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Wed 28 Jan 2009 09:55 PM

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Iraq to issue first post-Saddam bonds

Iraq's Finance Minister says the government will soon issue its first paper since the fall of Saddam Hussein.

Iraq will soon issue its first new government bonds since the fall of dictator Saddam Hussein, for $5 billion dollars, Finance Minister Bayan Jabor said on Wednesday.

"For the first time, we will soon issue government treasury bonds, worth about $5 billion dollars," Jabor told a banking conference in Baghdad.

"These bonds will be guaranteed by the government of Iraq through the huge assets Iraq owns, which reach to tens of billions dollars, guaranteed by limitless crude and gas reserves, guaranteed by the promising Iraqi economy."

He did not give a specific time frame to issue the debt.

Iraq, which gets nearly all its revenues from oil exports, had a large budget surplus in 2008 when oil prices were high, but faces a deficit in 2009 despite revising its spending plans down to $62 billion from $80 billion as oil prices fall.

The government is in need of funds to pay for investment, not least to boost oil exports and increase future revenues.

Although about $66 billion of the country's Saddam-era debt has been forgiven, it still owes billions to its Arab neighbours, some of which it disputes. (Reuters)

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