Regarding Iraq’s 2022 general federal budget bill, in my opinion, there is no fundamental difference in the formulation of that budget compared to last year’s budget. The only difference is this year’s budget could increase by 10 per cent because Iraqi government’s 2022 budget bill set price of a per oil barrel between ($55 and $60), while our exports are 3.4 million barrels per day.
“The benefits of rising oil price”
Iraq’s reserves have risen by 16 billion dollars in less than a year due to a significant rise in oil prices and a decline in the price of Iraqi dinars by the central bank. Iraq’s reserves are also expected to increase in 2022. The money that Iraq earns from selling oil is about seven billion dollars per month, which is exchanged by the central bank to dinars and then the government distribute to employee’s salaries, its spends and some amount of it sends to markets through the banks. In less than a year, Iraq’s reserves rose from 48 billion dollars to 64 billion dollars, due to the two reasons, which is the rise in oil price that determines by market’s price, and the other one is the dinar that has been determined by the Central Bank of Iraq. The effective point of this budget is depending on project’s program, which means that a number of projects will prepare to parliament and then these projects will be approved by them and their budgets will be approved for the coming years.
In previous years the Iraqi government has suffered a number of economic crises, which the most notable are drop in oil prices, ISIS war, and increases militia salaries and armed forces on the state budget, which has led Iraq to double its debts and shortfall and gain a lot of debt. Although Iraqi financial officials have announced in the past that the size of Iraq’s foreign debt has dropped to $20 billion, but an economic expert revealed that Iraq’s foreign debt is about to 60 billion dollars. Contrary to what the government claims, Iraq’s foreign debt is 60 billion dollars, except other seven trillion dinars of local debt, which the government is unable to repay by the end of next year.
Regarding Iraq’s expulsion from the list of dangerous countries in terms of money laundering and funding terrorism, which has announced on January 8, 2022, this decision and decisions similar to this decision have three positive effects. The first point is arrival of capital of foreigners to work in Iraq. The second one is facilitating transportation money from Iraq to abroad and vice versa through easily banking system without restrictions. The third point enables Iraqi banks to deal with European and global banks.
Iraq has a lot of income from natural resources, and more than 90 per cent of Iraq’s income depends on oil, which annually returns a virtuous income to the state treasury, but it cannot be sufficiently used because of its inexperience in internal management and conflict.
