Expectations of the Iraqi economy to shrink and the budget deficit to exceed 29%

[Mary B]

Expectations of the Iraqi economy to shrink and the budget deficit to exceed 29%

 09/05/2020

 

 

 

 

Baghdad - Mawazine News
The World Bank expected, on Saturday, the Iraqi economy to shrink and the budget deficit to rise to 29%.
According to the report, it is expected that "the country's GDP growth rate will shrink during the year 2020 by 9.7%, registering a decrease from a positive growth rate achieved in the year 2019 by 4.4%, which makes it the country's worst annual economic performance since 2003."
The report pointed out that "with the previous conditions of Iraq and entering this current crisis, it limited its ability to address the economic and social impact and mitigate it resulting from the drop in oil prices, and reduce the share of production and turmoil caused by the embargo measures related to the HIV epidemic."
His report stated that "the economy of the public sector of the country that relies entirely on oil, hindered the creation of job opportunities in the private sector. Moreover, the growing resentment towards the lack of services and the increase in corruption and lack of job opportunities are all still present, in addition to the political stalemate over Forming a new government. "
"Financial regulation and diversification of the economy through a broader contribution to the private sector are vital to reducing Iraq's vulnerability to external shocks," said Sarju Kumar Juha, regional director of the World Bank for the Mashreq region.
He adds, "The presence of targeted reform and a program to promote growth would help maintain the reconstruction efforts and maintain the positive developments achieved in the electricity and agricultural sectors over the past year," noting that "
The report indicated that "if oil prices stabilize below $ 30 a barrel, and no reform measures are taken, the budget deficit will exceed 29% of GDP for 2020, and that the total financing needs will reach $ 67 billion (more than 39% of GDP) Total)".
The World Bank stated that, "According to this situation, the financing options will be limited, and the heavy reliance on local financing can affect the liquidity available for private sector credit, and weaken the budget of the Central Bank of Iraq, thereby creating pressures on financial inflation and the rate of selling the currency", / Guest: "At the same time, the possibility of access to global markets may prove difficult, taking into account the conditions of the global market and the weakness of the Iraqi economy system."
The report included "highlighting the importance of digital transformation for Iraq and the urgent need behind it," noting that "the benefits from the active digital economy are very huge, and upgrading the digital economy will help Iraq improve economic opportunities, especially for young people, and thus meet the demands of citizens."
He pointed out that "the digital transformation of the Iraqi economy will require economic reforms and long-term development priorities, as well as a digital economic framework with several axes that include providing access to a high-speed Internet, providing digital management services, improving access to information, and developing youth skills in technology science." Ended 29 / A 43

 

https://www.mawazin.net/Details.aspx?jimare=99451

[Mary B]

An economist warns the new government against external borrowing and presents the alternative

 

 

 

Economist Wissam Al-Tamimi warned of the new government's resort to external borrowing to finance the 2020 budget, pointing out: "Iraq can not resort to borrowing by tackling the budget and reducing the investment side."

Al-Tamimi said in a press statement: "The government is supposed to pass a normal budget while reducing the allocations for large grades in the country to compensate for oil losses."

He stressed: "The resort of the new government to external borrowing is an unsuccessful step that will shackle Iraq for decades and impose significant restrictions on it, while the solution lies in reducing the investment budget in addition to the possibility of raising the dollar exchange rate, even a few percent, to ensure that commodity prices do not rise." .

The economist said: "The treatment of the budget must be by stopping some contracts and not launching job grades and postponing them for the next year, provided that the budget situation is addressed and other resources are found to finance it instead of oil."

