Iraq Economic Articles pointing toward an RV

 2015 | 11:57 صباحا

05/04/2015 (00:01 pm)
- The number of readings: 49 - Issue (3354)
Specialists call for reconsideration of the banking sector to activate the Iraqi economy
Specialists call for reconsideration of the banking sector to activate the Iraqi economy
BAGHDAD / long-Presse
Counting specialists, economists, on Sunday, that the legislative and financial obstacles highlighted the problems faced by the Iraqi banking sector, while criticizing the conflict of the implementation of the Iraqi Central Bank instructions between private and public banks, called for a reconsideration of the work of this sector and to find capable banking system to attract investment and management of the country's resources.

The director of the Euphrates Center for Development Studies strategy, Khaled Aerada, in an interview to the (long-Presse), said that "the Iraqi banking sector, private and public, are suffering real problems most notably the legislative and financial obstacles", it returned it necessary to "shed light on those barriers and treatment."
He Aerada, that "the proportion of foreign investment in Iraq is low and not exceeding the 2 percent of the total investment," ruling out "the possibility of activating the Iraqi economy and achieve sustainable development without capable of attracting investment and management of the financial resources of the country by about an integrated banking system."
He called on the Director of the Euphrates Center for Development and Strategic Studies, to "re-examine the work of the Iraqi banking sector and find solutions that reduce losses in the current financial crisis in the country."
For its part, Director of the Trade Bank of Iraq in Karbala, Uras Abdel-Nour, in an interview said to (the long-Presse), said that "the Iraqi banking sector suffers conflicts of implementation of the Central Bank of instructions between the private and public sectors", calling for "the unification of labor between banks and private systems and the year. "
So economist said Ahmed Rehn, said in an interview to the (long-Presse), said that "the Iraqi banking sector faces caused by the work environment risks, and the limited resources available to credit, as well as other administrative problems," noting that "banks suffer big debts are difficult to restore what It increases the size of the loss and reflect negatively on the interest rates. "
Rehn added that "banks independent economic entities councils departments and their capital, and it has to devise effective solutions to their problems and to convince the State by the possible application commensurate with their resources," pointing out that "the state can help in improving the banks conditions and improve their performance."
Meanwhile, the adviser said the National Investment Commission, Abdullah al-Bandar, in an interview to the (long-Presse), "The banking sector suffers many obstacles related to the banks themselves and their boards of directors and shareholders and limitations of the central bank imposed on both private without government".
He revealed al-Bandar, for "having problems legal Balaanaat and complaints from the money that is holding in banks and can not be disposed of," returned to "the banking sector's problems need to be radical solutions will not be identified, only direct meeting between decision-makers and concerned government agencies and the private sector."
He criticized the National Investment Commission adviser, "the Iraqi banking sector failure has led to the reluctance of many investors from entering the local market, and form a negative factor, plus the security and economic problems", calling for the need to "restructure the Iraqi banks."
The bankers and economists, carried in (15 May 2013), the Ministry of Finance and the Central Bank of Iraq responsible for the decline and the reality of local private banks, while the latter accused of encouraging Arab and Iranian banks on the Iraqi account.
The International Monetary Fund said in a report issued in (the 21st of March 2013), that an improvement in the financial sector, but stressed that it still needs to be greater by the central bank in the revision of monetary policy and strengthen banking supervision tools efforts, and to accelerate the restructuring of the banking system .
And the Iraqi banking system consists of 54 banks, including seven state-owned newly established Islamic one, and there are 23 private commercial banks, including Islamic nine. There are also 15 branches of foreign banks, and there are many institutions that do some banking, of which 34 money transfer company, and nearly 200 belonging to the banks foreign exchange company or deal with the banks, with the Loan Guarantee Company and to finance small and medium enterprises, with two companies for services of electronic banking and card Smart, in addition to nearly 800 branches and subsidiary banks spread over Iraqi provinces.

Economist: Cancel zeros from the currency will raise the value of the Iraqi dinar against the dollar

Baghdad /...qal economic spokesman Antoine, Sunday, that the expert Cancel zeros from the Iraqi currency project comes to restructure and reduce the currency in circulation process in the markets at the moment, "dollarization".

