Warnings of running out of Iraqi cash reserves due to indicators of the international economy[You must be registered and logged in to see this link.] |Today, 19:[You must be registered and logged in to see this image.]
Baghdad today - Baghdad
Today, Wednesday, the economist, Bariq Shubar, warned of the depletion of the Iraqi cash reserves, due to the indicators of the international economy and the state of contraction, and the occurrence of actual deficits in the general budget and the Iraqi balance of payments.
Shubbar expected, in press statements, followed by (Baghdad Today), the general international economy will shrink, oil prices will decline, and export revenues will decline, with the continuation of planned government spending in the 2023 budget and subsequent years, which will cause a state of fiscal deficit and depletion of foreign currency and gold reserves.
And the economist said, "The increase in cash reserves is very important for the future of the Iraqi economy, because of its strategic importance, but the fiscal and monetary policy pursued by successive Iraqi governments failed to use the reserves for sustainable development purposes." He pointed out that "the total cash reserves announced by the Central Bank of Iraq include the financial abundance achieved in the past year belonging to the Ministry of Finance, and it will be withdrawn by the US Federal Bank after passing the 2023 budget."
Shubar emphasized that "the central bank sells large amounts of dollars, which are leaving large amounts of it outside Iraq, and this means that an inevitable decrease will be exposed to the cash reserves."
The Central Bank of Iraq revealed a new statistic that showed the increase in foreign exchange reserves and the quantities of gold available as strategic storage, in addition to its progress in the global ranking among the countries that have the most gold reserves.
And the statistics, which were published yesterday, Tuesday, showed that the cash reserves of the dollar rose until the end of May 2023 to 111.7 billion dollars, from about 77 billion dollars one year ago, and the gold reserves rose to 132.7 tons from 96.4 tons a year ago.
According to the same statistic, Iraq ranked 30th in the world in gold reserves, eight places higher than it was in May 2022.
Despite the rise in monetary and gold reserves, there are warnings of the risks of repercussions of this rise, which will lead to structural imbalances and economic problems that are difficult to treat.
The advisor to the Prime Minister for Economic Affairs, Mazhar Muhammad Salih, explained that the increase in foreign currency reserves resulted from the oil price differences for the year 2022, as the selling price of a barrel of Iraqi oil reached about $93.
Saleh said, in media statements, that this increase was due to the lack of a budget for the country, in addition to the fact that government spending was limited according to the 1/12 system, with the existence of the food security law, which provided large revenues for the general budget, and this was reflected in the provision of large revenues for the finances. the public.
He referred to the storage available at the Central Bank of foreign currency reserves with budget savings amounting to about 16 trillion Iraqi dinars, which means that the reserves revealed by the Central Bank of monetary currency include the bank's storage with the government's storage.