven at this point despite the direct impact of the interruption of development and service activities.

Saleh added that we are working with the Fund on the subject named DSA any debt sustainability or debt sustainability energy without affecting the economic growth of the country, or to enter into the risk of failures in the payment of debt service in the future, noting that despite the reassurance there are a lot of concerns over the medium term, and the requirements of reform on the current situation, which we agree on the difficulty of implementation under these current circumstances.

He said the exchange rate peg to the dollar, which is an important basic foundation, noting that growth prospects will remain in the medium term modest because of the expected oil production stability, and the stability of its investments in the face of constraints on revenue and recovery modest in non-oil growth, supported by the improvement of the security situation, and the implementation of reforms structural.

He said the head of mission that Iraq needs more reforms to create fiscal space inclusive growth, and enhance the business environment, reduce corruption, and reform of the banking sector to support growth led by the private sector, and diversification of the economy, as soon start the process of reconstruction in post-organizing Daesh. "

He stressed that "high-risk; this is the basis stems from the uncertainty surrounding the prospects for oil prices, the security situation and political uncertainty, and citizen management weaknesses. "

When reviewing the Iraqi private financial condition No. 04/16 Fund statement, we find that he considered the financial correction for the period 2016-2019 correction appropriate to address the financial pressure from lower oil revenues and rising spending on humanitarian and security needs, but the financial correction elements should be improved gradually, to allow spending investment bigger and more efficient, it is necessary to conduct a comprehensive reform of the system of public financial management in order to improve fiscal discipline and raise the quality of spending.

The statement added that the sharing of the budget with the Kurdistan Regional Government has led to the improvement of the KRG put the federal government, allowing them to face Daesh and oil prices attacks agreement.

It refers Press Release No. 16/321 statement, issued by the Fund and the Iraqi private financial situation in 2016, to the Executive Board of the International Monetary Fund approved an agreement credit to prepare with Iraq worth 3.831 billion and SDR (about 5.34 billion US dollars, or 230% of the share Iraq) to support the government's economic reform program, and allow the Council's approval and disbursement 455 million SDR (about 634 million US dollars) to Iraq.

Iraq was received in July 2015 amounted to boost 891.3 million and SDR, as US $ 1.24 Adel billion time of approval, through the "rapid financing tool."

The aim of economic reform, which is supported by the standby credit agreement to meet the needs of the balance of urgent payments program, and access spending to a level consistent with the decline in world oil prices, and to ensure that debt remains within the limits could be unsustainable, and the protection of the poor, strengthening financial management, and support the stability of the financial sector, and curb corruption; and implementation of these policies requires the availability of support from the international community

According to the International Monetary Fund in the statement 16/540: "The average public finance program in 2016 and the draft 2017 budget came consistent with what is stated in the standby credit agreement, noting that it should be a gradual improvement of the financial correction elements, by increasing non-oil revenues and spending cuts current - including wage payments and pensions - and the reform of the electricity sector, and support, and state-owned enterprises, to make way for greater investment spending, but more effective and efficient to support growth.

It includes support for the stability of the financial sector, strengthening the legal framework of the Central Bank of Iraq, and the restructuring of state-owned banks' procedures, and the abolition of exchange restrictions, and the application of measures to prevent money laundering, combating terrorism, and strengthen anti-corruption law.

The statement added: "It will be important to achieve a significant improvement in the management of public finances, re-evaluate the arrears and repaid after verification, and enhance cash management and spending commitments to prevent the accumulation of new arrears. "It includes support for the stability of the financial sector, strengthening the legal framework of the Central Bank of Iraq, and the restructuring of state-owned banks' procedures, and the abolition of exchange restrictions, and the application of measures to prevent money laundering, combating terrorism, and strengthen anti-corruption law.

The statement said: "Implementation of the budget sharing with the Iraqi Kurdistan Regional Government to put both the KRG federal government in a better position to face the crisis facing the Iraqi economy agreement."

He suggested the International Monetary Fund during the meeting held in 03.18.2017 several proposals meeting the financial correction in Iraq; including economic and administrative reform to curb corruption, promote and create the appropriate environment for business and investment, and reform of the banking sector and the economic diversification of any diversification of income sources, and support growth led by sector private, and in particular that the country is on the verge of the reconstruction phase of the post-war Daesh.

The Fund demanded the commitment to amend the Commission the current Integrity Act in order to comply with the United Nations Convention against Corruption, the new draft in the process of legislation, and amending the Central Bank Law is a strengthening of internal control of financial operations, in line with World Bank standards and the International Monetary Fund as well as to prepare the credit of the Fund program continues to amend a law of financial management, all of these amendments is to fight against corruption.

Experts point to the insistence of the centers of power in Iraq to keep the corruption and chaos, especially in the financial and administrative side, which manifestations:

- inconsistencies in the preparation of the staff of the House of Representatives, as Chairman of the Finance Committee says the council MP Mohammed Halbusi number of employees 3,000 employees, while the Finance Committee member Rahim al-Darraji says that after careful statistical work shows that they 1950 employees; which means that there is a big difference is 1050 employees.

- a statement to the Prime Minister Haider al-Abadi and former defense minister Khaled al-Obeidi, confirmed the existence of 40 thousand space in the armed forces.

- allocation within the budget for the year 2017 amount of 588 million US dollars for endowments, although the Awqaf Diwan, which is a source of national income sources, the disbursement to beneficiaries of social welfare has high entry through money endowments movable and immovable property left behind and still leave Improvers of their money after death, or in their lives, as well as from the proceeds of shrines and shrines, mosques, and according to the Ministry of Education, the construction of a model school cost is one billion Iraqi dinars, the equivalent of 844 000 US dollars, the budget endowments per day is enough to build two schools Nmozcetin day any 720 schools per year.

The risks remain on the list of the Iraqi economy because of the uncertainty or forecasting oil prices and the security situation, the political and administrative weaknesses in the country.

He continued envoy that "the Iraqi authorities and experts of the International Monetary Fund began discussions on the second review of the agreement to prepare the credit," explaining that "discussions will continue during the upcoming spring meetings of the International Monetary Fund and the World Bank in the period between 21 to 23 April 2017 in Washington, DC."

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PostSubject: Re: IMF: High 64% of Iraq 's debt and low cash reserves and processors reasons ..   Mon May 08, 2017 6:26 am

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PostSubject: Really??   Mon May 08, 2017 7:25 am

This is a huge development, and huge signal to those that think they are anywhere near an RV...

"""""the IMF prevents its staff from traveling to Iraq and manages all of its offices in the Jordanian capital, Amman, and depends entirely on the figures and statements of the Iraqi state, issued by the Ministry of Finance, Financial Control Yuan, the central bank."""""

The IMF/World Bank/UN are not even in Iraq.
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