The economic challenges in the wider context
First: "Public Finance and reflect the current status of the initial indicators of the public finances in the next few years on the economic difficulties of the situation e.xac.er.bated by the decline in crude oil prices
The narrow scope of choice "for most. Vemoazinp next year, tied a large amount of operational expenditure is estimated at about 52 trillion dinars, the equivalent of the oil resources around," according to the price of Iraqi oil supposed that not more than 60 dollars a barrel.
The estimated capital expenditures, the budget of 2010, about 15 dinars, see Leon and the deficit is close to 10 trillion dinars.
The amounts of crude oil, electricity and liquidation are not commensurate with the minimal critical importance of those sectors and agreed upon by all. It seems that the uncertainty and hesitation on the role of foreign investment and contracted versions of the appropriate resolution and the difficulty of the pressures faced by the Central Government, has frustrated the development of programs of energy production and export of crude oil and even liquidation of investment in industry, and financial budgets to reflect that concern. The financing of new power projects, which reliable for the solution of the problem before 2012, has been developed outside the original 2009 budget, "and plunged the sector into a debate with the Central Bank of Iraq's most dangerous on the joints, the relationship between public finance and monetary institution, which is regrettable that the issue be discussed on the sidelines again, the electricity, and in a hurry While it was necessary to investigate the facts and dealt with systematically, "as serious in itself, and not because it is associated with a" delicate problem in the eyes of the public. It is noticed that the estimated non-oil revenues from domestic sources is still limited and not able to stakeholders and the adoption of a clear system of measures to increase.
The review of operating expenses are still conservative, and as if do not want to prejudice to the solid circles and groups associated with the gains of the operational expenditure, and was expected to announce the cuts at the detailed level in the allocation of expenses and paragraphs are and to reflect those procedures, the first place, a sense of the administrative staff of the advanced state of its responsibilities, Achkas and willingness to participate in a portion of the burden of the difficult financial situation, and this is what he wants the community, to promote confidence and trust Balnkhb leadership on the economic future of the country and revive the hope of combating poverty and promoting social justice. need, "stated the principles upon which the priorities of the government to additional efforts in order to become really to the program of work for the Department of Finance, the researcher found it difficult to connect them with the estimates of revenue and expenditure allocations, with the observation of improvement in the presentation of those principles, compared with previous years.
Seems to change the situation on both sides of the financial revenue and expenditure is still elusive, requiring a focus on the social - political in the economic aspect away "conflict of visions and goals on the distribution of powers and administrative positions and roles. It is well known that the higher national interests of Iraq, the economy requires a focus," a key "is a joint activity of the national political commitment to raise the requirements of the Iraqi economy, and not to allow the employment problems in a speech last Tnahari the entire election cycle is not limited to the period usually devoted to the debates that preceded the elections.
II: the need to break the impasse difficult decisions:
- There is no doubt that the need has become urgent to increase revenues and must not surrender to the terms of the current situation, must take urgent measures to increase crude oil production, increased significantly during 2010 and increase exports to 3.5 million barrels per day by the end of 2012. It is not many options for Iraq should be to intensify efforts towards those goals.
- And was expected to direct a comprehensive and systematic audit of all the items of operational expenditure, including the appropriations and contracts for the supply of goods and services in all its forms, and this is not the aim of reducing the total spending, but to ensure that the best disposition of resources and gains from the re-allocation of society and sees indeed contribute to increased prosperity and better standards of service delivery governmental organizations.
- Which helps to alleviate the problems the adoption of a sustained program of action necessary for the cell managed to increase local revenues and reach for more clarity and detail to meet the shortfall, based on the intensive care unit and the realities of the economic situation and the necessary relations, and examines the experiences of other countries without Mspqat ideology, and this requires the departure of current methods in address economic issues and to commit stakeholders refer to the methodological work and to resist the temptations of the specialized and impressions ready circulation.
Promoting the sector oil refining and electricity, and achievements in the water and sanitation sector and the transfer of pollutants from the river, and the manufacturing, building and construction, those tasks can not be postponed any longer.
Third, "to accelerate the rebuilding of the economy:
The reluctance of the private sector continue to invest, and the Iraqi capital to flow abroad, deepened in the archaic features of the Iraqi economy to retract relative to the commodity production sectors and to reduce the scope of the work product, with the failure to achieve concrete achievements for the development of infrastructure construction. The imports have increased in recent years, a large margin compared with the days of the siege, and the average income of the state and the number of employees and went flows from other sources to the household sector, and contributed to the improvement of living of the average family, which is evidenced by the possession of the cars and household appliances, the rate of purchases of clothing and food, but at the same time, there are in Iraq, pockets of poverty and the worst forms of social misery, with many families who have lost their breadwinners, immigrants, widows and orphans and the bereaved, the poor neighborhoods beset by sewage, with the repetition of body parts in the scenes of the innocent blood of the oppressed the wails of the bereaved and that is the deepest doubts about the moral merit of the entire human kind. It should be of the Iraqi society that excuses based on a radical re-consideration "and depends on the re-completed production of misery and the courage to rebuild a new life on the basis of security, freedom, dignity and well-being of future generations. and that is determined to end corruption and poor management practices and end the anomaly that casting a pall over the business environment and impede performance. And the government has to go to the following:
- Review the status of the administrative system and an objective approach to a wide range of transfer and officials affiliated with the ministries and departments to improve quickly, "performance, and expand the service of sovereign power, in particular, it is not logical to keep the waiting lines and circles in front of the stampede, and the treatment required to complete two hours of work time a week , in the State suffer from a surplus in the volume of affiliates from all levels of education. We must assess the effectiveness of the officials of the various launch sites and their energies, and not allow them to freeze qualified. political and adopt administrative measures to clean the state's departments of mismanagement and corruption, because the control and eradication services in nature preserve not expected to breach the balance of the status of any country in the world and in no time.
