Shafaq News/ The financial advisor to Iraq's prime minister, mudher Mohammad Saleh, said the country's 2023 budget is shielded by hedging contingencies in anticipation of any sharp decline in global oil prices to ensure the sustainability of critical strategic projects with minimal damage.

"The federal budget relies heavily on the monolithic component of the economy, oil. It constitutes an overwhelming majority of its total income, ranging between 90-93%," he told Shafaq News Agency, "Given this excessive dependence, the budget planners maintain a cautious stance by hedging against possible oil price fluctuations, keeping a relatively conservative per-barrel oil price below the market expectations, while simultaneously ensuring stable export quantities."

"The primary objective is to avert any prospective risks stemming from the price volatility, and prevent the planned or expected deficit from transforming into an actual one," he said.

"In case the price fall went beyond expectations, the budget would be entirely restructured. It would prioritize the social expenditure and maintain the living standards while sustaining the critical strategic projects that directly impact the economy's life," said the advisor.

"The budget account for more than 50% of the Gross Domestic Product (GDP), and economic activity depends on it by 80-85%," he said, "and since oil is its major source of income, contingencies were postulated to deal with any emergency. Any excessive spending can be postponed to a later period, and it may require reducing the public debt's interest rate or developing tax revenues."