Parliament passes the Loans Act: a necessary evil

Baghdad | The Iraqi parliament was finally able to pass a deficit financing law, which allows the government to take internal and external loans to guarantee the salaries of state employees, who have been behind for weeks. After dozens of meetings that preceded the approval of the law between the Presidency of Parliament and the leaders of the parliamentary blocs, it was approved in two parliamentary sessions that lasted until dawn the day before yesterday, since the first was dedicated to “persuasion “and the second to vote on it.

Iraqi Prime Minister Mustafa Al-Kazemi has repeatedly linked the guarantee of employee salaries and the payment of government fees to the passage by Parliament of the bill on financing the fiscal deficit. He confirmed, two days ago, that his government had requested the disbursement of salaries for October and November, after the enactment of the law.
Parliamentary sources reported, in an interview with Al-Akhbar, that the Kurdish representatives abstained from entering the voting session on the debt law, in the context of what was stipulated in one of its paragraphs, which obliged the Kurdistan region to deliver 480 thousand barrels of oil to the federal government with all non-oil revenues. In exchange for sending the region’s salaries and his share of the budget, MP Faleh Khazali claims that the Kurds and most Sunnis opposed voting on the loan law.
According to the Financial Deficit Financing Act, the government has the right to borrow 12 trillion dinars, 20% of which is allocated to investment projects, including 350 billion dinars to exclusively build the great port of Faw , and 150 billion dinars to the Ministry of Agriculture to help farmers provide fertilizers and pesticides to cover agricultural crops in support. For the local product, and the rest is destined to finance investment projects in progress, 50% for ministries and agencies not associated with a ministry, and 50% for governments.
By voting on the borrowing law, Iraq is mounting an additional financial burden that has raised its debt ceiling, internally and externally, amid the continuing global economic crisis resulting from low oil prices due to the outbreak of the Corona epidemic. .

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