The Ministry of Finance said on Sunday that the amount of income received by Iraq over the course of the previous 12 months in the federal budget surpassed 135 trillion dinars, indicating a decline in the budget’s 93% oil contribution.
stated that the Ministry of Finance released data and tables in February for the accounts of the previous fiscal year’s 12 months, demonstrating that oil remained the primary source of funding for Iraq’s general budget, accounting for 93% of the total. This suggests that the country’s general budget is derived from the rentier economy.
After deducting transfer revenues, which came to 1 trillion 259 billion 301 million, and 196 thousand dinars, the financial tables also showed that the total revenues up until December of last year were 135 trillion 681 billion 266 million 197 thousand, and 696 dinars. This meant that the total expenses with advances were 122 trillion 772 billion 745 million 546 thousand dinars.
The financial figures show that non-oil income totaled 9 trillion and 799 billion and 47 million and 964 thousand dinars, while oil revenues totaled 125 trillion and 882 billion and 218 million and 622 thousand dinars, or 93% of the general budget.
In the meantime, economic expert Hilal Al-Taan reasoned in an interview with Shafaq News Agency that “Iraq reduced its oil production in compliance with the decisions of OPEC, which resulted in a decrease in the percentage of oil in the budget, adding that this percentage is still high compared to oil-producing countries.”
He also mentioned that Iraq had a small fiscal year-end surplus, indicating high spending.
Al-Taan also emphasized that “the government will remain dependent on oil for a long time as the main source of the budget, stressing that it needs political will and a real will to do so.” This is because the government has not developed other economic sectors.
Iraq’s oil output was seen to have decreased by 600,000 barrels per day in accordance with the OPEC agreement, bringing the total to 4 million barrels per day, as stated by Prime Minister for Energy Affairs and Oil Minister Hayan Abdul Ghani yesterday, Saturday.
Mazhar Muhammad Salih, the Prime Minister’s Advisor on Financial Affairs, confirmed in a March 2021 interview with Shafaq News Agency that the wars and economic blockade imposed on Iraq in the past, along with the ongoing political conflicts we are seeing now, are the reasons why the economy is still in a state of rentier state. distribution of financial resources.
“The Ministry of Oil has developed an ambitious plan to increase production, but Iraq is a major part of OPEC, and is committed to the organization’s production ceilings, and Iraq’s share amounted to four million (600,000) barrels,” stated Abdul Ghani in his speech during the Sixth Baghdad Dialogue Conference / Regional Communication. Production was reduced two years ago to four million (400,000) barrels per day.
“There are two voluntary reductions, and Iraq implemented them,” he continued, adding that “the goal of this is to maintain price stability and achieve a balance between supply and demand.” Production had reached four million barrels per day.
The Iraqi state’s continued reliance on oil as the only source of funding for the general budget exposes it to the occasional global crisis because oil is impacted by them. As a result, the nation is forced to borrow money from abroad or from within to make up the shortfall, which shows a lack of effective state money management and a failure to identify other sources of funding.