 

https://www.thebaghdadpost.com/ar/Story/194769/%D8%AE%D8%A8%D9%8A%D8%B1-%D8%A7%D9%82%D8%AA%D8%B5%D8%A7%D8%AF%D9%8A-%D9%8A%D8%AD%D8%B0%D8%B1-%D8%A7%D9%84%D8%AD%D9%83%D9%88%D9%85%D8%A9-%D8%A7%D9%84%D8%AC%D8%AF%D9%8A%D8%AF%D8%A9-%D9%85%D9%86-%D8%A7%D9%84%D8%A7%D9%82%D8%AA%D8%B1%D8%A7%D8%B6-%D8%A7%D9%84%D8%AE%D8%A7%D8%B1%D8%AC%D9%8A-%D9%88%D9%8A%D8%B7%D8%B1%D8%AD-%D8%A7%D9%84%D8%A8%D8%AF%D9%8A%D9%84

[Mary B]

What does Washington want from Al-Kazemi? Trump's adviser will answer

 

 

 

Gabriel Soma, a member of the advisory board of US President Donald Trump, confirmed the support of the United States of America to Prime Minister Mustafa Al-Kazemi for implementing reforms, controlling uncontrolled weapons and holding early elections.

Suma said in a press statement: "The United States decided, after Mustafa Al-Kazemi obtained the confidence of the House of Representatives, to grant Iraq a new exemption from sanctions to import energy from Iran for a period of four months, to support Al-Kazemi in his mission to run the Iraqi government."

He added: "The US administration welcomes Al-Kazemi 's pledge to hold early elections and supports him to implement them and address health problems in Iraq, in addition to the economic situation amid low oil prices."

And Trump's adviser continued: "Prime Minister Mustafa Al-KazemiHe has the support and support of the American administration, and therefore he must implement reforms and confine arms to the state. "

 

https://www.thebaghdadpost.com/ar/Story/194768/ماذا-تريد-واشنطن-من-الكاظمي-مستشار-ترامب-يجيب

[Mary B]

Finance Committee: The federal budget will be monthly

---

 

9/5/2020 11:49:00

 

 

       

Finance Committee: The federal budget will be monthly

 

The Parliamentary Finance Committee announced today, Saturday, that Iraq may have monthly, not annual, budgets as before.

Member of the Finance Committee, Shirvan Mirza, said during a special statement to PUKmedia: The variation in oil prices and the possibility that Iraq will not have an annual budget, as happened in previous years, is very likely.

He added: Perhaps the budget will be monthly, according to oil prices and the movement of global markets, and will determine imports and expenditures accordingly.

https://www.pukmedia.com/AR_Direje.aspx?Jimare=142359

 

[ChuckFinley]

Thanks Mary B for keeping us updated.   

[Mary B]

Expert: The pension is legally and constitutionally protected and spending it is an obligation without delay

 05/09/2020

 

  

Information / Baghdad ..
Legal expert Ali Al-Tamimi stressed, on Saturday, the inability of the government or any party to delay or cut the salaries of retirees because of their legal and constitutional immunity, indicating that it is not possible to manipulate the pension.
Al-Tamimi said in a statement to / Information / that “the Iraqi constitution talked about the rights, freedoms and obligations of the state in Article 22 to Article 36 of it, which requires protection of aging and decent living in all fields.” Noting that “the Unified Retirement Law 9 of 2014 spoke at length about pension arrests.” These are the rates of deduction from the employee’s salary throughout his work in the job, so he will be given a retirement pension later on, as it is more like saving in the long run.
Al-Tamimi explained, “In this law 9 of 2014, there is a retirement fund and it has an independent legal personality. The person who manages it will provide salaries to retirees away from budgets and financial allocations from any party, as stated in Article 7 and later of this law.”…
He continued that “this Salaries are sacred and legally and constitutionally protected, and they need urgent solutions not to delay spending them because those who are waiting to receive them have calculated a thousand accounts if we know the difficulty of life and the high cost of living. Ended / 25

 

https://www.almaalomah.com/2020/05/09/473151/

[Mary B]

The new Minister of Industry announces a plan to advance the industrial sector

 09/05/2020

 

FacebookViberWhatsAppEmail

 

 

