Iraq to Grow 9% in 2012

Iraq’s gross domestic product growth is expected to rise by 9 percent in 2012, up from around 6 percent in 2011, mainly driven by an expected increase in oil production and exports, reports Al Arabiya TV.

Mudher Kasim, a deputy governor of Iraq’s Central Bank, told Reuters in an interview, “it will easily jump to 9 percent next year, it will not be difficult. If production and exports in the oil sector rise, it is possible to reach that figure,”

He said he expected GDP growth of around 5-6 percent at the end of this year.

Kasim said he also expected Iraq’s foreign reserves to jump to around $70 billion by end-2012 from $58 billion currently if oil prices stayed at current levels and exports climbed as anticipated.

Last October, Kasim had put reserves at around $50 billion, with 45 percent held in dollars, 45 percent in euros and 10 percent mainly in gold and British pounds.

Kasim said the central bank had no plans to lower interest rates, currently at 6 percent, as that would spur more capital flowing out of the country.

“I believe the interest rate is suitable because to decrease it more, the interest rate will become useless … it will help capital to go out (of the country),” Kasim said.

(Source: Reuters, Al Arabiya TV)

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