Iraq plans to finance its balance of payments deficit by drawing its foreign exchange reserves down to $43 billion in 2016 from $59 billion at the end of October, it said in an International Monetary Fund memo on Tuesday.

The deficit is expected to reach $14 billion in 2015 before narrowing to $11 billion in 2016, the government said as part of a Staff Monitoring Programme that the IMF has approved as a precondition for a loan.

Iraq estimated gross domestic product (GDP) would grow by 1.5 per cent in 2015 and 10.6 per cent in 2016 on increased oil production, while falling oil prices would create a budget deficit of 15 per cent of GDP in 2015 and 10 percent in 2016. – Reuters