Special Saturday Podcast In numbers and details.. the 2022 budget and a precedent that did not happen before

Special Saturday Podcast In numbers and details.. the 2022 budget and a precedent that did not happen before

The articles I discussed are below:

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Planning for the Euphrates News: We rule out an economic depression in Iraq..and explain the reasons

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The Ministry of Planning ruled out an economic recession in the country.

The ministry's spokesman, Abdul-Zahra Al-Hindawi told {Euphrates News}: "We rule out an economic recession in the Iraqi market due to the high rates of consumption of the Iraqi individual, as well as the presence of a large cash block derived from the salaries of employees, which amount to 50 trillion dinars annually."

And he indicated that "salaries are enough to move the market and keep it away from the state of depression that occurs when the purchasing power of the individual is lost or the quantities of supply are greater than the demand."

On August 2, Prime Minister Mustafa Al-Kazemi announced a plan for economic reform and diversification of revenues, to face challenges caused by high expenditures and fluctuating incomes.

Al-Kazemi said on the sidelines of chairing a meeting of the government's Supreme Committee for Reform, "The reform plan will provide a solution to the chronic economic management crisis, which is represented by complete dependence on oil, and the failure to diversify sources of income... We want to prove to the Iraqis that we are serious about reform."
He explained that the government aspires strongly "to restore the country's economy to its strength after five years, after the situation reached very low levels as a result of rampant corruption, this plan would rebuild the Iraqi economy in a proper manner."
He added: "The damage to the Iraqi economy is very great, and for this reason it is impossible to implement the reform plan in a short time, and whoever promises to do so is delusional. Our goal is to advance the state, not the current government, for governments go and the state remains."
It is noteworthy that the Iraqi economy, over the past 18 years, suffered damage to all its joints, and caused a decline in the sectors of agriculture, industry and trade, and the country has become dependent mainly on oil revenues.

Iraq suffers from a shortage of funds and a decline in the economy due to the decline in oil revenues due to the outbreak of the Corona virus.

And Iraq, the second largest producer of crude in the Organization of Petroleum Exporting Countries after Saudi Arabia, with a daily average of 4.6 million barrels in normal conditions, and depends on crude to provide more than 92 percent of its revenues

Now these are in the order I discussed on the podcast:

Economist: Supporting the private sector in the media only, and the wealthy have become a burden on Iraqis

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The economic expert, Basem Jamil Antoine, described the support of the private sector as "media only."

Antoine told Al-Furat News: "We suffer from instability in the prices of materials and goods as a result of a series of unbalanced changes that affected the exchange rates of the dollar, in addition to the Corona pandemic, which increased the economic crisis and greatly affected the poor classes."

He added: "Carpentry, electricity, and others led to a loss of stability and monetary inflation that raised the value of the dollar, and at the same time, an economic downturn pushed the purchasing power of the citizen to a low level and the weakness of local production."

And Antoine said: "Iraq is not poor and its budget is large;

And he continued, "There is no law of solidarity and retirement, a health social security for the Iraqi citizen to live on during the ban period, and support for the private sector is found in statements only, and there is no implementation on the ground, and the private sector law since 2014 has not taken its role in implementation." 
Antoine added, "The private sector constitutes 8 million citizens, all of whom are exposed to calamities, diseases and others without a real security law for them. There are 3 million and 500 citizens living in slums, and this is a problem that we hope to address seriously."

He noted: "The real obstacles that stand in the way of supporting the private sector are rampant corruption, lack of real will and mismanagement," declaring: "The current economic reform came to serve the rich and against the poor, and the government had to create job opportunities and internal production.

Al-Kazemi is the first president to visit Iran next Sunday after the two presidents took office

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An informed source in the Iraqi Foreign Ministry revealed, on Thursday, September 9, 2021, .that Prime Minister Mustafa Al-Kazemi will visit the Iranian capital, Tehran, next Sunday

The source said that Al-Kazemi will visit Tehran at the head of a large and high-level delegation, according to Al- .Furat Agency

This is the first visit by a foreign official at this level to Iran after Ibrahim Raisi took power in Iran on August 4 .last .

The prime minister had previously announced that he would visit Tehran to form the new Iranian government 

It is likely that next year's budget will witness more investment projects. The appearance of Saleh: Reducing the hypothetical deficit due to the increase in revenues.

