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The Iraqi Finance Ministry on 18 January issued a batch of $1bn five-year international bonds guaranteed by the US with an annual yield of 2.1%.
This rate is far below the market interest on Iraq’s non-guaranteed debt. The ministry announced on its website that the proceeds from this sale will be used to finance Iraq’s budget deficit as stipulated in the 2017 budget law, noting that Iraq is paying lower interest on this issue than other countries with similar US-guaranteed bond issues.
It is unclear if the US will continue with this largess under President Donald Trump, or indeed if his regime will ask for anything in return. Mr Trump’s previous quips that the US should have “grabbed the oil” following the 2003 invasion are suddenly less funny now that he has updated the comments as president. “We should have kept the oil when we got out,” he told ABC in a 25 January interview. And comments from White House press secretary Sean Spicer suggest that the threat remains live: “We’re going into a country for a cause. He wants to be sure America is getting something out of it for the commitment and sacrifice it is making,” he said, referring to continued US military support for Baghdad. (CONTINUED - 629 WORDS)
DATA INSIDE THIS ARTICLE
|table||GCC 2016 International Bonds Issues|
|chart||Iraq Drilling* Slumps Amid Cash Crunch|