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By Mary B
Parliamentary Finance: The country's fiscal deficit is 6 trillion dinars per month
NEW MORNING IRAQI AFFAIRS OCTOBER 26TH, 2020 COMMENTSON PARLIAMENTARY FINANCE: THE COUNTRY'S FISCAL DEFICIT IS 6 TRILLION DINARS PER MONTH, CLOSED 13 VIEWS This week the second reading of the approval of the government loan law will be completed
Baghdad - Waad Al-Shammari:
The Finance Committee in the House of Representatives confirmed, yesterday, Monday, that the amount of the monthly deficit of Iraq reaches 6 trillion dinars, indicating that the passage of the fiscal deficit financing law depends on the reduction of the value of the loan that it implies, stressing that the second reading of the project will take place during the current week.
The committee’s rapporteur, Ahmad al-Saffar, said, “The House of Representatives agreed to complete the second reading of the fiscal deficit financing law during the current week.”
Al-Saffar added, in an interview with “The New Morning”, that “the government informed us that it is unable to disburse the employees’ salaries unless we complete this law, as it includes in its provisions obtaining new loans. ”
He pointed out, "The amount of what is included in the law is very large for what Iraq actually needs, especially since the treasury achieves monthly revenues, even if they are low, but amounts that reduce the rates of need for new debts."
And Al-Saffar, that "the amount of 41 trillion dinars to cover the expenses of three months is very large compared to the budget for a whole year, it represents about 40% of the budget.
He stressed, "Iraq achieves about 4 trillion dinars every month through its oil resources, direct and indirect taxes, and border crossings."
Al-Saffar stressed that "Iraq needs monthly to secure its necessary expenses, including the salaries of employees and retirees, to 10 trillion dinars."
And he goes on, that "the monthly deficit according to revenue figures compared to expenditures does not exceed 6 trillion dinars, which is less than half the amount that the government wants in the loan."
Al-Saffar continues, "The second reading will pass, without problems, and after that we will hold direct meetings with the government to see the truth about the amounts it wants and its expenditures."
Al-Saffar went on to say, "The current circumstance requires the government to put in place rapid economic plans aimed at maximizing the state's resources, and not relying solely on oil revenues."
In addition, a member of the Committee, Representative Jamal Cougar, said, in a statement to "The New Morning," that "the House of Representatives will not stand in the way of the government about any action that would improve the financial and economic situation of the country."
Cougar added, "linking salaries to the enactment of the disability law should be overridden by the government and not repeat the same scenario last month when it stopped paying employees' dues for about 45 days."
He mortgaged "the House of Representatives vote on the financing of the fiscal deficit law by reducing the amount of the loan you want. As for insisting on it, we will never allow that."
Cougar concluded, "the need to hold quick meetings with officials in the Ministry of Finance to discuss the draft law and come up with a text and an amount consistent with the actual need of Iraq."
It is noteworthy that the House of Representatives is currently discussing a draft law on financing the fiscal deficit sent by the government to avoid delaying the distribution of salaries to employees, retirees and the social welfare network.
A new international classification .. Iraq is one of the upper middle income economies
2020-08-29 07:34 Shafaq News / The World Bank considered on Saturday that Iraq is one of the economies with higher middle income, indicating that these economies consist of 56 countries .
The bank said in a report seen by Shafaq News Agency that "Iraq is one of the economies with upper middle income," indicating that "these economies range in terms of per capita gross national income between $ 4,046 and $ 12,535 ."
"These economies consist of 56 countries, in addition to Iraq, they also consist of Albania, Argentina, China, Jordan, Brazil, Turkey, Lebanon, Libya, Malaysia, South Africa and Thailand, " he added.
