Finance: the issuance of international bonds will revive the economy for a limited period

Parliamentary Finance: the issuance of international bonds will revive the economy for a limited period

02/09/2015 (00:01 pm)

Iraqi dinar currencyBAGHDAD / Noor Ali

Parliamentary Finance Committee predicted, on Tuesday, the recovery of the Iraqi economy, by the international issuance of bonds worth $ 6 billion, saying it is one of the ways employed by States when the collapse of its economy, as economists student be attached to the budget tables cash flow of local and foreign currency, confirmed that the amount of 6 billion dinars for Aestday reservation.

He said the parliamentary finance committee member Sarhan Sylvana in an interview with the “long” that “this step of the steps set forth in the budget No. 2 of 2015 Act, and that the issuance of international bonds one of the ways to address the shortfall in the budget of 25 trillion dinars, but now and in the With the decline in oil prices, I think up the deficit ratio to 50 trillion dinars.
“He added that” This move could revive the Iraqi economy for a limited period until the stability of oil prices in world markets, and added, “for the purpose of the shortfall in the budget of 2015 treatment, we produced an internal bonds and external, and the last is the best, because the demand for internal bonds by the citizens is weak, but did not get to the level we desire.
“He said Sylvana that” issuance of international bonds, will show a negative impact in the long term and not short, and that future generations over the next 20 years will bear These expenditures that will address the current economic situation, which is a topical treatment.
“fallen government revenues with the fall in oil prices at a time when waging the Iraq expensive military campaign to organize Daash in the northern and western its provinces, which resulted in a potential deficit estimated at 25 trillion dinars Iraqi ($ 21.4 billion).
For his part, he says economic expert, Dr. Ahmed Abrihi, in an interview with the “long” that “the amount of $ 6 billion is not large, compared to the size of the Iraqi economy, and the potential size of the revenue of oil in the conditions of the ordinary, and this is to Aestday reservation” .
“But if borrowing from abroad has become a major, when it should be the reservation, because he is not permitted to encumber the extra budget commitments, especially since oil supplier wobbling.” “The borrow $ 6 billion will allow more foreign to the Ministry of Finance currency, becomes can sell the amount of the biggest ones of the Central Bank, which supports the latter reserves indirectly.”
He noted that “the need for religion need to reduce foreign currency inflows, has personally asked the Council Representatives must be attached in the general budget table showing the cash flow home and abroad of foreign currency, and the balance of foreign currency attached to the general budget.
“He noted that” this balance will show how much will enter Iraq from foreign currency, and how much will come out of them, and the amount of need for the government which also, how much enters oil revenues and other sources, “and expressed regret that the application of this method.”
He added by saying that “the absence of this table which shows the internal and external flow of foreign currency, can not appreciate the need to accurately borrowing, calling for the House of Representatives in the next year be attached to the budget this table , and on the basis of this table is estimating religion from home and abroad.
“The Finance Minister Hoshyar Zebari (4 March 2015) that Iraq is considering several options to overcome the fiscal deficit, which is currently suffering from it, and these options to borrow from government banks and issuing six billion worth of loans, bonds dollars, in agreement with international banks.
Zebari said that the ministry is looking for ways to cover the fiscal deficit by several means, “noting that among that” the issuance of bonds or borrowing from state banks and the conversion of part of the assets deposited in the Central Bank to loans worth bonds six billion dollar agreement with the German Deutsche Bank and Citibank American. ”