Iraq and America discuss the existing partnership between the two countries and enhancing cooperation
Today, Tuesday, the Speaker of the Iraqi Parliament, Mahmoud Al-Mashhadani, discussed with the Chargé d'Affairs of the US Embassy in Baghdad, Ms. Elizabeth Trudeau, in the presence of the Director of the Political Section at the Embassy, Ms. Michelle Siders, the general situation in Iraq, and ways to enhance cooperation and existing partnership between the two countries.
The media office of the Speaker of the House of Representatives stated in a statement received by "Kalima News": "During the meeting, the general situation in Iraq was discussed, and ways to enhance cooperation and existing partnership between the two countries, with emphasis on the United States' support for Iraq in various fields, in a way that enhances stability and development."
According to the statement, the meeting also discussed "a number of topics of common interest, including developments in the regional situation and their effects on the Iraqi arena."
Dr. Al-Mashhadani stressed the importance of strengthening relations between Iraq and the United States within the framework of common interests, stressing the need to continue dialogue and cooperation to support Iraq's stability and continue efforts to confront political and economic challenges. link
Iran is out of Iraq for good
Al-Sudani conveyed Trump's orders to Khamenei:
Forced to dissolve militias
Forced to stop importing Iranian gas
Forced to prevent currency smuggling to Iran
Forced to deal with the new Syrian government
Forced to cut off the air and land bridge between Iran, Iraq and Syria and close the borders and airspace.
LFG
Article 12 obstructs budget schedules and Parliament is unaware of the size of expenditures and deficit
Member of the Parliamentary Finance Committee, Jamal Kojer, expected on Tuesday that the budget tables would be sent in February, while he pointed out the possibility of delaying its passage due to disagreements over Article 12.
Kocher said in a statement to Shafaq News, "The Iraqi law requires the Council of Ministers to send the state's general budget to the House of Representatives in the ninth or tenth month of each year, but this has not happened in the past years."
Koger expected that the budget tables for the year 2025 would be sent to the Council at the beginning of next February, but the disagreements over Article 12 of the budget law may delay sending the tables from the government to Parliament.
Koger added that "the House of Representatives and members of the Parliamentary Finance Committee do not have any knowledge of the details of the budget schedules for the year 2025," noting that they do not "know the size of the budget in terms of operating and investment expenses and the deficit rate so far."
Article 12 of the draft budget law includes compensation for the Kurdistan Regional Government for the costs of production and transportation of oil extraction in the region.
It is noteworthy that the representative of the Kurdistan Democratic Party bloc, Jiay Timur, confirmed earlier to Shafaq News Agency, that "the Iraqi government previously calculated in the budget law the cost of extracting oil at $6, and this is a very small number," noting that "foreign companies that work on extracting oil at a cost of up to $26 per barrel."
In June 2023, the Iraqi Parliament voted on the draft general budget law for the fiscal years (2023, 2024, 2025). link
MZ: We hope it will happen before the 10th. There is a lot of stuff pointing to it possibly happening before the 10th. But there are a growing amount looking now for it to happen after the inauguration. Then it will let rip.
Member: Have you confirmed lower denoms have been released in Iraq?
MZ: No confirmations. There are some in Iraq telling us they are out- but no confirmations. I have seen pictures but do not know if they are old lower denoms or new on
MZ: I just want to warn you all of scammers out there. I have a great contact at Interpol that we send information to about people offering QFS accounts right now. That is a scam. One used my email address which is similar to my real address with an addition I in it…2 I’s in original…....its not spelled right. People are trying to get you to send a couple hundred bucks to get a QFS account.
MZ: You CANNOT get a QFS account yet. The new system has not started. Anyone saying differently is a scam. Fortunately Interpol is starting to go after these companies WORLDWIDE. For the love of God people. Do not fall for this. Desperate people are being preyed on left and right.
MZ: When the new system is ready you will not have to pay for an account. All of our accounts will be on it.
