How Much Does Iraq Really Need For its Budget?

Since the 2003 US-led invasion that toppled former Iraqi leader Saddam Hussein, and then the subsequent removal of international sanctions, Iraq’s oil production and exports have increased steadily. Exports have risen this has corresponded with an increase in oil prices throughout the 2000s, beginning from 2003. Due to this, Iraqi revenues from the oil sector have increased dramatically and this has been reflected in surges in the annual budget. The 2013 budget is the highest in Iraq’s history.

But now we return to the question at hand: how big does the Iraqi budget need to be for it to be adequate? To decide how much is enough, one can look to developed nations for a benchmark - specifically the OECD average, to derive an approximate “ideal” figure from recent expenditure. The following table indicates how much each country spent per citizen in 2009; it also shows the OECD average spend per citizen for 2009.

This turns out to be US$15,331 per citizen. Meanwhile Iraq’s 2013 draft budget is US$118 billion. With Iraq’s population of over 34 million this means Iraq would only be spending about US$3,440 per citizen.

8 Responses to How Much Does Iraq Really Need For its Budget?

  1. Nibras Hadi 28th December 2012 at 16:13 #

    "The International Energy Agency predicts that Iraq will produce more and more oil – up to 4.4 billion barrels per day by 2020"(2nd to last paragraph - before the conclusion.

    Really ????? I think that's an obvious mistake.

  2. Kickabuck 29th December 2012 at 00:57 #

    Rework your figures, this number is insane:

    4.4 billion barrels per day by 2020

    Do you realize what they are producing now?

  3. Ramy S. 31st December 2012 at 07:13 #

    Kickabuck, I believe they meant "4.4 Million", Saudi produces only 11 million today, that figure is surely a mistake.

    Great article though, I loved it. This is why I love this site, it shows the other side of Iraq.

  4. Seerwan 2nd January 2013 at 14:48 #

    Dear Nibras and Kickabuck,

    The entire article is referenced on my blog (http://seerwan.blogspot.co.uk/2012/12/what-should-iraqs-government-budget-be.html).
    This is the link to the International Energy Agency Iraq Energy Outlook, demonstrating that in the view of the IEA, Iraq will be exporting 4.4 million bpd in 2020 in the Central Scenario (please scroll to page 114): http://www.iea.org/publications/freepublications/publication/WEO_2012_Iraq_Energy_OutlookFINAL.pdf

    In any case gentlemen, whether Iraq will export 4.4 or 7.1 (the IEA High Case scenario) mbpd in 2020, the point still stands that it's simply not enough to fund government spending to a developed nation level.

    Dear Ramy,

    The highest Saudi Arabia has produced in thirty years was 10.1m bpd set in June 2012 (http://www.ft.com/intl/cms/s/0/e7d9ac5c-43c2-11e2-844c-00144feabdc0.html#axzz2Gp9nVetZ), but according to OPEC figures Saudi Arabia exported an average of 7.2 million bpd in 2011 (which naturally was the latest annual figure at the time writing the article). Please see page 49 of the OPEC Annual Statistical Bulletin: http://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB2012.pdf
    Glad you liked the article.

    Thank you all for your interest.

    Best regards,
    Seerwan Jafar

  5. Editor 2nd January 2013 at 15:42 #

    Dear Seerwan,

    many thanks for your comments - much appreciated! I've amended the text from '4.4 billion' to '4.4 million'.

    Best Regards,

  6. Seerwan 2nd January 2013 at 17:42 #

    Not at all.
    Thanks Editor.

  7. Ramy 4th January 2013 at 13:28 #

    Dear Seerwan, Thanks for stating those facts, I only meant 11million is their highest ever, also I was wrong there.

    I also saw your blog, amazing work! keep it up Seerwan.

  8. Seerwan 4th January 2013 at 18:37 #

    Dear Ramy,
    Oh, I see. My apologies.

    Thank you very much. Pleased you enjoyed my work.

    Best regards,
    Seerwan Jafar