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Fitch Revises Outlook on Iraq to Stable

Fitch Ratings revised the outlook on Iraq’s long-term foreign-currency Issuer Default Rating (IDR) to Stable from Negative. (AFP)
Fitch Ratings revised the outlook on Iraq’s long-term foreign-currency Issuer Default Rating (IDR) to Stable from Negative. (AFP)
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Fitch Revises Outlook on Iraq to Stable

Fitch Ratings revised the outlook on Iraq’s long-term foreign-currency Issuer Default Rating (IDR) to Stable from Negative. (AFP)
Fitch Ratings revised the outlook on Iraq’s long-term foreign-currency Issuer Default Rating (IDR) to Stable from Negative. (AFP)

Fitch Ratings has revised the outlook on Iraq's long-term foreign-currency Issuer Default Rating (IDR) to stable from negative and affirmed the IDR at “B-”.

The outlook revision reflects a smaller-than-expected decline in foreign reserves and materially higher oil prices relative to Fitch's baseline in April 2020.

Iraq’s rating is constrained by commodity dependence, weak governance, high political risk and an undeveloped banking sector.

Fitch expects government debt per GDP to decline in 2021 to 74 percent, before increasing gradually towards 80 percent over the medium term.

Political risks, domestic and regional, constrain the rating, it explained, expecting reserves to stabilize in 2021 as stronger oil prices and the devaluation narrow the current account deficit (CAD).

In other news, spokesman for Iraq’s Ministry of Electricity Ahmed al-Abadi said the US General Electric Co will take over Iraq's transmission network and interconnection with the electricity grid of Jordan.

In press statements on Wednesday, Abadi said the electric interconnection projects with neighboring countries are vital and contribute to supplying Iraq with power.

The project will take 26 months to be implemented and will supply Iraq with 150 megawatts of electric power.

Details of the project's launch phase will be set after approving the country’s 2021 state budget law.

In 2019, Iraq signed a deal with the GCC to build a power line that would import 500 megawatts of electricity.

According to Abadi, the project was activated but was later suspended due to the coronavirus pandemic and the global economic crisis.

He pointed out that the government agreed to open headquarters for the GCC Interconnection Authority (GCCIA) to later proceed with the project’s implementation.

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Sultan of Oman Stresses Private Sector’s Role, Alongside Government, in Employing Citizens

Sultan Haitham bin Tariq met on Monday at Al-Baraka Palace with business leaders, owners of SMEs, and startup representatives. (ONA)
Sultan Haitham bin Tariq met on Monday at Al-Baraka Palace with business leaders, owners of SMEs, and startup representatives. (ONA)
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Sultan of Oman Stresses Private Sector’s Role, Alongside Government, in Employing Citizens

Sultan Haitham bin Tariq met on Monday at Al-Baraka Palace with business leaders, owners of SMEs, and startup representatives. (ONA)
Sultan Haitham bin Tariq met on Monday at Al-Baraka Palace with business leaders, owners of SMEs, and startup representatives. (ONA)

Sultan Haitham bin Tariq of Oman emphasized the role of the private sector in creating job opportunities for Omanis, urging businesses to make use of the economic incentives provided by the government to support local employment.
During a meeting on Monday at Al-Baraka Palace with business leaders, owners of small and medium enterprises, and startup representatives, Sultan Haitham affirmed that addressing unemployment is the top priority for the government.
He underscored the private sector’s responsibility to join efforts with the government in providing employment, training, and development for citizens by leveraging government incentives, programs, and initiatives aimed at supporting the private sector.
Discussing the banking sector, he highlighted its importance as a “cornerstone of modern economies and a key player in economic growth and shaping the business environment.”
The Sultan also pointed to the adoption of the national policy on local content, which aims to enhance the competitiveness and growth of the national economy. He stressed the importance of the private sector’s role in advancing this policy by localizing industries, prioritizing local products in purchasing and tenders, thereby creating job opportunities for Omanis, reducing import dependence, boosting exports, and increasing the GDP.
Sultan Haitham reviewed Oman’s financial and economic performance, noting the positive outcomes achieved through effective government-private sector partnerships. These partnerships have contributed to GDP growth and the continued improvement of Oman’s credit rating, which in turn enhances business and investor confidence, creating an attractive investment climate that supports the growth of various economic sectors.
He also called for strengthened partnerships between the government and private sector to ensure a favorable environment for investment and local economic development.
Sultan Haitham commended the efforts of the Financial and Economic Committee in the Council of Ministers, the Ministry of Commerce, Industry and Investment Promotion, and the Authority for Small and Medium Enterprises Development.
In coordination with the Oman Chamber of Commerce and Industry, these entities hold regular meetings with business leaders and investors to continuously address the challenges facing the private sector, particularly small and medium enterprises, and work towards viable solutions.