The amount of money sold, domestically and internationally, by the Central Bank in dollars this year has exceeded $62 billion, resulting in the receipt of dinars in equivalent proportion, averaging approximately 80.6 trillion dinars for the year.
Here’s the very important part –à ereHNon-oil revenues generated from taxes, fees, and customs by the end of October 2024 amounted to 14.3 trillion dinars. Combined, these revenues total around 95 trillion dinars. However, by the end of October, Iraq’s total expenditures had reached 122 trillion dinars. With two months of expenditures still unaccounted for, it is evident that the dinar reserves derived from oil-based dollar revenues have been exhausted.
This comes despite reports from the Central Bank’s Foreign Currency Selling Window, which indicate that total transfers abroad (remittances and credits) this year have reached the highest level in seven years—34% higher than last year. Similarly, dinars returned to the Central Bank and subsequently to the Ministry of Finance in proportion to this increase. So why is there talk of a cash shortage affecting the distribution of December salaries for some ministries in Baghdad and the November salary allocations for the Kurdistan Region?
According to reports from the Iraqi Ministry of Finance on revenues and expenditures, total expenditures for the first nine months of this year amounted to 94.5 trillion dinars, including 85 trillion dinars in operating expenses and 9.5 trillion dinars in investment expenses. However, according to the Ministry of Finance’s October report, total expenditures had climbed to 122.7 trillion dinars, with operating expenses accounting for 100.6 trillion dinars and investment expenses rising to 22 trillion dinars.
Looking back at previous months, it becomes evident that average monthly expenditures ranged between 10 and 11 trillion dinars. For instance, total expenditures from the beginning of the year to July were 73 trillion dinars, increasing to 83 trillion dinars in August and 94 trillion dinars in September—demonstrating consistent monthly spending within this range. However, expenditures surged dramatically in October, reaching 28.2 trillion dinars and bringing the total for the year to 122 trillion dinars by the end of that month. This significant jump was driven by increases in both operating and investment expenditures. Operating expenditures, which typically ranged from 9 to 10 trillion dinars per month, rose to 15.6 trillion dinars in October, while investment expenditures, previously averaging 1 trillion dinars per month, soared to 12.6 trillion dinars in the same period.
As a result of the excessive expenditures in October, the Ministry of Finance now lacks the cash needed to cover expenses at the end of the year. October’s spending was nearly triple the average monthly expenditure of previous months.While total revenues for the first 10 months exceeded expenditures, converting the full oil revenue—received in dollars—into Iraqi dinars or conducting domestic transactions in dinars has not been feasible which is due to government policies mandating that all domestic transactions must be conducted in dinars, while foreign transactions must be conducted in dollars and processed through remittance.
According to the Iraqi Ministry of Finance, October’s expenditures rose so significantly that the total amount of dinars generated from selling dollars domestically and internationally, combined with non-oil domestic revenues, was insufficient to cover the spending. Total expenditures for the month reached 28 trillion dinars, approximately 18 trillion dinars more than in previous months. It remains unclear how the Ministry of Finance plans to manage expenses for the remainder of the year, as 95% of Iraq’s currency is held outside the banking system, which amounts to 95.5 trillion dinars out of a total of 101.3 trillion dinars by the end of November 2024.
The underlying issue here highlights the weaknesses in Iraq’s monetary system and the absence of a coherent expenditure and revenue policy. Despite having not spent 60% of its allocated budget, the Ministry of Finance is already encountering significant challenges. Had the budget been fully implemented as planned, cash shortages would likely have arisen mid-year rather than at year-end.
In conclusion, is it true that Iraq has cash problems? Yes, Iraq is indeed facing cash problems. However, these issues are not caused by low oil revenues, declining oil prices, or a shortage of money or dollar issuance. Instead, the root cause lies in the government’s economic expenditure policy, which allowed spending to surge by approximately 300% in a single month.
