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Al-Kazemi’s Advisor Identifies The Negative Effects Due To The Lack Of Approval Of The Budget
Economie| 06:59 – 31/07/2022 Baghdad – Mawazine News, the financial advisor to the Prime Minister, Mazhar Muhammad Salih, clarified, today, Sunday, the alternative laws for the budget in minimum treatments, while warning of five negative effects when the budget is delayed.
Saleh said, “The alternative laws to the annual federal budget law are treatments for the minimum in the conduct of economic life in the country, such as the financial management law and its current applications or the recently adopted emergency food security law.”
He explained, “The most negative point in not passing a law on the general budget is the delay in approving new government investment projects, especially large and strategic projects, which leads to delays or shortcomings in economic growth rates.”
He continued, “This shortcoming extends its negative effects to the coming years due to the faltering growth of the great national capital accumulation, and the transformation of spending into a phenomenon limited to consumption only, which is fed by imports,” noting that “this leads to growing cases of stagnation and economic stumbling at the end.” Ultimately, levels of underemployment or crowding out levels of unemployment are in all cases.”
The Jump In Oil Revenues Saves Iraq’s Economy From Collapse..And Conflicts Reduce Gains
Posted On2022-08-01 By Sotaliraq The jump in oil prices came to save Iraq from stifling economic and financial crises, and to get it out of the predicament of borrowing, depleting cash reserves and exacerbating the budget deficit.
And revenues from Iraqi oil exports, during the month of June, amounted to about 11.505 billion dollars, according to official figures issued by the Ministry of Oil in Baghdad. The ministry said in a statement that the total amount of crude oil exports for the same month amounted to more than 101 million barrels.
The researcher in Iraqi economic affairs, Hamza Al-Hardan, said that the opportunity for high oil prices comes to Iraq again after the world witnessed a rise in oil prices nearly ten years ago, and the country did not benefit from it in real terms, relying on its rentier economy (oil money) to fill its operating and investment expenses. .
Al-Hardan said that the Iraqi government should take advantage of the opportunity to rise in oil prices correctly this time, because it is expected that oil revenues for this year will reach more than 120 billion dollars.
He added that this increase in oil prices can continue, which may be reflected positively so that there will be a turning point in the Iraqi economy, through the correct and sound investment operations, and the establishment of projects to support the Iraqi budget and the lack of complete dependence on the oil sector.
He explained that the Iraqi government should invest opportunities to develop the economic sectors and industrial and agricultural facilities, and to develop projects that could be an essential source of transforming the national economy from rentier to diversified.
He pointed out that this increase is a temporary opportunity due to international factors and variables, and the possibility of an end to the Russian-Ukrainian crisis, which will be followed by international agreements to reduce global oil prices.
Standard cash reserve
Iraqi Prime Minister Mustafa Al-Kazemi revealed that during the two years of the government’s life, the Central Bank’s reserves were less than 50 billion dollars, and now it has reached 76 billion dollars, and it will reach 90 billion dollars by the end of this year.
Al-Kazemi indicated during a press conference, that the salaries of employees, retirees, benefits and others amount to 5 billion dollars per month, and there are two billion dollars in operating expenses, bringing the total amount of monthly expenses to 7 billion dollars, at 84 billion dollars annually.
Al-Kazemi made it clear that the Iraqi government has no intention of moving towards changing the dinar exchange rate.
For his part, the economist, Manar Al-Obaidi, stated that the Central Bank owns multiple types of reserves, amounting to more than 160 trillion dinars, including an investment reserve of 60 trillion dinars invested in foreign banks in return for returns and interests.
Al-Obaidi added that there are reserves of gold estimated at 140 tons, worth approximately two trillion dinars, in addition to the presence of internal debts with the Ministry of Finance of the Central Bank of up to 40 trillion dinars, and the high oil prices in the global market contributed to a jump in Iraq’s cash reserves.
Possibility to face challenges
A member of the Finance Committee in the Iraqi parliament, Jamal Cougar, explained that it is too early to say that Iraq is capable of facing global economic challenges, because Iraq is a rentier country that depends on oil revenues, and any fluctuations that occur in countries of the world contribute to causing great paralysis in the local economy, which It is considered a fragile economy.
And Cougar indicated that the Iraqi state today does not have integrated economic studies, and the effects of global inflation will have great repercussions on the Iraqi economy, because the country depends mainly on importing goods and services from abroad and there is no local production, which means that the Iraqi market is negatively affected by every case of inflation witnessed by the countries of the region. and the world.
He added that the rise taking place today enabled the Iraqi economy to regain its monetary activity, raise reserve rates, and pay large sums of debts owed internally and externally.
He pointed out that the government should benefit from the rise in oil prices, and allocate the surplus to support the investment side, because the state is still spending 75 percent of its budget for the operational side, expenses and salaries, and all of these expenses have no financial return.
He called on the government to work on approving an investment budget, not an operational one, to create new sources of funding, and to transform the Iraqi state from a rentier state to a multi-resource state.
In light of the intersections within Parliament, the budget has not yet been approved, which specifies the items of state expenditures within a year, especially those allocated to salaries, support and the payment of debt burdens, as well as specifying the target of state revenues.
Despite the government’s success in obtaining about $ 18 billion within the emergency security law recently approved by Parliament to secure energy imports, finance important service projects, and finance the Social Welfare Fund, officials confirm the country’s continued need for the budget that was drafted earlier at nearly 90 billion. dollar. LINK
Find Out The Exchange Rate Of The Dollar Against The Dinar
Economie| 12:07 – 01/08/2022 Baghdad – Mawazine News The dollar exchange rates witnessed stability, today, Monday, in the local markets.
The selling prices of the dollar were 148,700 dinars per 100 dollars, while the purchase prices of the dollar were 148,600 dinars per 100 dollars. https://www.mawazin.net/Details.aspx?jimare=201148
Low Oil Prices In World Markets
Economie| 08:27 – 01/08/2022 Follow-up – Mawazine News: Oil prices fell on Monday, as rising global inflation and the effects of recession in America and Europe eroded demand for fuel, as investors prepared for this week’s meeting of officials from OPEC and other major producers on supply adjustments.
Brent crude futures were down $1.07, or 1.03 percent, at $102.90 a barrel at 04:40 GMT.
The price of US West Texas Intermediate crude was $97.32 a barrel, down $1.30, or 1.32%. Ended 29/N33
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