What are the consequences of basing the budget on an oil price of $55?
Economic analyst Abdul Rahman al-Mashhadani warned on Thursday of the repercussions of basing the oil price at $55 per barrel on the general budget law. He noted that this measure will lead to a financial deficit exceeding 80 trillion dinars, threatening a stifling economic crisis in the country.
Al-Mashhadani told Al-Maalouma, “Adopting a price of $55 per barrel in the budget is unrealistic in light of the ongoing fluctuations in global markets, and could result in a huge financial deficit that would exacerbate Iraq’s economic and financial crises.”
He added,
“Some experts believe that reducing the price of oil to $55 per barrel could increase the fiscal deficit, reflecting the inaccuracy of this budgeting mechanism.” He emphasized that "continuing this approach could lead Iraq to a real economic catastrophe."
Al-Mashhadani pointed out that "the only solution lies in the government's deliberate reduction of operating and investment expenditures and its efforts to diversify sources of income instead of relying entirely on oil revenues." He called for "the development of a comprehensive economic reform plan that relies on the private sector, agriculture, industry, and tourism as alternative and sustainable sources."
A number of experts suggested that calculating the price of a barrel of oil at $55 is the most appropriate option to address the current financial crisis, given the realism it provides in the estimates and the avoidance of falling into a larger budget deficit. link
I think we’re very close…Haven’t you noticed the change in pattern?
…Articles. Didn’t you notice? …That’s where all the truth, all the vital information that we need about this investment is at. This is called the Asraflak. Asraflak is when they’re giving the financial literacy education of the monetary reform, that I promised you was going to happen. That’s where we’re at.
[Iraq boots-on-the-ground report]
FIREFLY: Sammy wants to talk to you. The reason you don’t see the budget is the same reason you don’t see the back pay paid out or the oil not restarted because it’s all related to the budget tables and a rate.
FRANK: I agree 100%...I agree with you Mr. Sammy because if you sit back and look at the whole picture of the monetary reform there’s only one thing missing – a new exchange rate that makes everything work. That makes everything make sense because nothing is logical at 1310.
Community comment: “$6.47 like it was in my dreams!“
I don’t think it could ever reach something like that…because that would cause a domino effect with the other Middle Eastern currency values. It would be the opposite of what we’re doing right now, an undervalued exchange rate. We would be dealing with an overvalued exchange rate. That would really mess tings up in imports and exports.
In a meeting with Al-Sudani, Oman offers a digital partnership to Iraq.
Prime Minister Mohammed Shia al-Sudani received today, Thursday, the Omani Minister of Transport, Communications and Information Technology, Saeed bin Hamoud al-Maawali.
According to a statement from his office, a copy of which was received by {Euphrates News}, Al-Sudani welcomed the Omani minister and sent his greetings to the Sultan of Oman.
Al-Sudani pointed out that "the level of development, employment, and investment in Iraq, including the telecommunications sector, has advanced and improved, thanks to the political, security, and social stability the country is witnessing, as well as the economic renaissance," stressing that "the many commonalities between Iraq and the Sultanate of Oman provide an opportunity to develop economic and investment cooperation between the two countries."
For his part, Al-Maawali praised Iraq's achievements on various fronts, reviewing "the results of his discussions in Baghdad," and affirming "the readiness of his country's public and private sectors to cooperate with Iraq in the field of the digital economy and digital government."
Al-Maawali also expressed his country's "readiness to cooperate in the ports and airports sectors by investing in projects related to various Iraqi airports." link
MILITIAMAN: Real-time Iraqi dinar data - Coordination and cooperation mechanisms targeted
Highlights
Summary
In this engaging video by Militia Man, the host discusses the current state of the Iraqi economy and its banking sector while providing updates on political developments in Iraq, particularly in relation to the Kurdish region.
The host stresses the importance of collaboration between the central government and the Kurdistan region to resolve issues surrounding oil exports and economic stability.
He notes significant improvements in the political and economic landscape of Iraq, driven in part by foreign investments and a renewed focus on integrating Iraq within the global financial system.