Said Antoine's "Eye Iraq News" that the process of deletion of zeros from the currency is a project under discussion at the State Commission in collaboration with the Central Bank, but under implementation, "stressing that" the purpose of which is to reduce the process of dollarization in the market this time to maintain the dominance of the Iraqi dinar and make it the most heavily traded in the markets and ease the use of the dollar, "adding that" the Iraqi currency sober and accept fraud. "

He added that the confusion which has increased demand for the dollar and not pumping dinars in large quantities by the central bank has increased more demand than supply, which led to the appreciation of the currency from the dollar in the local market. "

"The Central Bank on the terms of any transfer must be proved in the papers martyrdom on the import of goods against the dollar, with the imposition of the tax, which is 8% 0.5% fee Comerk and 3% income tax." Ended 7







Citizens are afraid to enter large cash categories and experts they consider a new achievement


Citizens are afraid to enter large cash categories and experts they consider a new achievement

Dinars / Abbas Al passengers /..rpma Iraqi government's progress in some cases, the steps have not only benefited a class or a specific segment of Iraqi society, while the ordinary citizen is affected first and last of those steps that Ataud benefit him.
Iraqi street was trading days since the news that the Ministry of Finance, represented by the Central Bank will issue a new currency from the category of "50" thousand dinars and then followed after issuing another currency of a larger category of a "100" thousand Iraqi dinars.
The moves in light of the suffering severe the country as a result of fiscal austerity that has ravaged the country about more than a year and a large deficit in the state budget since, through a multitude of objects of expenditure and the adoption of the government to only rentier economy, oil and some industries light of, in addition to the face of the country to organize Daash terrorist war against it, and having to reduce staff in the public sector wages as well as stop the financing of some projects as a result of fiscal austerity.
Dr. appearance of Mohammed Saleh adviser to Prime Minister for Economic Affairs told "economic dinars" on the subject, saying: I am with this trend in the introduction of large cash categories because it will raise the efficiency of large payments large cash and categories system facilitates the trading of large parliamentary blocs so they shortened the monetary amounts by half or more and solve the problem of the transfer of those quantities, Iraq is still handles cash Order Cache and not the card that requires time and effort and the culture of the visa regime.
He adds that the benefit of this project was due to work done for years, which does not contradict with the project to delete the zeros because reform, there is no need to fear the introduction of these large groups to the market because the financial institutions in the country studied the subject from all sides and is a guarantor of safety.
Some citizens believe that the "large cash categories" to enter the market now is tantamount to adding new burdens on the ordinary citizen as simple salary categories will be hard to break or turn them into smaller groups in order to dispose of them.
They accuse the state to take decisions to Atsb in their interest never, through this confusion decisions is well thought out economic feasibility and benefits desired, but are skeptical about a lot of them that there are mafias significant financial and whales want to take advantage of the introduction of these large groups that might cripple the market movement and the elimination of small groups of categories of "250" dinars and the "500" and "1000" dinars final and the first affected by it is to cancel the taxi buses that operate within the alleys and removed from the "500" to "1000" and the abolition of the pricing "ticket" hospitals, the government's "500" BD also due to lack of loose change final of daily trading, and will be traders are the first beneficiaries of this decision because they would import goods from outside Iraq through that currency instead of running behind the currency of the US dollar or the euro European volatile in terms of demand and supply and the purchase price as well.
To Aikhvi citizen "Abu Zahraa al-Moussawi," 34-year-old fear of this sudden decision to us and says that his fear Mtota of greed merchants, exploitation and opportunists of them, because large denominations were a big problem in one day, especially in the post-dictatorial regime fall of 2003 as traders to Aigmon take unzip large currency, which was at the time 10 000 dinars and 25 thousand, but buy eggs layer or a dozen full of cigarettes or any other commodity is determined by the dealer himself, citizens are forced to acquiesce to buy some of the issues they do not need them perhaps some people to Aadechn or unwilling to buy eggs table of the market and other goods.
He adds that the ordinary citizen fears of a repeat of the same scenario, especially since there is chaos in Iraq and the absence of economic sergeant in the market now is Maahdja traders on foot to carry out acts of earning profits is due and multiply.
It recalls that monetary categories in the country has gone through many stages and each time increased in number Ocefarha and pulls small currencies "loose change" and rising prices and growing, while large currency chasing small currencies remain as it says modern economic base, and increasing numbers of financial Warraq entering the market and the corresponding gold . / End / 22 /