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The financial advisor in the Prime Minister, Dr. Mazhar Muhammad Salih, suggested that the next year’s budget 2022 will witness more new investment projects, which will be guaranteed to be implemented as a result of the increase in oil revenues. The price of black gold rose to exceed $70 a barrel, which economists rely on a lot to bridge the deficit gap in the public budget, which was built on the basis of a barrel price of $45.

Saleh stressed, during his speech to Al-Sabah, that "reducing the hypothetical deficit due to the increase in oil revenues in the federal general budget for the year 2022 will exceed important percentages of financing that deficit by means of traditional borrowing from local or international financing institutions to secure the needs of implementing new investment projects."

And the government advisor indicated that this matter will be done through two parts, the first is the additional funding and filling the deficit due to the improvement in the price of a barrel of oil, at five dollars above the price of a barrel approved by the 2021 budget, which will be mostly $ 50 instead of $ 45.

 

oil assets 

Saleh explained, “The second part relates to the cycle of oil assets, which still indicates an improvement in global oil prices, with an annual average expected to exceed $65 a barrel in 2022, with the growing détente of the global economy and the increasing levels of vaccination against the Corona pandemic and the return of its trade and investment entanglements and prosperity All forms of transportation sectors, indicating that the transportation sector is responsible for consuming 75% of oil derivatives in the world.

 

investment projects 

The financial advisor believes, “The list of new investment projects will be guaranteed to be implemented, and according to the flow of additional revenues in the general budget, which will cover the hypothetical deficit in the 2022 budget without having to resort to domestic or external borrowing, which helps to provide strength to the state of financial consolidation that is looking forward to to public finances in providing means of its sustainability.

Revenue stability

A spokesman for the Ministry of Oil, Assem Jihad, told the Iraqi News Agency (INA) that “the stability of oil prices at $70, despite the great challenges and the economic stagnation of many countries’ economies, is a good indicator for the member states of “OPEC +”, including Iraq, because it enhances their its fiscal revenues, revives their economies, and reduces the proportion of the fiscal deficit.”

Jihad indicated, "The stability of financial revenues for Iraq between 65 and 70 dollars during the past months is a good realistic indicator in light of the challenges facing the economies of countries and the (fragile) reality of the oil market," noting that "Iraq aspires to achieve higher revenues through commitment." With the gradual increases that were agreed upon in “OPEC +”, which contribute to reducing the proportion of the budget deficit.”

raq discusses with the World Bank an indicator to improve the business environment

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Deputy Secretary-General of the Council of Ministers, Farhad Nematullah Hussein, discussed with representatives of the World Bank in Iraq indicators of improving the business environment.

A statement by the General Secretariat of the Council of Ministers received by the "National News Center" stated that "the Deputy Secretary-General of the Council of Ministers, Farhad Nematullah Hussein, chaired the second periodic meeting of the Diwaniyah Order Committee (52 for the year 2021) concerned with following up on reforms and addressing indicators for evaluating the business environment in Iraq that were reported by the Bank. The international community in its annual report by improving the regulatory environment for the private sector and its workers, as one of the essential items in achieving economic growth and motivating young people to engage in the local labor market and shift towards the private sector.

The representative of the World Bank indicated, according to the statement, that “the Bank is a key partner in supporting Iraq’s aspirations; To improve the business environment and implement strategic plans and programs to achieve economic growth, in implementation of Iraq's commitment to the terms of the white paper approved by the government earlier in this regard.

He added, "The meeting, which was held in the building of the General Secretariat of the Council of Ministers, dealt with the annual assessment prepared by the World Bank on doing business according to the axes (obtaining credit, settling price cases, enforcing government contracts, and protecting investors with the lowest percentage)."

Iraqi politicians: The differences of Shiite forces may pave the way for Al-Kazemi for a second term

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The Iraqi politician, Bahaa Al-Araji, said, on Tuesday, September 7, 2021, that the differences between the Shiite forces within them are paving the way for the current Prime Minister, Mustafa Al-Kazemi, for a second term.

Al-Araji added in a televised interview, followed by “The Obelisk”, that political forces may support Al-Kazemi for a second term, adding that Al-Kazemi deserves to remain as prime minister.

In a related interview, for a second term for Al-Kazemi, Kurdish politician Mahmoud Othman said that the current Prime Minister, Mustafa Al-Kazemi, may continue for a second term with the support of political forces.

International Development confirms its readiness to provide investment opportunities in Kurdistan

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The Chief of the Kurdistan Regional Office, Fawzi Hariri, received today, Thursday, the Chairman of the Board of Directors of the International Development Bank, Ziyad Khalaf Abd, in the context of strengthening partnerships and cooperation with financial institutions in the region, while the latter confirmed the bank's readiness to provide investment opportunities for Kurdistan.

