Iraqi's proposed budget for 2012 to offset falls in oil revenues

Ahram Online, Wednesday 14 Dec 2011

Iraq and the International Monetary Fund have engaged in a very successful partnership, anchored by successive IMF-supported economic programmes, says IMF head

Christine Lagarde (Photo: AP)

Following her meeting with Nouri Al-Maliki, the Prime Minister of Iraq, in Washington on Wednesday, Christine Lagarde, the Managing Director of the International Monetary Fund (IMF), said she was very encouraged by the Iraqi government’s new budget proposal for 2012, recently submitted to the Iraqi Council of Representatives.

The proposal aims to restrain the growth of current spending, freeing up resources for infrastructure investment and social support, while limiting the size of the budget deficit. The proposed budget would allow the current Stand-By Arrangement (SBA) to continue providing a safety net to the budget should oil revenues sharply.

“We are working closely with the Iraqi government to rebuild its essential economic institutions to help improve economic management and public service delivery,” Lagarde remarked. “The current SBA offers a framework for Iraq’s structural reform agenda, by promoting better public financial management, including the management of Iraq’s hydrocarbon resources, and developing a financial sector capable of supporting private sector activity and job creation. We look forward to further progress in these areas.

The IMF staff mission is scheduled to meet the authorities in January to discuss progress under the programme and next steps.

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