Research Update: Iraq Ratings Affirmed At 'B-/B'; Outlook Stable

We expect Iraq's government and current account balances to worsen and government indebtedness to increase over the coming four years, based on our assumption that the average Brent oil price will decline to US$55 a barrel (/bbl) in 2020 from US$65/bbl in 2018. However, the government may be able to curtail fiscal risks if it more actively pursues fiscal consolidation efforts, under the auspices of the International Monetary Fund's (IMF's) program. We are therefore affirming our 'B-/B' sovereign credit ratings on Iraq. The outlook is stable. On Aug. 24, 2018, S&P Global Ratings affirmed its 'B-' long-term and 'B' short-term foreign and local currency sovereign credit ratings on Iraq. The outlook is stable. The stable outlook reflects our expectation that

...+ We expect Iraq's government and current account balances to worsen and government indebtedness to increase over the coming four years, based on our assumption that the average Brent oil price will decline to US$55 a barrel (/bbl) in 2020 from US$65/bbl in 2018. + However, the government may be able to curtail fiscal risks if it more actively pursues fiscal consolidation efforts, under the auspices of the International Monetary Fund's (IMF's) program. + We are therefore affirming our 'B-/B' sovereign credit ratings on Iraq. + The outlook is stable....

Research Update