Iraq says IMF loans not needed; asks instead for help recovering up to $200 billion 'smuggled' abroad

Mustafa Shilani 2021/08/26 21:03

Visitors are silhouetted against the logo of the IMF at its annual meeting with the World Bank in Tokyo. (Photo: Reuters)

Iraq Iraq IMF Economy

ERBIL (Kurdistan 24) – The Iraqi government announced on Thursday that it no longer needs to borrow certain funds from international financial organizations, but instead requested help in retrieving billions of dollars "smuggled" out of the Middle Eastern nation in recent years.

"We do not need loans from the International Monetary Fund (IMF) now and we no longer need the nearly 4 billion dollars for economic reform, after the improvement of the financial situation," said Finance Minister Ali Abdul Amir Allawi in a press conference held at his ministry in Baghdad

He added, "Currently there are three available ways for obtaining loans from the Fund. First, the coronavirus loans we did not need, the economic reform loans we did need, and the loans to cover large financial deficits of countries we also did not need."

Allawi instead advocated for international assistance in seizing and retrieving money from the nation's coffers that has been smuggled abroad which the minister said amounts to "between $150 billion and $200 billion, only five percent of which is money taken from the former regime."

The official provided few details regarding the funds in question or practical plans for how the international assistance would be provided.

"The longer this money remains abroad, the more it dwindles. We need cooperation from countries and international courts to recover it, and this task is very complicated and not easily completed."

He explained, "We have begun moving on this and talking with several offices to retrieve the money. We started with funds now in neighboring countries, some of which has evaporated, like when the Central Bank of Lebanon told us about the disappearance of 20 billion dollars."

In January, Allawi confirmed that Baghdad was in talks with the IMF to obtain a $6 billion loan.

At the time, an IMF representative said, "The Iraqi authorities have requested emergency assistance under the Rapid Financing Instrument, in a long-term arrangement, to support the planned economic reforms."

The IMF Rapid Financing Instrument provides rapid financial assistance and is available to all member countries facing an urgent balance of payments.

Editing by John J. Catherine