Iraqi News Economic News Highlights Sunday Afternoon

  In Iraqi News 

Sunday Afternoon Iraq Economic News Highlights 7-24-22

 

An International Agency Expects The Government Debt In Iraq To Drop To 47%

 

Money  and business  Economy News-Baghdad   The Fitch Ratings agency expected the government debt ratio in Iraq to decline to 47% in the current world, but it stated that the debt decline may not be sustainable in light of the political tensions that have restricted public spending .

 

The agency said in a report that “the ratio of government debt in Iraq to GDP is expected to decline, to record 47% in 2022, from 66% last year, supported by increased revenues from oil exports whose prices have risen, which is expected to reach 105 dollars per barrel and 85 dollars per barrel in the year 2023,” noting that “the decline is the largest for any sovereign country in the Middle East and North Africa .” According to Shafak News

 

The decline is positive for the sovereign’s creditworthiness, but the decline may not be sustainable, as it partly reflects the political tensions that have restricted public spending and reflects the high political risks recorded in Iraq’s rating of “B-“.

 

In our January 2022 confirmation of Iraq’s rating, we stated that a positive rating action could result from a sustained period of high oil prices, particularly if combined with increased oil production and exports, leading to a downward trend in government debt/ GDP and foreign reserves are larger. However, there remains a great deal of uncertainty about fiscal trends and the outlook for oil prices .”

 

The report explained that Iraq’s low debt ratio also reflects its failure to form a government and pass the budget since the October 2021 elections. This limited spending to 2021 levels until Parliament passed an emergency financing bill on June 6 to allocate $17 billion, or 7% of output GDP, to support food, energy and salaries,” he said, noting that “the support programmes, which were not reformed, were at risk of running out of money due to rising global commodity prices .”

 

Our forecasts assume a fiscal surplus of 17% of GDP in 2022 and an increase in spending of 6% of GDP, broadly consistent with emergency financing. However, risks to our spending forecasts are to the upside. As any new budget is likely to involve higher spending in light of Iraq’s urgent social and economic development needs .”

 

He also noted that “we still expect some nominal debt reduction in 2022 if a new budget is passed, in particular the central bank’s backlog of claims on the government, which rose to about 13% of GDP in 2021, however, could weaken Accelerated spending from the sustainability of public debt as happened in 2018, also after the elections, when public spending was slow to accelerate after the rise in oil prices, which reduced the debt somewhat, but spending rose strongly in the end .”

 

The report indicated that “it remains unclear whether the next government will implement the reforms that were presented in the white paper under the previous administration in October 2020, even if Prime Minister Al-Kazemi is reappointed. Parliament approved proposals for income tax reform from the 2021 budget, While other reforms, such as the abolition of fuel subsidies for electricity generation, were approved, but not implemented .

 

In the same report, the agency emphasized that “public grievances could degenerate into social instability on a larger scale, as occurred in 2019-2020, as protests eventually lead to early elections. Iraq scores poorly across the World Bank’s governance indicators, reflecting Insecurity and political instability, corruption, government ineffectiveness, and weak institutions, she predicted, “Levels of political risk will continue to rise, and weak management will continue to affect the sovereign rating .”

 

Fitch, or Fitch International Credit Rating Corporation, is one of three major rating companies along with Standard & Poor’s and Moody’s, and is one of three organizations recognized within the Statistical Rating Rating (NRSRO) appointed by the United States Securities and Exchange Commission in the year 1975, along with Together with Moody’s and Standard & Poor’s, they are known as the “Big Three credit rating agencies “.    https://economy-news.net/content.php?id=28986

The Largest In The World.. Oil Announces An Extractive Program To Raise Iraq’s Production To 8 Million Barrels By 2025

 

Energy    Economy News-Baghdad   The Minister of Oil, Ihsan Abdul-Jabbar, outlined the actual steps to escalate the production and export of crude oil within the framework of implementing a plan considered the largest in the world to reach the goal of producing 8 million barrels by the end of 2025.

 

Al-Sabah quoted Abdul-Jabbar as saying: “When we talk about an increase in oil production quantities estimated at 3.3 million barrels per day, we are talking about a giant scope of work over 5 years, perhaps the largest extractive program in the world.”

