Iraq is said to be discussing a possible bond issue worth around $6 billion with Deutsche Bank and Citibank in an effort to cover a “huge” projected budget deficit this year, Finance Minister Hoshiyar Zebari said, according to Reuters.
Revenues in the nation have plunged along with the price of oil just as Iraq faces an expensive military campaign against the Islamic State in its northern and western provinces, which is expected to leave around a 25 trillion Iraqi dinar ($21.4 billion) budget shortfall, according to Reuters.
To help fund the deficit, Zebari says the ministry is eyeing measures such as the bond issue, borrowing from state banks, and converting some Iraqi bank assets held by the central bank into bonds, the report said.
The report also said that Iraq may also consider raising money through forward sales of oil should the cabinet reject plans for the 10-year bond issue.
Zebari said that a proposal to convert half of the assets that are held by state banks in the central bank into bonds will raise around $5 billion, and that the nation would also use its Special Drawing Rights to raise around $1.8 billion from the International Monetary Fund, the report added.