02/04/2015 (00:01 pm)

Economists call for a return to work and raise the auction currency Article 50 of the Budget Law
BAGHDAD / Amer Mohi

Called experts Central Bank economy to re-work the auction currency and put strict controls on the dollar trading movement, stressing that

the central able to in previous years to maintain the value of the dinar according to good monetary policy, and with drew that determine the

bank sales to $ 75 million a day led to a disruption of the relationship exchange rate between the dollar and the price in the parallel market,

promised to Article 50 of the budget, "a breach of the law of the independence of the bank," according to their opinion.
The economist said Maytham Laibi in an interview for the "long" that

"the mechanism that was followed by the central bank through currency auction proven throughout the years," noting that "the intervention of Parliament in central work, through the inclusion of Article 50 in the general budget and identified sales law daily bank $ 75 million a day, led to the disruption of the relationship between the official dollar exchange rate and the price in the parallel market (the market) and also inhibits the independence of the central bank. "
He Laibi saying that "restrict the quantities sent negative signals to the market was reflected in a pessimistic outlook and then the relationship between the two rates of separation of larger, while the other way, is that the central bank to abandon its cheap dollar policy of the dollar to the forces of supply and demand and leave the larger to be determined value ", calling on the central bank and the government to" distribute the negative effects of the scarcity of dollars between the government and the public of traders and individuals by raising the value of the dollar gradually. "
He stressed that "the options taken by the Parliament regarding the currency auction, which came due to scarcity of the dollar as a result of lower oil prices.

For his part, an expert in economic affairs Ahmed Sabih said in a statement to the "long", that "the central bank pursued after 2003 a new monetary policy to improve the dinar exchange rate and get rid of the oscillations which he suffered, and through innovation currency auction, which has achieved great success to raise the value of the Iraqi dinar from the roof top up to 2,500 dinars to the dollar to less than 1,200 dinars / USD, "noting that the measure contributed significantly to the achievement of monetary and economic stability and contributed to the improvement of the purchasing power of citizens and increase their confidence that the dinar became fully repository for value instead of Dollar despite carrying a large burden of the government by providing the dollar at a cheap price. "
The expert added that "the decline in oil prices (source foundation to provide dollar) contributed significantly to the decline in Iraq's imports of that currency which reduced the central bank's ability to provide the dollar the previous quantities, as well as the operations of corruption and smuggling of the dollar and money laundering that accompanied the auction mechanisms." , pointing out that "these things have forced the central bank to take a series of decisions and actions that codifies the dollar selling at a low price and restrict them larger to cover import operations, and the move to create a sort of banking panic among speculators and citizens and local merchants for fear of losing the Iraqi dinar for its value dramatically , He also created a parallel market exchange rate increase by 100 dinars for the auction exchange rate. "
He called Sabih the central bank to "issue a statement to reassure the public to continue to sell the dollar through currency auction, and was accompanied by a regulatory policy of strict, for forcing the importers to sell their goods only in Iraqi dinars, according to the price of the currency auction (1190) dinars to the dollar, as long as he provided them in dollars and in accordance with those pricing before the importation of those goods and ready to provide them with more in the case of repeated import process. "
The Governor of the Central Bank on the Keywords, warned in an interview with the "long", published on the first Tuesday, the vulnerability of Iraq's assets and reserves abroad to risk booking in the case has been retained to Article 50 in the budget law, pointing out that the cap to sell the currency away from
Central exercised an important tool through which monetary policy.
The prime minister Haider al-Abadi said in (23 March 2015) the need to develop to control the Iraqi dinar exchange rate mechanisms, and said he should be the existence of a sophisticated banking system in Iraq comparable to developed countries.

 Abadi talk came during a meeting with Governor of the Central Bank on the Keywords in his office in Baghdad, according to the website of the Office of al-Abadi, said the site where he was during the meeting, they discussed the strategy work of the Central Bank for the next period and the control of the Iraqi dinar exchange rate against foreign currencies.
The Prime Minister emphasized "the importance of the central bank maintains its independence and work to promote the financial and economic reality of the country and draw financial and economic policies that enable us to move forward towards what we aspire to."
He noted "the importance of Iraq has to be a sophisticated banking system comparable to developed countries," stressing "the need to put the control of the Iraqi dinar exchange rate mechanisms."
Economic Adviser to the Prime Minister Haider al-Abadi and demanded the appearance of Mohammed Saleh (February 5, 2015), the Central Bank to clarify the reasons for the low value of the Iraqi dinar against the dollar rise in the price in the local market.
Saleh said, "the central bank need to clarify the reasons for the high price of the dollar against the dinar, though slightly, and shows what actions and policies taken to preserve the value of the dinar."




