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Iraq secures $2.7 bln US loan for military equipment

Baghdad will have eight and a half years, including a one-year grace period, to repay the loan

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Iraq secured a $2.7 billion loan from the United States on Wednesday to fund ammunition and maintenance of fighter jets, tanks and other military equipment for use in the war against ISIS.

Baghdad will have eight and a half years, including a one-year grace period, to repay the loan, which carries a 6.45 percent interest rate, a US embassy statement said.

The deal will help Iraq service its F-16 fighter jets, M1A1 tanks, armored vehicles and attack helicopters as well as maintain navy ships and systems to protect the Umm Qasr port and southern oil platforms, the embassy added.

Declining global oil prices and the costs of fighting ISIS militants who seized a third of Iraq’s territory in 2014 have hit government revenues, which rely almost completely on oil exports.

Iraq received its first batch of F-16s in 2015 as a part of a $65 million deal with Lockheed Martin Corp.