Iraq Government’s Economic Strategies*. By Kadhim Al-Hassani **

<!––>

Iraq’s Macroeconomic Context

Iraq was hit in 2014 by a dual crisis – the Islamic State and Significantly Lower Oil prices

With 95% of revenues coming from oil sales, Iraq had a significant budgetary Deficit as it took time to adjust expenditures down

Initially investments both in the oil sector and the non-oil sector were reduced significantly

This caused arrears to IOC’s as well as to government contractors generally

In late 2015, Iraq engaged with the International Monetary Fund with a Staff Monitoring Program, and was followed in 2016 with a Standby Arrangement (SBA)

The principal goals of the SBA were:

1. Getting rid of arrears (payments to all IOC’s are now current and payments to other contractors have been rescheduled)
2. A strong fiscal consolidation program, in which expenditures were curtailed and non-oil revenues increased (leading to a reduction in deficits as part of the GDP as well as a reduction in the non-oil primary balance deficit)

iii. Establishing a sustainable debt program

To continue reading please download PDF. Click on the following link

Iraq’s Energy Strategies. By Kadhim Al-Hassani