Iraq's new oil-dependent 2019 budget one of largest ever

Iraq approves inflated 2019 oil-dependent budget, after weeks of deadlock
2 min read
24 January, 2019
The approved budget represents a nearly 45 percent increase from last year and awards even more money for public salaries, including those of the northern Kurdish region.
Parliament scheduled a vote on the remaining empty cabinet posts in Abdel Mahdi's government [AFP]
Iraqi lawmakers on Thursday approved the government's 2019 budget, which at $111.8 billion is one of the oil-rich country's largest ever spending bills.

It represents a nearly 45 percent increase from last year and awards even more money for public salaries, including those of the northern Kurdish region.

Nearly 90 percent of the budget comes from oil revenues.

Iraq expects to export 3.9 million barrels per day in 2019, including 250,000 bpd from the Kurdish region, at an average of $56 per barrel.

The current price of crude sits at $63 per barrel.

The deficit is expected to more than double to $23.1 billion, while investments increase to $27.8 billion.

The draft bill was originally submitted to parliament in October but has been fiercely debated since then.

The session was initially scheduled for 1:00 pm on Wednesday, The New Arab's correspondent in Iraq reported, but it was delayed to 7:00 pm, and MPs stayed until just after midnight until it was approved.

The MPs voted on it article by article, a TNA reporter said, adding that "fierce debates broke out among MPs over some of the articles, which were subsequently omitted as a consensus was not reached."

MPs from provinces ravaged by the fight against the Islamic State group criticised it for not allocating enough reconstruction funds to their regions.

Another debate raged over the share that would be allotted to the administratively autonomous Kurdish region.

The government proposed $52 billion in salaries, pensions, and social security for state workers - a 15 percent jump from 2018 and more than half the total budget.

Salaries for Peshmerga forces

Notably, parliament passed a budget measure to fund salaries for the Kurdistan region's state workers and armed forces, the Peshmerga.

The budget also stipulates the Kurdish Regional Government must export 250,000 bpd of crude through state-owned companies and deposit the revenues in federal coffers.

If it didn't, MP Sarkawt Shamsaddin told AFP, Baghdad would continue to pay salaries but would not disburse other funds to the Kurdish region.

"The good thing is public servants' salaries and peshmerga are not subject to political disputes," said Shamsaddin, representing the northeastern Kurdish city of Sulaymaniyah.

Relations between Baghdad and Erbil, the capital of the Kurdish region, soured in 2017 after Kurdish authorities held an independence referendum.

Last year's budget was approved by parliament in March.

Parliament had also scheduled a vote on two of the five remaining empty cabinet posts in Prime Minister Adel Abdel Mahdi's government but adjourned without holding it.

Agencies contributed to this report.

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