 

He added, that this means that “there is an active participation of international oil companies in pumping huge capital, expertise and technology to major oil investment companies, as well as the investments of the Ministry of Oil derived from its profits achieved through its capital participation in oil licensing fields, and the two sides aim behind achieving a balanced policy between Profits and the construction process to complete horizontal and vertical projects at the same time, and it is known that companies take all care and caution when making their decisions to increase their oil production.”     https://economy-news.net/content.php?id=28984

 

Iraq’s Oil Exports To America Rose To 456,000 Barrels Per Day Last Week

 

Energy   Economy News-Baghdad   On Sunday, the US Energy Information Administration announced that Iraq has surpassed Saudi Arabia in its oil exports to America during the past week, to become the third largest exporter of it.

 

The administration said in a report published by “Shafaq News”, that “the average US imports of crude oil during the past week from eight countries amounted to 5.722 million barrels per day, an increase of 439 thousand barrels per day from the previous week, which amounted to 5.283 million barrels per day.”

 

She added that “the rate of Iraq’s oil exports to America amounted to 456,000 barrels per day last week, thus exceeding Saudi Arabia, whose exports to America reached 242,000 barrels per day, and thus Iraq became its third exporter after Canada and Mexico.”

 

She pointed out that “most of America’s oil revenues during the past week came from Canada, at a rate of 3.481 million barrels per day, followed by Mexico at a rate of 877,000 barrels per day, and oil revenues from Colombia at a rate of 405,000 barrels per day, and then Saudi Arabia at a rate of 242,000 barrels per day.”

 

According to the administration, “the amount of US imports of crude oil from Nigeria amounted to an average of 136,000 barrels per day, from Brazil at a rate of 70,000 barrels per day, and from Ecuador at a rate of 57,000 barrels per day, while no quantity was imported from Trinidad and Tobago or Russia.”

 

https://economy-news.net/content.php?id=28983

 

The Stability Of Gold Prices In The Iraqi Markets… And An Expert: Its Pricing Locally Is Linked To The “Global”

 

Shafaq News/ “foreign and Iraqi” gold prices stabilized in the local markets today, Sunday (July 24, 2022), while a financial expert considered that gold prices in Iraq are linked to global prices per ounce and the dollar.

 

Shafak News Agency correspondent said that gold prices in the wholesale markets on Al-Nahr Street in the capital, Baghdad, recorded this morning, the selling price of one weight of 21 karat of Gulf, Turkish and European gold 355 thousand dinars, and the purchase price 351 thousand, while the selling prices for Thursday were 347 thousand dinars. for one weight.

 

 

Our correspondent indicated that the selling price of one 21-carat weight of Iraqi gold was also stable at 315 thousand dinars, and the purchase price reached 311 thousand.

 

With regard to gold prices in the jewelers’ shops, the price of selling the weight of Gulf gold 21 carat ranged between 355 thousand and 365 thousand dinars, while the selling price ranged from the weight of Iraqi gold between 315 thousand and 325 thousand dinars.

 

It is equal to one mithqal of gold (five grams).

 

for his part; The financial expert, Hilal Tahan, said in an interview with Shafak News Agency; “Gold prices in Iraq are linked to global ounce prices and local dollar prices,” noting that “the decline in gold prices in the local markets during the past week is due to the drop in an ounce of gold globally from 1810 to 1700 dollars, and thus this was reflected in their local prices.”

 

He added that “gold prices are expected to remain low as a result of the Federal Reserve’s tendency to increase interest rates, which affects gold prices globally.”   LINK

 

A Slight Decrease In The Exchange Rates Of The Dollar In Baghdad And Its Stability In The Kurdistan Region

 

Shafaq News/ The exchange rates of the US dollar against the Iraqi dinar decreased slightly, on Sunday, in the main stock exchange in the capital, Baghdad, while it stabilized in the Kurdistan Region.

 

Shafaq News Agency correspondent said that the Al-Kifah and Al-Harithiya Central Stock Exchange in Baghdad registered this morning 148,500 Iraqi dinars, compared to 100 US dollars.

 

Yesterday, Saturday morning, prices were recorded at 148,550 Iraqi dinars per 100 US dollars.

 

Our correspondent indicated that buying and selling prices have stabilized in banking shops in the local markets in Baghdad, where the selling price amounted to 149,000 Iraqi dinars per 100 US dollars, while the purchase prices amounted to 148000 Iraqi dinars per 100 US dollars.

 

In Erbil, the capital of the Kurdistan Region, dollar prices witnessed stability compared to what they recorded last Thursday, as the selling price reached 148,700 dinars per 100 US dollars, and the purchase price reached 148,600 dinars per 100 US dollars.   LINK

 

The Government Debt Ratio In Iraq Is Expected To Drop To 47% In 2022

 

Shafaq News/ The credit rating agency Fitch expected a decrease in the government debt ratio in Iraq, to record 47% in the current world, but it stated that the decline in debt may not be sustainable in light of the political tensions that restricted public spending.

