Thursday, December 08, 2011 Iraqi Cabinet Ratifies $98.39 Billion Budget For 2012
The Iraqi cabinet has ratified a draft 2012 budget of 117 trillion Iraqi dinars ($98.39 billion), compared with some $81.8 billion this year, a government spokesman said Thursday.
Ali Al Dabbagh said the 2012 budget, which still needs to be approved by parliament, forecast a deficit of IQD15 trillion, which would be covered through a combination of unspent money from this year's budget, issuing new treasury bills, and loans from the International Monetary Fund and the World Bank.
"The council of ministers approved today the federal budget and has sent it to parliament for approval," Dabbagh said in a statement emailed to Dow Jones Newswires.
The new budget is based on an oil price of $85 a barrel, compared with this year's forecast of $76 a barrel, Dabbagh said.
The 2012 budget forecasts oil exports of 2.6 million barrels a day, up from 2.2 million barrels a day predicted for this year. Iraq's actual exports have been so far running at 2.167 million barrels a day, according to figures of the State Oil Marketing Organization.
The proposed oil exports include some 175,000 barrels a day from the semi-autonomous Kurdistan region, he said.
According to the Iraqi new constitution, Kurdistan would get 17% of the budget which means some IQD12.6 trillion, he said.
Security and energy take some IQD17 trillion each. Iraq needs to upgrade its power generation as the country now produces around 6,500 megawatts, less than half of its actual needs.
Baghdad has signed this year multi-billion deals with international companies to set up new power projects, but most of them would need two years from now to finish.
About IQD37 trillion will be spent on investment, while IQD80 trillion will be operating expenditure, Dabbagh said.
Iraq, which has the world's third-largest crude oil reserves, depends on revenues from oil to finance around 95% of its public expenditure. During the first 11 months of this year, Iraq's oil revenues totaled around $75.6 billion. Iraq expects its total revenue in 2011 to reach some $82 billion.
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