PM Advisor: Tax deposits are part of the budget
Prime Minister's financial advisor, Mazhar Mohammed Saleh, confirmed on Friday that tax deposits are part of the budget that can be used to adjust government spending, while specifying the financial scope for government spending from tax deposits.
"The world is living in a state of anticipation for fear of entering a phase of economic contraction, and then a major economic depression. This phase takes six months during which growth and unemployment levels in the global economy are monitored," Saleh told the Iraqi News Agency (INA). He pointed out that "Iraq is an important part of the world's energy system. A 1% drop in the world's GDP will undoubtedly lead to a half-percent drop in demand for oil, leading to a glut in supply, which requires a cautious policy from OPEC+ to help the group's countries protect their financial budgets for 2025 and the beginnings of the next fiscal year 2026."
He added that 'a precise technical precaution to confront the oil asset cycle was assumed by the legislator when approving the three-year federal general budget (Law No. 13 of 2023 as amended) by adopting a conservative oil price of $70 per barrel of exported oil and with the export of 3.4 million barrels of oil per day,' indicating that 'this precaution is in two directions: the first is spending with a comfortable budget, but at the minimum possible limit of 160 trillion dinars annually instead of 200 trillion dinars annually, and the second direction: spending at the maximum limit while reserve with a maximum annual deficit of 64 trillion dinars.'
Saleh continued, "In the 2024 budget, spending was within the comfortable minimum of 156 trillion dinars, with an average oil price of around $75 per barrel. This spending covered the entire operating budget, including salaries, wages, pensions, social care, and support, in addition to spending on more than 8,000 suspended government investment and service projects." He pointed out that "government borrowing, most of which is from domestic borrowing sources, recorded a financing indicator in the budget deficit of 7.6% of GDP, compared to 1.3% in 2023."
He pointed out that "if oil prices fall to an annual average of $60, which is the maximum possibility in the 2025 budget, there are two options: either spending around 130 trillion dinars and maintaining the same deficit-to-GDP ratio as in 2024, or spending up to a ceiling of 156 trillion dinars and accepting actual bond borrowing that rises to 9% of GDP in order to secure salaries, wages, pensions, social care, support, and spending on service projects without interruption, taking into account the drop in oil prices and the two-fold contraction in GDP growth."
Saleh pointed out that these are "the expected possible options unless the oil asset cycle improves, which in all cases depends on the upcoming OPEC+ policies regarding the future of production limits and the review of member quotas, as well as the development of the geopolitical situation in the world, especially in the Russian-Ukrainian war and the development of the situation in the Mediterranean Basin region, as the Gulf region is responsible for exporting nearly 40% of global crude oil exports, and this is reflected in the fluctuations in energy prices in global markets, including crude oil markets."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Shafaq News
3 days ago
- Shafaq News
Drone strikes in Iraqi Kurdistan disrupt oil output, lifting prices
2025-07-18T05:25:28+00:00 Shafaq News - Singapore Oil prices extended gains on Friday, underpinned by supply concerns following drone attacks on northern Iraqi oilfields and tight market fundamentals amid healthy summer demand. Brent crude futures climbed 29 cents, or 0.40%, to $69.81 a barrel as of 0451 GMT, U.S. West Texas Intermediate crude futures advanced 27 cents, or 0.42%, to $67.81 a barrel. Four days of drone attacks on oilfields in Iraqi Kurdistan that shut down half the region's output have supported prices, pushing both contracts up $1 on Thursday. Additionally, seasonal travel demand has propped up the market. In the first two weeks of July, global oil demand has averaged 105.2 million barrels per day (bpd), up by 600,000 bpd from a year earlier and largely in line with forecast, JPMorgan analysts said in a research note. "Crude prices have been broadly stable this week, with no significant moves as the impact of OPEC+ supply increases has been offset by strong seasonal demand in the U.S.," said LSEG's analyst Anh Pham. U.S. crude inventories fell a larger-than-expected last week as exports rose, government data on Wednesday showed. Demand in Asia also firmed as refineries came back from maintenance amid peak seasonal demand. Near-term oil fundamentals are likely to remain supportive, with the market set to remain fairly tight through this quarter, before becoming better supplied from the last three months of the year, ING analysts said in a note on Friday. Still, the uncertainty around U.S. tariff policy, which appears unlikely to be settled until after August 1, is weighing on the market. Plans by major oil producers to remove output cuts will also add to supply as the seasonal Northern Hemisphere summer demand ends. For this week, both Brent and WTI were down more than 1%. Oil output in the semi-autonomous Kurdistan region has been slashed from about 280,000 bpd to between 140,000 bpd and 150,000 bpd, two energy officials said. Officials pointed to Iran-backed militias as the likely source of attacks this week on the region's oilfields, although no group has claimed responsibility. Despite the attack, Iraq's federal government said on Thursday that Iraqi Kurdistan will resume oil exports through a pipeline to Turkey after a two-year halt. (Reuters) Only the headline is edited by Shafaq News Agency
Iraqi News
4 days ago
- Iraqi News
Iraq starts developing 70,000 barrel-per-day refinery in Nineveh
Baghdad ( – The Iraqi Prime Minister, Mohammed Shia Al-Sudani, initiated on Wednesday the construction work of the Nineveh refinery, which would have a capacity of 70,000 barrels per day. Al-Sudani stressed the project's strategic importance for the northern Iraqi province of Nineveh, which is part of a larger strategy to set up refineries across Iraq, the state-run news agency (INA) reported. Iraq's refining capacity has grown faster than predicted during the last two and a half years, according to Al-Sudani. This increase is part of the government's strategy to transfer 40 percent of the country's crude oil output to downstream industries. Iraq is currently above the 30-35 percent objective, which was originally set for the following 10 years, according to Al-Sudani. The new refinery, located south of Mosul, will assist northern provinces satisfy their fuel demands while also producing a range of petroleum derivatives. The project will provide around 1,000 direct job opportunities, as well as more individuals of indirect jobs.
Rudaw Net
4 days ago
- Rudaw Net
At least 50 killed, dozens missing in Iraq shopping mall fire
Also in Iraq Iraqi PM inaugurates Mosul airport on anniversary of city's liberation from ISIS Cardinal Sako urges Iraqi PM to halt 'violations' against Christian sites in Najaf Senior KDP, PUK figures to meet Iraqi PM amid financial crisis Iraq's three presidencies condemn 'drone attacks' on Kurdistan oil fields A+ A- ERBIL, Kurdistan Region - At least 50 people have been killed and dozens remain missing after a fire broke out early Thursday morning at a shopping mall in Iraq's eastern Wasit province, according to Iraqi state media. The state-run Iraqi News Agency (INA) reported that the blaze swept through the Hypermarket Mall in al-Kut, the provincial capital of Wasit, leaving 'at least fifty people dead' and '30 others still missing. 'Investigations are underway to determine the circumstances surrounding the tragic incident,' INA stated. In a post on his official Facebook page, Wasit Governor Muhammad Jamil al-Miahi declared 'three days of mourning for the souls lost in the tragic fire at the ill-fated Hypermarket Mall in al-Kut.' He added that lawsuits have been filed against the mall and building owners, as well as 'everyone involved.' 'We assure the innocent victims that we will not tolerate those who were a direct or indirect cause of this incident,' al-Miahi added, promising preliminary results from the investigation within 48 hours. Fires are a recurring threat in Iraq and the Kurdistan Region, where enforcement of fire and safety regulations is often inadequate. The risk increases significantly during the summer months, when extreme heat exacerbates the potential for electrical faults and other fire hazards. Contributing factors include aging infrastructure, overcrowded public spaces, poor electrical systems, and a widespread lack of basic fire safety measures.
