The International Monetary Fund announced Friday an extension of a two-year loan window to Iraq by seven months to allow the authorities time to get policy measures on track under the program. That means Iraq has extra time to borrow from the $1.96 billion in IMF financing that currently remains available. The loan, initially for $3.6 billion, had been scheduled to expire on July 23 and will now expire on February 23, 2013, the IMF said in a statement.
The IMF executive board approved the extension on July 20 following a request by the Iraqi authorities, the global lender said. The IMF said the extension will provide the Iraqi authorities with more time to implement the policy measures needed to complete the fund's combined third and fourth reviews under the so-called Stand-By Arrangement (SBA) program.
"The extension will, in particular, provide time for discussions on fiscal policies for the remainder of 2012 and on measures to improve the functioning of the exchange regime," it said. The IMF approved the SBA for the war-ravaged country in February 2010 to help authorities ensure macroeconomic stability, advance structural reforms and temporarily support the budget.
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