Iraq is far from bankruptcy, and its reserves are close to 70 billion dollars

Iraq is far from bankruptcy, and its reserves are close to 70 billion dollars


Iraq is far from bankruptcy and its reserves are close to 70 billion dollarsThe Central Bank of Iraq announced , last Sunday, that the cash reserves exceeded 70 billion dollars, while specialists confirmed that reaching the central bank’s reserves the threshold of 70 billion dollars will enhance the structure of the local economy and its global standing, but the challenge of ill-considered and unproductive spending remains Iraq’s biggest economic challenges.

The economic specialist, Malath Al-Amin, said that reaching the $70 billion mark in the Central Bank’s reserves would strengthen the structure of the local economy and its global standing, reiterating his call to invest sums in agricultural and industrial projects in order to reduce dependence on oil revenues .

Al-Amin said in a press statement, “Achieving the cash reserve of hard currency at the Central Bank has reached the threshold of $70 billion, a qualitative event that contributes to raising the level of the local dinar, as well as strengthening the structure of the Iraqi economy globally.”

He stated that “raising the value of the Iraqi dinar will make it a competitive currency that will help lower the prices of commodities and foodstuffs in the markets,” noting that “Iraq needs proper planning and management for these funds that can be invested in agricultural and industrial projects that return oil to the annual budget without relying on Oil revenues that fluctuate between declining and rising as a result of their exposure to sudden shocks caused by instability.”

Financial position

Is Iraq on the verge of declaring bankruptcy? The economic specialist, Nabil Jabbar Al-Ali, replied that “Iraq today is far from bankruptcy, as the Iraqi financial position is very good. Iraq’s reserves are close to $70 billion, and external debt rates are in the range of $20 billion, which is very good compared to its proportion of Iraq’s gross domestic product of $180 billion, representing only 11 percent.

Al-Ali added that “the growth expectations for Iraq are high during 2022, according to data from international institutions, to approximately 8.9 percent. We also add that Iraq’s credit rating (B-) is stable, according to Fitch, according to the latest rating in April, which reflects Iraq’s financial capacity as a result of improved oil prices and oil revenue rates.

However, the challenge of ill-considered and unproductive spending remains Iraq’s biggest economic challenge, as the policy of wasting wealth still exists without significant improvements, as well as social indicators in the rate of unemployment and poverty are still increasing and rising, which reflects the negative economic and financial management, according to Jabbar Al-Ali.

Development of the country’s reserves

The financial advisor to the Prime Minister, Mazhar Muhammad Salih, put forward mechanisms to address poverty, unemployment, inflation and price hikes.

Saleh told the official news agency, “The financial abundance achieved as a result of the rise in international oil prices, and then the growing country’s oil revenues, will address the social and economic problems left by the current economic crisis and its inflationary repercussions on the local economy, especially its impact on social groups.”

He explained that “the rise in food prices has had a significant impact on low-income people in particular, and has now constituted 80 percent of their income, which will lead to an increase in poverty rates in the country,” noting that “the monetary policy closely follows the performance of fiscal policy and its role in raising levels of poverty.” Income and livelihood for the affected classes and the advancement of the policy of operating projects, which leads to raising population growth rates.”

He added that “indicators of poverty and unemployment can recede through 4 measures represented in supporting social welfare, supporting the components of the ration card, supporting the prices of agricultural crops and grains, in addition to operating important lagging projects,” noting that “the role of fiscal policy lies in the use of financial surpluses on the To the fullest extent, even if there are some indications of a rise in prices, as long as the requirements for protecting the poor classes are provided by subsidizing incomes and prices and providing real income that supports those affected social segments.

He added, “The fiscal policy is working to combat the repercussions of rising inflation, as monetary policy will have a broader role in the development of the country’s reserves that support the purchasing power of the dinar, allowing the defense of monetary income and a broader purchasing power through a strict monetary policy.”