He pointed out that "low-income economies are those that have a per capita national income of 1035 and included 29 countries including Eritrea, Yemen, Sudan and Syria," noting that "the high-income economies consist of 83 countries, including Qatar, the UAE and Bahrain from Arab countries, Italy, Austria and Germany . "
The World Bank classifies countries in the world into four groups - low-income, lower-middle-income countries, upper-middle-income countries, and high-income countries. It is estimated on the basis of gross national income per capita at the current US dollar rate.
Iraqi Prime Minister discusses economic reform efforts with a representative of the World Bank missionBy yota691
Iraqi Prime Minister discusses economic reform efforts with a representative of the World Bank mission
Iraqi Prime Minister, Mustafa Al-Kazemi, during his meeting with the Special Representative of the World Bank Mission in Iraq, Ramzi Numan May 12, 2020 03:35 PM Mubasher: The Iraqi Prime Minister, Mustafa Al-Kazemi, received today, Tuesday, the Special Representative of the World Bank Mission in Iraq, Ramzi Numan .
Ways have been discussed to coordinate work between the Iraqi government and international institutions to overcome the economic crisis, according to a statement of the Information Office of the Prime Minister.
Al-Kazemi also discussed with the Special Representative of the World Bank Mission in Iraq work to launch economic reform efforts, which would encourage investment and reconstruction, enhance the service reality, and provide job opportunities .
The former Iraqi Minister of Planning, Nuri Sabah Al-Dulaimi, received on April 28 last , the representative of the World Bank in Iraq, Ramzi Numan, and his accompanying delegation.
During the meeting, a number of issues of common concern were discussed, and ways of strengthening national efforts facing the emerging epidemic of the Corona Virus pandemic.
Noaman affirmed that the World Bank is ready to provide possible support and restructure the loans granted to Iraq, in a way that contributes to protecting the vulnerable sectors of society.
Analysis .. The world is approaching the fourth wave of debt
February 09, 2020 03:07 PM
Mubasher - Ahmed Shawky : Amidst the World Bank warning of a massive wave of debt escalating all over the world, it is not clear who will be affected the most.
But if the countries most vulnerable to the brunt of the debt wave, from the UK to India, do not act soon, they may face severe economic damage, according to Kyushik Paseo, a former World Bank economist, through an analysis published by Project Syndicate.
Over the past decade, the global economy has seen a steady accumulation of debt, now reaching 230 percent of global GDP, with the fact that the last three debt waves have caused a major economic recession around the world.
The catastrophic past of debt
The first debt wave was in the early 1980s, after 10 years of low borrowing costs that enabled governments to expand their balance sheets considerably, interest rates began to rise, making debt service increasingly unsustainable.
Mexico was the first victim, as the US government and the International Monetary Fund were informed in 1982 that they could no longer pay their debts.
This had a domino effect, as 16 Latin American countries and 11 least developed countries outside the region eventually rescheduled their debt.
In the 1990s, interest rates were again low, raising global debt again.
The crash came in 1997, when the fast-growing but financially vulnerable East Asian economies - including Indonesia, Malaysia, South Korea and Thailand - experienced a sharp slowdown in growth and their currency rates plunged, thus extending effects to all parts of the world.
But emerging economies are not alone vulnerable to such meltdowns, as demonstrated by the 2008 US mortgage crisis.
By the time everyone discovered what the mortgage crisis meant, American investment bank Lehman Brothers had collapsed, causing the worst crises and recessions since the Great Depression.
The fourth wave of debt
The World Bank recently warned that the fourth debt wave may exceed in its first three waves, as emerging economies whose debt-to-GDP ratio reached a record low of 170 percent are particularly vulnerable.
As in previous cases, the debt crisis increases due to lower interest rates, while anxiety will start as soon as interest starts to rise.
The reality is that the mechanisms of such crises are not well understood, but research conducted by "Stephen Morris" and "Mortar Song Shin" in 1998 about the mysterious origins of currency crises, and how they are transmitted to other economies, shows that a "financial tsunami" can make the situation go beyond a source the crisis.
