U.S. Embassy Announces First-Step in $1 Billion Sovereign Loan Guarantee for Iraq

Today the Government of Iraq signed a loan guarantee agreement with the United States. The signing represents the first step in the process for Iraq to obtain greater access to international capital markets. After specific legal requirements and policy considerations have been satisfied, Iraq can move forwards to become the beneficiary of a U.S. sovereign loan guarantee. This loan guarantee underscores the United States’ enduring commitment to the people of Iraq and its government in their fight against ISIL. This loan guarantee is designed to financially support Iraq as it strives to complete the liberation of Iraq from Da’esh and pursue important economic reforms to restore growth and prosperity.
Today’s signing is the first of two important steps to finalize the sovereign loan guarantee. The second step is a formal exchange of diplomatic notes between the Government of the United States and the Government of Iraq, in which the Government of the United States guarantees the repayment of principal and interest on a Government of Iraq sovereign bond issuance totaling up to $1 billion. The second step of the process is expected to occur over the coming weeks.
During the signing ceremony, the U.S. Embassy’s Chargé d’Affaires Stephanie Williams highlighted the solidarity of the people and Government of the United States with the people and Government of Iraq, saying, “These funds will help the Government of Iraq provide food, water, shelter, and medical care to the most vulnerable Iraqis as well as allow Iraqis to benefit from government services, such as education, that prepare them for a bright and fulfilling future.”
Today’s loan guarantee agreement recognizes that Iraq continues to make progress toward meeting its economic reform goals on behalf of the Iraqi people. Under the Strategic Framework Agreement, the U.S. Embassy is working closely with the Government of Iraq to ensure that current economic challenges do not affect the ongoing campaign to defeat Da’esh. This sovereign loan guarantee offers additional support to Iraq as a stable and self-reliant strategic partner of the United States.