Adviser to Prime Minister reveals the economic laws revive the market and investment

  • Agency eighth day
  • January 24, 2015, 11:07
Adviser to Prime Minister reveals the economic laws revive the market and investment

BAGHDAD - ((eighth day))

Revealed the appearance of Mohammed Saleh adviser to Prime Minister Haider al-Abadi Economic Affairs proximity of key economic laws contribute to the recovery of the Iraqi market and investment opportunities.

Saleh said "a forthcoming law for cities and industrial industry mixed, and this is very important, and there is a law is for private sector investment, encourage and create Association and strong bond between the private and state sector to stimulate the movement of the market and the end of separation existing between them."

He added, "there is also a market-oriented economy is the one who activates development and not speculators and Ctkarion, there are politicians heading for the development of the market."

And Saleh, said that "the solution is the need for the development of commodity sectors and foci of production, and today the state is moving strongly towards the revitalization of agriculture, manufacturing, and began a strong movement in this aspect."

"The agriculture in Iraq is the private sector by 98% and is not a government, but in contrast, the basic infrastructure for agricultural irrigation, dams and Alambazl and 85% is the relationship of the government list, and agriculture need to protect the local product."


Near the release of economic laws
1/25/2015 0:00

BAGHDAD - morning

Prime Minister for Economic Affairs Advisor to detect the proximity of key economic laws contribute to the recovery of the Iraqi market and investment opportunities.

He said the appearance of Mohammed Saleh, in a press statement, that "a forthcoming law for cities and industrial and mixed industry, and this is very important, and there is a law is for private sector investment, encourage and create Association and strong bond between the private and state sector to stimulate the movement of the market and end the separation existing between them." He added "there is also a market-oriented economy is the one who activates development and not speculators and monopolists, "noting that" there are policies that are moving to the development of the market, ".saleh between" The solution is the need for the development of commodity sectors and foci of production, and the state today strongly moving towards agriculture and revitalize manufacturing and began a strong movement in this aspect, "adding that" agriculture in Iraq is the private sector by 98% and is not a government, but on the other hand, the agricultural infrastructure basic irrigation, dams and Alambazl and 85% are government relationship list, and agriculture need to be local product protection ".


Parliament calls for the adoption of the local currency instead of US

BAGHDAD / my day saw the National Alliance MP Mohammed al-Shammari  said the global economic situation makes it imperative for everyone stand up and actively national Iraqi economy and keep it from schemes designed to Tahedima.oukal in a statement that "by some States to increase its oil exports to the market in order to reduce oil prices, aims to impact on the economies of countries that rely on oil Coward Head have to pass a number of special projects major countries ". He expressed Shammari regretted that" some government departments and institutions to contribute in that attack, which seeks to weaken our national economy and destroyed a number of ways, including, dealing currency US (dollar) instead of the local currency, including, for example, Iraqi Airways, which does not accept cut flights in Iraqi dinars, but require that the amount of the US dollar, ".oshdd the need to instruct the government departments and institutions that deal in Iraqi dinars, to contribute to the revaluation against the US dollar, which assigns the Iraqi national economy.

Economic Committee Member: raise zeros from the currency had been postponed because of fears of fraud and money laundering

Posted: February 17, 2014 in Iraqi Dinar/Politics

Monday, February 17, 2014 12:49

A member of the parliamentary Economic Committee Qusay Ebadi that the issue of lifting of the zeroes of the process has been postponed to another slogan because there are fears the government of money laundering and fraud.

According to al-Abadi told all of Iraq [where] today that “the Iraqi Central Bank expressed its readiness over a year ago to raise zeros from the Iraqi currency, noting that the laws and the Constitution did not specify the cause of lifting of the zeroes and there is no legal impediment, but there are concerns by the government that There are forging process and the washing process will accompany the lifting of the zeroes. “

“The bank said that the value of the Iraqi dinar will not change with the lifting of the zeroes also expressed his willingness to combat fraud and money laundering in the case of lifting of the zeroes, but fears of fraud by the government led to the postponement of the application of this step until further notice. “

The Council of Ministers decided in its meeting held on April 10, 2013 wait in the application process to delete the zeros from the national currency until further notice.

