Iraq uses IMF loans to stabilize economy

(MENAFN) In a recent statement, Mazhar Salih, the Advisor to the Iraqi Prime Minister for Financial Affairs, shed light on Iraq's engagement with the International Monetary Fund (IMF) over the past two decades. Salih emphasized that since 2003, Iraq has availed itself of IMF loans totaling less than USD8 billion, all of which have been diligently repaid. These loans were strategically deployed to bolster macroeconomic stability and enact vital financial reforms within the country.

Detailing the timeline of IMF assistance, Salih outlined various financing programs Iraq participated in, ranging from emergency aid to more extended financial support initiatives. Particularly in the aftermath of the 2003 regime change, the IMF played a pivotal role in extending crucial support to Iraq. Programs such as the SBA Credit Readiness Program and the Rapid Financing Instrument were instrumental in providing immediate financial relief and laying the groundwork for broader economic reforms.

One notable instance highlighted by Salih was the approval of a USD5.34 billion SBA Credit Readiness Program in 2016, earmarked specifically to bolster economic reforms in Iraq. Subsequently, Iraq successfully accessed two-thirds of this allocation, diligently fulfilling its repayment obligations within the stipulated five-year timeframe.

Despite the ongoing economic challenges faced by Iraq, Salih underscored the country's continued collaboration with the IMF to navigate these turbulent waters. Notably, in 2021, Iraq sought an emergency loan amounting to USD6 billion from the IMF. However, this request did not materialize, as it was not aligned with any existing IMF programs at the time. Nevertheless, Iraq remains committed to leveraging its partnership with the IMF to implement necessary reforms and mitigate the economic ramifications stemming from fluctuating oil prices and their subsequent impact on the country's balance of payments and overall economic activity.



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