Central Bank of Iraq has reportedly allocated $5.1 billion in loans for governmental and private banks throughout the crisis-hit country in a bid to keep a handle on inflation.
Central Bank general manager Ali Allaq told, "The central bank is accountable for monitoring possibilities before the emergence of economic crisis and its priority is to keep the market stable inside and outside the country and also help boost the banking system which is one of the important sectors after the oil sector."
He added, "A while back, the economic committee of the Iraqi parliament called on the Iraqi ministries to open bank accounts in the private banks in Iraq to help boost the economy. But it seems like Iraq's finance ministry is reluctant about the economic committee's decision because they think they do not have to deal with private banks, only the governmental ones."
According to Allaq $4.29 billion of the loans will go to the Industrial Bank, Agriculture Bank, and Housing Bank and the other $841 million will go to the private banks. On January 21, the Iraqi Cabinet approved a $102.5 billion national budget for 2015 based on a projected oil price of $60 a barrel and projected deficit of $19.1 billion. But oil prices have dropped from around $100 last year to less than $50 this month.
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