“Dragged from the Petrodollar” – Sat. PM KTFA Thoughts/News 9-11-21

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KTFA

Adviser to the Prime Minister: The 2022 budget will be distinguished by something important, and we do not rule out surprises

08/29/2021 11:36:08

The Prime Minister’s Advisor for Financial and Economic Affairs, Mazhar Muhammad Salih, revealed an “important matter” in the draft financial budget bill for 2022.

Saleh told {Euphrates News}: “This budget will be characterized by greater revenues and less deficit if the spending ceilings remain less than the deficit, as the financial obligations will then be lower.”
 
He added, “It is the duties of the current government as long as there is plenty of time to prepare the budget, even if the new parliament wants to make observations or make changes to it.” Saleh pointed out, “Circumstances are changing, and there may appear surprises, as it relied on an oil price of 50 dollars per barrel, according to what was announced by the Ministry of Finance.”

And Finance Minister Ali Allawi announced last Thursday (08/26/2021) the completion of the preparation of the draft financial budget law for 2022, and that it will be presented within 3 weeks to the Council of Ministers. And Allawi indicated in a press statement that “the price of a barrel of oil in the 2022 budget will be $50, or 65% of the total. The state budget goes to salaries, and OPEC may add 450,000 barrels to Iraq’s oil production.”  And he indicated, “There are about 6.5 million citizens who receive financial dues from the state.” 

He pointed out, “The state’s oil resources are eroding due to the large obligations of salaries and retirement, and that the improvement in oil prices does not solve the financial distress quickly because of internal and external debts, and the state’s resources in Iraq are used incorrectly.”   LINK

Finance Minister: We have started reform, and we need everyone’s concerted efforts.

Sunday 29 August 2021  Baghdad: Hussein Thaghb

Finance Minister Ali Abdul-Amir Allawi stressed that the country’s situation is described as sensitive and requires concerted efforts by all, in order to achieve serious reforms that distance the country from potential dangers, pointing out that cooperation is most intense with the Central Bank of Iraq with the aim of building a clear financial map.  Allawi said during a meeting with a group of journalists: The budget for the year 2022 will be completed within 3-4 weeks and presented to the Council of Ministers, expecting to submit it to the next parliament.

 And it will depend on the price per barrel of oil, $50, and it will be based on the current production level. Regarding the exchange rate and the decision to devalue the national currency, Allawi stated that {the exchange rate represents the external face of the economy, and the high exchange rate brings benefit to many economic sectors}, noting that {the price when it affects the economy negatively and encourages the transfer and transfer of resources. On the outside, it is necessary to reconsider and this is what happened.”

He said, “The decision to devalue the currency came in order to create a competitive economy that encourages the work environment in the country,” noting that “during the past six months, we have indicated an increase in demand for investment licenses in the industrial sector.”

Allawi pointed out that “the increase in prices in local markets, and the percentage that exceeds the rate of devaluation of the currency, came due to the increase witnessed by global markets, which coincided with the decision to reduce and the Corona pandemic, which had negative effects on the global economy as a whole.” He stressed, “We are moving towards offering treasury bonds for trading in the Iraqi Stock Exchange, and we expect a great turnout for them in the absence of ideal investment opportunities in the country,” noting that “Iraq’s revenues are large, but the obligations are also wide, and there is an inflation in the number of employees that coincides with a lack of productivity employee.”

Frank26 » September 11th, 2021

Finance Minister: We have started reform, and we need everyone’s concerted efforts (CITIZENS GET INTO THE BANKS…F26)

He said: {Reform of government performance and the economic system is inevitable, and far from it we cannot create an incubating environment for the economy}, pointing out that we have begun a real reform of government institutions, banks, customs and taxes, in order to manage Economy”.

LINK

MilitiaMan » September 11th, 2021

We have the PM Kahdimi on the 22nd of August telling the world he has a 2021 – 2023 plan with 33 pages of information on the White Papers, digital transformation, etc.. 

Then days later on the 26th of August we see his advisor and  the Finance Minister telling us the 2022 budget will be completed and and presented to the Council of Ministers within 3 weeks and then again suggesting it would be within 3-4 weeks.

Regardless they say the reform of the government and economic system is inevitable. 

We understand that 3 weeks from the 26th of August gets us out to the 16th of September or within that time frame.

The Council of Ministers tend to meet on Tuesdays. That would be the 14th of this month.  But, we see there was an extraordinary session today. Interestingly enough,  they use a few terms that caught my eye; i.e., highest levels of financing, insurance and support.

All seem to be in line with what is to be expected for conducive manner for elections and for the aspirations of the people. Well, highest levels of finance seems a tad out of place, but, is it?

The citizens all want purchase power and support not only in respect to their finances, but also fair and transparent elections.

Now, the other thing that is seemly odd, is they mention insurance. Not assurance they will be fair. The use insurance. Well the highest levels of finance include insurance, as in insurance on their money. Just like we have in our country.

Lets think about these items in respect to timing and amounts related to finance. If the extraordinary meeting today was about the citizens aspirations, the highest levels of finance and support, then this small sentence in the scheme of things appears at first glance a minor issue, however, that may very well be far from being insignificant! 

Lets take a look at what they did yesterday in respect to financial matters.

That may have a serious impact in respect to the highest level of finance, insurance and support. To get the aspirations of the citizens satisfied, they want purchase power.

Well, it looks like they were told they have de-pegged from the US Petrodollar and are using the Dinar evaluating the price of oil.

It suggests with simple math that 45 Dinar to a barrel of oil is fairly simple to figure out. By doing so one can deduce there is purchase power in what the calculation shows.

Thereby, supporting the high level of finance, the need for insurance and even support in the on going educational processes that goes with that new purchase power and new financial change, not to mention the electoral process, as well.

The electoral process is expensive. The budget has what is needed for all that within it. Thus, the need for a change to precede elections. Therefore, we can deduce, the new exchange rate will need to be sorted if it has not already as of today, as the PM says they fulfilled the requirements. 

If not in todays meeting, then it would likely be sorted this next Tuesday when the COM normally meets..

What I see is regardless they have the digital transformation openly discussed on the 22nd of August, and with the above, the next move is as they say is inevitable. imo ~ MM

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Al-Kazemi: We have fulfilled the requirements of the electoral process, and it is the only solution to Iraq’s problems”

““We are holding the extraordinary session today, due to the proximity of the parliamentary elections that will take place on their scheduled date on 10/10, as well as the approach of the fortieth visit to the martyrdom of Imam Hussein (peace be upon him).” ” He added, “We have provided all the needs of the Electoral Commission at the highest levels of financing, insurance and support, to ensure that the polls are conducted in a manner that achieves the aspirations of the people.”
  
LINK

“It is noteworthy that the government specified in this budget In 2021, the price of a barrel of oil is based on $ 42 per barrel and an export rate of 3.25 million barrels per day, but Parliament calculated it at a price of up to $ 45,

using the Iraqi currency in evaluating the price of a barrel instead of the dollar, which ended a major political debate about restoring government support to the value of the dinar. Iraq against the dollar.”

LINK

https://oilprice.com/oil-price-charts/45#

Brent Crude

$72.92
+1.47
+2.06%

Basra Light

$73.23
-0.64
-0.88%

IQD 45 per barrel.. 

https://cbi.iq/static/uploads/up/file-162607942971064.pdf

Source: Dinar Recaps

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