Iraq Economic News and Points to Ponder Thursday AM3-27-25
Financial expert: Iraq's budget deficit is due to bond issuance
Economy Iraq breaking Budget disability Financial bonds
2025-03-24 23:01 Shafaq News/ Financial expert and former director general of the Central Bank of Iraq, Mahmoud Dagher, attributed the country's budget deficit on Tuesday to the Iraqi Ministry of Finance issuing large bonds. Dagher told Shafaq News Agency,
"The budget deficit is behind the Ministry of Finance's efforts to issue bonds worth 3 trillion dinars to obtain cash liquidity to cover its expenses."
He added, "Given the difficulty of marketing bonds to the public, interest rates on bonds were raised and they were marketed through banks this time,
given the latter's liquidity and preference for risk-free, profitable securities such as government bonds."
Dagher expects this move to attract banks, given that the interest rates offered are close to the returns generated from other activities.
The Iraqi Ministry of Finance is seeking to issue national bonds worth 3 trillion dinars (about $2.3 billion) allocated exclusively to local banks,
according to a letter issued by the Central Bank to banks. She noted that
the bonds will be divided into two tranches: the
first,
worth half a million dinars per bond,
for a two-year term, with an
8% annual interest rate, and the
second,
worth one million dinars per bond,
for a four-year term, with an
annual interest rate of 10%.
The sale is scheduled to take place from March 20 to 29.
https://www.shafaq.com/ar/اقتصـاد/خبير-مالي-العجز-بموازنة-العراق-بسبب-صدار-السندات
Insurance and Credits
Economic 03/26/2025 Yasser Al-Mutawali Article 45 of the current budget law stipulates that open documentary credits must be insured within Iraq. This procedure means that
when the state or individuals import from abroad,
the imports must be insured by companies in the country within Iraq.
This decision reflects the government's interest in activating and stimulating the insurance sector, given its
significant role in maximizing financial resources, on the one hand, and
in bearing risks in a balanced manner across economic sectors as a whole, by distributing them fairly.
Continuing our previous article titled "Insurance and Risk,"
it can be said that the Central Bank of Iraq has
circulated this order to banks and
called on them to implement it,
indicating its support for this important decision.
However, it is noticeable that the
response from banks has been very weak, so
coordination between insurance companies and banks is required to ensure the full success of this decision.
The current government, in its efforts to support the insurance sector, is attempting to revitalize this vital and important financial sector.
These measures may be a response to what we raised here in Al Sabah newspaper, given the difficulties this essential sector is facing.It is clear here that
there is unfortunately a lack of insurance culture,
for which the insurance companies themselves and the economic media bear responsibility.
It is worth emphasizing here that , in
this measure will contribute to maximizing the budget's financial resources addition to
preserving the hard currency that goes to international insurance companies in the insurance process.
The benefit of the domestic insurance decision will therefore be to stimulate important economic sectors, such as insurance companies and banks, while providing many job opportunities in this field,
thus alleviating the widespread unemployment among young people.
Here, I believe that a partnership should be created between reputable Iraqi insurance companies and international companies, with the aim of benefiting from each other's expertise,
similar to the partnership between our banks and correspondent banks, to ensure profitability from the outset.
We ask: What role does the Iraqi insurance company play in these changes?
It used to play a major role in insuring imports and exports and investing funds domestically and internationally.
In a related context, the government's support for this sector was not limited to requiring documentary credit insurance, but
this interest was also reflected in the new health insurance law, which encouraged insurance companies to issue insurance policies for expatriate and resident workers.
Thus, insurance companies will flourish again, but insurance companies are required to work on developing their workforce, given the expertise required by these insurance products, especially in the era of digital transformation.
This is a shared responsibility in cooperation and coordination between the Insurance Bureau and government insurance companies. Both private and public. https://alsabaah.iq/112251-.html
Iraqi oil refinery energy Economy News – Baghdad The Prime Minister's financial advisor, Mazhar Mohammed Salih, confirmed on Wednesday that Iraq's oil exports to the United States have increased by more than 110% over two years.
"Economic cooperation between Iraq and the United States extends to diverse investment, trade, and economic areas. Economic cooperation between Iraq and the United States has witnessed remarkable developments in recent years," Salih said in a statement reported by the official news agency and seen by Al-Eqtisad News.
He pointed out that "the volume of trade between the two countries has more than doubled over the past two years, as Iraq's oil exports to the United States increased by more than 110%, and Iraq's imports from the United States increased significantly over the past two years, with the value of that trade ranging between $9 and $10 billion."
He explained that "Iraq's imports were primarily in cars, transportation equipment, engineering, and electrical equipment, but the trade balance remained in Iraq's favor, with a difference of $5.7 billion, reflecting the continued superiority of Iraqi exports to the United States, especially in the crude oil sector."
He noted that "economic cooperation between Iraq and the United States is developing, with a focus on enhancing trade exchange and supporting joint investment activities, serving the economic interests of both countries."
Saleh stated that "financial and economic cooperation is part of a positive, shared dialogue between the two countries. Since the beginning of this year, many mutual understandings have been reached in the field of economic cooperation, which are consistent with supporting stability and economic reforms outlined in the government's program, particularly the development of an attractive investment cooperation environment for investors between the two friendly countries, within the framework of the country's general economic policy to achieve sustainable development goals." https://economy-news.net/content.php?id=53840
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