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Central Bank announces the establishment of a joint lending fund to fund important projects

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12/21/2017 12:01:00 AM
Baghdad / Zahraa al-Jassim (4093)

Central Bank announces the establishment of a joint lending fund to fund important projects

Baghdad / Zahraa al-Jassim

The Central Bank announced the establishment of a joint lending fund with a capital of 500 billion dinars, and according to the Banking Law, this fund can grant a 10% loan to finance the infrastructure projects of the country, an expert confirms that the idea is open to a number of banks and banking experts eight years ago, but the entry of the central to apply now, It should give it momentum and strength of lending, provided that the process of lending from the lenders and brokers and routine, and half of its members from the private sector to start new methods of easy to lend without complications or extortion.

The adviser to the Governor of the Central Bank of Iraq, Walid Eide, said in an interview with the press, that the Central Bank established a joint lending fund with capital of 500 billion dinars to finance projects that develop infrastructure, noting: The Banking Law allows the bank to grant a loan of 10% of capital as a result of the challenges facing The economy due to the security situation and the weakness of the guarantees provided. He pointed out that the Central Bank decided to establish a joint lending fund with a capital of 500 billion dinars, which can be increased and with compulsory participation from all commercial banks, explaining that each bank will contribute to the capital of the Fund by 4 billion dinars.

"The loans that will be granted by the Lending Fund are related to the development of infrastructure such as the establishment of hotels and hospitals, financing the government's dilapidated projects and the construction of schools and others," he said, stressing that the interest of the Lending Fund will be very small compared to market interest. On the one hand loan.

According to the expert on economic affairs, in the name of Antoine in an interview with (range), that this idea was presented by a number of banks and banking experts more than eight years ago, the establishment of a lending fund shared by all Iraqi banks with a joint capital to activate investment in Iraq But the idea remained a dead letter and was not implemented. However, today, when the central bank enters into this process, it must give it momentum and strength to lend to many companies that can choose projects that create job opportunities for the unemployed and reduce the poverty rate. It is also one of the means of financing especially that the bank Focus previously allocated five trillion dinars amount to the industry, agriculture and housing.

Antoine confirms that the lesson is not in the allocation of funds, but in the tools of implementation, because we did not see the movement to the required level, especially in the industrial sector, where the previous lending process had very difficult conditions, and now we can see the same situation, but we hope that the process After the completion of the selection of members of the fund and money, is to start new methods of lending without complications and routine, because without it we will see this idea dead, because in Iraq we have a problem is the gap between planning and implementation, and the rampant financial and administrative corruption is also a handicap and obstruction, not to mention the bureaucracy And routine utilities For the process of extinction.

In the case of this lending fund, there is a major obstacle. Who will manage this fund? Will a government administration also have the same process of red tape or will it be shared by private banks?

There should be a hand for the private sector through a board of directors, half of which will be from the private sector.

To facilitate the process and obstacles and reduce the complexities and freedom, it is a sound step if the monitoring and follow-up and the selection of people appropriate to this process, and can provide something important and solve part of the economic problems of the country, but we must keep this fund from the file of corruption and hegemony for the presence of people trying parasites Blackmail We should also issue a law in the fund called the Lending and Financing Law, so that there will be a nucleus for this process, including selecting the appropriate fund managers to witness the success of the idea.

Iraq has about 70 banks licensed by the Central Bank and their capital is more than 11.7 trillion dinars, which gave the banks operating in Iraq, government and private loans more than 37 trillion dinars, according to data issued by the Association of Iraqi private banks.

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