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Significance
The 5.3-billion-dollar loan is part of a broader international aid programme. The SBA loan will be disbursed over three years in 13 quarterly installments, including a first payment of 634 million dollars of budget support in the fourth quarter of 2016.
Impacts
A rally in oil prices and improved current account balance could erode Iraqi commitment to the structural reforms required by donors.
International scrutiny may slow a re-expansion of Iraqi spending for 3-5 years.
The aid will bolster Haider Abadi, whose continuation as premier is viewed as vital by international donors and investors.
Longer-term structural reforms for private-sector growth will be difficult to implement, but may be successful in the Kurdistan region.
Keywords:
economy,
international relations,
politics,
aid,
debt,
finance,
fiscal,
reform,
Iraq,
ME/NAF,
IMF-World Bank,
United States
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2016
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