Finance Minister: Cash reserves will reach more than 90 billion dollars by the end of this year

Baghdad-INA

Finance Minister Ali Allawi confirmed Wednesday the increase in cash reserves at the Central Bank to 90 billion dollars by the end of this year, while setting the ratios of Iraq's commercial debts.

Allawi told the Iraqi News Agency (INA), that "the devaluation of the Iraqi dinar led to the preservation of foreign currency reserves with the Central Bank of Iraq after the low and critical levels that reached in late 2020," noting that "the recovery in oil prices and wise financial management have helped reserves become $70 billion by April."

He added, "It is expected that the continued recovery of oil prices will increase these reserves to more than $90 billion by the end of 2022, which is a record level for Iraq."

As for the commercial debt of Iraq, the Minister of Finance said, "The only real commercial debt of Iraq is two of three Eurobonds with an interest rate of 5.8% and 6.72%, while the third at an interest rate of 2.149%, which is guaranteed by the US government, and all other debts are on very concessional terms,” noting that “the external debt does not include the debts of the former regime, which amount to 57.8 trillion dinars, or the equivalent of 39.9 billion dollars, and it has been frozen since 2003 without interest or repayment as part of the Ministry of Finance’s work to reduce debt.”

Allawi stated, "The ministry has reconfigured all local debts as follows: The balance of all local debts has become medium or long-termed after the government agreed with the Central Bank and public banks in 2020 to convert all current treasury (bonds) into loans for 10 years and for 20 years, With repayment of installments starting from March 2021 and an interest rate reduced to 2%, "while the total external and internal debts amount to more than 99 trillion dinars."

He continued, "The Cabinet, in its session held on Tuesday, April 5, 2022, agreed to adopt the strategy for repaying the internal public debt for the years (2022-2024), which was prepared by the Public Debt Department / Ministry of Finance within the draft federal budget bill for the fiscal year 2022 of the Republic of Iraq for.

He noted that "inflation in Iraq is lower than that of emerging economies and the group of oil-exporting countries."