Iraq Achieves The Highest Trade Surplus In History.. An Expert Summarizes The Reasons And Clarifies The "Restrictions", 5 SEPT

 Iraq Achieves The Highest Trade Surplus In History.. An Expert Summarizes The Reasons And Clarifies The "Restrictions" - Urgent

Baghdad today - follow-up    Today, Monday (September 4, 2023), economist Nabil Al-Marsoumi announced that Iraq achieved the highest trade surplus in the past year 2022, while he indicated that the trade surplus had increased unrelated to reform.

In his post, Al-Marsawi outlined the reasons for Iraq achieving the highest trade surplus in the past year, pointing out that the surplus is "the difference between merchandise exports and imports."

And he continued, "The surplus achieved for the year 2022, over the course of the history of the oil industry, which is close to a hundred years old, as the surplus amounted to 53.54 billion dollars due to the increase in oil exports in 2022 to about 120 billion dollars, of which 115 billion dollars came from crude oil exports, and 5 billion dollars most of it." of black oil exports.

Al-Marsoumi added, "This means that the increase in the trade surplus in Iraq has nothing to do with reform, development, diversification of the economy, or any self-efforts, but rather is linked to an external variable, which is oil prices, whose annual rate in 2022 reached more than $95 a barrel."

 Trade Surplus

In addition, statistics conducted by the German company  Statista , which specializes in market and consumer data, today, Monday (September 4, 2023), revealed that Iraq achieved the largest trade surplus for the past year 2022 over the past ten years.

The trade balance indicates the differences in imports and exports of goods in the country during the year. If the value of its exports during a period exceeds the value of its imports, it is called a surplus in the trade balance. If the total value of imports exceeds the total value of exports, it is called a deficit in the trade balance.

And the company stated in a table it published today, that Iraq achieved the highest trade surplus for goods in 2022 over the past ten years, as the surplus last year amounted to $53.54 billion, up by 64% from 2021, when the trade surplus for goods in that year reached $20.08 billion.

He pointed out that Iraq achieved a deficit in its trade balance for two years, the first in 2020, when the deficit amounted to 4.11 billion dollars, and the second in 2015, when the trade deficit amounted to 0.94 billion dollars.

And the report continued, while in 2019 the balance achieved a trade surplus of $16.62 billion, in 2018 the trade surplus reached $35.95 billion, and the trade surplus in 2017 reached $15.1 billion, indicating that the trade surplus in 2012 amounted to $35.39 billion.

 Oil Export

And Iraq had achieved during the past year (2022) financial revenues of more than 115 billion dollars from the export of crude oil, to be the highest in years, according to official figures announced by the Iraqi Ministry of Oil.

According to those figures, the daily export rate amounted to 3,320,000 barrels, which is a total of one billion, 211,800,000 barrels for a full year.

 Reflections

And about the repercussions of these financial revenues on the economy and the citizen, and their impact on resolving the economic crises facing the country, whose budget depends more than 95% on oil sales, the financial advisor to the Iraqi government, Mazhar Muhammad Salih, says that these revenues were subject to two restrictions in financial behavior due to the absence of the budget law for the year 2022:

The first is by adhering to Article 13 of the amended Financial Management Law No. 6 of 2019, which requires spending 1/12 of the total actual ongoing or current expenditures in the previous budget estimated at 115 trillion dinars ($70 billion).

The second restriction refers to the allocations contained in the Emergency Law for Food Security and Development No. 2 of 2022, amounting to 25 trillion dinars ($17 billion), which means that the total expenditures for 2022 amount to 140 trillion dinars ($88 billion).

Saleh explains that the remaining financial surplus from the 2022 revenues is 27 trillion dinars ($18.5 billion), and it will be an opening balance in the 2023 budget.

Sovereign Fund

For his part, the economic academic at the University of Baghdad, Ali Dadoush, stresses the need to invest the financial surplus in developing industry and agriculture and supporting the foundations of the real private sector, to operate factories and factories and produce locally manufactured goods and services, in conjunction with the gradual re-imposition of taxes on goods that are produced locally, in line with Activating the role of oversight and preventing the removal of locally produced commodities and keeping them within prices equal to or a margin lower than the prices of competing foreign commodities.

Dadush added, "All of the aforementioned is achieved through the method of balancing programs and performance with the establishment of the sovereign fund," which he considers "the first step towards diversifying the sources of the Iraqi economy."

The academic indicated that this guarantees the solution of several problems rooted in the Iraqi economy, such as unemployment and corruption, in both its financial and administrative aspects, the imbalance of the trade balance and the smuggling of foreign currency abroad.

Source: "Baghdad Today - Agencies"   LINK