Following Iraq’s exit last week from the UN’s Chapter VII restrictions, an Iraqi economist has called for a rescheduling of the country’s debt repayments.
“Iraq’s financial funds are under UN trusteeship, according to UN’s Article 7,” Dr. Nabil Jaafar of Basra Univesity told Aswat al-Iraq news agency, pointing out that “the official and private debtors would activate their demands to force Iraq pay back its debts, thing that necessitates its scheduling of the debts,” warning that such development “would cause a real problem, due to the increase of such payments.”
He said that “if this year’s debts payment would be US$ 1.3 billions (b), it may become 5-6 billion (b) dollars during the forthcoming few years, caused by the payment of the instalment plus the interest, that is linked to the average of the rate of inflation.”
Dr. Jaafar said that “Iraq might be forced to pay back such debts to the creditors, thing that would leave passive impacts on its economy, as such debts would drain out the country’s foreign currency reserves, along with the oil revenues.”
He added that Iraq “must treat this problem though avoiding foreign loans, so long as the local resources are enough,” calling for “holding talks with the creditors for rescheduling of the debts, in prelude to pay them back and get rid of their bulks.”
(Source: Aswat al-Iraq)