How the source of the financial crisis could fade has been illustrated in the delightful short story "Ranam Kurtva" by the famous Indian writer, Shibram Chakraborti.
In this story, the desperate Chipram asks an old school friend, Harsha, to lend him 500 rupees ($ 7) on Wednesday with a promise to pay the deposit the following Saturday.
But Chibram is wasting money, so when he comes on Saturday, he has no choice but to ask another school friend, Jopar, for a loan of 500 rupees, to pay it back next Wednesday.
Chipram uses the money to pay off his debts to Harsha, but when he comes on Wednesday he has no way to pay off Jopar’s debt, so he reminds Harsha that he paid off his debts on time and therefore borrowed from him again.
This becomes customary as Shibram repeatedly borrows from a friend to pay off his debts to the other, and Shibram then clashes with Harsha and Jobar one day.
After a moment of anxiety, Chipram proposes an idea that every Wednesday Harsha should give “Jopar” 500 rupees, and every Saturday the latter must give the same amount to the first.
Shepram assures his former friends at school that this will save him a lot of time and change nothing for them, and he will disappear in the crowds of the city "Kolkata" in India.
The UK and India are a model of the crisis
So who are the potential "Harsha" and "Jobar" in today's debt spree? According to the World Bank, they could be any country with domestic vulnerabilities, a large fiscal balance sheet, and a heavily indebted population.
There are many countries that fit this description and run the risk of becoming the channel that carries the fourth debt wave of the global economy.
Among the advanced economies, the UK is a clear candidate, and in 2019 Britain barely avoided recession, recording the weakest pace of growth in any period not seen since the 1945 recession.
Britain's conservatives have also promised big increases in commercial investment, and this is unlikely, but instead it will be a debt wave.
Among emerging economies, India is particularly vulnerable, as in the 1980s the Indian economy was somewhat protected, and consequently the debt wave had little impact at that time.
At the time of the East Asia crisis in 1997, India had just begun to open up and thus experienced some slowdown in growth.
By the time of the debt wave in 2008, the country had become globally integrated and severely affected, but its economy was strong and growing at almost 10 percent annually, and recovered within a year.
But India’s economy today faces one of the deepest crises of the past 30 years, with growth slowing sharply and unemployment at the highest level in 45 years, almost no export growth over the past six years, and per capita consumption in the agricultural sector over the past five years.
Add to this a highly polarized political environment, and therefore it is no wonder that investor confidence is rapidly declining.
It is not too late for countries to build "walls" to protect against the debt tsunami, while while India's political problems will take time to resolve, the new budget may be an opportunity to take precautionary action.
The fiscal deficit must be controlled in the medium term, but the government will be prudent in adopting an expansionary fiscal policy now, with funds directed to support infrastructure and investment, and if managed properly, could boost demand without increasing inflationary pressures and strengthening the economy in order to cope with the debt wave.
02/20/2020 09:08 Views 91 Section: Iraq Government official: Iraq still owes Kuwait seven billion dollars
Baghdad / Obelisk: The financial advisor to the Prime Minister, Mohammed Mazhar Saleh, announced on Tuesday 4 February 2020 that Iraq is still in debt to Kuwait with an amount of seven billion dollars, after he paid 52 billion as a result of the invasion of the previous regime to Kuwait in the nineties of the last century, while he indicated that the agreement with China was launched from The principle of building bridges and reviving the Silk Road.
Saleh said in a press statement, that China is one of the developed countries in infrastructure, and that the real development in any country can only be achieved with a solid infrastructure.
He added, that the 100,000 agreed barrels should enter the Development Fund, and then deduct from it the compensation for the Kuwait war, which remains approximately 7 billion dollars, after Iraq paid about 52 billion dollars.
He pointed out that this agreement was based on the principle of building bridges and reviving the Silk Road, which China seeks to restore in order to bring peace and increase economic development in the world, especially since the countries that lie on the belt line constitute 65 percent of the world's population.
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