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The International Monetary Fund recommends that Iraq control public wages and gradually abolish compulsory employment
Economy 2024-05-16 | 10:42
9,047 views
Today, Thursday, the
Executive Board of the International Monetary Fund (IMF)
concluded Article IV consultations with Iraq and
studied and approved the employee evaluation, while
recommending the control of public wages and the
gradual abolition of compulsory employment.
obtained Al-Sumaria News a World Bank report published today, which reads as follows:
“Internal stability has improved since the new government took office in October 2022, which facilitated the approval of Iraq’s first three-year budget, which required a major financial expansion starting in 2023.
This supported a strong recovery in Iraq's non-oil economy after a contraction in 2023. 2022, while
Iraq was largely unaffected by the ongoing conflict in the region and domestic inflation fell to 4% by the end of 2023, reflecting lower international food prices, the revaluation of the currency from February 2023, and the return of trade finance to normal.
However, imbalances were exacerbated by the significant fiscal expansion and low oil prices. The report added,
“It is expected that the continued fiscal expansion will enhance growth in 2024, at the expense of further deterioration in financial and external accounts and Iraq’s vulnerability to oil price fluctuations.
Without policy adjustment, the risks of medium-term sovereign debt pressures are high and risks could arise.”
“The main downside risks include a
significant decline in oil prices or the
spread of conflict in Gaza and Israel.”
The executive directors agreed, according to the report, “with the thrust of the staff assessment, and welcomed the strong economic recovery, low inflation, and improved domestic conditions that led to the implementation of the first-ever three-year budget.
They noted that the risks were tilted towards the downside, given regional disputes and high dependence.” on the volatile oil prices, and that
a major financial expansion could lead to financial and external imbalances.”
The Directors stressed “the need for sound macroeconomic policies and structural reforms to
secure public finances and
debt, sustainability,
promote economic diversification, and
achieve sustainable and inclusive private sector-led growth.” The Directors stressed that
“a gradual but significant fiscal adjustment is needed to
stabilize debt in the medium term and
rebuild fiscal safety margins.”
They encouraged the authorities to focus on
controlling public wage rolls,
phasing out compulsory employment policies, and
mobilizing non-oil revenues, with
Better targeting of social assistance.
They agreed that
"immediate implementation of Customs and Revenue Administration reforms,
full implementation of the Single Treasury Account,
strict supervision and limiting the use of extra-budgetary funds and government guarantees
are essential to support fiscal consolidation.
Reducing monetary financing and reforming the pension system are also important."
The Directors praised the Central Bank's efforts to
tighten monetary policy and
strengthen the liquidity management framework.
Improving coordination between fiscal and monetary operations would help
absorb excess liquidity and
enhance monetary policy transmission.
The Directors agreed that accelerating the restructuring process of large state-owned banks is also essential.
They encouraged “To
continue modernizing the private banking sector, including by
facilitating the establishment of correspondent banking relationships,
reducing regulatory uncertainties, and
enhancing the efficiency and competitiveness of private banks.”
The Directors stressed the need for structural reforms to unleash private sector development.
They encouraged
equal opportunities between public and private jobs,
enhancing women’s participation in the labor force, and
reforming education and labor laws.
The Directors agreed that
improving governance and combating corruption are also essential, and
encouraged Continue to strengthen the framework for combating money laundering and terrorist financing,
strengthen public procurement and business systems, and
address deficiencies in the electricity sector.
