The path of local credit and its impact on the macro variables in the Iraqi economy

Abstract

The issue of local credit is one of the most important issues in economic life in general and banking life in particular by providing the necessary financing to customers and providing liquidity required by the requirements of economic development. The study is based on the issue of financing, which plays an important role in achieving a high economic growth rate in the national economy, in light of commercial banks providing credit facilities to local and foreign investors alike.

The importance of the study within the framework of the banking industry lies in ensuring a credit climate capable of moving the economy to a stage of economic stability, and accelerating integration into the global financial and banking system, which could contribute to increasing the growth rate in the national economy. While the problem of the study revolves around the weakness of the banking industry in general and local credit in particular in the Iraqi economy and its lack of keeping pace with developments in the global financial and banking systems. The study aims to determine the role of local credit in the national economy and the functions it performs, along with an explanation of the local and external factors affecting the effectiveness and development of local credit, using a number of macro variables and showing the extent of their impact on it, as well as clarifying the extent of the possibility of developing it and raising its contribution to the economic development process. According to the hypothesis assumed by the study, which confirms the existence of a direct relationship between local credit and some macro variables.

The study concluded that local credit effectively affects the macroeconomic study in light of its provision of the necessary funding to perform its role in economic activity and in a way that leads to raising the level of performance in the Iraqi economy if it is given the appropriate opportunity to prove this.