How will Iraq benefit from the rise in oil prices in the global market?

How will Iraq benefit from the rise in oil prices in the global market?

[size=45]With the rise in crude oil prices in the global market to reach the barrier of 85 dollars per barrel, and with expectations of exceeding 100 dollars per barrel next year, especially with the reservations of OPEC + to increase production, despite the increase in global demand, but this rise did not create great hopes for the Iraqis, As a result of the accumulation of debts incurred by Iraq, corruption, mismanagement and planning, and the ambiguity of Iraqi oil policy, with regard to licensing rounds, and the monopoly of international companies for it for decades to come.[/size]
[size=45]accumulated debts[/size]
[size=45]The price of a barrel of oil, which is supposed to be determined to calculate revenues in the next year’s budget 2022, ranges between 50 to 60 dollars per barrel, according to what was said by the financial and economic advisor to the Presidency of the Council of Ministers, Mazhar Muhammad Salih, who confirmed in his speech to (Al-Mada) that “the Council of Ministers said: The ministers took into consideration that oil constitutes 90% of the total budget revenues, and the rest of the revenues are left to non-oil revenues.”[/size]
[size=45]Saleh added that "the federal general budget for the year 2021 was based on the price of a barrel of oil for export purposes, which was estimated at about 45 dollars per barrel, and such an estimate with non-oil revenues caused a deficit of 29 trillion dinars out of total expenses of 129 trillion dinars."[/size]
[size=45]Regarding the volume of debts owed by Iraq, Salih affirmed that it is divided into “the Iraqi foreign debt prior to 1991, and it is constantly decreasing, and only less than 6 billion dollars remains from the actual sovereign debt under the Paris Club Agreement, and it is in the process of repaying by way of installment payment with interest.” And that is until the maturity date at the end of 2028, and it is accompanied by commercial debts that were also scheduled after they were deducted by 80% in 2006,” noting that “the remaining amount of it amounts to 2.7 billion dollars.”[/size]
[size=45]He also added that “there are other foreign debts that do not exceed 12-13 billion dollars that arose during the financing of the war on the terrorist Daesh after the year 2015 and there is a gradual payment mechanism and it is also decreasing, and all the mentioned foreign debts have allocations for their extinguishment that were placed in the annual general budget, and there are also there Internal sovereign debts estimated at $50 billion, which are liabilities or liabilities within the institutions of the official or government system itself, all between public finance, the central bank and government banks, and there are steps to extinguish them without affecting the integrity of the economic development plan or affecting national financial sustainability.[/size]
[size=45]Corruption and mismanagement[/size]
[size=45]The Iraqi monetary policy depends on 90% of the proceeds of what Iraq produces of oil and the rest of the resources related to trade, taxes and customs, which do not reach what achieves financial sufficiency due to the random accumulations in the Iraqi monetary policy over the past years.[/size]
[size=45]Economist Hazem Hadi believes that "oil prices do not stop at a certain limit as long as they depend on supply and demand, and that Iraq's imports of oil with its high prices in the global market must address many of the problems facing the Iraqi economy, including unemployment, poverty and reducing debt levels."[/size]
[size=45]Hadi confirmed to (Al-Mada) that "the Iraqi monetary fiscal policy does not live up to what Iraq aspires to because of the confusions based on the reaction to every crisis facing the Iraqi economy," noting that "the fiscal policy must rely on long-term strategies to get out of these crises and prepare The Iraqi economy for future generations.[/size]
[size=45]Researchers believe that the increase in corruption, mismanagement and lack of planning is one of the most important reasons that make benefiting from high oil prices questionable, especially with the presence of effective economic offices in various state institutions that finance their parties through state funds, in addition to the partisan quotas that these institutions witness.[/size]
[size=45]According to the researcher in Iraqi economic affairs, Ahmed Eid, "economic reform must begin through deterrent legal measures, foremost of which is holding the corrupt accountable and recovering the looted money from the state treasury in a realistic and tangible way."[/size]
[size=45]Eid indicated to (Al-Mada) that "the looted money and rampant corruption issues cannot be reduced or bypassed in light of the presence of the current political class that has been able to penetrate all institutions and make them sources of financial and economic funding."[/size]
[size=45]Take advantage of higher prices[/size]
[size=45]However, Mazhar Muhammad Salih, the economic advisor to the Prime Minister, believes that “the citizen’s benefit from the rise in oil prices is reflected in the rise in budget revenues, and these revenues are linked to the state’s ability to convert them into real investments that increase the material capital accumulation of the country, and strengthen human development in education and health and achieve rates Growth in the gross domestic product and the maximization of the country’s total national income, which is something that must enhance economic prosperity and eliminate the scourge of unemployment when there is a job opportunity for every citizen.”[/size]
[size=45]As for the researcher in Iraqi economic affairs, Hamza Al-Hardan, confirmed in an interview with (Al-Mada) that “the financial and economic management of the country is one of the most important problems facing the Iraqi economy, because the Iraqi monetary policy depends on the volume of irresponsible spending and depends on operating budgets only and did not take into account the creation of Development and investment funds through which at least 30% of oil revenues can be invested.[/size]
[size=45]Al-Hardan added that “investing in the rise of oil prices in development and providing ways for the success of the labor market enables the state to maintain its economic balance, except that the matter continues on random spending, and it is not possible to address the economic problems in the country and fulfill the requirements of the Iraqi citizen unless there is a real investment of these revenues.” .[/size]


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