Iraqi News Highlights and Points to Ponder Friday AM 1-19-24

An “Exciting” Statement By Al-Sudani: How Will Iraq Double Its Non-Oil Revenues By 200% In Just Two Years?

Politics/Economy |Today  Baghdad today – Baghdad  Prime Minister Muhammad Shiaa Al-Sudani revealed today, Thursday (January 18, 2024), during a discussion session at the World Economic Forum in Davos, that Iraq has set a goal in a three-year budget to reduce dependence on oil revenues from 95 percent to 80 percent.

Achieving Al-Sudani’s statement requires raising non-oil revenues by 200% within just two years, which are the remaining two years of the tripartite budget, according to a digital analysis of the economic section in the “Baghdad Al-Youm” newsroom, amid questions about how to achieve this.

As of the end of November, Iraq had achieved revenues amounting to more than 121 trillion dinars, of which oil revenues amounted to more than 112.6 trillion dinars, while non-oil revenues amounted to more than 8.5 trillion dinars, which means that the percentage of non-oil revenues constituted about 7% of the total. Revenues.

For oil revenues to be 80% of total revenues, non-oil revenues must be more than 24 trillion dinars, which means doubling them by about 200% from their current number.

The Ministry of Finance’s accounts show that the bulk of non-oil revenues came from taxes on income and wealth, amounting to more than 4.3 trillion dinars, which raises questions about how the government will raise non-oil revenues and whether it will impose certain taxes, which will consequently reduce the percentage Reliance on oil revenues.  LINK

$21 Billion Is The Size Of Iraq’s External Debt Until 2028

Posted On01-19-2024 By Sotaliraq   Baghdad: Haider Falih Al-Rubaie  01/18/2024  The financial advisor to the Prime Minister, Dr. Mazhar Muhammad Salih, suggested that Iraq’s external debt until the year 2028 would not exceed the $21 billion barrier, stressing that the country’s creditworthiness is at a high degree of sobriety and reliability, according to which Iraq’s position is based. It is classified as stable, while he pointed out that the accumulation of debt was the result of the national economy being exposed to two shocks.

Despite the accumulation of internal and external debt, the Parliamentary Finance Committee reassured that there would be no financial deficit in the country’s budget for the current year 2024, while specialists in economic affairs expressed their fear of the continued fluctuation of oil prices, hinting at the possibility that public revenues would be affected in the event of a decline. Global black gold prices.

Saleh said: “The external debt that must be repaid until the year 2028, in my estimation, does not exceed the barrier of 21 billion dollars,” indicating that “the repayment mechanism is subject to the actual current or ongoing allocations allocated in the federal general budget on an annual basis to pay the debt dues.”

The government advisor stressed that “Iraq’s credit record, or creditworthiness, stands at a high degree of sobriety and reliability, which is why international credit rating companies have placed Iraq at rank B of the stable category throughout the last ten years, due to its high financial worthiness and commitment to paying service dues.” his debts on an ongoing basis.”

During a previous press statement, Saleh calculated the size of the country’s internal debt, while confirming that the Iraqi economy was exposed to “two shocks.”

Saleh said: “The internal public debt in Iraq is estimated at approximately 55 billion dollars,” indicating that “the accumulation of this debt came as a result of two shocks to which the country’s economy was exposed between the years 2014 - 2021.”

He added, “The first shock was financial and security, as the country was exposed to the threat of ISIS terrorist gangs, in addition to the war in which Iraq won against ISIS terrorism, which then required financing the budget deficit, due to the growing military expenditures and the sharp decline in oil prices.”

Saleh pointed out that “the second shock, which was financial-health, resulted from the Corona pandemic crisis and the decline in oil price revenues at the same time due to the sharp cycle of oil assets and the loss of a barrel of oil in both shocks of approximately 40% of its estimated revenues as revenues for the general budget,” noting that this This prompted the financial authority in Iraq to borrow from the government banking market, mostly by issuing treasury bonds or annual treasury transfers that carry an average interest of about 3%.

The advisor noted that “domestic public debt has been traded exclusively within the government financial apparatus, without intervention in the banking market except in a very limited manner. That is, domestic debt, with its tools represented by bonds and treasury transfers, is traded at a rate of 95% exclusively within the government financial apparatus.”

In the midst of this, a member of the Parliamentary Finance Committee, Moeen Al-Kadhimi, expected that there would be no financial deficit in the budget for the current year 2024, indicating during a press interview followed by “Al-Sabah” that “the government will submit amendments to the table of amounts, and these amendments are in the process of being completed and sent to the Finance Committee and will be studied there and approved.” It is decided by Parliament and is on its way to implementation.”

Al-Kadhimi pointed out that “last year’s budget, 2023, did not suffer from a deficit, but the current year’s budget, 2024, will not have a financial deficit, especially since oil prices are constantly increasing.”

