Official: $79 billion in Iraq’s internal and external debts

Official: $79 billion in Iraq’s internal and external debts

December 24, 2021 10:42 am

 Official - 79 billion in Iraqs internal and external debtsMubasher: The economic advisor to the Prime Minister, Mazhar Muhammad Salih, announced today, Friday, that the remaining internal and external debts on Iraq amount to 79 billion dollars.

Saleh said in a statement to the Iraqi News Agency (INA), that “as for foreign debts, there is a suspended amount that has not been settled under the Paris Club Agreement to settle Iraq’s foreign debt, and it goes back to the so-called debts before 1990, estimated at 41 billion dollars, which requires that the debt is correct. To be discounted by 80 percent or more according to the terms of the Paris Club Agreement, with no more than $8-9 billion.ā€

He added that “the aforementioned amount appears in the accounting books of four Gulf countries at a rate of approximately 66 percent distributed between Saudi Arabia, Kuwait, Qatar and the Emirates, and it dates back to the era of the Iran-Iraq war and is expected to be written off by 100 percent because it is a debt associated with wars and not for development purposes.”

He pointed out that “the remaining 34 percent belongs to eight different countries, and in general it can be said that the sovereign debt on Iraq is divided between the group of Paris Club countries and countries outside the Paris Club, and commercial debts.”

Adviser to the Prime Minister explained that “Iraq’s foreign debts, especially debts before 1990, were settled under the 2004 Paris Club Agreement, where it was agreed to write off 80 percent and more of those debts, whose initial estimates at the time approached $129 billion, and most of them were written off and the rest was scheduled. Debt over 20 years.

And he indicated that “despite the fact that Iraq made some external borrowings due to financial distress after 2014 as a result of the war on ISIS terrorism and the drop in oil prices and its direct impact on the country’s public budgets, the total external public debt subject to repayment obligations does not exceed 20 billion dollars today.”

He added, “As for the internal public debt, it is the largest today and amounts to about 50 billion dollars, but it is a debt between government financial institutions exclusively, and it is settled within the internal economic policies, and it is a low-risk debt,” noting that “the increase in oil revenues will provide high financial leverage to settle the debts.” The remnants of debt and easy choices.

Saleh explained: ā€œIn light of the foregoing, the public debt components can be re-analyzed as follows: If the internal public debt touched nearly $50 billion, 67 percent of it goes back to the Central Bank of Iraq with an average annual interest of 3 percent, while the debt The remainder of it, which must be paid, is about $20 billion.ā€

He stressed that recalculating the actual external public debt is $29 billion, and that the actual total internal and external debt is $79 billion, and assuming that the gross domestic product for the year 2021 is $178 billion, the actual debt-to-product ratio is about 45 percent, and it is still falling within the safe range of EU standards of stability and growth.