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IMF issue a pessimistic outlook for the future of the Iraqi economy
Likelihood of worsening budget deficit of more than government estimates, and Baghdad demanding a review of dollar sales by the central bank.
03/20/2015, Issue: 9862, p. 11]
BAGHDAD - The International Monetary Fund that the Iraqi authorities are trying to take proactive steps to address the dual shock that hit the country's economy hard, and of organizing Daash control over large areas of the territory of Iraq and the collapse of oil prices.
International Monetary Fund cut its forecast for the growth of the Iraqi economy to 1 percent this year, the forecast, issued in Anaerpenmo rate of 2.5 percent, in line with current expectations recent government estimates of the Central Bank of Iraq.
He estimated Fund report released yesterday that the Iraqi economy has shrunk by 2 percent in the last year, becoming the first contraction of the economy since the US-led invasion of Iraq in 2003, compared to the previous discretion, to contraction of 0.5 percent in a report issued earlier this year.
Fund said in a report on the occasion of the conclusion of Article IV consultations with Iraq, the forecast indicates the average height of Iraq's oil exports in 2015 to 3.1 million barrels per day, compared to about 2.5 million barrels per day in 2014.
Fund and as high budget deficit to 12 percent of GDP.
And met with the IMF mission in the period between 6 to 15 March, Finance Minister Hoshyar Zebari and Oil Minister Adel Abdul-Mahdi and the Governor of the Central Bank of Iraq on the Keywords, and a number of officials in the oil, trade and electricity sector.
Fund pointed out that the control of the organization Daash on areas of Iraq, did not stop the expansion of the Iraqi oil sector, which is expected to exports of oil to rise during the current year, helped by the oil agreement signed in the past year with the North County.
The IMF report pointed out that the rate of inflation in the outside areas that are not controlled by the organization Daash amounted to less than 2 percent by the end of 2014, but may rise after the activation of the tariff law which imposes high tariffs on imports.
The IMF said that the Iraqi Central Bank's foreign exchange reserves fell from $ 78 billion at the end of 2013 to $ 66 billion at the end of last year due to lower oil revenues and rising imports.
12 percent of the Iraqi economy shrink in 2014, and likely to grow by 1 percent this year
Iraq relies on oil imports to finance 95 percent of the budget, an order to increase oil exports seeks to 3.3 million barrels per day during the current year, after raising production to 4 million barrels per day.
The Iraqi government relies on oil contracts to raise the country's production of crude to around 8 million barrels per day in the next few years.
IMF report said that external shocks accompanied by spending on security and humanitarian crises requirements, formed a pressure on the financial performance of the country, pointing out that the lack of adoption of the budget in 2014 led to contain spending at less than that experienced in the 2013 levels.
Iraq was not able to approve the 2014 budget because of disagreements between the political blocs on the terms and clauses contained in the budget bill, and the worsening violence in the north and west of the country. The IMF estimated in the Iraqi budget deficit through 2014, about 3 percent of GDP, compared to about 6 percent in 2013.
He pointed out that the decline was partly due to deferred investment spending, stop the budget to the territory of northern Iraq, payments, and non-payment of dues of foreign oil companies. He said that the deficit was financed mainly through domestic borrowing from state-owned banks. And assume the current year's budget and the arrival of oil exports to 3.3 million barrels per day and is priced at $ 56 a barrel, which includes an increase taxes on non-oil sectors and strive to rationalize spending.
IMF: Iraq needs to adjust spending standards in light of declining financial reserves
It is expected that the budget deficit up to 12 percent of GDP in the current year, but the IMF's report is likely to reach much higher. He pointed out that Iraq needs more fiscal control measures, particularly with regard to revenue and spending standards, so as to contain the deficit in 2015 at levels commensurate with funding constraints, and ease the pressure on the government-owned banks, given the decline in foreign exchange reserves.
The IMF said that the foreign exchange market in Iraq remained stable over the past year after a number of steps taken by the Central Bank to liberalize the market, as the proliferation of black-market currency rate to 3.5 percent, down from the total volume of transactions in the foreign exchange market by the end of 2014.
He advised the Iraqi government to re-evaluate the CBI sales ceiling of the dollar, and the system of collection of customs duties through commercial banks, pointing out that these measures restrict the infusion of foreign exchange in the Iraqi economy and led to the arrival of the black market for the currency to record levels in recent weeks.
Central Bank of Iraq and held six weekly auctions for the sale of foreign currency, so as to provide dollar liquidity to the local market, and was the official price for the sale of Bank of dollars to domestic banks and exchange offices in 1166 dinars to the dollar.
The bank lowered its sales from the dollar to $ 75 million a day in the current year from $ 250 million a day in the past.
The Fund noted that the achievement of a comprehensive and diversified economic growth in the medium term in Iraq, also depends on a wide range of reforms, which include the state-owned energy sector and the labor market and improve the business environment and corporate governance. Article IV of the Agreement Establishing IFAD, that the Fund shall conduct annual bilateral discussions with Member States, which focuses on the macroeconomic policies of countries.