A statement from the office of the head of the regional office, received by the "National News Center", stated that "Hariri received today in his office the Chairman of the Board of Directors of the International Development Bank, and reviewed with him the most important achievements and developments at the level of the bank and the huge infrastructure of the bank, including its application of the controls and standards of the information technology system. Which led to the bank obtaining the highest standards of classification and evaluation at the level of Iraqi banks, despite all the challenges experienced by the Iraqi banking sector in general.”

On the other hand, the Chairman of the Board of Directors of the International Development Bank stressed to “Hariri the bank’s keenness to cooperate with all regional banks in the field of developing infrastructure and activating advanced electronic payment systems.”

He expressed the bank's readiness to "provide the best banking services in accordance with the digital financial technology that the bank has reached and approved international standards, and to provide investment opportunities in accordance with a future vision and strategic directions to support all vital sectors and what the next stage requires."

It provides about 100,000 job opportunities for both sides.. Developments of the joint economic city between Iraq and Jordan

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The Director General of the Industrial Cities Authority in the Ministry of Industry and Minerals, Hamid Awad Muhammad, revealed new details about the joint economic city between Iraq and Jordan, confirming that an agreement had been reached to resolve the implementation procedures.

Muhammad said in a statement to the official newspaper, followed by "Yes Iraq", that "an agreement has been reached to resolve the procedures for implementing the economic city between Iraq and Jordan within the boundary between them, 500 meters from their borders, and north of the Trebil port located in Anbar Governorate."

He added that "the city, which will have an area of ​​four thousand and 800 acres, with a width of 2000 meters and a length of six thousand meters, will be implemented under a joint administration, and facilities will be provided to the industries of the two countries, and will provide 50 to 100 thousand job opportunities for the people of the two countries."

And Muhammad indicated that “the economic city includes three main areas: the industrial city, the two free zones, and the logistical support, while the proposed area for the establishment of the area will be 400 acres inside and it is capable of expansion in the future, with the establishment of a city similar to it on the Jordanian side,” noting that “it will be managed The city jointly after choosing a site for its construction.

Sovereign Fund

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Oil, a commodity subject to recession at any moment, noting the severe price collapses witnessed by the global market, during periods, not far apart, in 2008, 2014, and 2020, and it is also subject to depletion, or dispensing with it when the world discovers sources of energy In light of these oil repercussions, the lives of future generations in the oil-producing countries seem to be under threat, because the current generations will nibble on all available wealth, above and below the earth.

Hence the importance and necessity of setting controls that guarantee the rights of the successors, and this matter falls on the shoulders of the current governments, and those before them and those who come after them, and on this basis came the idea of ​​establishing the Generations Fund in Iraq. It is true that the step came too late, as it was supposed to be established Such a fund has existed since the early years of the emergence of oil, but to come late is better than never, after many countries preceded us in establishing effective sovereign funds, including Kuwait, which is the first country in the world in this field, and there are the UAE, Saudi Arabia and Qatar And many other countries, and it is estimated that the volume of money invested in sovereign funds around the world amounts to (3) trillion dollars, mostly from oil surpluses.

Therefore, I think that the remaining three decades of the oil life, stagnating or depleting, may be appropriate to finance the Generations Fund recently announced by the government, through the available financial surpluses, by taking advantage of the price difference between the budget and the real selling price, provided that Reducing the size of the fiscal deficit in the budget to its lowest levels, and if the deficit remains at this level, talking about financing the Fund remains a dream, and reducing the deficit is also linked to the necessity of reducing the ceilings of the massive operating and consumption expenditures that account for three quarters of the state’s public spending.

In the event of the inability to reduce the volume of operational spending, due to the massive inflation in the functional body of the state, and the presence of wide doors, in which the exchange cannot be stopped, the matter requires resorting to activating other development sectors in order to reduce dependence on oil, and then the possibility of transferring part of the revenues The oil sector will be transferred to the Generations Fund, which must have an active role in the development process, through its strong contribution, in investing in various fields, and here we will achieve two things. Second, maximizing the revenues of the Fund, to guarantee the rights of future generations, and thus achieving social justice. Such trends are of great importance to be included in the law establishing the Generations Fund, with an emphasis on the transparency of the Fund’s work, and knowledge of its outcomes and paths, its inputs and outputs.

(They sowed and we ate, and we sowed and they ate).