Monday AM Iraq Economy News Highlights 6-6-22

How Iraq's Budgets Contribute To The Spread Of Corruption?

Adviser to the Prime Minister: About 96 billion dollars were withdrawn as government advances without documents

Sabah Nahi is an Iraqi researcher and writer Saturday 4 June 2022 21:12  The current crisis in Iraq lies in the absence of the governmental authority empowered to present the budget to Parliament for approval (AFP)

Eight governments have run Iraq since 2003 after the occupation, four of which came during the presence of the American forces until their exit in late 2011, and the signing of the Sofa agreement for cooperation to keep the “ Saw’s hair ,” as politicians in Baghdad describe it between local and American politicians, which has been subjected to repeated attempts to cut off,

With the bombing of the Washington embassy and the military forces, and the killing of dozens of soldiers and officers, to begin a phase described as a consensual, democratic federation, during which the country’s budgets were distributed among the parties that toppled the former regime, and the permanent constitution was written with an endless stream of criticism from partner and opposition parties, especially from the Sunni component and many Shiites , And Reda Kurdi drafted the constitution according to his whims and interests.

Unprecedented Financial Budgets

The annual financial budgets, which enjoyed an abundance, multiplied several times due to the increase in oil production and the increase in its prices, which reached 120 dollars per barrel, and enabled governments to free government appointments, which reached unprecedented inflation and accumulation of nearly six million employees, extracting what is More than 60-70 percent of the country’s budget, which is described as operational, has resulted in the phenomenon of “space employees”, a popular term for the fictitious employment of people close to the parties in power, and they are just designations for certain people in the state that do not exist in reality, and others who are unemployed Work, registered in the payroll without performing a role or a ceiling in productivity, classifies Iraqis as disguised unemployment, which deprives budgets of huge sums, as if government employment with the motives of winning electoral votes was practiced by all sects quoting the distribution of roles in the three authorities.

There are thousands of people who are classified as multi-salaries, as a result of the transitional legislation that prevailed after 2003, which favored a certain segment of followers, loyalists and supporters of power, which resulted in the phenomenon of extreme disparity in financial incomes, which enriched some and impoverished the majority.

Who Is In Charge?

Towards the end of each year, the Iraqi government presents the annual spending budget, which the Council of Ministers discusses at length to determine spending priorities on state activities.

Writer Hussein Hamed said, “If you ask most of the parliament: What are the functions of the parliament, the answer will come (legislation and oversight), but the shocking answer that these members do not know is that the parliament’s competencies are financial and legislative, while the oversight role is a subsidiary jurisdiction, because the budget is an absolute jurisdiction of the authority. The legislative role, as for the government’s role, is to prepare budget data only.

But this matter is not actually done in the way he mentioned, because the budget is going in reverse, when governments deliberately seized the decision to prepare the budget and presented it to the Council for approval, which created a huge space for the executive authority to control public money and direct it according to its interests and needs without the need for the legislator’s control. In a system that adopted the parliamentary method, not the presidential one, according to the effective constitution approved in 2005.

Politicians' Interference

Adviser to the Iraqi Prime Minister Mazhar Muhammad Salih explains the phenomenon of politicians’ interference and their biased control in setting the general budget and stealing the role from economic specialists by saying:

“The majority of politicians tend to jobs and businesses that generate high revenues for them and improve their personal well-being, as (Buchanan) says the economist , at the expense of the general budget by virtue of their legislative powers, and this leads over time to the expansion of the scope of the general budget as long as they constantly need to be re-elected.

Rather, those politicians go to provide government jobs to their supporters, and expand the scope and multiplicity of government jobs to provide job opportunities for them in an attempt to win their electoral votes during subsequent sessions, and to maintain their political weight.

Saleh said, "By this, the government financial system is biased towards the principle of (large budget) in allocations and trading activities, which puts governments in front of complex difficulties in making financial decisions, which requires more experts to delve into intractable public finance problems.

Thus, as (Buchanan) marked the Keynesian economics calls it 'disease', or rather, 'Keynesian disease', which leads to ends that undoubtedly require a limitation of the irresponsible conduct of politicians, and constrain them to act in a disciplined fiscally responsible manner.

He added that "the Keynesian school is what has made politicians far from the principle of balancing the general budget, and immersed in the fiscal deficit. (Buchanan) also turns away with his idea of​​hostility to the political dimensions of the school (post-Kinsey)."

Saleh believes that "future generations in Iraq will bear the budget deficit, which requires them to pay more taxes and bear many tax burdens in a manner that is not compensated by the interest returns granted on government bonds, according to which they lent to governments, which is called Ricardo's parity.