Militia Man highlights the crucial role the banking reform process plays in modernizing Iraq’s financial institutions, aimed at compliance with international standards and enhancing investor confidence. He touches upon the ongoing efforts to resume oil exports from the Kurdistan region and emphasizes that these measures are necessary to address severe economic setbacks. He asserts that Iraq is approaching a critical phase, needing to synchronize various political, economic, and financial efforts to foster stability and sustainability.
The host expresses optimism that Iraq is not only ready but also actively engaging with regional players to strengthen ties and attract investments. He concludes by urging viewers to stay connected for future updates while reminding them of the importance of supporting independent content creators and platforms in this space.
☕ Morning Coffee Ritual: The host starts his day with Freedom Forge coffee, setting a personal tone for the discussion.
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Banking Sector Reforms: Iraq is undergoing reforms in its banking system to comply with international standards and boost investor confidence.
🇮🇶 Political Stability: The host emphasizes recent improvements in the political scene, contributing positively to the economy.
🛢️ Kurdistan Oil Exports: Significant discussions are ongoing to resume oil exports in the Kurdistan region, which is critical for Iraq’s economy.
🌍 Global Integration: The need for Iraq to synchronize its financial practices with global norms to enhance economic stability is stressed.
🗣️ Regional Cooperation: Both the federal government and Kurdistan region show signs of cooperative efforts to resolve outstanding economic issues.
🤝 Ongoing Conversations: The importance of continuing dialogues between various authorities in Iraq to facilitate economic growth and stability is highlighted.
Key Insights
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Importance of Data Analysis: Militia Man emphasizes the necessity of data analysis in drawing conclusions about Iraq’s economic situation. The aggregation of information on a daily basis allows for informed discussions regarding economic forecasts and the overall health of the country’s financial environment.
📈 Investment Climate Improvement: The increasing presence of foreign and Arab banks signals a recovering investment climate in Iraq. By enhancing the banking framework, Iraq is working towards becoming a regional financial hub, which would uplift its economy and attract more foreign investments.
📉 Impact of Delaying Oil Exports: The halt in oil exports from Kurdistan has resulted in massive losses for Iraq. Understanding the financial implications, it’s clear that immediate action is required to resume oil production to benefit the federal budget and overall economy.
💼 Legal Framework and Federal Coordination: Establishing a legal framework that supports the oil agreement between the federal government and the Kurdistan region is essential for long-term economic sustainability. This coordination underscores the interdependencies within Iraq’s political landscape.
🔄 Synchronizing Economic Strategy: The host argues that Iraq must synchronize its economic reforms and strategies, particularly regarding currency valuation and cross-border trading processes. This synchronization is necessary to minimize market disruption and boost investor confidence.
🛣️ Infrastructure Development: The development road project indicates ongoing efforts not just for domestic growth but for integrating regional economies. This strategic approach ensures that economic benefits extend beyond borders to foster neighborly partnerships.
📊 Emerging Digital Frameworks: The emphasis on transparency and accountability in Iraq’s governance structures suggests a transition toward digital frameworks for financial management. This modernization is necessary for confronting challenges in a global context and ensuring effective state functionalities.
Overall, Militia Man’s reflections emphasize that Iraq is in a crucial transitional phase; the outcome will greatly depend on its ability to navigate political, economic, and cooperative relations effectively. The journey toward financial integration and stability entails a multi-faceted strategy and significant collaboration across all levels of government and society.
The leader of the Kurdistan Democratic Party, Wafaa Muhammad Karim, confirmed that the Kurdistan Region will seek to convince oil companies operating on its territory to resume oil exports, as part of the joint efforts between the federal government and the region to resolve the oil file.
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Karim said in a statement to {Al-Furat News} that: “Among the important axes discussed by Prime Minister Mohammed Shia Al-Sudani during his visit to the region, is the size of the losses incurred by Iraq as a result of the suspension of Kurdistan’s oil exports during the past two years,
which amounted to 23 billion dollars.” He added that “the region will work seriously to convince oil companies to resume exports, within the framework of the recent understandings aimed at ending the stalemate in this file.”
