Iraq's economy is collapsing from bad to worse

Finance Committee in the Parliament expects to move the economic situation of the contraction phase to the recession during 2016.

First Published: 2015-12-26

Middle East Online

Baghdad, the Finance Committee in the Iraqi parliament Saturday predicted transition of the Iraqi economy from the contraction phase to the recession during the year 2016, noting that oil revenues and other resources do not believe in only a quarter of the budget in all its clauses.

He said the Finance Committee rapporteur Ahmed al-Haj "difficult to achieve what is planned in the budget of imports expected, a $ 71 billion (84 trillion Iraqi dinars) and the price of a barrel to $ 45," explaining that the dollar decline to one barrel of oil leads to increased deficit an additional billion dollars.

He acknowledged the Iraqi Council of Representatives last week, the majority of the financial budget for 2016, amounting to nearly $ 90 billion (105 trillion Iraqi dinars), with a deficit of 21 billion dollars (25 trillion dinars) and the size of imports expected value of $ 71 billion (84 trillion dinars).

Haj "The economic crisis faced by Iraq will increase next year and turn of contraction phase to the recession, which is a critical stage in a country's economy," pointing out that according to current oil prices, "we can secure a quarter of the budget for fiscal 2016 only amounting to 105 trillion dinars."

He noted the decision of the Finance Committee that there is a $ 53.3 billion (63 trillion Iraqi dinars) will deserve paid 2016 represented by Bill salaries and retirement, premiums religion and international obligations.

Iraq faces a severe economic crisis due to low oil prices in the international markets, which depends on imports by 90%.

Crude oil prices have fallen by 60%, during the past 19 months, bringing the price of a barrel of oil below US $ 45, down from US $ 115, through the year 2013.

It is intended marked recession and widespread decline in economic activity accompanied by increased supply with lower demand, what is pushing the low industry and trade revenues and declining value of the investment and rising unemployment rates, in addition to the negative social and political effects.