Baghdad, 23 May 2024, (GNP): Mazhar Salih, the financial advisor to the Iraqi Prime Minister, confirmed that Iraq has fully settled all the loans it borrowed from the International Monetary Fund (IMF) since 2003, amounting to nearly $8 billion.
Salih clarified, as reported by the Iraqi News Agency (INA), that the IMF extended multiple loans to Iraq with the goal of bolstering macroeconomic stability and implementing financial reforms.
During the expansive period spanning from 2003 to 2021, Iraq embarked on a series of financial engagements with the International Monetary Fund (IMF), traversing a diverse landscape of financing modalities ranging from exigency-based disbursements to protracted financial aid initiatives.
Notably, in the year 2016, amidst a backdrop of economic recalibration and reformative endeavors, the IMF extended its support to Iraq through the approval of a significant financial program valued at $5.34 billion.
This infusion of capital was strategically devised to underpin and catalyze a multifaceted spectrum of economic reforms within the nation, spanning from structural adjustments to institutional enhancements.
In the year 2021, against a backdrop of economic turbulence spurred by fluctuating oil prices, Iraq found itself in a precarious fiscal position, prompting the pursuit of a substantial $6 billion emergency loan from the International Monetary Fund (IMF). This endeavor, however, encountered an impasse as the IMF refrained from granting the loan, citing its lack of alignment with any ongoing IMF initiatives at the time.
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Why Iraq entered IMF’s program?
Firstly: to grapple with the pronounced impact of oil price volatility on the nation’s economic landscape, which reverberated through the intricate tapestry of its balance of payments.
secondly: to chart a course of comprehensive governmental reforms aimed at bolstering the resilience and dynamism of the Iraqi economy.
The intricacies of Iraq’s economic entanglements underscored the pressing need for external assistance, and the IMF emerged as a pivotal ally in navigating these turbulent waters.
However, the failure to secure the emergency loan underscored the nuanced interplay between geopolitical exigencies and the stringent criteria governing IMF disbursements.
Nevertheless, the dialogue with the IMF served as a catalyst for introspection and recalibration within Iraq’s policymaking circles, galvanizing efforts to chart a sustainable trajectory of economic renewal and reform.