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Likelihood of worsening budget deficit of more than government estimates, and Baghdad demanding a review of dollar sales by the central bank.
03/20/2015, Issue: 9862, p. 11]
BAGHDAD - The International Monetary Fund that the Iraqi authorities are trying to take proactive steps to address the dual shock that hit the country's economy hard, and of organizing Daash control over large areas of the territory of Iraq and the collapse of oil prices.
International Monetary Fund cut its forecast for the growth of the Iraqi economy to 1 percent this year, the forecast, issued in Anaerpenmo rate of 2.5 percent, in line with current expectations recent government estimates of the Central Bank of Iraq.
He estimated Fund report released yesterday that the Iraqi economy has shrunk by 2 percent in the last year, becoming the first contraction of the economy since the US-led invasion of Iraq in 2003, compared to the previous discretion, to contraction of 0.5 percent in a report issued earlier this year.
Fund said in a report on the occasion of the conclusion of Article IV consultations with Iraq, the forecast indicates the average height of Iraq's oil exports in 2015 to 3.1 million barrels per day, compared to about 2.5 million barrels per day in 2014.
Fund and as high budget deficit to 12 percent of GDP.
And met with the IMF mission in the period between 6 to 15 March, Finance Minister Hoshyar Zebari and Oil Minister Adel Abdul-Mahdi and the Governor of the Central Bank of Iraq on the Keywords, and a number of officials in the oil, trade and electricity sector.
Fund pointed out that the control of the organization Daash on areas of Iraq, did not stop the expansion of the Iraqi oil sector, which is expected to exports of oil to rise during the current year, helped by the oil agreement signed in the past year with the North County.
The IMF report pointed out that the rate of inflation in the outside areas that are not controlled by the organization Daash amounted to less than 2 percent by the end of 2014, but may rise after the activation of the tariff law which imposes high tariffs on imports.
The IMF said that the Iraqi Central Bank's foreign exchange reserves fell from $ 78 billion at the end of 2013 to $ 66 billion at the end of last year due to lower oil revenues and rising imports.
12 percent of the Iraqi economy shrink in 2014, and likely to grow by 1 percent this year
Iraq relies on oil imports to finance 95 percent of the budget, an order to increase oil exports seeks to 3.3 million barrels per day during the current year, after raising production to 4 million barrels per day.
The Iraqi government relies on oil contracts to raise the country's production of crude to around 8 million barrels per day in the next few years.
IMF report said that external shocks accompanied by spending on security and humanitarian crises requirements, formed a pressure on the financial performance of the country, pointing out that the lack of adoption of the budget in 2014 led to contain spending at less than that experienced in the 2013 levels.
Iraq was not able to approve the 2014 budget because of disagreements between the political blocs on the terms and clauses contained in the budget bill, and the worsening violence in the north and west of the country. The IMF estimated in the Iraqi budget deficit through 2014, about 3 percent of GDP, compared to about 6 percent in 2013.
He pointed out that the decline was partly due to deferred investment spending, stop the budget to the territory of northern Iraq, payments, and non-payment of dues of foreign oil companies. He said that the deficit was financed mainly through domestic borrowing from state-owned banks. And assume the current year's budget and the arrival of oil exports to 3.3 million barrels per day and is priced at $ 56 a barrel, which includes an increase taxes on non-oil sectors and strive to rationalize spending.
IMF: Iraq needs to adjust spending standards in light of declining financial reserves
It is expected that the budget deficit up to 12 percent of GDP in the current year, but the IMF's report is likely to reach much higher. He pointed out that Iraq needs more fiscal control measures, particularly with regard to revenue and spending standards, so as to contain the deficit in 2015 at levels commensurate with funding constraints, and ease the pressure on the government-owned banks, given the decline in foreign exchange reserves.
The IMF said that the foreign exchange market in Iraq remained stable over the past year after a number of steps taken by the Central Bank to liberalize the market, as the proliferation of black-market currency rate to 3.5 percent, down from the total volume of transactions in the foreign exchange market by the end of 2014.
He advised the Iraqi government to re-evaluate the CBI sales ceiling of the dollar, and the system of collection of customs duties through commercial banks, pointing out that these measures restrict the infusion of foreign exchange in the Iraqi economy and led to the arrival of the black market for the currency to record levels in recent weeks.
Central Bank of Iraq and held six weekly auctions for the sale of foreign currency, so as to provide dollar liquidity to the local market, and was the official price for the sale of Bank of dollars to domestic banks and exchange offices in 1166 dinars to the dollar.
The bank lowered its sales from the dollar to $ 75 million a day in the current year from $ 250 million a day in the past.
The Fund noted that the achievement of a comprehensive and diversified economic growth in the medium term in Iraq, also depends on a wide range of reforms, which include the state-owned energy sector and the labor market and improve the business environment and corporate governance. Article IV of the Agreement Establishing IFAD, that the Fund shall conduct annual bilateral discussions with Member States, which focuses on the macroeconomic policies of countries.
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