Economy News – Baghdad
The financial adviser to Prime Minister Mazhar Mohamed Saleh confirmed on Saturday that the sovereign guarantees of the private sector will contribute to the industrial renaissance, noting that they are a practical application of the government approach in modernizing the national industry.
And Saleh said, In a statement reported by the official news agency, and seen by “Economy News”, “sovereign guarantees are amount to undertakings from the government to ensure the payment of debts or financial obligations owed to another entity such as a company or a subsidiary government entity,” pointing out that “the sovereign guarantees have taken another direction, which is to guarantee the activities of the national industrial private sector, based on Article II/3 of the Federal Public Budget Law (Tripartite) No. 13 of 2023, Article II/3 of the law stipulates: The Federal Minister of Finance with the approval of the Federal Council of Ministers may issue the necessary guarantees to support the agricultural industrial sectors and the private industrial sectors to establish projects that will finance Foreign institutions are at least 85% of the value of each project and with a total amount not exceeding one trillion dinars.”
He added that “based on the above, this guarantee issued by the sovereignty of the state makes it easy for those companies or entities in the private sector to obtain external financing in particular, especially investors or lenders feel more secure because there is a government guarantee to proceed with their projects, which are made with accurate choices that help the industrial renaisssance in the country, and contribute to diversifying the sources of national production, especially the renaissance of the private industrial sector in particular, provided that the private sector benefiting from the sovereign guarantee contributes to providing a percentage of financing for its industrial project from its own funds of not less than 15% of the total value of financing the project.”
He pointed out that “the coverage of the industrial private sector with sovereign guarantees is only a practical application of important aspects of the philosophy of the government curriculum, aimed at modernizing the national industry and ensuring the state for the private industrial sector and promising it as a strategic basis in economic diversification and in accordance with the principle of applying the economic partnership between the market and the state, the latest of which is the decision of the Council of Ministers, which allowed the activation of Article 35 of the Public Companies Law No. 22 of 1997 amended by making dozens of public industrial companies become joint stock public companies.”
Saleh continued that “the priorities of the Sovereign Guarantees Committee, which follows up implementation, according to the General Budget Law (tripartite), its priorities are directed towards supporting the industrial sector, and that the objectives of the committee constitute at the same time one of the priorities of the government in maximizing the rates of economic development and its sustainable opportunities in growth, building accumulation in human capital, combating the phenomenon of unemployment and promoting economic well-being.”
He pointed out that “the first aspect is the industrial promotion and through the financing partnership by granting sovereign guarantees to the private sector producing industries, medical supplies and export supplies for medicines. The second aspect is related to the industrial base related to infrastructure, especially construction and construction projects, whether from iron, brick-cement and other factories, while the third aspect is related to the diversification of the oil sector itself, especially the chemical and petrochemical industries, in addition to energy projects and industries related to agriculture.”
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