Posted on 09 February 2011. Tags: Budget, oil prices
Iraq’s
government submitted a revised draft budget to MPs for approval on
Sunday, raising projected public spending as oil prices have increased,
government spokesman Ali al-Dabbagh said.
The new spending
programme estimates overall expenditure at $81.86 billion, or 96.6
trillion Iraqi dinars, while income will be $68.56 billion, leaving a
shortfall of $13.3 billion– about a 16 percent budget deficit.
Sunday’s
submission is based on average oil prices of $76.5 per barrel and
projected exports of 2.2 million barrels of oil per day (bpd), a figure
which includes 100,000 bpd of exports from the autonomous Kurdish
region.
A previous draft budget, sent to parliament on December 1,
estimated spending of $78.8 billion based on oil prices of $73 per
barrel.
Of the overall spending in the new budget, $56.44 billion
will be operating expenses — primarily salaries and pensions for civil
servants – and the remaining $25.42 billion will be dedicated to
investment, Dabbagh said.
Energy sales are expected to account for 90 percent of revenues.
Dabbagh
said the $13.3 billion deficit would be covered by “money accumulated
from past surpluses and from internal and external loans.”
He
added that the cabinet also gave the green light for the finance
ministry to request a $4.5 billion loan from the International Monetary
Fund, and a further $2 billion from the World Bank.
While Iraq’s
projected oil price currently looks to be a conservative estimate —
prices currently stand at around $89 in New York — its projected exports
are more ambitious.
Iraq has not exported 2.2 million barrels per day of oil since the 2003 US-led invasion ousted dictator Saddam Hussein.
The
country currently produces around 2.5 million bpd, with exports
averaging around two million bpd, though the former figure is expected
to rise to three million bpd by the end of the year, according to the
oil ministry.
(Source: Zawya)