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Representatives to receive budget plan next week
01/12/2011 12:29
BAGHDAD, Dec. 1 (AKnews) - The Council of Representatives will probably not approve the 2012 budget before the end of the year.
The government will forward the draft to the Council after it voted on it next Tuesday, but economists and experts expect the 2012 budget to be delayed in the Council due to political differences between the parliamentary blocs that appear annually during the discussion of financial budgets.
Mariam al-Rayyes, spokeswoman for the Council of Ministers, said, "We hope the budget will not be delayed like last year."
The 2011 budget was not approved until late February.
The 2012 budget is estimated to be $112 billion USD (133.6 trillion IQD). It is an increase of 36% on 2011, but there remains a deficit of $20 billion USD (23.9 billion IQD).
For its calculation of the 2012 budget, the Iraqi government uses an estimated average price per barrel of crude oil of $95 USD (113,300 IQD). The government did not follow recommendations of the Finance Committee in the Council of Representatives to consider a lower oil price of $75 USD (89,400 IQD). The Committee had warned that a drop of the oil price could negatively affect Iraq's budget plans.
"We don't expect the oil price to fall below $90 USD," Salam al-Quraishi, economic adviser in the government, said.
Over the last couple of years, Iraq always planned with a deficit but it never turned out to have one.
One reason is that Iraq never executed its entire budget. In 2010, Iraq only spent $55 billion USD of its budgeted 27.3 billion USD, or in other figures around 76% of its budget. The percentage rose from 68% in Iraq's first sovereign budget in 2006. Observers believe that the government lacks the capacity and skilled politicians to spend great amounts of money. A large, top-down bureaucracy and outdated and contradictory regulations further slow down spending.
A second reason is that -- for example in 2011 -- oil revenues were higher than expected due to an higher oil price. According to different statistics, the oil production accounts for something between 89 and 95% of Iraq's annual budget.
Quaraishi said that the Council of Ministers will approve the budget plan next week, then it will be transferred to the Council of Representatives.
By Jaafar al-Wannan
RN/CU/AKnews
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01/12/2011 12:29
BAGHDAD, Dec. 1 (AKnews) - The Council of Representatives will probably not approve the 2012 budget before the end of the year.
The government will forward the draft to the Council after it voted on it next Tuesday, but economists and experts expect the 2012 budget to be delayed in the Council due to political differences between the parliamentary blocs that appear annually during the discussion of financial budgets.
Mariam al-Rayyes, spokeswoman for the Council of Ministers, said, "We hope the budget will not be delayed like last year."
The 2011 budget was not approved until late February.
The 2012 budget is estimated to be $112 billion USD (133.6 trillion IQD). It is an increase of 36% on 2011, but there remains a deficit of $20 billion USD (23.9 billion IQD).
For its calculation of the 2012 budget, the Iraqi government uses an estimated average price per barrel of crude oil of $95 USD (113,300 IQD). The government did not follow recommendations of the Finance Committee in the Council of Representatives to consider a lower oil price of $75 USD (89,400 IQD). The Committee had warned that a drop of the oil price could negatively affect Iraq's budget plans.
"We don't expect the oil price to fall below $90 USD," Salam al-Quraishi, economic adviser in the government, said.
Over the last couple of years, Iraq always planned with a deficit but it never turned out to have one.
One reason is that Iraq never executed its entire budget. In 2010, Iraq only spent $55 billion USD of its budgeted 27.3 billion USD, or in other figures around 76% of its budget. The percentage rose from 68% in Iraq's first sovereign budget in 2006. Observers believe that the government lacks the capacity and skilled politicians to spend great amounts of money. A large, top-down bureaucracy and outdated and contradictory regulations further slow down spending.
A second reason is that -- for example in 2011 -- oil revenues were higher than expected due to an higher oil price. According to different statistics, the oil production accounts for something between 89 and 95% of Iraq's annual budget.
Quaraishi said that the Council of Ministers will approve the budget plan next week, then it will be transferred to the Council of Representatives.
By Jaafar al-Wannan
RN/CU/AKnews
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