Parliament: the petro-dollar cut 6% of the budget and there are 3 scenarios to get out of its crisis

by **Ponee** Wed Jan 29, 2014 8:43 am

Parliament: the petro-dollar cut 6% of the budget and there are 3 scenarios to get out of its crisis
BAGHDAD / Mohammad Sabah

Committees saw the financial and economic situation in the House of Representatives, on Monday, that the government is obliged to pay the petro-dollar allocations to the provinces of oil, which will reach about 6% of the total budget.
Committees and talked about the 3 scenarios out of the petro-dollar crisis, including raising oil prices to more than $ 90 or increase oil production to more than 3 million barrels per day, or make transfers in the doors Almoisntin operational and investment.

He warned members of the Committees of government efforts to resort to borrowing to plug the budget deficit of 23 trillion dinars, stressing the need to discuss it in the parliament.
The head of the House of Representatives Osama Najafi likely, on Monday, re-budget to the government in the event of failure to address its problems, stressing that the allocations to the provinces did not take into account population density, indicating that the Parliament will make all efforts to speed up the adoption of the budget, and stressed that the meetings of the Council will continue until the 15th of April next.
The Council of Ministers approved, on 15 January of the current, on the draft general budget for the current year of 2014, and decided to refer them to the House of Representatives for approval.

8 provinces and announced oil, during a meeting in Basra a few days ago, strongly rejected the government's budget, which reduced the petro-dollar allocations to $ 1 for every barrel of oil.

And opposes a number of political blocs to pass the federal budget unless it is to meet the demands of the provinces of oil.

And scenarios out of the crisis "Alaptroodlar," confirms MP Abdul-Hussein al-Yasiri, a member of the parliamentary Finance Committee, that "disable the budget approval by the House of Representatives will hurt the Iraqi economy significantly delay in service projects and investment because of the demands of the oil-producing provinces include budget allocations of the petro-dollar."

He adds Yasiri, in an interview for the "long" yesterday, that "the provinces demanding allocation of petrodollars is right, because the extraction of oil or gas may hurt its environment and led to the deduction of large swathes of territory," stressing that "the government has an obligation to compensate those provinces by implementing the provisions of petrodollars , "pointing out that" the provinces of Basra, Maysan, alone together produce nearly 80% of Iraq's oil source outside. "
And about possible solutions to bring the budget in 2014 of the bottleneck, MP for the coalition of state law to the existence of three scenarios have recourse to her government. "Explains" The increase in oil prices of speculative from $ 90 to $ 95 or increase the estimates of oil production to more than 3 million barrels daily or the reallocation of investment and operational expenses of the province to the other. "
And confirms that Yasiri "mechanism to address the crisis in the petro-dollar budget has become too late and it was on everyone's preparing the budget to meet all the needs of the people of the provinces in early."Attention is a member of the parliamentary Finance Committee that "the payment of the $ 5 to the provinces will cost the government about 6% of the total size of the budget."

Confirms Yasiri that "the current budget did not prefer to keep the other in the distribution of investment projects, but we noticed justice in the distribution to all provinces according to population density," adding that "the Kurdistan region takes 17% on the basis of population density and this Agreed politically and technically also by competent authority that prepared the budget. "

The head of the House of Representatives Osama Najafi expect the government to restore the budget because of the lack of observance of "population density" in the distribution of benefits.

And on an interview with the Minister of Finance about the possibility of borrowing in order to pay off the budget deficit and exchange allocations petrodollars, said Yasiri "There are two types of borrowing internal and external, either the first means for asylum federal government to offer securities lending to financial firms and private banks in return for interest of up to 6%, while the external borrowing have to resort to the International Monetary Fund. "

He warned a member of the parliamentary Finance of the government resorting to internal and external borrowing citing it as "risky Iraqi economy, which may be subject to setbacks in the event of a large debt."

The Minister of Finance and serenity net debt agency announced the possibility of borrowing the government's 9 trillion dinars in order to repay the petro-dollar funds allocated to the provinces, if approved by the House of Representatives on it.
It stresses Yasiri that "the allocation of petrodollars acquired right and government is obliged to repay debt and remains in the event of lack of funds," likely "the issuance of bonds to cover the budget deficit, estimated at 23 trillion dinars."

In the same context, the Attorney Abdul Hussain Abtan, a member of the Economic Committee, the need to take a series of steps to correct the federal budget.

Explains Abtan, a deputy from the Bloc citizens, saying that "the first of those steps is the exchange allocations petrodollars by converting these amounts to investment projects holds the provinces to run their affairs," stressing that "the provinces are all going to be collaborating with the Ministry of Planning for the implementation of Law No. 21, the rate for the governorates ".

And a member of the Economic Commission criticized the trend towards borrowing to repay the amounts of petrodollars, noting that "there is a large deficit in the budget and there is big money in spending, and therefore what we need is to reduce these expenditures and the provision of these amounts."

Abtan He noted that "in the event of re-budget to the Council of Ministers will be taking the opinion of the House of Representatives to borrow and will examine the issue and the House of Representatives saw the absence of contraindications that we will deal with it positively."

by **Kevind53** Wed Jan 29, 2014 10:17 am

Seems related to the previous article. Typical politicians. Notice there is discussion about raising the price of oil, (not very practical in a competitive environment,) increasing production, viable, and even attractive in the short term, but also short sighted, or borrowing, (dumb,) but no discussion of adjusting the budget by making cuts to non-essential expenses elsewhere.

Still overall not bad ...

Parliament: the petro-dollar cut 6% of the budget and there are 3 scenarios to get out of its crisis

Parliament: the petro-dollar cut 6% of the budget and there are 3 scenarios to get out of its crisis

Re: Parliament: the petro-dollar cut 6% of the budget and there are 3 scenarios to get out of its crisis