DPM SALIH ON BUDGET EXECUTION AND COMPACT

C O N F I D E N T I A L BAGHDAD 001474 SIPDIS SIPDIS E.O. 12958: DECL: 04/30/2017 TAGS: ECON EFIN PREL IZ SUBJECT: DPM SALIH ON BUDGET EXECUTION AND COMPACT PREPERATIONS REF: A. BAGHDAD 1464 ¶B. BAGHDAD 843 Classified By: Economic Minister-Counselor Daniel Weygandt for reasons 1.4 (b) and (d). ¶1. (C) In a meeting with Economic Counselor and Treasury Attache on April 30, Deputy Prime Minister Barham Salih discussed ongoing progress and challenges in improving GOI budget execution, and final preparations for the International Compact with Iraq launch on May 3. DPM Salih said that the GOI is making progress on budget execution through weekly task force meetings and process reviews at the Council of Ministers, noting that the next review at the COM would be next week. Treasury Attache said that the Iraqi Budget Execution conference of March 7 was an excellent basis for further work (ref B). While acknowledging the lack of timely data, DPM Salih believes that execution was improving in several ministries, although the Ministry of Oil was still problematic. "It has been useful to confront the Minister of Oil on the ministry's poor performance during CoM meetings," DPM Salih said. While he does not expect most ministries to execute 37.5% of their budget by June, DPM Salih thinks that the reallocation mechanism of the 2007 Budget Law is an important incentive for ministers. He also said that he was working to build a professional staff within his office to monitor GOI budget execution. ¶2. (C) DPM Salih said he was looking forward to the launch of the International Compact with Iraq (ICI). EconCouns encouraged him to make sure that the importance of the ICI was not lost when attention turned to the Neighbors' Conference on the following day. DPM Salih also agreed to arrange for an officially signed letter indicating Iraq's intention to settle its arrears with the Arab Fund for Economic and Social Development (ref B). CROCKER