Moody's: Iraq will witness a significant decline in financial revenues

Shafaq News / A report issued by Moody's company stated that a number of countries in emerging markets and below, such as Iraq, Kuwait, Ecuador and Cambodia, which depend on goods or tourism, are likely to witness significant annual declines in financial revenues.

The company stated in its report that the sharp recovery in global financial markets, during the unprecedented period of turmoil, preceded the stability of production or the decline in the rates of infection with the Coronavirus in many emerging and frontier market economies.

It indicated that while a set of political responses supported the return of risk, and what appears to have been successful in avoiding a complete global financial crisis, many economies will start their recovery with greater financial and external weaknesses.

According to the report, the unprecedented economic shock hit lower-credit rating governments stronger, leading to widening financial and external imbalances, at a time when emerging frontier markets witnessed an economic shock through reduced exports, weak tourism and reduced global demand.

In severe cases, liquidity pressures rose towards serious deficit, at a time when the company clarified that some governments in emerging and frontier markets have benefited from emergency financing, as large financial support by international financial institutions.

Moody’s stated that the unequal economic recovery and weak financial and external conditions will create permanent credit challenges for many countries, even after the return of global economic conditions to normal.