"Tidbits From TNT" The Budget is Passed 6-12-2023
TNT:
CandyKisses: House votes on tripartite budget law worth more than $150 billion
Shafaq News / The Iraqi Council of Representatives voted, ahead of Monday, on the federal budget law for the years 2023,2024,2025, after five-day discussions.
The value of this year's budget is 197 trillion and 828 billion Iraqi dinars (about 152.2 billion dollars), with a total deficit of 63 trillion dinars ($48.3 billion), while the budget items of 2023 and 2024 have not been published.
Harambe: Iraq Approves Record Budget IMF Warns Could Destabilize Finances | Bloomberg (6/12/23)
(Bloomberg) — Iraqi lawmakers have approved a budget that may see the government spend a record 199 trillion Iraqi dinars ($153 billion) this year.
It signals a significant increase in expenditure in the OPEC nation, with the International Monetary Fund warning it could accelerate inflation and push Iraq’s breakeven oil price up to $96 a barrel, much higher than today’s price for Brent of around $74.
“Barring a large increase in oil prices, the current fiscal stance could lead to mounting deficits and intensifying financing pressures in the coming years,” the IMF said on May 31.
The fiscal plan was passed in the early hours of Monday morning after months of wrangling over how Baghdad would share revenue with the semi-autonomous Kurdistan Regional Government in the north.
It follows the formation of Prime Minister Mohammed Shia Al Sudani’s government late last year.
Iraq, like other major petrostates, enjoyed a windfall in 2022 as Russia’s invasion of Ukraine roiled energy markets and sent crude prices above $125 a barrel. They’ve since fallen, largely because high interest rates have weakened the global economy.
Baghdad’s finances and economy often suffer when oil prices drop, with the government struggling to rein in spending. The country has one of the world’s highest wage bills as a proportion of gross domestic product.
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Iraq expects revenue to reach $103 billion in 2023, based on 3.5 million barrels per day of oil exports at a price of $70 per barreli.
The budget deficit is set to reach $49 billion, which Iraq expects to partly cover with $18 billion of sovereign bonds.
Iraq’s $2.7 billion Eurobond maturing in 2028 — its only one outstanding — trades at a yield of around 9.8%.
To speed up the process and avoid more delays in the coming years, Iraq’s parliament has said budgets for 2024 and 2025 should be based on this years’ figures but tweaked according to oil prices and export volumes.
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Tishwash: Sudanese in the first official position on the approval of the tripartite budget
On Monday, Prime Minister Muhammad Shia al-Sudani commented on approving the highest budget in the history of Iraq.
Al-Sudani said in a statement, which “NAS” received a copy of (June 12, 2023), “We extend our congratulations to our people, on the occasion of approving the Federal General Budget Law for the years 2023, 2024, and 2025, and we also express our thanks to the presidency and members of the esteemed Parliament, for the efforts that have been made and the keenness to approve the budget.
He added, "The budget that the Council of Ministers voted on last March 13 took into account priorities that affect the basic requirements of the individual and the family, and the livelihood of citizens, and seeks to meet their aspirations in what they expect from the government in terms of services, construction and infrastructure projects."
And he continued, "Our government has relied, by presenting the tripartite budget, on the clear reform vision that we adopted in the government program, which is a procedural and scientific step that carries solutions to the phenomenon of recurring or failing projects, which has accompanied governments over the past years, and this vision also confirms the reduction of operational spending and the development of revenues." non-oil and private sector support.
He pointed out that, "based on this, the government will work to review the items that have been amended in the budget, and study the extent of their conformity with the government's vision and objectives approved in the ministerial curriculum approved by Parliament."
And he stressed, "We highly appreciate all the efforts that have been made to approve the budget, and we especially mention the members of the Parliamentary Finance Committee, the Strategic Planning Committee, and the Parliamentary Federal Service, for what they have provided over the past period." link
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Harambe: Iran’s SEPAM to replace SWIFT in trade transactions: ACU chief | ILNA (6/12/23)
The secretary general of the Asian Clearing Union (ACU) says Iran’s financial messaging system SEPAM will replace SWIFT, a dollar-based international system, in trade exchanges between ACU members beginning next month.
Farhad Morsali said that Iran’s SEPAM has been accepted by ACU members as an internal financial messaging system, according to a Saturday report by Fars News Agency.
He said it will take six months for the union’s own messaging system to be ready, and in the meantime, the members should replace SWIFT with SEPAM, for which Iran will charge a fee.
Iran unveiled SEPAM in October 2013 as an alternative to SWIFT, a Belgium-based financial messaging system that is being gradually abandoned by countries because of its sheer reliance on transactions that are based on the US dollar.
Last month, central bank governors of ACU member states decided at a summit in Tehran to create an internal financial messaging system to replace SWIFT in banking transactions between members of the bloc.
The decision was in line with the efforts made by ACU members to reduce the domination of the US dollar in global trade.
Iran’s CBI governor Mohammad-Reza Farzin said on May 24 that the bloc will diversify the basket of currencies it accepts for payment settlements to help the global de-dollarization bid.
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