Iraq Today

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Financial advisor to the Prime Minister: May’s salaries were borrowed from Iraqi banks, and June salaries will be borrowed from our citizens with high interest

The financial advisor to the Prime Minister, Mazhar Muhammad Salih, revealed on Sunday that the emergency cell for financial reform set up by the Council of Ministers operates in two directions, the first is the circulation of money to manage monthly financing, and the second is the payment towards economic reform.

Saleh said, “There are monthly ruling expenses in Iraq, which are seven (7) trillion dinars as a minimum, including expenses payable for more than forty-six (46) items, in the forefront of which are salaries of employees, retirees, and social welfare,” explaining that “the size of salaries from ruling expenses is estimated at 5, 7 trillion dinars (five trillion and seven hundred billion dinars).

He added: “The outcome of our sales of oil ranges between (24 to 25) dollars per barrel, meaning that the monthly revenues amount to one and a half trillion dinars, to which other revenues are added (non-oil revenues), such as taxes and customs, about two hundred billion Iraqi dinars,” noting that “our revenues The monthly (oil and non-oil) amounts to less than (2) trillion Iraqi dinars regarding the requirements of seven trillion per month.

The financial advisor pointed out that “the government borrowed from the banks of Al-Rafidain and Al-Rashid and the Iraqi Bank for Trade about (3) trillion dinars to pay salaries for the month of May this year,” stressing that “there is a deficit in the operational budget such as paying debts, expenses of lecturers, night guards, contractors receivables and others.”

He continued, “The government in the month of May was able to cover only the salaries of employees, retirees and social welfare due to the lack of revenues.” And there is a trend towards internal borrowing to pay the salaries of workers in the state for the month of next June. “

Saleh stressed that “there are negotiations with international banks and banks to borrow from them to pay the deficit in the operational budget, but these negotiations need time.” And in the “long-term and the coming months, there is an intention to issue a national bond (borrowing from citizens) at high interest rates with many concessions.”

He pointed out that “the emergency committee is studying the possibility of legislating the Federal Budget Law for the remainder of the fiscal year, but in the event that this budget is not legislated, the government will issue the final accounts with a law called the status quo to clarify revenues and expenditures for the year 2020 and send it to the House of Representatives for approval.”

And the government counselor stated that “the reduction of higher salaries depends on the financial situation in the month of June,” explaining that “the financial reform committee will address the large salaries in the Iraqi state because of the lack of revenue, which is a reform opportunity.” Source