Where will money be deposited in the Generations Sovereign Fund with no financial surplus?
The financial advisor to the Prime Minister, Mazhar Muhammad Salih, confirmed on Monday that Iraq lacks a sovereign fund, indicating that there is an idea to establish it soon.
Saleh said that “Iraq does not have a sovereign wealth fund, but it has the investment portfolio of the bank responsible for economic stability and currency stability, and it is considered a semi-wealth of a sovereign fund, and there is also the Iraq Fund for Foreign Development that has investments with joint Arab companies of up to 3 billion dollars and receives Profits, but they are not large, and it is considered a sovereign wealth fund, but it is simple.”
He explained that “the Gulf countries have formed the largest sovereign wealth funds, in addition to Norway, which has the largest sovereign fund in the world, with an amount of 1.250 trillion dollars, which came from oil revenues,” noting that “Norway builds its budget on the basis of balance and the budget surplus goes to various investments. This generates Income and the fund grows, and when the state needs a budget, the profits of the fund block the budget.”
Saleh pointed out that “the Iraqi government is considering establishing such a fund, but the country has a deficit and not a surplus,” noting that “we have proposals to establish an Iraqi sovereign wealth fund, in which amounts equivalent to the Kuwait war compensation will be deposited after the completion of paying those compensations in the coming months. And it is supported by any other assets and at the same time it is an investment for mineral wealth that is not invested or neglected, and its returns go to the fund and we establish the Generations Fund and this is called sustainable development.”
a sovereign wealth fund or sovereign funds; It is a state-owned fund consisting of assets such as land, shares, bonds or other investment devices, and these funds can be described as entities that manage state surpluses for investment and promise billions of dollars invested by states in stocks and bonds.
Parliamentary Finance: 50% of the articles of the 2021 budget have not been implemented
Today, Monday, the Parliamentary Finance Committee confirmed that there are several articles in the country’s general budget for the year 2021 that have not been implemented so far, while noting that the appeals submitted by the government concern only five articles.
A member of the committee, Jamal Cougar, told the “National News Center” website, “Parliamentary finance, pending the resolution of the appeals submitted by the government to the Federal Court, with articles (8, 12, 4, 52, 50), within the 2021 budget law, including what concerns The petrodollar fund and the increase in the prices of agricultural crops.
And Cougar stated, “The resolution of the appeals by the Federal Court, in the coming days, cannot be considered a gain for the government, because the House of Representatives has developed an alternative to these articles in the event that they are challenged,” stressing that “50 percent of the articles of the current year’s budget have not been implemented.”
The Council of Ministers had earlier authorized Prime Minister Mustafa Al-Kazemi to file an appeal with the Federal Court on some items of the federal budget for the 2021 fiscal year. link
Parliamentary Finance: International oil prices cannot be relied upon by the 2022 budget law
A member of the Parliamentary Finance Committee, Ahmed Hama, confirmed today, Sunday, that international oil prices are currently unstable and cannot be relied upon in presenting the draft law on the country’s general federal budget for the year 2022.
Hama said, “The government has fixed the price of a barrel of oil in the 2022 budget bill, at $50, for fear of a drop in prices in the coming days as a result of the lack of demand versus supply in global markets, as well as the continuation of the Corona pandemic.”
He added that “the price set by the government will exceed the oil break-even price estimated by the International Monetary Fund for Iraq,” noting that “the price of a barrel of oil in the draft budget is adjustable by raising or reducing the price.”
And he indicated that “the difference in the price of a barrel of oil fixed in the budget and in global markets, will help the government bridge the budget deficit, as well as prevent it from heading towards internal and external borrowing and increasing credit directed to the private sector.”
During the past months, the Ministry of Finance, headed by Minister Ali Allawi, held several sessions to develop “strategic” plans for the budgets for the years 2022-2023-2024. link
Source: Dinar Recaps
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