IMF opposed to large Iraqi budget deficit for 2012; Deputy G

[Stillw8n]

IMF opposed to large Iraqi budget deficit for 2012; Deputy Governor of the CBI says Iraq’s debt is comfortable

Preparing the Iraqi parliament within the next few days to begin the discussion of the general budget of the Iraqi state in 2012 after it was approved by the Council of Ministers.

This is the largest budget in the history of Iraqi budgets since the founding of the modern Iraqi state early twenties of the last century.

The announcement, according to sources, the Iraqi government about $ 120 billion.

Although the striking increase in the volume of investment allocations by 35%, the proportion of the deficit of 20 billion U.S. dollars. Was measured on the basis of as the rate of $ 73 per barrel of oil, which accounts for about 95% of them.
According to the announcement of the Finance Committee in the Iraqi parliament, the IMF objected to the federal budget for Iraq, which led to delay the submission to Parliament for discussion and approval.

Indeed, it was scheduled to begin by discussing the legislative recess of Parliament.

A member of the Finance Committee in parliament, Haitham al-Jubouri in a press statement, said that «objection Monetary Fund came as a result of the budget submitted by the proportion of large deficit, which amounted to 30% of the value of the budget».

He pointed out that this figure half deficit financed, where possible coverage, and the other half is funded can not be financed as Treasury operational ».

He added that «the Commission has agreed in principle to reduce the investment budget by $ 15% so that we can control in the case of falling oil prices on the budget and the economy». Jubouri revealed the existence of negotiations with the IMF in this regard.

The Ministry of Planning has declared the month of September last, that the financial budget for next year, ranging between $ 112 and $ 120 billion, confirming that 35% of the allocated budget investment, while the current year budget 81.9 billion dollar deficit of $ 13.3 billion.

For his part, Vice Governor of Central Bank of Iraq appearance of Dr. Mohammed Saleh told «Middle East», that «there are several ways to bridge the budget deficit, for example, by the amounts retained from last year even though it’s policy is not successful because the basic principle is that projects are implemented as planned, they », pointing out that« the plug can come from the collection of additional funds from the difference in oil prices or borrowing, both from the local market such as banks, government or central bank or foreign borrowing ».

Saleh said that «the Japanese loan, announced by Prime Minister Nuri al-Maliki during his visit to Japan recently, but it is one of the ways to bridge the deficit in the Iraqi budget, and there is also the World Bank, which announced its willingness to lend to Iraq almost a billion dollars». And on the fiscal policy currently followed, he considered Dr. Saleh said that «the current policy in Iraq is often the policy is successful economically, as there were 37 reason to block investment projects, for example, not to mention a lot of legislation is based on valid grounds, such as the creation of some institutions and funds have been exhausted a lot of money without production », considering move« legislation laws without examining the nature of the spending will shift the burden of serious financial policy which could lead to more mistakes accumulated, especially that Iraq will depend on a single resource variable is oil, which is not can be used to in the end, the long-term ».

In response to a question on Iraq’s debt and the rest of them and the impact on the budget, said that «Iraq’s debt of more than $ 120 billion, but about 80% of these debts were written off in the framework of the Paris Club countries and the rest of this debt about $ 23 billion has scheduled in 2028 to an interest rate of 8 % ».

He explained that «this amount is compared to the fact that Iraq is a significant oil, a small amount and does not constitute an impediment or a significant burden, especially as he is only 20% of the GDP of the country and therefore the situation of Iraqi debt is comfortable and not tired».

And excluded the Iraqi official debt Gulf to Iraq, where he was that «this debt is still a point of contention with the Gulf countries because the debt the Gulf from our perspective were not funds for the purpose of financing development plans as far as the money to finance the war machine», in reference to the Iraq war – Iran through eighties of the last century. He pointed out that «the Gulf brothers are silent now, but sometimes arise when you get no more political crises and are subject to discussion with them», and expected that «all debts are written off Iraq’s Gulf and the Gulf sooner or later ».

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