Contrary to the previous opinion, economic affairs specialist, Ali Al-Defafi, believes that the worsening situation in the region may lead to a delay in the arrival of oil supplies to consuming countries, and thus a decline in the financial revenues of some producing countries, expecting average oil prices to be stable between -75%. $80 for the current year.

Al-Diffai stressed the need to exploit the financial abundance achieved as a result of the increase in oil prices over the past two years, in establishing strategic projects and working to support the productive aspects that can contribute to supplementing the country’s financial budgets, especially the agricultural and industrial sectors, praising, at the same time, the government’s economic moves in Supporting the private sector, which will contribute during the coming period to reviving many local industries that could block the way for imported products.   LINK

Iraq's Financial Revenues Exceed 121 Trillion Dinars In 11 Months

Posted On01-18-2024 By Sotaliraq

The Ministry of Finance revealed that the volume of Iraqi revenues in the federal budget during 11 months exceeded 121 trillion dinars, confirming that the oil contribution to the budget had risen to 93%.

Shafak Agency followed the data and tables issued by the Ministry of Finance this January, for the 11-month accounts of the last fiscal year, which showed that oil is still the main resource for Iraq’s general budget, reaching 93%, which indicates that the rentier economy is the basis of the country’s budget. the public.

The financial tables indicated that the total revenues up to the month of November of last year amounted to 121 trillion, 214 billion, 907 million, 87 thousand and 408 dinars, after excluding transfer revenues, which amounted to one trillion, 438 billion, 122 million and 744 thousand dinars, indicating that the total expenditures with advances amounted to 98 trillion 727 billion 745 million 419 thousand dinars.

According to the financial tables, oil revenues amounted to 112 trillion and 665 billion and 1 million and 402 thousand dinars, which constitute 93% of the general budget, while non-oil revenues amounted to 8 trillion and 549 billion and 504 million and 931 thousand dinars.

While the economic expert, Muhammad Al-Hassani, considered that “the decrease in oil’s contribution to the general budget is a positive factor,” adding that “the decrease was not significant and came as a result of the decrease in oil prices in global markets.”

He added that “oil prices decreased significantly, which affected Iraq’s general budget,” stressing that “oil prices are subject to global fluctuations.”

He pointed out that “the Iraqi government must take advantage of the financial abundance in the budget by developing the economic and agricultural sectors to reduce dependence on oil.”

Advisor to the Prime Minister for Financial Affairs, Mazhar Muhammad Salih, confirmed in March 2021 that the reasons for the economy remaining rentier are due to wars, the imposition of the economic blockade on Iraq during the past era, and the political conflicts we are witnessing today, which led to the dispersion of economic resources.

The Iraqi state’s continued reliance on oil as the sole source of the general budget puts Iraq at risk from the global crises that occur from time to time because oil is affected by them, which makes the country tend every time to cover the deficit through borrowing from abroad or within, and thus indicates the inability to Managing state funds effectively, and the inability to find alternative financing solutions.   LINK

A parliamentary committee reveals the fate of the oil and gas law.. Will it be deported again?

Posted On 01-18-2024 By Sotaliraq  01-18-2024   The Oil, Gas and Natural Resources Committee revealed today, Thursday, the fate of the Oil and Gas Law, while suggesting that the law will be transferred to the next parliamentary session.

Committee member, Zainab Al-Moussawi, said in an interview, “There are no developments regarding the oil and gas law at the present time; The impact of the current political situation on the selection of a new speaker for the Iraqi Council of Representatives.”

She pointed out, “The repeated violations by the American forces in Iraq take up part of Parliament’s work, as it supports the government in removing its forces from the country,” adding, “It is expected that the chapters of dialogues between Baghdad and Erbil regarding the law will begin again after the selection of the Speaker of the Council.”

The oil parliamentary member explained, “If the Kurdish dispute continues over some points of the law, I expect it to go to the next parliamentary session.”

Earlier, former member of the Oil and Energy Committee, Ghaleb Muhammad Ali, confirmed on Wednesday that there were political problems and differences between Baghdad and Erbil regarding the oil and gas law.

The political analyst, Sabah Al-Ukaili, had previously seen that the Kurdistan region continues to pose obstacles to the approval of the oil and gas law, while he stressed that the adoption of the law will prevent all disputes in the oil provinces, especially the Kurdistan region.

The Kurdish parties continue to obstruct the government in approving the oil and gas law, which voting on within the corridors of Parliament has become a must, in order to end the violations and thefts carried out by the Kurdistan Regional Government in the oil smuggling file. LINK

Provoking Points To Ponder on Adversity:

Even if misfortune is only good for bringing a fool to his senses, it would still be just to deem it good for something.  - Jean de la Fontaine

Never does a man know the force that is in him till some mighty affection or grief has humanized the soul.  - Frederick W. Robertson

Disappointment is the nurse of wisdom.  - Sir Boyle Roche

Challenges make you discover things about yourself that you never really knew. They're what make the instrument stretch, what make you go beyond the norm.  - Cicely Tyson

A woman is like a tea bag: you never know her strength until you drop her in hot water.  - Nancy Reagan

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