Iraqi government announces 50% decrease in external debt

Shafaq News / The Iraqi government declared, on Monday, a 50% reduction in external debt, reaffirming its commitment to ushering in a qualitative shift in the Iraqi economy.

According to government spokesperson Basim Al-Awwadi, "As a testament to the government's transparency in economic endeavors and to keep the national and international media and public informed about Iraq's economic performance, and in light of the endorsement by the Council of Ministers of the recommendations of Decree No. 23942 regarding the regulation of external borrowing and restructuring of Iraq's public external debts, the government has taken a series of executive measures and adopted a package of financial decisions resulting in reducing the external public debt by over 50%, decreasing it from $19.729 billion at the end of 2022 to $15.976 billion in 2023, and reaching approximately $8.9 billion in 2024."

He added that "these financial steps, including halting several borrowing operations due to their delays and inefficiency, debt organization, auditing, restructuring, and redirecting some debts towards establishing strategic projects, aim to prevent the Iraqi economy from being encumbered by commitments that may affect future political decisions or national development trajectories. They coincide with an urban renaissance, infrastructure development, paving the way for a promising future and a thriving economy where current and future generations can excel and seize greater opportunities."

Al-Awwadi further stated that "the government has structured financial cooperation with the international community within specific frameworks, including productive direct borrowing and providing sovereign guarantees to ensure the production of projects undertaken by the private sector for the government's benefit, as well as sovereign guarantees offered by the government for the benefit of institutions financing the Iraqi private sector's imports of production lines to establish factories within Iraq."

He noted that "these steps pave the way for further integration of our country into the international economic cycle. The government is committed to the principle of borrowing only for productive purposes, effectively leading to an increase in the gross domestic product, financing national service and productive projects with economic returns, ensuring their timely completion and implementation."

With these steadfast measures, Al-Awwadi clarified that "the government reiterates its determination to bring about a qualitative transformation in the Iraqi economy, alongside tangible progress in the service sectors, infrastructure, and social welfare, all essential pillars for meeting the aspirations of our people across Iraq and executing the government program with its priorities and targets."