The Central Bank of Iraq, and on the lips of bank adviser appearance of Mohammed Saleh, has confirmed for [where] the need for Iraq to the process of administrative reform of the currency cash, and that the project to delete the zeros is the step comes as part of the country’s need to the process of administrative reform of the currency, in order to reduce the cost of cash transactions in the economic process, in addition to the need to provide small groups of coins used in daily circulation of small transactions.

The officials at the central bank, as well as some politicians and economists, urged the government to delete the zeros from the currency, and the issuance of a new currency denominations large cash, in addition to the presence of small coins.

Observers say that the government intends to delete the zeros from the currency as a step towards improving the purchasing power of the Iraqi dinar, is that economists played down the importance of this step, considering that the cost of raising the zeros will be greater than the expected benefit from the lifting of zeros.


Seniors Leave Out Zero Currency by the Government

Seniors leave out zeros currency by the government

Agency JD / Abbas Al traveler / .. You might have heard and you shop from the grocer or when buying bread or during the ascension in transportation also, you hear one "older" pronounces the words Hack: text dinars, or quarter of a dinar or give me bread dinar, at first glance you think he suffered a "Alzheimer's," but when Tfhsk position well, you find that it is the collective sense of the category of "older" nostalgic beautiful, and the days of the good, or, as he says, mostly "day Jean dinar Ahadji," and you find most of these "older" remember their wives, especially the time of the controversy and Ieirunhn, they paid مهورهن currency "Abu Shayeb or Abu fort or carpaccio Abu Ten," a reference to the categories of cash Dhma in their days, Vvih ten dinars where she painted the image of the Arab world, "Hassan Ibn al-Haytham," as well as a class of twenty-five dinars were three horses Arab painted them.
Pat nostalgia Gemayel, who lived Iraqis days of economic prosperity except during the dictatorial regime is obsessed with all Matnih this word and ماتحمله of meaning, where the purchasing power of the national currency, with small size or the small number of zeros that they contain, and may have استثقال figures large on the year "older" is Maidfhm to the word "dinar" in addition to most of them it gets lost the account due to the spread of currency in Iraq, there are plenty of shops dealing in foreign currencies, "the dollar and the euro," and he says Baghdadis "lost the thread and sparrow" and forced most of the elderly to take grandchildren or their children during their dealings or receiving their salaries.
Employees veterans remember things realistic about the purchasing power of the Iraqi currency day seventies and late sixties, including that more teachers were traveling to European countries in the summer holidays, Faihmlon them money Iraqi Ikomen Ptsrifaa in those countries with difference currency dollar compared to the Iraqi dinar, which was worth more than three Dollars are expenses of their journey became free with the purchase of gifts and extravagance spending.
And identifies a senior researcher "Hanna Batatu" in his famous book "Iraq" Iraqi families rich they own million dinars, or exceeded its wealth of this amount before the revolution of 1958, where the establishment of the Republic replaced the property, but not exceeding the number of these families and that was including the staff of the Jews, and the number does not exceed 8 families, and compared nice between Makant owned by these families in that period, which is set a huge, and the number "one million Iraqi dinars" Now, this amount was a record large in tanks wealthy and their bank accounts and was the subject of pride and bigger class, pour two scenarios must apply not exceed the price "Telephone mobile-class smart" holds any young Iraqi man in his pocket, no wealth largest traders and staff fifty years ago in the pocket of any young Iraqi average case or class "bourgeois" middle as he calls sociologists, and all this is due to over-printed coins with large groups that caused the decline of their purchasing power.
And still more Iraqis have "denominations old" in محفظاتهم personal keepsake for that stage gold, as well as to seek blessing from them as they have purchasing power too large to Atdhahiaa any other currency except the Kuwaiti dinar, and they consider a good omen for a living so found parked under "الجام:" on a table cashier In most popular restaurants and ovens, and believe it brings them livelihood.
Has worked governments that came after the occupation on the project to delete the zeros of the local currency, and return the prestige of the Iraqi dinar and its purchasing power against the U.S. dollar or other currencies other cash, but it apparently is not easy, the fact that Iraq is linked organizations oil such as "cartel" that impose upon conditions and laws they are mostly not in his favor, as well as link the country's government budget global oil market, which does not allow to take any step without detection or review.
And resorted to the Government of the dictatorial regime previously Among its monetary policy wrong, and because of the imposition of economic embargo on Iraq, to ​​put the local currency "printing" in exchange for withdrawal of currency Alsosria of the deal, which led to inflation, currency digitally with low purchasing power in the domestic market, in addition to rejection handled externally, and had been working in each period under which to disappointment or blow economical from the outside to put up a new currency alternative to the first, causing big losses for traders and owners of capital, opening the door to the counterfeiting of currency, which was carried out in Iraq or from abroad, specifically of its neighboring countries. / End / / 22

