Foreign Loans and Their Role in Economic Development

Abstract

This study attempted to shed light on borrowing policies in, Jordan, ARE, PLO and Iraq in order to bridge the gap between internal savings and investments. Jordan, ARE and PLO benefits from foreign loans in their developments efforts were limited. The case of Iraq is deferent in that it was and is endowed by oil resources which help not only minimizing foreign loans needs but also to extend loans to other developing countries. It resorted to foreign borrowing due to political, technological, institutional and government loaners conditions imposed with their loans to the extent affected its decisions and impose heavy burdens on future generations despite rescheduling and forgiveness by loaners. The sources of Iraq's foreign borrowings as well as the contracting, receiving and following up these loans were too many to the extent that minimizes their impact on development objectives. Finally, some recommendations were offered to help better planning contracting, managing and controlling these loans in order to develop the needy sectors of Iraq's economy.