Baghdad - Mawazine News The
Minister of Industry and New Minerals, Manhal Aziz Al-Khabaz, received Saturday the official duties of his position, announcing the adoption of a clear and sound plan to advance the industrial sector during the next stage.
The Ministry stated, in a statement received / Mawazine News / a copy of it, that "in the center of the Ministry of Industry And the minerals took place today, the formal receiving and handing-in ceremony of the Minister of Industry and Minerals, Manhal Aziz Al-Khabaz, from his predecessor: Saleh Abdullah Al-Jabouri, in the presence of agents, consultants, general managers and officials at the Ministry’s Center.
During his meeting with the advanced cadres in the ministry, the minister presented "about the most important files related to the work and performance of the ministry and its formations and the most important achievements of the activities and achievements during the last period and some topics of interest to the local industrial sector."
He stressed that "the next stage will be a challenging stage for the slogans stage", revealing "a clear and sound plan will be implemented in cooperation with officials in the ministry to advance the industrial sector, and we will support all state ministries and governorates to meet their requirements and needs."
The minister pointed out that "his ministerial program will focus on the basic elements of the Ministry of Industry and Minerals, the most important of which are human resources with expertise and competencies that are the capital of the ministry and whose sovereignty will work as much as possible to preserve and restore their rights," adding that "the ministerial program will also focus on Revitalizing the private sector and linking it with the public sector and operating industrial laboratories, as well as adopting sound strategic planning and intensifying the field of research and development, as it is an important step in developing production.
For his part, the former Minister of Industry and Minerals, Saleh Abdullah Al-Jubouri, blessed: "The new government and the new minister receive his duties in the Ministry of Industry and Minerals, wishing for his success in the performance of his duties in light of the critical conditions the country is going through in a healthy and economic way," stressing that "he was able during the period The past put the ministry on the right track with the efforts of the advanced cadres and all the employees of the ministry and its formations. "Ended 29 / A 43       

 

https://www.mawazin.net/Details.aspx?jimare=99485

[Mary B]

The dollar fluctuates against the Iraqi dinar amid economic concerns

 Kurdistan24, Erbil |

52 minutes ago

 

 

 

---

In Baghdad, the exchange rate of $ 100 reached 123,800 dinars

 

 

Erbil (Kurdistan 24) - Dollar prices recorded a new fluctuation against the Iraqi dinar in the Kurdistan Region and the rest of the Iraqi markets on Saturday.

This came in light of the economic concerns resulting from the collapse of oil prices globally and the lack of liquidity in Iraq, which has not spent the salaries of its pensioners for the current month so far.

The exchange rate for the $ 100 class in Erbil was 123,500 dinars, and in Sulaymaniyah 123,700 dinars, prices varied slightly in other markets in the Kurdistan Region.

In Baghdad, the exchange rate of $ 100 was 123,800 dinars, in Najaf the exchange was 123,900, while in Mosul it was 123,750 and in Basra 123,850.

 

https://www.kurdistan24.net/ar/news/6491cb84-6d55-4f92-8df4-f1d37d21a1f7

[Mary B]

A plan to build 250,000 housing units annually in Iraq

Baghdad / .. The Ministry of Construction, Housing and Public Municipalities has prepared a plan to implement 250,000 housing units annually distributed among all governorates.

 

A source in the media center of the Ministry of Construction stated that the ministry, within its plans to tackle the housing crisis, prepared a plan to establish (250) thousand housing units annually by distributing the tasks of their implementation among several sectors to fill the shortage of housing units. He explained that the study prepared by the ministry includes that the private sector implement 50 thousand housing units annually depending on its own ready-made construction factories in all governorates, in addition to 100 thousand housing units implemented by foreign companies with experience in implementing and operating ready-made factories, along with The implementation of 50 thousand housing units annually by the Ministry's companies through its factories spread throughout the governorates, while investment companies implement 50 thousand housing units annually by adopting the principle of a single window in obtaining land.

 

The source stressed that «the ministry will work to enhance its factories with production lines for residential homes, either through investment or purchase, as it is necessary to use special factories to build homes and apartments that are characterized by quality away from traditional methods that no longer meet the country’s need for millions of housing units.

