BAGHDAD (Reuters) - Iraq is in the process of setting up a "sovereign seafarers' fund," Al-Hayat said in a report, while it said it contained guarantees of economic development.
He quoted the financial adviser to the Prime Minister appearance of Mohammed Saleh, "The sovereign fund submersible, contains the guarantees of economic development, which represents a means, by which governments and institutions to put money and collected over time to extinguish debt," declaring that "Iraq is still at a safe level in its capabilities And has a standard rate of less than 60 percent in the ratio of public debt to output. "
According to the newspaper, "In recent consultations with the International Monetary Fund, the possibility of Iraq to establish a fund for the sovereign fund, which uses financing supplementary borrowing from the international market, the executive cohesion with the global construction market to promote the proportion of fixed capital formation, relative to the gross output to be 50 Percent instead of 25 percent now, and in the coming years. "
In the same context, the newspaper pointed out that the spokesman of the Iraqi Central Bank in the name of Abdul Hadi, he proposed, "the formation of an administrative unit in the Ministry of Finance to create the structure and staff and develop the capacity to establish a sovereign fund, performs its tasks in a form that makes an active contributor to the process of economic development."
"The experience of establishing the Development Fund for Iraq aims to ensure that the Fund's resources are used transparently to reconstruct Iraq and meet humanitarian needs," the paper quoted academic Falah Hassan Thwaini as saying. "It did not achieve the desired development for many reasons, including the failure of the Fund to adopt a clear development strategy "He said.
He explained that "the objectives of the Fund is to be a tool to finance economic and social development and contribute to macroeconomic stability, through the planning of spending through the strategy of the flow of oil revenues to the budget, and promote savings destined for future generations of depleted resource, and the principle of justice in the distribution of wealth, , Activating the activity of the stock market through the direct and indirect investment of the Fund's financial assets.
"The adoption of scenarios for the establishment of Iraq's sovereign fund, subject to the priorities of the requirements of the Iraqi economy, which is almost integrated and interact with each other, as can not separate the process of development and stability and investment from each other," saying that "the model that may put Iraq at the top of priorities, Sovereign investment because it will be the entrance to every development process and then a factor of economic stability. "
"The Future Fund is in line with the concept of sustainable human development and takes into account the right of future generations to scarce resources," the paper quoted the Dean of the Faculty of Business Economics at Al-Nahrain University, Star Al-Bayati, as saying. "It is not reasonable for the country to borrow from abroad, The burden of these loans and their increasing benefits. "
"The amount of proof of the right of future generations to the underdeveloped resources represents an achievement of justice between these generations," he said.
Al-Bayati proposed financing the fund by deducting a certain percentage of the oil revenues deposited in this fund, with the possibility of investing its assets. And perhaps some would agree that this ratio is 5 percent either in a permanent and permanent form or from an increase in oil prices whenever necessary. "
He pointed out to the newspaper that the proposed fund «derives its importance and the need to create it from the deficit faced by the budget since 2003, as a result of dependence on oil as the most important resource or source of income or public revenues».
He explained that «the main objective is to fill the budget deficit and protect from shocks as well as the economy as a whole, and stabilize the exchange rate of the dinar against fluctuations in the balance of payments arising from the fluctuation of commodity prices, especially oil, as well as face economic shocks and then seek to achieve sustainable development».
Al-Hayat said in a statement to the academy Hamdiya Shaker that "the importance of sovereign wealth funds stands out more clearly in the rentier economies, especially in oil-rich countries, because they rely on oil as the main source of revenue." The contribution of the oil sector to the generation of GDP and to exports and public revenues, which may expose them to external shocks and periodic crises due to continuous fluctuations in world oil prices, and unpredictability, and therefore considered that "the biggest challenge facing the oil countries is how to Financing sources Aa economies, and not rely on a single resource is characterized by volatility. "
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