As I see and see ( Buchanan) that leaving governments without constitutional restrictions will excessive financial behavior, and become trespassing on public money, and comes at the forefront of these demands constitutional restrictions by adopting the principle of balanced budget, on the basis of which public finances restore health, purity and integrity.

Mazhar asserts that "the problem in Iraq also lies in the final statements, which have not been issued yet, and they are the real source of our information about the extent to which the budget is adhered to or not."

Inability Of Budgets To Implement Their Goals

Regarding this paragraph regarding the feasibility of budgets and if they coincide with the objectives of their allocation in investment spending, the Iraqi presidential adviser told The Independent, “Unfortunately, investment budgets over two decades have not been able to implement their financial and material goals by more than 28 percent annually, for the best productive sectors And the infrastructure sectors, with the exception of the oil extraction sector, which was linked to the rounds of licenses and service contracts that are paid for directly with crude oil.

Based on the foregoing, operational budgets acquired the share of the investment budget through the annual expansion of operational spending, with the aim of managing government jobs, which are of a service-consumer nature only, and the “compensatory budget” replaced the “compensatory budget” in the interest of expanding the number of workers in official jobs, as the relatively high government wage became Available or allocated in part to fill the cost of the shortage in infrastructure services, which was generated by investment spending, which was not achieved sufficiently and planned, by providing the opportunity for state employees to compensate from their salaries for the shortfall in social services and general public goods, such as schools, hospitals, hygiene and electricity water, and others.

Borrowing And Its Accumulation

The current crisis in Iraq lies in the absence of the governmental authority empowered to present the budget to Parliament for approval. And government spending as a result of the current political blockage.

The government has no authority to present a budget, and it has no right to take advances from the financial surplus, due to the rise in oil revenues, and after the constitutional amendment of the Financial Management Law.

The economic advisor to the Prime Minister comments on this that “the government cannot borrow or take advances outside the constraint of the first of December, and if it were possible, the problem would be basically solved without resorting to the emergency law or even the existence of a budget in the first place.

The advances withdrawn without documents, which are made Settling it later requires the existence of a budget law, as these are wrong interpretations taken from one of the paragraphs of the Financial Management Law No. 6 of 2019, amended regarding dealing with advances, and if things are that easy, which some imagine, why then go to the emergency law, but it is possible Making arbitrary allocations, paying them with an advance check, and directly disposing of the surplus reserves that the government currently has in advance.

Bad Document

Saleh confirms the fact that there are accumulated unreconciled advances from previous budgets, which indicates the government's inability to liquidate huge financial assets. He said that "the accumulated unreconciled advances from previous budgets amounted to approximately 140 trillion Iraqi dinars (about 96 billion dollars), 70 percent of which are withdrawn from the exchange units and there are no fundamental documents, and this is one of the reasons for the failure of the state's final accounts since 2021. Due to the withdrawal of advances under the previous Financial Management Law before it was amended in 2019.

Yet Another Crisis

The former Minister of Oil, Jabbar Al-Luaibi, who was interviewed by The Independent Arabia, believes that the problem with the Iraqi financial budgets lies in another dimension, which is a feasibility study and the proceeds of the allocations that were made to ministries and departments and approved for government sectors, where were they spent and how? Especially in the investment and not the operational aspects of salaries, and what results have been achieved, after the end of the year, that is, the grantor of the allocations does not pursue the feasibility of their implementation and what the objectives of their allocation have been achieved.

The bitter truth that economic specialists realize is that Iraq needs decades to verify the outlets for spending its budgets and to prosecute corrupt politicians and their followers who have missed growth opportunities in light of the oil financial boom and billions of budgets.   LINK

Al-Amiri: Not Passing The Budget Is Considered Circumventing The Judiciary’s Decision Regarding The Region’s Oil

Posted On 2022-06-05 By Sotaliraq   LINK

Huge And Crazy Exaggeration.. Al-Fateh: Food Security Is A Door To Corruption And Theft In The Name

Article at link:   https://baghdadtoday.news/ar/news/191258/A

Disagreements Within Parliamentary Finance Postpone The Final Draft Of The Food Security Law

Shafaq News/ A source in the Parliamentary Finance Committee stated, on Sunday, that the difference of opinion among the members of the committee postponed the settlement of the final draft of the emergency support law for food security and development.

The source told Shafaq News Agency, "Some members of the Finance Committee wish to reduce some expenses and make financial transfers for some articles of the law, and others are trying to delete articles from the Food Security Law, and this led to delays in resolving the final draft of the law."

He added that "the committee may not reach a solution in today's meeting that continues until the moment, and that it will hold another meeting tomorrow, Monday, to vote on the final version of the law, and then it will be submitted to the Presidency of Parliament to set a date for voting on the food security law in the parliament session."

Today, the Parliamentary Finance Committee held a meeting to put the final touches on the proposed emergency support law for food security and development, in preparation for a vote on it in the parliament.

