| 2008: IMF expects significant growth of Iraqi economy |
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January 21, 2008 Mohsin Khan, Director of the Middle East and Central Asia Division in the IMF, said in a press conference in Washington that he expects Iraqi GDP to grow by 7% in 2008, and will continue growth by 7 or 8% in 2009, but this of course depends on the expansion of oil production and the improvement in security situation; he added that he expects oil production, which represents approximately 70% of Iraq income, to increase by 20 thousand barrels a day at least in 2008. According to IMF estimates, Iraq's average production of oil amounted to about two million barrels per day during the period from 2006 to 2007. Khan pointed out that the improvement of security situation in Iraq in the second half of 2007 led to a rise in economic activity and in oil production during the last quarter of 2007, a trend expected to continue in 2008. On the other hand, Stefan de Mistura, United Nations envoy to Iraq, said that he will present a positive image of progress in Iraq and the efforts of the Iraqi government in supporting political reconciliation, in his report to the Security Council. He added, "at the beginning of 2007, we were concerned about the the weakness of progress on the national dialogue, but now the situation has changed fundamentally." According to BBC correspondent in Baghdad Johnny Diamond that the statements issued by officials of the United Nations and the IMF on Iraq reflect what is, compared to Iraq, improvement in the situation. He added that the law of allowing some former Baath Party officials to work in the army and government departments contributed to the optimism on the situation in Iraq. Economic progress The IMF agreed to grant Iraq credit facilities of about $744 million in December 19, 2007, after a week of Iraq repaid debts worth $471 million before their due time. This improvement in the repayment ability of Iraq was due to the increase in oil prices which made Iraq's oil revenues in 2007 hit about $27 billion compared to $20 billion dollars in 2006. Khan praised the economic progress achieved by Iraq in the last period, which included strengthening the role of the Central Bank and the restructuring of two State-owned banks, as well as reducing inflation which reached 65% in 2006. Khan explained that the price index in Iraq showed an increased by about 4% only during the period from January to November 2006. However, Khan stressed the need for international support for Iraq, particularly in the area of security. |