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Expert group to develop economic reform package

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Expert group to develop economic reform package

Wednesday, March 11, 2020 15

Baghdad / Muhannad Abdul Wahab Hazem Mohammed Habib

Members of the House of Representatives called for the formation of a team of economists, financial experts and legal experts from the government and private sectors to consult internationally to take a package of economic measures and reforms to avoid financial and economic deterioration, provided that these measures do not affect the poor class and those with limited incomes, while economists stressed that the exchange rate of the dollar in the domestic market will not be affected by the decline in oil prices,

stressing that this decline will not last long.  

"Political blocs should speed up the selection of a prime minister, and then form a government to take office as soon as possible, in addition to the immediate formation of a team of economists, financiers and jurists from the government and private sectors, and request international consultation to find out a package of measures and reforms," Said Mohamed Chiaa, a member of the State of Law, told Al-Sabah.

"It is important that these measures be far from affecting the poor class, and that they should be directed to middle and high income earners to degrees that correspond to the level of income, whether they are tax measures related to the rest of the state's joints of laws or other measures, taking into account its budget for the standard of living and the poverty rate that is rampant in many provinces," al-Sudani said.

"The most important measures that must be taken are to combat corruption of all kinds and forms, reduce the waste of public money that drains the state in these economic conditions, develop non-oil revenues such as taxes and customs, and the need for strong control of the ports to ensure that fees are met in accordance with the law," he said, noting that

"the government should take measures to reach a complete solution to the problems with the Kurdistan region, the most important of which is the exporting oil and customs in the region's ports with abroad, and to review the operational budget through the closure of some drainage doors and limit them to the necessary."

He stressed "the importance of activating the central bank initiative on bank loans (industrial, agricultural and real estate) and housing, and directing this initiative to small and small and large enterprises, as this will support the sectors of industry, agriculture and housing and create jobs, as well as prevent or identify the import of unnecessary goods to make way for the domestic product to cover the needs of the domestic market and the resulting employment and the preservation of foreign currency within the country."

"It is important to check the numbers of employees, sort out the aliens and double salaries, stop some allocations and reconsider them, review the currency auction and adjust the exchange rate of the dollar so as not to burden the poor class," he said.

Exchange rationing

"The government should work on the use of special alternatives, including the legalization of spending on the three presidencies and sovereign positions and their protections, which are a burden on the budget, in addition to rationalizing spending without compromising the salaries of state employees, the social welfare network and those with limited incomes," said Nada Shaker Joudt, a member of the economic committee.

"The government is responsible for attracting foreign investment, working to activate the Chinese agreement to implement economic projects within the country in exchange for oil during this period, and to meet the imports of outlets - which are very large revenues - and the government should withdraw the hands of the political actors who dominate these outlets and therefore return its proceeds to the government to finance the state treasury," Joudat told Al-Sabah.

"It is possible as measures that the government will borrow from the domestic reserves without going to foreign borrowing, in addition to the government should seek to expose the Iraqi people about the economic situation," she said, adding that

"the Finance Committee has a responsibility to present and explain to citizens the debt sought by the country, and therefore must develop solutions by calling Iraqi and international experts to develop real radical solutions to improve the economic situation."

"The deficit in the 2020 budget has reached 60 trillion dinars," she said, denying that the drop in oil prices and the economic decline in the salaries of employees, low-income earners, retirees and the social welfare network.

Red line

Abdul Hadi al-Saadawi, a member of the parliamentary finance committee, told Al-Sabah that "the current fiscal deficit is very large, yet the salaries of employees are a red line, and even if oil prices fall, it is expected that this decline will not continue, as prices will be at a specific stage, to return to the rise Gradually again."

Al-Saadawi stressed that "the real impact and danger on the budget is the unnecessary spending issued by the government and some ministries that exceeded the powers of spending," adding,

"We have asked the government to withdraw the hands of some ministers who exceeded the budget ary spending powers, in addition to the need to reduce spending other than It is necessary, and to emphasize the follow-up of the border crossings file in support ing the state's resources and dealing with the Kurdistan Region."

"The collapse in world oil prices will not last long because countries have backed away from individual decisions on the sale of oil, as well as the decline of the Corona virus, particularly in China," said Ahmed Hama, a member of the parliamentary finance committee.

These imports have been affected by the Corona epidemic in China."

"The 2020 budget is over and the 2021 budget law will be reviewed and some improvements will be made to the economy if the new government is in place," he said, adding that

"the Finance Committee has unanimously agreed that the salaries or allowances of employees will not be compromised at all, regardless of Iraq's losses due to the fall in world oil prices."

Dollar Price

In a related context, economist Saleh al-Hamash stressed that the exchange rate of the dollar in the Iraqi domestic market will not be affected by the current decline in oil prices, and explained that

"currency prices are affected by the country's gross product, but in Iraq the Central Bank is trying to maintain the exchange rate of the dollar through The auction of the currency at 120,000 dinars for $100."

"Even if the dollar's exchange rate is affected by the current crises, it returns at 120,000 dinars, but if the crisis continues for a long time, the impact on the exchange rate will be clear," he said.

"The impact of the dollar exchange rate will depend on the government resorting to cash reserves for a long time, especially if this reserve is used to fill the budget deficit," al-Hamash said, adding that

"there are agreements with the INTERNATIONAL Monetary Fund to maintain the exchange rate of the dollar inside Iraq."

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