Today, Sunday, deputies of the Sadrist bloc in the Finance Committee of the Iraqi Council of Representatives announced the completion of the finalization of the proposed law on emergency support for food security and development, in preparation for a vote on it within the parliament, stressing that the law is based on important, "indispensable" basic points.   LINK

Parliamentary Finance Reveals Details Of “Food Security”

Economie  2022-06-04 | 13:53  Source:  Alsumaria news   6,747 views  On Saturday, the Parliamentary Finance Committee revealed details of the “Food Security” proposal, stressing that the proposal will include the necessary allocations for the ration card items, improving the food basket and purchasing wheat.

The head of the committee said Hassan Al Kaabi[/url]In a statement, "The Finance Committee will hold a meeting tomorrow, Sunday, to put the final touches to the proposal for the emergency support law for food security and development, and to complete all its paragraphs to be included in the agenda of the next session for the purpose of voting on it."

He added that "the proposed law will include the necessary allocations for the ration card items, improving the food basket, purchasing local and imported wheat to secure food for the honorable citizen, paying the dues of farmers and farmers, and purchasing imported gas and the energy needed for the continuation of electric power and its uninterruption during the hot summer days."

Al-Kaabi pointed out, "The inclusion of the necessary funds for the development of the regions for our dear governorates, petro-dollars and full allocations to end the problem of lecturers, contracts, procedures, certificate holders and financial allocations to include the largest possible number of people with special needs, social care and the unemployed," noting that "there is no truth to the news that spoke that The amount allocated for the proposed law exceeds 25 trillion dinars.   LINK

The Iraqi President Warns Of An "Existential Danger" Threatening The Country

Shafaq News/ The President of the Republic, Barhamam Salih stressed, on Sunday, the necessity of dealing with climate change as a national priority in Iraq because of the existential danger it poses to the country's future, noting that the water deficit will reach 10.8 billion cubic meters in the year 2035.

The Media Office of the Presidency of the Republic stated, in a statement received by Shafaq News Agency, that President Barham Salih held an expanded meeting at Al-Salam Palace in Baghdad, on the occasion of World Environment Day, in the presence of the Minister of Environment Jassem Al-Falahi, representatives of the United Nations, UNESCO and Iraqi civil society organizations specialized in the issue of environmental protection.

During the meeting, Salih stressed the need for addressing climate change to become a national priority in Iraq, as it represents an existential threat to the country's future as one of the countries most vulnerable to the effects of climate change.

He called for the necessity of revitalizing Mesopotamia through the national strategic plans developed in this regard, in addition to the necessary partnership of civil society organizations and youth in this aspect.

He added that the population of Iraq today is more than 41 million, and it will be 52 million in ten years, and 80 million in the year 2050, and that will be accompanied by an increase in demand for water.

Saleh warned that "desertification affects 39% of our lands and the scarcity of water is now negatively affecting all parts of our country and will lead to the loss of the fertility of agricultural lands due to salinization," noting "the need not to rely on the rentier economy, but rather to move towards achieving economic transformation."

He pointed out that "our water deficit is expected to reach 10.8 billion cubic meters by 2035, according to the studies of the Ministry of Water Resources, due to the decline in the levels of the Tigris and Euphrates, evaporation in dam water and the failure to modernize irrigation methods."

He pointed out that "the project to revive Mesopotamia, submitted by the Presidency of the Republic and adopted by the Council of Ministers, is a project for Iraq and all of our region, which shares the serious threat of climate change, and relies on strategic programs that include afforestation, modernization of water management of the Tigris and Euphrates, generation of clean energy, and the integration of environmental plans for countries in the region with each other through joint solidarity.

And Saleh added, "Iraq, with its geographical location in the heart of the region, and its ecological diversity, where the palm trees, the marshes and the mountains of Kurdistan, can be a starting point for gathering the countries of the Middle East environmentally."

He stressed "the need to strongly support young people in climate action," noting that "the Iraqi youth are a major contributor to the issue of environmental protection, and they have excellent initiatives in this regard, in addition to the great role of international community organizations specialized in the issue of the environment."

And he added, "The climate crisis does not discriminate or exclude one country without another, and adapting to it and limiting its damage will not succeed through individual steps, and a country that believes that its measures are enough to protect it from the dangers of climate change will not be delivered without measures similar to its neighbors, its region and the world as a whole."

He noted that "sand storms, water scarcity, high temperatures and desertification are cross-border risks that will only be addressed with high-level joint international coordination and planning that integrates national, regional and international plans with each other.   LINK

Iraq's Water Rights Are A "Red Line"... A Tripartite Meeting That Includes Iraq, Iran And Turkey In

Article at link:   https://khabaar.press/archives/85719