Finance Minister Hoshyar Zebari said on Thursday that his country is seeking a sovereign rating and continue with the credit rating agencies, as they prepare to issue huge bonds worth five billion dollars needed to cover the budget deficit caused by low oil prices.
Zebari told Reuters in a telephone interview, "We started the process. Banks also seek to help us in this direction. "
Iraq has announced that it will issue bonds worth five billion dollars in the first issued in the international bond market nine years ago.And Iraq in dire need of liquidity as the government predicted that the deficit this year to about 25 percent of the budget of $ 100 billion roughly the size.
and obtain a sovereign rating agency major credit which lacks him Iraq now may help persuade the global funds, international banks managers in underwriting bonds.
Zebari said that Iraq is seeking to connect with two or three credit rating agencies, but he did not name. Iraq and discusses the bond issuance plan with City Bank and Deutsche Bank.
The process of obtaining the credit rating may be sensitive for Iraq as it will be forced to open its books to these institutions and reveals unveil new information on public finances. Zebari did not disclose the date on which it is expected to complete the process.
It is expected to attract Iraq's oil reserves huge -alta it did not reach the hands of the terrorist organization Daash, buyers for this offering. But many fund managers believe that Baghdad would face difficulty in the sale of five billion dollars in a short period even if the pricing generous.
In response to whether the number five billion to be very ambitious, Zebari said, "We have a budget commitment to issue six billion. Thus this is the minimum This is our plan to cover the deficit. But there is no way to be issued in a single chip. "
Iraq has issued existing dollar bonds, maturing in 2028 and prompted a wave of selling panicked late last year with the erosion of oil prices, the yield on these bonds to rise to a record level at 10.49 percent from about 7.2 percent in September. But the yield has since tumbled to 8.04 percent.
In addition to the issuance of international bonds has taken or plans to take Iraq and other financial measures, including the issuance of bonds in local currency to the banks and the imposition of taxes on some consumer goods and cut salaries in the public sector. A request for assistance from the International Monetary Fund as looking. PUKmedia
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