Questions on funding security in the 2019 budget
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Questions on funding security in the 2019 budget
by claud39 on Wed Mar 06, 2019 7:26 pm
https://annabaa.org/arabic/economicarticles/18501
Questions on funding security in the 2019 budget
* Future Center for Strategic Studies / 2001-2019
Questions on funding security in the 2019 budget
After the enactment of the general budget of the state and ratification by the Presidency of the Republic and published in the Iraqi fact sheet on 11/2/2019 raised several questions on how to fulfill the government and parliament commitments to the promises they made in that budget, which was identified by (133) trillion Iraqi dinars, and the amount of imports (105) trillion, and deficit set at (27) trillion, based on the calculation of the price of a barrel of oil at (56) dollars, and the exchange rate (1,118) thousand dinars per dollar, and exports expected by (3,800,000) three million and eight hundred thousand barrels of oil per month , In addition to 250 thousand barrels by the Kurdistan region.
In many budget paragraphs, the government has relied on the principle of financial abundance and betting on high oil prices and increased exports, but these bets and even loans are just wishful thinking to reduce the large budget deficit in light of the fears of the return of war to the hasty and at a time still many Of the oil wells in Nineveh and disputed areas are not qualified and active in the export process.
The budget planners have not found any means to reduce public expenditure and have not found realistic ways to increase revenues such as taxes, levies and others. Even the planned figure for oil exports is not fixed monthly up and down, and oil prices are no indication of the continued increase in oil prices by $ 70-68 due to The supply of oil in the United States, Iraq selling its oil price less than (7) dollars of the price of Brent crude, in addition to the cost of extraction, production and export of oil by the companies known as (licensing rounds) $ 11, making sense B oil price of 56 dollars, and with oil prices remain up to 70 dollars is the guarantor to achieve financial abundance in the approved budget.
On the expenditure side, the government has not made any significant cuts because of the need to improve services against the backdrop of protests in Basra and elsewhere, and privatization, collection, sales taxes, mobile phones and the Internet will not work.
True, the government has relied on (24) external and internal borrowing and may depend on sales of bonds and reserves of gold and foreign currency, but relying on all these mechanisms will increase inflation.
The government and the parliament were supposed to agree on a number of steps to address the deficit, pressure on expenditures and not rely on loans, debt, consumption, grants and promises in the preparation of the budget.
For example, the following articles are promises and wishes associated with accounts counting on high oil hours, including:
Article (5) of the budget is all wishes associated with increasing oil prices to cover the deficit of compensation for martyrs and political prisoners and cover ration card and health medicines taking into account the share of the region.
Article (10), which stipulates the settlement of receivables with the region since 2014 by the Office of Financial Supervision with the need to export 250,000 barrels through the National Oil Company Sumo and the salaries of Peshmerga and staff of the region as well as their proportion of the development of regions of oil source and benefits of airports Border crossings and taxes. Assuming the region's commitment to this article, although he announced a few days ago that he did not commit to export and sent him a delegation to Baghdad to negotiate again on his dues. Because the region was counting on 17% and more, but Article (9). First, the share of the region was linked to the number of people in each governorate within the region minus the sovereign expenditure estimated at (5%). This will open political differences between the federal government and the region.
3 - Article (11) Fourth and fifth included the installation of electricity contracts and free lecturers and contracts of the Electoral Commission, in addition to the introduction of degrees for the heads of administrative units and the reappointment of the members of the House of Representatives and ministers, advisers, governors and administrative units.
Article (13): extinguishing advances for previous years.
5. Articles (28) and (29) stipulate that the contractors' entitlements shall be given since 2017.
6 - Article (36) included granting end of service benefits to members of the former army not less than ten million dinars.
Article (42) provides for the reduction of interest on loans to residents of liberated areas.
Article (44) includes the allocation of funds to pay Iran's receivables from imported gas for the purpose of operating power plants.
9. Article (47) included the re-establishment of police vehicles for service in the liberated areas before 2014, the introduction of graduated ranks from the Ministry of Interior and Electricity in 2008 and the return of the retired police and military personnel to service contracts.
10- Article (49) stipulates the creation of 6,500 degrees for the popular crowd in Samarra, and scores for the popular crowd, the tribal crowd, the national security and the intelligence apparatus of the liberated cities.
11- Article (53) The Ministry of Finance has committed to provide job grades to adapt the sons of liberated cities as well as the families of martyrs in all of Iraq in the Ministry of Defense.
Article (55) provides for the payment of salaries saved to liberated areas at once and pay 125 thousand dinars as transfer fees for lecturers in the Ministry of Education.
13. Article (56) includes granting compensation to the martyrs and the wounded and freedom of employment for the rest of the high-paying ministries.
Article (57) provides for the confirmation of contracts of good deeds in Diyala and Nineveh.
15. Article (60) included postponement of the payment of government debts to farmers.
16. Article 61 provides for the payment of Boeing Company's dues to the Ministry of Transport.
Article (62) pay one billion dinars for community reconciliation from the budget of the Sunni Endowment.
18. Article (63) grants the right to modify the employee's job titles, calculate the differences and raise their job grades from bonus and promotion.
Article (64) included the return of political prisoners in general after auditing their administrative status.
These advantages and benefits will clash with the bets of financial abundance, and may not be realized and achieved will be at the expense of deficit and loans and benefits and the specter of inflation.
Political strife and balances may be present in this budget in addition to appeasement and appeasement, but the burdens of these shrines will increase and their dependence will be linked to the lenders more and increase the risk of economic decline.
All this shows that the Iraqi budget for 2019, a financial budget and not economic stimulus to growth and planned investment, and it devotes to the climate of consumption culture and dependence on oil as a single source of funding, which indicates the future major obstacles in the economy of the country in case of low oil prices Or less needed without planning and focusing on other imports.
* Future Center for Strategic Studies / 2001-2019
http://mcsr.net
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