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Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

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Established in 2006 as a Community of Reality

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    “It will not withstand fluctuations in oil prices.” Debate in Iraq over the “three-year” budget

    Rocky
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    “It will not withstand fluctuations in oil prices.” Debate in Iraq over the “three-year” budget Empty “It will not withstand fluctuations in oil prices.” Debate in Iraq over the “three-year” budget

    Post by Rocky Sat 18 Mar 2023, 5:36 am

    [size=45][size=41]“It will not withstand fluctuations in oil prices.” Debate in Iraq over the “three-year” budget[/size]
     20 hours ago
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    The Iraqi debate continues regarding the Iraqi government's approval of the country's financial budget for a period of 3 years, which is happening for the first time since 2003, as previous governments used to prepare the budget for a period of one year and send it to Parliament to take its path to implementation after its approval.
    In quite a few years, the approval of the financial budget faltered as a result of political conflicts or the escalation of violence, as happened in 2014, after the rise of ISIS and its control of about a third of Iraqi territory. And just as it happened during the last two years of former Prime Minister Mustafa Al-Kadhimi’s tenure, against the backdrop of the October protest movement.
    According to government data, the total budget for the current year amounts to 197.828 trillion dinars (about 140 billion dollars), while the operational budget is 150.273 trillion dinars, while the investment amount is 47.555 trillion dinars. As for the deficit, it is 63.275 trillion dinars. The government approved the price of $70 per barrel of oil, given that more than 95 percent of budget revenues depend on oil sales, which angered most of the economic trends that do not revolve around government circles.
    Although the "triple" budget still needs to be approved in parliament, the debate is divided between two main directions. The first represents the government and its political parties and blocs, while the other represents economic trends that it believes are risky and are not consistent with the budget law and the context of rents on which the Iraqi economy is based.
    The Prime Minister, Muhammad al-Sudani, said the day after the budget was approved by the Council of Ministers, last Monday: “The budget for the years 2023, 2024, and 2025 has been approved, and this is the first budget prepared by the government, and it received enough time for research and discussion, in a way that guarantees the implementation of the government program.” He added, "We are responsible for implementing the programs, projects, plans and policies in the budget, and there is a possibility of modification by the Ministries of Finance and Planning, with the approval of the Council of Ministers and Representatives, in the future if oil prices and numbers change."
    Al-Sudani believed that approving a three-year budget “is a bold step that is calculated for this government, and its importance lies in supporting financial stability.” The ministries usually entered a stage of hibernation at the end and beginning of the year until the budget was approved.
    It was noted that the political leaders in the Kurdistan region, which often had problems and objections to the budget law, welcomed this time, and the leader of the Kurdistan "Democratic" Party, Masoud Barzani, said the day before yesterday that it was a "positive step." He hoped that this would be reflected in the discussions of the Federal Oil and Gas Law.
    As for the economic trends that oppose the “three-year” law, it was issued by economists and oil experts. Economics professor Imad Abd al-Latif Salem, who says, on his Facebook platform, says: “In a rentier economy, in which oil revenues constitute 96 percent of its total public revenues, the adoption of three-year budgets will necessarily mean the existence of three-dimensional political “claws-tricks.” , also".
    Salem believes that “decision makers deal in Iraq with the legal frameworks, and sometimes the constitutional ones, according to their desires, and in a way that serves their interests, directly or indirectly, before any other consideration. Based on this approach, the Iraqi government, and the political forces supporting it, deal with the provisions of Law No. 6 of 2019, just as it deals with democracy in its strange, fabricated, and ambiguous Iraqi form.
    It is reported that «Articles (1) second, ninth, and eleventh, of the budget law, confirm commitment to the principle of annual budget».
    Professor of Administration and Economics at the University of Baghdad, Ihsan Jabr Ashour, asks: “Is it a political cycle of budgeting, miserable political propaganda, or is it a new flow to finance the sustainability of political financial corruption?” And he adds, “What are the economic, political and social foundations, principles, and philosophy that were adopted in formulating such a draft budget? What is the logical justification for its departure from the most important financial and economic indicators and criteria?
    As for Nabil Al-Marsoumi, a professor of economics at the University of Basra, he believes that “the budget will enter the critical path if the price of Brent crude drops to about $60 a barrel; As the oil revenues will then be sufficient to cover only the two paragraphs of employee salaries and social care, which amount to more than 87 trillion dinars in the 2023 budget.
    "The budget was disappointing when it set the default oil price at $70, while today we are selling our oil for less than that, let alone if Europe and America succeed in bringing prices to $60 or less," oil expert Hamza al-Jawahiri said in a press statement. He added, “This matter will greatly affect Iraq in particular. Because there is about 34 percent of the budget deficit, after the operating budget has greatly inflated, while the investment budget has diminished, which has become less than a quarter.
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