Iraq says discussing $6 billion bond issue with banks
Iraq is discussing a possible bond issue worth nearly $6 billion with Deutsche Bank and Citibank as part of its efforts to cover a huge projected budget deficit this year, Finance Minister Hoshiyar Zebari said. State revenues have tumbled along with falling oil prices just as Iraq faces a costly military campaign against Islamic State militants […]Dominic Evans writes for Reuters :
Iraq is discussing a possible bond issue worth nearly $6 billion with Deutsche Bank and Citibank as part of its efforts to cover a huge projected budget deficit this year, Finance Minister Hoshiyar Zebari said. State revenues have tumbled along with falling oil prices just as Iraq faces a costly military campaign against Islamic State militants in its northern and western provinces, leaving a likely 25 trillion Iraqi dinar ($21.4 billion) shortfall.
To fund the deficit, Zebari said the finance ministry was looking at measures including the bond issue, borrowing from state banks, and converting some Iraqi bank assets held with the central bank into bonds. It might also consider raising money through forward sales of oil if the cabinet rejects plans for the 10-year bond issue. Officials say Prime Minister Haider al-Abadi's cabinet sees the proposed 9 percent interest rate as prohibitively high.
