Iraq turns to Gulf, seeks funds to tackle financial collapse

by Abdulmumeen S. Yitta

Ali Allawi, Iraq’s new finance minister, in what was his first trip abroad since becoming minister visited Saudi Arabia on Saturday 23rd May 2020 seeking financial assistance to help his country out of the financial impasse engendered by collapse in oil prices.

Allawi met with Minister Faisal bin Farhan who is the Saudi Arabian Foreign Minister and discussed how to work together and strengthen relations between the two countries.

Faisal on Saturday tweeted, “In Riyadh, I met with Iraqi Deputy Prime Minister, Ali Abdel Amir Allawi, who was pleased with his visit to his second country, the Kingdom of Saudi Arabia, and at the meeting we discussed the distinguished brotherly relations between the two countries, and the Kingdom’s keenness to see Iraq enjoy stability and development, and we look forward to working together.”

Prior to his departure, Allawi has made it known that his priority is restoring Iraq’s financial strength and bridge the wide gap in the country’s budget.

“Iraq is in need of immediate monetary support so that the government can fulfil its obligations towards its employees,” Allawi said.

The financial crisis that plagues the country has brought with it fears that the government might have challenges paying millions of workers salaries, especially state workers as well as pensions and welfare to other millions of people.

The government has just made a 1.4 million earning from crude oil sold in April which is far below $4 billion earmarked to pay one month salaries.

Against this background, last week, Prime Minister Mustafa Kadhemi has pledged that workers would have their May salaries paid as usual, and this has to considerable extent alleviate fears over salary payment.

Similarly, in a bid to seek financial support, Iraqi government has earlier disclosed that the prime minister would as well visit countries like Kuwait and the United Arab Emirates to garner more financial support to help the country out of its financial difficulty.

Ali Allawi took office as the new Iraq’s finance minister on May 7 2020 after months of political deadlock in the country.

Allawi’s appointment as a minister was welcomed and approved by the United State and that has helped Iraq to enjoy a 120-day extension waiver that allowed it to import Iranian gas to feed its worn-out power grid.

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