Iraq to sell a $2bn unsecured bond in 2018, but what of the IMF’s $850m loan?
Iraq’s Central Bank Governor Ali Al-Allaq discusses Iraq’s return to the global bond market and the challenges they face. He speaks on “Bloomberg Markets: Middle East.”
Iraq will return to the bond market next year in a bid to reduce a $2bn budget deficit, and it may not be difficult, according to Bloomberg.
It is the second time that Iraq sells independent international debt, or bonds that don’t carry a government guarantee, after having sold in August $1bn worth.
Bloomberg says that the August debt was very well received and had orders of about $7bn for the debt. But there are challenges ahead, such as receiving the second tranche of IMF loans worth $850 million, which the IMF could tie with the Kurdistan referendum.
Allaq said that most of the IMF targets have been met and that the discussions revolving over the 2018 budget have mostly been resolved.
“Now discussions will take place in the Iraqi parliament, but the IMF mostly cares about reducing the Iraqi deficit, more than anything else, and as such we expect to receive the second tranche of the IMF loan in January 2018, which will be followed by other loans from the World Bank and others,” Allaq said.