Iraq's economy is suffering from cancer oil

(OPED) 18/07/2016 0 Visit

Hamid Abdul Hussein al-Jubouri Angsd cancer in terms of medical specialization customary among specialists and among the members of the community, as far as what we mean in terms of the analogy of the problem of the Iraqi economy on the basis of the causes and effects of that disease, any analysis of the problems suffered by the Iraqi economy based on the methodology to identify the causes and effects left by the cancer on an individual's life.

When studying the history of economic thought note the economists Alvezocrdo time (natural) who believe that all economic laws are derived from the heart of the natural life, namely that the economy is functioning normally without any intervention laws, his work is like a natural phenomenon in the universe, and that the money supply in the economy is such as blood in the body, and this is what gives justification to liken the problem of the Iraqi economy -alta Snhddha- cancer.

Approach characterization In order to diagnose a problem the Iraqi economy more accurately based on the analysis and diagnosis of the causes of cancer and the effects of disease, we have to give a brief overview of the cancer, it means the growth of certain cells in the human body abnormally and is specified on the normal growth of cells and other expense, cells that grow abnormally and Unknown are devoid cells for automatic balance in terms of saturation and lack of it, which she had lost control of the control gates of food reception when needed and satiated.

Since it lacks control of it to accommodate larger capacity of food and this is what causes swollen and then clogging the arteries of blood transfusions and non-arrival of food to other cells following the bulging cells, and this is what causes the Dmorha (atrophy of other cells).

This accelerates the death of a person with this disease.

The application of the curriculum this analysis has many Massadik in the economy both in terms of the capitalist system or the socialist meaning that the capitalist system is trying to evolve and expand and spread at the expense of other systems, particularly the Socialist and vice versa, and this is what we observe is clear that between the capitalist system underdeveloped countries with socialist regimes that industrialized nations It took a gradual turn toward the capitalist system, this shift is suffering a lot of challenges which stand achieved without the least cost and fastest times, and this is what caused atrophy socialist economies and provides capitalist economies.

In terms of individuals that any individual with a capitalist thought trying to advance and develop financially on account of other individuals, regardless of the legitimacy of the production money mechanisms.

Yes development and progress is a positive thing, but should not be at the expense of others, it can bring the expense of others leads to the emergence of social, economic, political and military problems ... etc, as the cancer appears in the human body when they grow some cells on other growth account.

Triple oil in the Iraqi economy also applies the causes and effects of cancer on the Iraqi economy illness in terms of contribution to economic activities in the gross domestic product, and the extent of the contribution of oil revenues, compared to income other, as well as the case for oil exports when compared to other exports.

It should be noted that the causes and effects of the disease affects the Iraqi economy in the case of high oil prices without falling, as the rise in oil prices will cause the contribution of other productive activities, and the ineffectiveness of other revenue, especially taxes, lower non-oil exports by virtue of increased interest in oil exports as a result of higher prices and lower costs production.

The contribution of the oil and other sectors in the GDP that oil production costs in Iraq are the lowest in the world, and when the combination of high oil prices, with low costs, will lead to increased revenue (profit oil) obtained by the state, and this is what encouraged to increase wages of workers in the oil sector in order to continue to increase oil production and continue to get the oil revenues, with the survival wages of workers in the productive sectors, especially agriculture and manufacturing the same.

The higher wages for workers in the oil sector will pay workers in other productive sectors to move towards the oil sector in order to get higher wages, and the result is reduced labor supply in other productive sectors, thereby increasing the demand for it rises wage work and rising output of these sectors costs and so the price of their product versus prices of similar foreign goods, and reduced competitiveness of goods similar foreign, and thus lower sales and production of exerting downward pressure on its contribution to the gross domestic product, compared with an increase the contribution of the oil sector in it, and the high contribution of the oil sector in GDP at the expense of the contribution of the sectors which is a cell growth abnormally and unspecified the human body cell growth on the other account.

In 1990 the proportion of the contribution of the mining sector and the extractive industries, which is controlled by the oil sector, 14.29% of GDP, and accounted contribution of the agricultural sector, 19.80% of GDP, while accounting for the contribution of the manufacturing sector is 8.83% of GDP.

But these proportions changed in 2014, as the proportion of the contribution of the oil sector rose to 53.27% of GDP, while the contribution of agriculture dropped to 4.75%, and the proportion of the contribution of the manufacturing industry, fell to 3.32% of GDP.

This disparity between the contribution rates, especially the oil sector and other sectors lineage back several factors, most notably oil prices, which rose from US $ 22.26 per barrel in 1990 to $ 96.2 per barrel in 2014, this is what caused the higher wages for workers in the oil sector and the movement of workers other sectors had fallen to him offer of employment in other sectors, and increased wage workers in other sectors, and the high cost of production rises in prices and sales decline (decline in other sectors, the growth of the oil sector growth due to abnormally and unspecified).