- There must be the development of shareholding companies and large through the intense work and continuing with the money and business in Iraq because this sector is limited in scope, and keep it in its current status is the despair of the supposed efficiency of the system of free economy and the role of private initiative. The development of the corporate sector was related to privatization and the restoration of the Iraqi capital and the advancement of immigrant financial sector.
The rehabilitation of public facilities in the sectors of industry and construction and to ensure that most of the work on the basis of sound economic and trade, before the end of 2010, is possible if the assigned this responsibility to the fair with a cadre of leadership is high. It is supposed to privatization decisions are subject to financial and economic analysis firm, in other words a policy shift from the delay and indifference towards the public sector and the potential established in the Coalition Provisional Authority in 2003 and early 2004.
To be given greater effort to solve the problems of finance and banking sector and to ensure compatibility with the march of the national economy, particularly the speedy resumption of normal activity for the Rafidain bank and all the good lines of action in the domestic banking international financial relations of Iraq. The data indicate the investment banks for more than 5 trillion dinars in the Central Bank of Iraq until the end of June this year. It was the first to go, those resources, to finance private investment and the operation of economic enterprises. It can be said, objectively, "that the necessary efforts to revitalize the bank credit has not yet begun, as an urgent need to reduce the credit risk assessment by banks, or find them new arrangements for debt relief in the context of the rehabilitation of the business environment. Perhaps this requires financial firms to develop a new type of insurance or the purchase of loans and other debt. did not begin a serious and fruitful efforts for the propagation and Trchin the Islamic financial institutions to resolve the problem, which hinders the legitimate direct savings to the financial market.
Iraq is in dire need of major investment companies, a broad sense of the word, including mutual funds and to increase liquidity in the stock market, and the establishment of the necessary groundwork for the development of bond markets to finance the government, corporations, and it is necessary to find arrangements for help to mobilize money and expertise and the necessary communication and coordination for the establishment of companies new.
IV: "- on the exchange market and balance of payments:
The exchange market in Iraq to the most simple mechanism of supply-side as it takes over the Finance Ministry 95% of the oil revenues are 'so far' in the calculation of so-called Development Fund for Iraq DFI. And paid from that account directly to "the expenses and obligations of foreign imports. And also" the the sale of foreign currency 'dollar' to the Central Bank for the purchase of Iraqi currency to cover local spending. That the foreign currency purchased by the Central Bank from the Ministry of Finance is the source
The main display in the exchange market 'which is at the same time, the only source of reserves, as a sell "them to the private sector, in the process of conducting a daily basis", regularly, and the remaining ones, which is the difference between the purchases of the Ministry of Finance and sales to the private sector, added to the reserves. So far, the difference was positive, "as the request does not exceed the private sector's foreign currency sales and the Ministry of Finance to the Central Bank. It should be noted that the characteristics of the financial system in Iraq had to do so. As long as all government revenues' almost '" is a source of foreign currency only for the Iraqi currency to domestic spending, and because the local government spending is the basis for the creation of money, any domestic liquidity, the private sector demand for foreign currency derivative, "and a" for government spending. Under the mechanism, confirmed the basic facts, a typical: --
1st State can respond to the request of the private sector to foreign currency at all levels.
2nd increasingly central bank reserves have always
3. The decline of foreign currency resources of the non-oil sources.
4. Limiting the role of banks to mediate between the central bank and their customers.
Requests the private sector foreign currency for three motives are:
1. The financing of imports.
2nd investment outside of Iraq.
3rd retain cash "payments in the home and small-scale
As a result of the progress that Iraq's economy operates with a surplus in the balance of payments and the accumulation of capital abroad in the Iraqi official and private. Does not shrink in the Iraqi capital abroad, but to increase domestic economic activity, especially investment, to increase spending and the demand is derived from the foreign currency. That the financial hardship faced by the general budget does not mean at all and difficulties in balance of payments, does not mean there is a need 'economic sense' of external funding. There are problems, but careful consideration should be given the realities of the Iraqi economy and re-understanding of the role of oil and the financing mechanisms of government spending.
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