 

He explained that the Ministry had previously completed residential floor designs under the New Residential Cities Project, with different areas, according to the latest construction standards and specifications, so as to contribute to providing housing units at reasonable prices.

 

morning newspaper

 

https://aynaliraqnews.com/index.php?aa=news&id22=133641

[Mary B]

The Cabinet approves a draft of the domestic and foreign borrowing law to finance the fiscal deficit

 05/09/2020

 

  

The information / Baghdad ..

On Saturday, the Council of Ministers announced its approval of the draft domestic and foreign borrowing law to finance the fiscal deficit of the year 2020.

The media office of the president of the council stated, in a statement received / information / that “the cabinet decided to cancel the previous cabinet decision No. (97) for the year 2020 on the subject of stopping the financing, in addition to approving the draft of the local and external borrowing law to finance the fiscal deficit for the year 2020 and referring it to the council Representatives according to the provisions of the constitutional articles.

The Council decided, “The Ministries of Transport and Culture to renegotiate with hotel managers for the purpose of reducing room rates in hotels, and the food is the responsibility and responsibility of the Ministry of Health to accommodate returnees from abroad for the purpose of booking them in those hotels.”

The Council of Ministers asked the House of Representatives to "complete the vote on the new election law and send it to the Presidency of the Republic for the purpose of bringing it into effect after its publication in the Official Gazette, and provide logistical support and provide all the capabilities available to the Independent High Electoral Commission so that it can hold elections after the date is set."

He called on ministries and entities not associated with a ministry to "cooperate with the Independent High Electoral Commission by providing human staff to carry out the electoral process."

In today's session, the Cabinet approved "amending the parties law to lead to the regulation of the legal status of parties' work on democratic national foundations that guarantee political pluralism and democratic transformation." 25 h has ended

 

https://www.almaalomah.com/2020/05/09/473237/

[Mary B]

 With the money from surplus currency reserves, the industry is building trade and cultural museums to work for Iraqis

 

Mustafa Akram Hantosh Dear Prime Minister Mustafa Al-Kazemi, this article is based on an integrated idea about the possibility of investing the surplus of the Central Bank of Iraq from ((gold and currency reserves that amount to (81) billion dollars), as what the Iraqi currency needs as a reserve is the amount of (52) billion dollars According to a rule (130%) of the total issued cash, which must be equivalent to gold and foreign currencies, and since the total issued cash in Iraq is (48) trillion Iraqi dinars, which is equivalent to (40 billion dollars x 130% = 52 billion dollars), which creates a surplus of (29) One billion dollars, which allows the investment of approximately (25) billion dollars in reserves, which are unnecessary in maintaining the values The Iraqi currency)). It is worth noting that many countries hold a balance of gold and currencies equal to or less than the value of the currency, and it is a country that maintains its currency in its stable value due to the base of increasing 30% mainly from the amount of cash issued.  The Iraqi government can gradually transfer these amounts to: The ages and renovations of the Iraqi Ministry of Industry companies, which number approximately (78), are a major company, each company owns several branches with hundreds of warehouses spread in Iraq, and authorization of construction and construction companies, including the task of building and reconstructing the Iraqi central markets, amounting to (72) central markets in Iraq, as well as reconstruction ( 68) A ruined palace of the previous regime and turning it into museums for a dark era in the history of Iraq (such as museums of the neighboring countries that belong to the previous eras of these countries), which will achieve high profits for the Iraqi state, and authorize other industry companies (textiles - oils - food - electrical appliances - and other companies) Ministry of Industry Proof) launched its products Iraqi central markets after building them and opened ,, and the Iraqi people will meet the call of generations to support the national producer of these markets. It is worth noting that a contract was concluded during the last period with the investment of five central markets, namely (the people, the authority, the worker, justice and Al-Mustansiriya) for the investing company after signing the investment contracts with it and obtaining the licenses of the National Investment Commission. And that "the investment period for each site is (30) years and in the system of modern malls," but no reconstruction process has started so far in these sites. The Iraqi government can invest the remaining central markets before selling them to other investors. With this safe investment in (industry, trade and culture), the Iraqi state will once again have the reins of the diversified Iraqi economy that provides work to more than (a million) new job degrees funded by the profits of industry, trade and culture, in addition to that the state budget will get rid of the weight of the salaries of approximately (500) One thousand employees at the Ministry of Industry and Trade receive current grants without success from their jobs. And the duration of this project in the event that the real will to work is available, it does not exceed 3 years as a maximum .. It is a safe investment that is not feared and is almost equal to its security. Keeping money in the Central Bank of Iraq to no avail and letting Iraqis without work.

05/09/2020 http://economy-news.net/content.php?id=20196

[Mary B]

5 grave risks threatening the collapse of the Iraqi economy

 

 

 

Economists have revealed that the Iraqi economy is exposed to great risks, in light of the crisis of the outbreak of the emerging Corona virus and the drop in oil prices globally.

The experts said that the crisis is represented in five things: the
status of foreign exchange reserves, the problems of the general economy , interest and credit contraction, and finally the political problems the country is experiencing.

The experts explained that there is a deep recession due to the Corona virus and that the problems that arise are due to the policies pursued by the bank Central with regard to the high dollar debt and what is going on in the minds of analysts that the foreign currency reserves have decreased significantly in light of the Corona pension crisis.

1-
The foreign exchange reserves were established, and this year the international monetary reserve at the Central Bank decreased
The Minister of Finance and Treasury said that the international monetary reserve was more than enough, and stated that there were no plans such as the introduction of capital controls.
The minister’s statements are confined only to allay investors ’fears, for fear of the investment that is on the brink.

Some analysts believe that if the IMF continues this track, it will be implemented within months.

  The problems of the economy overall
seems that Iraq will live wide recession in addition to the lack of liquidity in the market and the inability of the state to manage the salaries of retirees.
This includes a decrease in the Turkish lira.

3- Low interest
The central bank reduces interest very quickly, which leads to staying under the weight of existing inflation, and investors ask whether the rate of return will be high enough.

4- Credit shrinkage
According to some forecasts, paying the state and companies debts in dollars is more expensive.
5- Political problems The
 investor always worries if the state has political problems, and this is the situation in Iraq , which lives many problems on the international scene such as tension in its relations from the United States of America, and the problems of oil and gas in its price drop.

According to a Reuters report, the ruling regime failed to provide an economic climate for investors, which led to a decrease in investment and consequently a decrease in foreign exchange reserves, and a decrease in the value of the dinar.

 

https://www.thebaghdadpost.com/ar/Story/194795/5-مخاطر-جسيمة-تهدد-بانهيار-الاقتصاد-العراقي

[Laid Back]

They will have to decide on external borrowing or move to an open market economy and give real market value to the dinar.

 

Go Iraq

Go international 

Go purchasing power

[Mary B]

Parliamentary Finance expects oil prices to rise to 40 dollars

 09/05/2020

 

  

Information / private ...

The Parliamentary Finance Committee expected, on Saturday, to increase international oil prices to $ 40 during the next month.

Committee member Hanin Al-Qaddu said in a statement to “Information”, that “the government is currently facing the problem of determining the selling price of a barrel of oil within the federal budget bill for 2020,” noting that “the government formed a team of economic and financial experts to develop a financial dealing mechanism that exceeds The current crisis. ”

He added that "economic forecasts confirm the presence of an increase in oil during the next month, and oil prices may reach 40 dollars after the return of economic activity in a number of producing countries," noting that "determining the selling price of a barrel of oil in the budget is premature at the present time."

He continued, "The 2020 budget will be devoid of the investment component and will be focused on securing the salaries of employees and retirees."

Oil prices rose yesterday, Friday, amid measures to reduce restrictions on public isolation in several countries, which sparked market hopes to boost demand for crude and its products. It ended 25 T.

