The Iraq Central Bank said that the survival of a high oil price will double Iraq GDP, helping it to achieve its goals by improving the value of the dinar through economic growth.
Speaking to IKHNews, adviser of the Central Bank, Mudhir Saleh, predicted the survival of oil prices in the $80-$85 range, which will double GDP and be reflected in government revenues. The proposed government budget, which should see a budget surplus by 2012, is based on a modest oil price of $70 per barrel.
Saleh said that “All the indications are that the Iraqi economy will shift dramatically during the next two years, improving the value of the dinar.” He pointed out that this will help to develop the oil sector further and push productivity to four million barrels per day, up from the current 2m to 2.5m.
This growth can be expected to improve national income, the value of the dinar, wages, and GDP per capita. Saleh noted that the dinar and the Central Bank’s reserves are stable, helping with monetary policy.
(Source: IKHNews, Central Bank of Iraq)