The large reserve of skilled economic: Iraq of hard currency and gold must be invested to develop the economy

27/05/13 09: 05

Said former science and technology Minister Raed Fahmi and the Economist, "the great Iraq reserve of hard currency and gold must be invested to develop the economy through the benefits of this reserve".

He said in a press statement that "Iraq and what owned him from the large reserve of hard currency and gold also must invest in raising the value of its currency against other currencies," it is inconceivable that the Iraqi currency is weak compared to what Iraq owes a large reserve of hard currency ".

He added that "Iraq has said economic stability at least part of the hard currency and gold curiously under the stability that this currency fluctuation," he said, adding "it affected rely on gold for the strengthening of the local currency.

"We must have a strong dinar and the Iraqi economy needs a clear strategy for currency and strengthen the risk management capacity and economic fluctuations faced in Iraq", indicating that "currency stabilization and strengthening of the policy of the Central Bank to assume her engagement with global companies." Financial sources have noted rising Iraqi cash reserve of hard currency to 74 billion dollars.


Economic Analyst: The government erred in forcing the central bank to pursue a policy of non-current in the market

Tuesday, May 28 / May 2013 12:02 | PDF | Print | Send to a Friend

{Baghdad: Euphrates News} economic analyst Ismail Aboudi, said the central government committed A big mistake in forcing the central bank's policy of non-existent in the market which impact negatively on the dollar price increase.

And refers economists that the reasons for poor fiscal policy of the country, especially monetary and fluctuating exchange rate of the dollar against the dinar many, and focus on the political differences that disrupted a lot of things the state and weakened, including fiscal policy or monetary, as well as the conditions of the country's current overall especially the security file and its implications for the serious situation public service in his country.

He bonded to the Euphrates News Agency {} on Tuesday that "the government forced the central bank to transfer funds and sell currency In addition to Iraq to import bills, "noting that" the issue of conversion and the dollar does not need to these factors, but there are many factors that control the market needs. "

He added that "determining the central bank to the currency exchange policy and allegiance impact negatively on the volatility result make the climb to the dollar Larger numbers of truth. "

He bonded to the "responsibility to pour into the central bank to maintain the exchange rate is the most important pillars of the mission in Iraq is to have a stable currency and where there is no wiggle".

The MP for the mass of the parliamentary Abdul Hussein Abtan stressed that his bloc will not remain silent about the continuing decline in the value of the dinar and its impact on the country's economy and the lives of citizens, especially low-income and poor people who unfortunately make up half of society.


Abtan stressed in a statement to the Euphrates News Agency {} "The central bank primarily is responsible for improving the dinar exchange rate, it is not reasonable that the country has reserves estimated at 74 billion dollars and the dinar assaulted him in front of the eyes of everybody."

Abtan said that "on the central bank to take action fast and needed to be one dollar versus thousand Iraqi dinars, and this is what our work during the previous years and we have achieved stability of the dinar with the reserve did not exceed $ 30 billion at the time."

The Committee on Economy and Investment has confirmed that parliamentary disputes and political crises that hit the country and the lack of clarity of central bank policy led to the fluctuation of the exchange rate of the dinar against the dollar.