Directors welcomed renewed efforts towards
accession to the World Trade Organization and encouraged the authorities to
improve the coverage and timeliness of statistics. Directors agreed that
“close engagement with the Fund, including through
ongoing technical assistance, would be beneficial, and welcomed the
authorities’ request to establish a policy coordination instrument.”
are expected to be held The next Article IV consultations with Iraq in the standard 12-month cycle.
https://www.alsumaria.tv/news/economy/488824/النقد-الدولي-يوصي-العراق-بالسيطرة-على-الأجور-العامة-والإلغاء-التدريجي
Economy 2024-05-16 | 10:42
9,047 views
Today, Thursday, the
Executive Board of the International Monetary Fund (IMF)
concluded Article IV consultations with Iraq and
studied and approved the employee evaluation, while
recommending the control of public wages and the
gradual abolition of compulsory employment.
obtained Al-Sumaria News a World Bank report published today, which reads as follows:
“Internal stability has improved since the new government took office in October 2022, which facilitated the approval of Iraq’s first three-year budget, which required a major financial expansion starting in 2023.
This supported a strong recovery in Iraq's non-oil economy after a contraction in 2023. 2022, while
Iraq was largely unaffected by the ongoing conflict in the region and domestic inflation fell to 4% by the end of 2023, reflecting lower international food prices, the revaluation of the currency from February 2023, and the return of trade finance to normal.
However, imbalances were exacerbated by the significant fiscal expansion and low oil prices. The report added,
“It is expected that the continued fiscal expansion will enhance growth in 2024, at the expense of further deterioration in financial and external accounts and Iraq’s vulnerability to oil price fluctuations.
Without policy adjustment, the risks of medium-term sovereign debt pressures are high and risks could arise.”
“The main downside risks include a
significant decline in oil prices or the
spread of conflict in Gaza and Israel.”
The executive directors agreed, according to the report, “with the thrust of the staff assessment, and welcomed the strong economic recovery, low inflation, and improved domestic conditions that led to the implementation of the first-ever three-year budget.
They noted that the risks were tilted towards the downside, given regional disputes and high dependence.” on the volatile oil prices, and that
a major financial expansion could lead to financial and external imbalances.”
The Directors stressed “the need for sound macroeconomic policies and structural reforms to
secure public finances and
debt, sustainability,
promote economic diversification, and
achieve sustainable and inclusive private sector-led growth.” The Directors stressed that
“a gradual but significant fiscal adjustment is needed to
stabilize debt in the medium term and
rebuild fiscal safety margins.”
They encouraged the authorities to focus on
controlling public wage rolls,
phasing out compulsory employment policies, and
mobilizing non-oil revenues, with
Better targeting of social assistance.
They agreed that
"immediate implementation of Customs and Revenue Administration reforms,
full implementation of the Single Treasury Account,
strict supervision and limiting the use of extra-budgetary funds and government guarantees
are essential to support fiscal consolidation.
Reducing monetary financing and reforming the pension system are also important."
The Directors praised the Central Bank's efforts to
tighten monetary policy and
strengthen the liquidity management framework.
Improving coordination between fiscal and monetary operations would help
absorb excess liquidity and
enhance monetary policy transmission.
The Directors agreed that accelerating the restructuring process of large state-owned banks is also essential.
They encouraged “To
continue modernizing the private banking sector, including by
facilitating the establishment of correspondent banking relationships,
reducing regulatory uncertainties, and
enhancing the efficiency and competitiveness of private banks.”
The Directors stressed the need for structural reforms to unleash private sector development.
They encouraged
equal opportunities between public and private jobs,
enhancing women’s participation in the labor force, and
reforming education and labor laws.
The Directors agreed that
improving governance and combating corruption are also essential, and
encouraged Continue to strengthen the framework for combating money laundering and terrorist financing,
strengthen public procurement and business systems, and
address deficiencies in the electricity sector.
Directors welcomed renewed efforts towards
accession to the World Trade Organization and encouraged the authorities to
improve the coverage and timeliness of statistics. Directors agreed that
“close engagement with the Fund, including through
ongoing technical assistance, would be beneficial, and welcomed the
authorities’ request to establish a policy coordination instrument.”
are expected to be held The next Article IV consultations with Iraq in the standard 12-month cycle.
https://www.alsumaria.tv/news/economy/488824/النقد-الدولي-يوصي-العراق-بالسيطرة-على-الأجور-العامة-والإلغاء-التدريجي
