“Fitch” given Iraq “low rated credit” ahead of a planned issuance of international bonds

“Fitch” given Iraq “low rated credit” ahead of a planned issuance of international bonds

09/08/2015 (00:01 pm)

Fitch given Iraq low rated credit ahead of a planned issuance of international bondsReuters

Iraq got its first sovereign credit rating for versions which sought him ahead of a planned issuance of international bonds worth five billion dollars, aims to ease the pressure drop in oil prices on public finances of the state.
And it chose Fitch B rating with a stable outlook for Iraq which is less than six degrees from investment grade and attributed it to political risks and the lack of security, which said it is one of the most serious risks faced by any sovereign entity receives Atimanaa rated by Fitch.

And predicted Fitch also a deficit in dozens of public finance for Iraq box in 2015 due to the decline in oil prices and increasing costs of military spending associated with efforts to combat international Islamic organization in the country’s north and west.
He said Finance Minister Hoshyar Zebari said earlier this year that Iraq plans to sell international bonds for the first time in nine years. This could help get a credit rating to convince global investment funds and bank managers to buy bonds.
For his part, the parliamentary finance committee member Haitham al-Jubouri said the rating low “does not meet the ambitions” but might be considered the start of the financial Tnmbh point.
He said al-Jubouri told Reuters: “It encourages us to start taking serious steps to reform the Iraqi banking sector and send a strong message to investors and improve our own future economic and financial outlook. ”
In a move towards increasing investor confidence the World Bank said last month that he would provide for Iraq loans totaling $ 1.7 billion and reached the International Monetary Fund to deal in Earlier on the loan program worth $ 833 million.
Being the owner of the fifth-largest oil reserves in the world can be for Iraq to become an attractive investment for some investors. Oil contributes 40 percent of gross domestic product of Iraq and more than 90 percent of the public finances and the external current transactions revenue.
said Fitch Ratings said in a statement that “the low production costs. Most of the facilities and infrastructure for the production of oil infrastructure is far from safe areas inside. ”
and will contribute to the recovery of oil prices in improving public financial situation of the government. Fitch expects a slight deficit by 2017.