Iraq May Have $79B Budget Surplus

GAO Finds Oil Prices Bolstering Iraq's Treasury, As Some Ask Why U.S. Taxpayers Keep Supporting Reconstruction





Text Size:  A  A  A

 (CBS/iStockphoto)



Answers.com

(AP) The Iraqi government could end the year with as much as a $79 billion budget surplus as ever-increasing oil revenues pile on top of leftover income the Iraqis still haven't spent on their national rebuilding effort, congressional auditors say.

A report by the Government Accountability Office made public Tuesday prompted renewed calls from senators that Baghdad pay more of the bill for its own reconstruction, which has been heavily supported with U.S. funds.

The projected Iraq surplus, including unspent money from 2005 through 2008, has been building because of rising world oil prices, increasing Iraqi oil production, the government's inability to execute budgets for spending its money and persistent violence in the country, the GAO said.

The report was requested by Democratic Sen. Carl Levin and Republican Sen. John Warner, the chairman and ranking member, respectively, of the Senate Armed Services Committee.

"The Iraqi government now has tens of billions of dollars at its disposal to fund large-scale reconstruction projects," Levin said in a statement. "It is inexcusable for U.S. taxpayers to continue to foot the bill for projects the Iraqis are fully capable of funding themselves."

"It is time for the sovereign government of Iraq, using its revenues, expenditures and surpluses, to fully assume the responsibility to provide essential services and improve the quality of life for the Iraqi people," Warner said.

The GAO said Iraq had an estimated cumulative budget surplus of about $29 billion from 2005 to 2007 and could have another surplus of up to $50 billion this year.

The expected surplus could be lower if Iraq passes stalled legislation for a $22 billion supplemental budget for 2008 - and if the government then executes the budget.

But the report noted oft-repeated factors holding the government back on its spending plans.

"First ... (the) relative shortage of trained budgetary, procurement and other staff with the necessary technical skills as a factor limiting the Iraqi government's ability to plan and execute its capital spending," the GAO said, adding that a second problem is the government's weak accounting systems.

"Third ... violence and sectarian strife remain major obstacles to developing Iraqi government capacity," it said.

The report also estimated that this year Iraq could generate $67 billion to $79 billion in oil sales. Other U.S. officials previously had said they expected the oil windfall to be about $70 billion.

"This substantial increase in revenues offers the Iraqi government the potential to better finance its own security and economic needs," the GAO said.

Since 2005, the United States has funded a number of efforts to teach civilian and security ministries how to effectively execute their budgets.

The efforts included programs to advise and help Iraqi government employees develop the skills to plan programs and to effectively deliver government services such as electricity, water and security.







Text Size:  A  A  A

Comments [ + Post Your Own ]

Now you're in the public comment zone. What follows is not CBS News stuff; it comes from other people and we don't vouch for it. A reminder: By using this Web site you agree to accept our Terms of Service. Click here to read the Rules of Engagement.

Back To Top Back To Top



A Crisis Of Financial Faith
CBS Evening News: Behind The World's Largest Fiscal Collapse In Decades Is A Tangled Web Of Fear And Uncertainty

CBSNews.com Front Page  |  RSS RSS

U.S., Europe Plan To Bail Out Banks
Paulson Pushes For Purchase Of Bank Stock While Euro-Zone Countries Move To Temporarily Guarantee Bank Refinancing

Section Front Page  |  RSS RSS