Assessing the implementation of the fiscal rules in oil producing countries- a case study of Iraq

Fiscal sustainability is a central tenet of fiscal rules adopted by European Monetary Union (EMU), which was followed shortly by a Treaty of Maastricht and the Stability and Growth Pact introduced a detailed framework of rules; it is a precondition for financial and monetary stability. Budgetary flexibility is needed for stabilization policy. oil revenue accounts for the majority of government revenue in most of oil producing countries including Iraq, thus ensuring that fiscal policy is on a sustainable path is a high priority. This paper is aiming to study the deviation results in oil-exporting countries as a result of the income earned by what are the changes in these rules as a result of those revenues, and to what extent managed fiscal policy and the support of monetary policy to access to digital border financial rules agreed as international standardsThis study will try to work on the relation of oil revenues on fiscal rules and then their implication on the fiscal rules in Iraq. It will try to account the effect of long and short term response between the change in oil revenues and the abilities of countries to keep-hold of stable fiscal rules. This study will try to test the possibility of holding stabile financial rules in oil-exporting countries using ARDL model, which showed that the implementation and imposing constraints of the fiscal rules in oil producing countries (with Iraq as an example) of numerical fiscal rules is effected by fluctuating revenues.