IMF says Iraq seeks emergency loans after oil price crash | Business and Economy News

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The Iraqi government is reportedly seeking $6 billion in loans, with the possibility of another $4 billion, according to the finance minister.

Iraq has requested emergency aid from the International Monetary Fund (IMF) and talks are underway between the parties, the IMF said.

Iraqi Finance Minister Ali Allawi earlier told Bloomberg news agency that Iraq was in talks with the IMF for a $6 billion loan.

“The Iraqi authorities have requested emergency assistance from the IMF under the Rapid Financing Instrument and have indicated their intention to also request a longer-term arrangement with the Fund to support planned economic reforms,” ​​he said. a representative of the IMF in an e-mail on Sunday. statement.

“Discussions on the authorities’ request for emergency assistance are ongoing.”

The IMF’s Rapid Financing Instrument (RFI) provides rapid, accessible financial assistance to all member countries facing an urgent balance of payments need.

According to the IMF website, financial assistance under the RFI is provided without the need for a full-fledged program or review.

oil pressure

Iraq could request an additional $4 billion in low-cost loans under another program linked to government reforms, Allawi said on Sunday.

Iraq devalued its dinar last month after a slump in global oil prices, a major source of Iraq’s financial resources.

Allawi told Bloomberg that Iraq is also planning other types of funding to help fill the budget gap. Once the spending plan is approved, the government will proceed with the issuance of $5 billion in national bonds to broaden its financial base, he said.

The economy of members of the Organization of the Petroleum Exporting Countries (OPEC) has only a small manufacturing base and almost all imported goods are denominated in US dollars. A fall in the value of the dinar makes these imports more expensive.

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