Oil revenues and taxes rising oil prices lead to increased oil revenues on other revenue account, especially taxes.

The increase in oil revenues, encourage the increase of public expenditure, especially current expenditure - the impact of increased employment in the public sector, without paying attention to the burden of this employment (underemployment) - at the expense of investment expenditure on the one hand, and increased overhead of a social nature on the other hand, in order to gain political allegiances to win government positions at the expense of building the economy.

As the ease of access to oil revenues received by the government to finance public expenditures, while at the same time, the lack of political leadership with the will of truth and administration Avenue in building a strong economy does not depend on the rentier revenue, is what led to reduced interest income and other, especially taxes.

At a time when oil revenues ratio of 48.40% of overall revenues in 1990, the proportion of the contribution of tax revenue 10.77% of overall revenues, and the share of other revenue 40.81% of the overall revenues for the same year.

When oil prices rose oil revenues (some cells grow indefinitely) to reach its contribution rate of 83.62% of overall revenues in 2015, while the share of tax revenue decreased to 5.75% of overall revenues, as well as the case of revenue other since dropped to 10.63 % of total public revenues (other cells atrophy). Oil exports and the mechanism of the effect on other exports that the increase in world oil prices encourage increased interest in the oil sector to increase its production form in which more than meet domestic demand in order to increase oil exports and access to more foreign currency (an increase of foreign currency is displayed), which leads to lower prices (prices foreign currency) compared with a rise of local currency rates any higher local currency exchange rate and this means higher local commodity prices and their inability to compete with foreign goods with low prices when compared to prices of the local currency exchange, and thus lack of local industries ability to continue production and competition in local markets as well for the overseas market, and get (the evolution of oil exports and the growth of abnormally on other exports account).

Were oil exports account for 93.02% of total exports in 1990, while other exports did not constitute 6.98% of the total exports, while in 2014 the proportion of oil exports contribution rose (which crude oil include oil products, phosphates, sulfur) to 99.24% of the of total exports, while the proportion of other exports contribution decreased to 0.76% of the total exports.

Clear from the above analysis that the Iraqi economy is suffering from cancer in the case of high oil prices [[disease that causes high contribution of the sector Alnafty- growth of some cells - induced rise caused oil prices higher wage employees that encouraged the automatic transmission workers in other sectors, and higher wages workers in other sectors due to lack of workers in these sectors dropped contribution - Other cells atrophy - in the gross domestic product, on the one hand, on the other hand, the ease of access to oil revenues - the growth of certain cells - that finance public expenditures to pay the government to reduce taxes - atrophy other - cells on the part of citizens, and to increase employment in the public sector on the other hand, as a prelude to gain political allegiances and win elections and to continue political power.

It is a third hand that the increase in foreign currency as a result of increasing oil exports - the growth of some Klaya- lead to a rise in the exchange rate of the local currency and therefore higher domestic product prices and reduced their competitiveness both internally and externally will collapse Industries for Local other cells atrophy as a result of not putting the necessary plans and to address the negative effects of revenue oil and turn it into positive effects as did Norway when it planned to fund the sovereign placed where all the oil revenues, four are: to maintain the wages of workers in the oil sector and other sectors, finance the budget by only 4% as a percentage of annual profits earned by the fund as a result of its investments in the deficit for reasons abroad, prevent high Norwegian krone exchange rates (currency of Norway) to maintain the prices of Norwegian goods and keep their competitiveness, achieve justice between present and future generations because the general oil wealth can not be restricted to generation without the other.

In conclusion, should the Iraqi planning the government to put an Iraqi fund receives oil revenues when oil prices to neutralize the negative effects, particularly wage differentials between workers in the oil sector and other sectors to raise the contribution of other sectors in the GDP, the Fund general budget rates and certain financed, upon the economic studies Stratejah- when you get the deficit, legislation and implementation of the customs tariff law and bring justice to bear the tax burden (including the prevention of double taxation) and the fight against tax evasion and working hypothesis of progressive taxation in order to raise tax revenue and raising the contribution of taxes from the size of the public revenue ratio, direct support national industries directly and indirectly as an abstraction of all necessary licenses and permits, and comply with any notices or evidence or data required registration with the competent organs related to the company and employees, and the provision of electricity, which represents the most important production requirements, the exemption machines and machines that Isturha national product from customs taxes, reducing the prices of materials raw such as oil, natural gas, etc., to improve the health and quality of education needed to raise the quality factor -bdnaa and Aklaa- contributor to national industries ... etc.

* Researcher at the center of the Euphrates Development and Strategic Studies / 2004-Ⓒ2016

- Read more: