Economists: the reduction in oil prices causes budget deficit

Posted: October 22, 2011 in Iraqi Dinar/Politics

22/10/2011 19:11

Baghdad, October 22 / October (Rn) – two Iraqi economists said Saturday that oil prices down in the approved 2012 budget increases the deficit outlook.

The economist said, and teaching at the University of Mustansiriya Mohammed Globe, told the Kurdish news agency (Rn) that “the cabinet’s decision to cut crude oil prices, which will depend upon the budget of $ 85 per barrel to $ 80 per barrel would increase the deficit by 3%.”

He added that “the Iraqi government was better for her to inform the International Monetary Fund and the World Bank and the Central Bank of the coordinates of a general Mwaona in 2012.”

He noted that “the balance of 2012 took place the formal estimates have not been in any major changes differ from the budget in 2011, which also focused on the allocation of funds to Userat security, electricity and oil.”

For his part, said a member of the Council of Economic Studies Iraqi Baha Zurfi (Rn) that “the problem of the budget in 2012 to still rely on a cadre in the government concluded without the involvement of economic organizations known to give an impression of the economic budget.”

“The budget in 2012 will not recognize the beginning of the year and will be delayed because of the government to return the budget to the Ministry of Finance to re-formulation, which hurt the Iraqi economy significantly.”

He explained that “the budget deficit will not be a planning and oil revenues could fall to below $ 79 a barrel of crude oil, which would turn the deficit to a deficit of schematic and realistic difficult to treat.”

For his part, said a member of the Parliamentary Finance Committee, Abdul Hussein al-Yasiri (Rn) that “the budget deficit in 2012 will not be affected if the government reduced the basis of reliability of the oil prices to $ 85.”

“The House budget will receive the file after the legislative recess and will be approved after discussion of the substantive discussion by the House before the end of the year.”

The Commission announced the parliamentary services it provided Taliwm, a formal letter to the Council of Ministers warned of economic harm due to no increase in financial allocations to the provinces not covered by petro-dollars in the budget in 2012.

She noted the Parliamentary Finance Committee, said on Friday that the Iraqi government decided to adopt the price of oil is $ 80 a barrel instead of $ 85 in the budget of the 2012 Notes pursuant to the International Monetary Fund.

The government spokesman Ali al-Dabbagh has made a press statement earlier last month (18/09/2010) that the Cabinet discussed at its extraordinary bill the federal budget for 2012 noting that he has been allocated $ 131 trillion Iraqi dinars ( $ 112 billion) total federal counterbalance an increase of 36% from last year.

Al-Dabbagh said that “total federal income amounted to 107.7 trillion dinars (about $ 92 billion) deficit total of $ 23.3 trillion Iraqi dinars (20 billion dollars) are covered by the amounts of cash retained from the current year budget 2011 is internal and external borrowing and the proportion of of the savings expected from the increase in selling prices or increased oil production or borrowing from the IMF and the World Bank. ”

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