 

https://www.almaalomah.com/2020/05/09/473264/

[Mary B]

Agriculture: systematic attempts to hit the Iraqi economy with international planning and Iraqi implementation

 05/09/2020

 

  

Information / private ...

The Ministry of Agriculture revealed, on Saturday, that there are systematic targets to strike the Iraqi economy by burning crops during the harvest season, which are left behind by foreign countries and the implementation of Iraqi hands .

The ministry’s spokesman, Hamid Al-Nayef, told “Al-Maalouma” that “wheat farm fires during the harvest seasons stand behind them for many different reasons from one governorate to another.”

He added that "the fires of the southern governorates are mostly the result of negligence or spark or of a generator and others," noting that "some fires are caused by terrorist acts, especially those in the governorates of Kirkuk, Nineveh, Salah al-Din and the parties to Diyala."

Al-Nayef said, “There are systematic plans to strike the Iraqi economy through these fires and they are carried out with Iraqi hands ,” noting that “those countries were considered a super Iraq for their economy and were affected by the achievement of Iraq of self-sufficiency.”

He continued, "So far the fires are minor and do not constitute significant damage. There are plans in place to control and protect them. Ended 25 and

 

https://www.almaalomah.com/2020/05/09/473260/

[Mary B]

Economist for Mawazine News: The reasons for borrowing are multiple

09/05/2020

 

 

 

 

Special - balance News
commented Economic Ahmed Hazal expert, Saturday, the Ministry of financial move to borrow from the Rafidain Bank and Rasheed commercial banks in the secondary market management of central bank of Iraq. "
Said Hazal in an interview / balance News /" The year after this borrowing process The banks will take back the money that they lent to the Ministry of Finance. ”
He added: These papers will be deducted from the central bank, because the Ministry of Finance does not have liquidity to retrieve its securities from the banks and pay the debt, and the central bank will record the debt to the Ministry of Finance.
Hattal pointed out that "the finance is supposed to repay its liabilities to the Central Bank when oil prices rise, but it did not do so when oil revenues recover in previous years, and the bonds will die in the possession of the central bank and its value will be eroded because the finance has to extinguish the debt by the due date," saying : There are many reasons and one borrowing.
And he adds: When analyzing the tools of monetary policy, we find that there is a disconnect between the real and monetary sector, and the effects of monetary policy on the real product are very weak and even on credit and financial depth as well, noting that "this indicates that the money supply is an internal variable of the public finance, it is The controller is through the oil revenues it converts, which the central converts into dinars, and thus it is directed towards spending, most of which is consumer and import, indicating: After that, the central bank comes to finance these imports through its window, from which the dollar comes out, as well as being an instrument for deducting the internal government bonds, and thus it will be a creditor to the finance Which has not paid what this monetary policy has done in Iraq in a nutshell since 2003, as it is closer to banking than to activating its monetary tools in the banking system.
This turns out to say: Although leaving the interest to the market, it is the depth of the problem for borrowers, and banks have become artistic in imposing interest.
It is worth noting that, "On the other hand, (1,385) billion and three hundred million and eighty five thousand dollars are sales of the currency window for the month of April (credits and transfers that are abroad only), but the cash sale is equal to zero, so we find that the dollar rose to (1250 d) P) for every dollar, and the citizen bears an increase of 4% since the start of the crisis until now, by (5000) dinars per ($ 100).
The economic analyst asked: How much is the value of Iraq’s imports for the month of April? Until we know whether the value of the dollar sold is equal to the real value of the imported goods. ”And he
concludes this speech: The central bank defends its position on the currency window through the legal basis on which it is based (Law 56 of 2004) by maintaining the value of the currency and monetary stability, and when mentioning false bills Which drains the currency blames the customs institutions, does this mean that the customs control and deplete foreign reserves?

 

https://www.mawazin.net/Details.aspx?jimare=99534

[Rochester]

thanks, Mary B

[ChuckFinley]

3 hours ago, Laid Back said:

They will have to decide on external borrowing or move to an open market economy and give real market value to the dinar.

 

Go Iraq

Go international 

Go purchasing power