 

And the agency said in a report seen by Shafak News Agency, that it is expected that “the ratio of government debt in Iraq to the gross domestic product will decrease, to record 47% in 2022, from 66% last year, supported by increased revenues from oil exports whose prices have risen, which is expected It will reach $105 per barrel and $85 per barrel in 2023,” noting that “the decline is the largest for any sovereign country in the Middle East and North Africa.”

 

The decline is positive for the sovereign’s creditworthiness, but the decline may not be sustainable, as it partly reflects the political tensions that have restricted public spending and reflects the high political risks recorded in Iraq’s rating of “B-“.

 

In our January 2022 confirmation of Iraq’s rating, we stated that a positive rating action could result from a sustained period of high oil prices, particularly if combined with increased oil production and exports, leading to a downward trend in government debt/ GDP and foreign reserves are larger. However, there remains a great deal of uncertainty about fiscal trends and the outlook for oil prices.”

 

The report explained that Iraq’s low debt ratio also reflects its failure to form a government and pass the budget since the October 2021 elections. This limited spending to 2021 levels until Parliament passed an emergency financing bill on June 6 to allocate $17 billion, or 7% of output GDP, to support food, energy and salaries,” he said, noting that “the subsidy programmes, which were not reformed, were at risk of running out of money due to high global commodity prices.”

 

Our forecasts assume a fiscal surplus of 17% of GDP in 2022 and an increase in spending of 6% of GDP, broadly consistent with emergency financing. However, risks to our spending forecasts are to the upside. As any new budget is likely to involve higher spending in light of Iraq’s urgent social and economic development needs.”

 

He also noted that “we still expect some nominal debt reduction in 2022 if a new budget is passed, in particular the central bank’s backlog of claims on the government, which rose to about 13% of GDP in 2021, however, could weaken Accelerated spending from the sustainability of public debt as happened in 2018, also after the elections, when public spending was slow to accelerate after the rise in oil prices, which reduced the debt somewhat, but spending rose strongly in the end.

 

The report indicated that “it remains unclear whether the next government will implement the reforms that were presented in the white paper under the previous administration in October 2020, even if Prime Minister Al-Kazemi is reappointed. Parliament approved proposals for income tax reform from the 2021 budget, While other reforms, such as eliminating fuel subsidies for electricity generation, were approved, but not implemented.

 

In the same report, the agency emphasized that “public grievances could degenerate into social instability on a larger scale, as occurred in 2019-2020, as protests eventually lead to early elections. Iraq scores poorly across the World Bank’s governance indicators, reflecting Insecurity and political instability, corruption, government ineffectiveness, and weak institutions, she predicted, “Levels of political risk will continue to rise, and weak management will continue to affect the sovereign rating.”

 

Fitch, or Fitch International Credit Rating Corporation, is one of three major rating companies along with Standard & Poor’s and Moody’s, and is one of three organizations recognized within the Statistical Rating Rating (NRSRO) appointed by the United States Securities and Exchange Commission in the year 1975, along with Together with Moody’s and Standard & Poor’s, they are known as the “Big Three credit rating agencies”.    LINK

 

Iraq Overtakes Saudi Arabia And Occupies The Third Place Among The Largest Oil Exporters To America

 

Shafaq News/ The US Energy Information Administration announced on Sunday that Iraq has surpassed Saudi Arabia in its oil exports to America during the past week to become the third largest exporter of it.

 

The administration said in a report seen by Shafak News Agency, “The average US imports of crude oil during the past week from eight countries amounted to 5.722 million barrels per day, an increase of 439,000 barrels per day compared to the previous week, which amounted to 5.283 million barrels per day.”

 

She added that “the rate of Iraq’s oil exports to America amounted to 456,000 barrels per day last week, thus exceeding Saudi Arabia, whose exports to America reached 242,000 barrels per day, and thus Iraq became its third exporter after Canada and Mexico.”

 

She pointed out that “most of America’s oil revenues during the past week came from Canada, at a rate of 3.481 million barrels per day, followed by Mexico at a rate of 877,000 barrels per day, and oil revenues from Colombia at a rate of 405,000 barrels per day, and then Saudi Arabia at a rate of 242,000 barrels per day.”

 

According to the administration, “the amount of US imports of crude oil from Nigeria amounted to an average of 136,000 barrels per day, from Brazil at a rate of 70,000 barrels per day, and from Ecuador at a rate of 57,000 barrels per day, while no quantity was imported from Trinidad and Tobago or Russia.”   LINK

 

 

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