Moody’s Rates Iraq Stable

Moody’s on Friday has assigned a Caa1 long-term issuer rating with a stable outlook to the government of Iraq, Reuters reported. The ratings agency likewise gave a provisional Caa1 senior unsecured rating to the country’s bond issuance, a B3 for its long-term local currency and foreign currency bond ceilings and a Caa2 rating for long-term local currency and foreign currency deposit ceilings. Moody’s said the Caa1 rating, considered to be of poor standing and subject to very high credit risk, was driven by key factors regarding Iraq’s economy, institutional strength, fiscal position as well as political situation. “Iraq has a relatively large economy that is endowed with very substantial oil wealth, but which suffers from highly volatile growth due to its lack of economic diversification,” Moody’s said. Iraq’s proven oil reserves were placed at 153 billion barrels, the fifth largest in the world, equivalent to 9% of global proven reserves at the end of 2016.