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Don961: Parliament raises its meeting to Tuesday

Posted 2 hours ago  News source / Baghdad today

 On Saturday, January 23, 2021, the House of Representatives adjourned its session for today to next Tuesday.

The media department of the council said in a brief statement received (Baghdad today), that “Parliament raised its session for this day to next Tuesday.”

The parliament session witnessed a discussion of a proposed law to restore defense and interior personnel to service.    LINK

Don961:  Mazhar Saleh explains through the obelisk the opportunities available for printing the Iraqi currency and its consequences for the standard of living

1/22/2021 6:04:42 PM

Baghdad / Al-Masalla: The Financial Adviser to the Prime Minister, Mazhar Muhammad Salih, responded to the black-eyed expectations regarding the disastrous results of the option to print the Iraqi currency – according to the description of analysts and economists – by saying that such a scenario presents a very pessimistic economic prospect, and reminds the people of a stage Dangerous stages of the Iraqi economy during the international siege on Iraq during the dark period 1990-2003.

Saleh told Al-Masalla that public finances relied at the time on the cheap monetary policy and inflation financing at a rate of 95% of its revenues to finance expenditures at that time, that is, by using the mechanism of the monetary authority’s submission to the financial authority and its dominance in accepting government treasury transfers that the public finances consistently issue by the Central Bank. As he considers this government debt instrument as a financial asset matched by liabilities or liabilities, which is the currency issued to finance the absolute budget deficit (and convince the public that it is foreign money or (temporary) monetary wealth, but it is highly eroded in its purchasing power due to what it generates from inflation expectations that the citizen seeks every hour. ) ..

He added: That financial policy dominating the monetary issuance in the levers of its financing at that time led to the creation of a huge monetary mass that generated surplus demand or spending within the overall economy that was not matched by sufficient commodity supply, which reflects the case over the course of twelve years to create continuous inflationary expectations. Caused by the continued strength of demand, it is said.

And he went on: This financial policy, which was founded on the principle of government financing with an inflationary tool based on the super cash issuance, led to sharp and continuous rises in the general level of prices, and the inflation increased in it to become unruly and three decimal places, and the commodity that was equal to 20 dinars in 1990 became equal to 2000 dinars or more. During the 1990s, cash incomes declined and the standard of living declined.

Dr. Mazhar Muhammad Saleh believes that the aforementioned warning is nothing but a very dark scenario to remind the people of a dark period of time that the people lived and their livelihoods were uprooted during the siege of the 1990s and the few years after.

Dr. Saleh expects that the state of Iraq will not reach that, but in spite of that remains the policy of relying on monetary policy to finance the deficit by issuing cash (or monetizing debt) easy government financial leverage and is known (in the event of its continuation) in the knowledge of public finance as one of the constraints of the fragile budget ( The dangerous) because it neglects the inflation indicators and its potential projections as a result of financing the budget deficit by issuing cash without realizing the risks of its repercussions on the level of individuals ’cash income and its deterioration.

The economic advisor to the Prime Minister spoke to the obelisk earlier, about what the Iraqi public finances faced in the years 2020-2021, as the draft federal budget for the year 2021 indicates that the total deficit planned in it will rise to nearly 71 trillion dinars, and the aforementioned deficit will be no less than About 42% of total spending there, and a percentage of not less than 28% of the current GDP.

Saleh told Al-Masalla that the contractionary financial conditions in Iraq have led to dangerous economic manifestations, as the contraction of demand or government spending in the year 2020 has led to a widening of the national income gap, and a drop in growth by about 11% from its rates.

He added that the contraction was accompanied by an increase in unemployment levels that were not less than 25% of the Iraqi workforce, as well as an increase in poverty rates among the population that exceeded 30% of the country’s families.    LINK