By John Lee.
Reuters reports that Iraq is approaching credit rating agencies to obtain a sovereign credit rating as it prepares for its first international bond sale for nine years.
Finance Minister Hoshiyar Zebari (pictured) told the news agency:
“We started the process … The banks are also trying to help us in that direction.”
Iraq has said it will issue $5 billion (6 trillion Iraqi dinar) of debt to help cover a projected budget deficit of about $25 billion this year. A credit rating from a major agency could help persuade global fund managers to subscribe to the issue.
Iraq has been discussing its bond issue plans with Citibank and Deutsche Bank.
Reuters quotes fund managers as saying that Iraq would struggle to sell $5 billion in a short space of time, even with generous pricing.