The issue of central bank and its aftermath that led to the sacking of Central Bank Governor Sinan al-Shabibi and the appointment of Abdul Basit Turki instead of him acting in addition to reserve a number of staff were due to the low exchange rate of the Iraqi dinar against the U.S. dollar, but that these measures did not limit this fall. Ended 3 m

Editorial: Inflation in the Iraqi economy and how to reduce the repercussions (1-2)

Posted: February 13, 2013 

D. Accustomed Naji al-Hamdani

Inflation in the economy occurs in the case of the continuous rise in the general level of prices of all commodity groups, and service. Either the rise in the prices of some goods and services not called inflation.
And inflation complex phenomenon satisfactory and vehicle and staying in particular capitalist economy because of his ultra ongoing crises as an inevitable result of the structural nature-based struggle for exploitation
and profit. And can be subject to inflation all developed and developing economies alike.

Inflation arises in most cases because of the imbalance and lack of balance between aggregate demand and aggregate supply in the national economy. When commodity supply deficit to meet the total demand of the consumers of goods and services prices rising commodity groups and causing inflation. The greater the gap widening between aggregate demand and aggregate supply accelerates the pace of the rise in inflation rates.
According to a report of Economic Affairs of the United Nations, the inflation rate in Iraq until 2006 amounted to 64.8%. According to the report, Iraq is the country most of inflation among the 22 Arab countries. The record price index consumer grew by 33.6% and 33.9%, 36% and 64.8% for the years 2003, 2004, 2005 and 2006 respectively. Rising inflation index in March 2006 to 53% compared to 2005 put the Iraqi economy in inflationary trends experienced in the economic blockade. Inflation has risen to great ranges reaching monthly rate of increase in the index of consumer prices in July of 2006, nearly 70% compared with the same year, 2005, and continued to rise in the month of August 2006 until the rate of 76.6% compared to the same month of last year.

According to the report published by the Iraqi Ministry of Planning, the annual inflation index in Iraq has increased since April of 2011 until April of 2012 by 8.7%. The ministry justified the increase by rising food prices and non-alcoholic drinks by about 13% and housing prices rose 9.7% and vegetables at a rate of 13.3% and rents for residential buildings by 14%. The results of a selected sample prepared by the Central Bureau of Statistics on sales outlets in the provinces of Iraq, the index of consumer prices stood at 142.4% in the month of April 2012. Any rate rise from 1.1% to 8.7% compared with April last year, and the high prices of restaurants at a 6.9% rate. And education by 5.9% compared to April 2011.

The Iraqi economy because of its links to the multi-capitalist economy and absolute openness to foreign markets has been affected and will be greatly influenced by international foreign trade variables and what is happening in the capitalist countries of recession and inflation and the high cost of financial and monetary crises. And contribute in particular the policy of economic liberalization that Iraq seeks to apply to incapacitate the monetary authorities in control the prices of the national currency actress Iraqi dinar to strengthen its monetary value and competitiveness in the foreign exchange market.

The crisis experienced by the Iraqi economy is a complex crisis constitute a cause and a result of the crises of unemployment and services and in the failure of the productive sectors and skyrocketing prices. According to the Iraqi Ministry of Planning, the proportion of people living below the poverty line 23% and the number of poor people in Iraq exceeded 8 million, and the unemployment rate more than 20% until 2012. Iraq is ranked third in the world among the most corrupt countries and described as a failed state.

The most common inflation in developing economies such as Iraq is inflation due to demand that occurs due to the inability of the aggregate supply of goods and services to keep up with overall demand for consumer audience. Also occurs when growth exceeds the cash incomes increase in the prices of goods and services leading to fold purchasing power of money. Thus inflation becomes the cause of the deterioration of the value of the currency and that applies to the case of Iraq. The downturn in the general level of prices of goods and services leads to enhance the monetary value of the national currency is achieved by bridging the gap between demand and supply market. An increase of the supply of goods and services a manner that achieves balance and enough to cover the needs of the market on a permanent basis.

For the inflation multiple types as inflation by demand and inflation pressure costs and inflation creeping inflation hidden and hyperinflation that arises when high prices at rates very high in the short period of time, leading to the collapse of the monetary system and thus lose money and function as a store of value and as an intermediary for the exchange. There has been this kind of inflation in Iraq in the nineties, reaching 31000% inflation rate. In Germany after the First World War prices rose at a rate of 100,000,000,000, and also happened in Greece, thereby increasing prices more than 25,000 times between 1939 and 1948.

Despite the radical change in economic philosophy after the regime change in Iraq, the Iraqi economy did not achieve economic growth real only in the oil sector, a growth faltering due to lack of planning and economic mismanagement and this remained the Iraqi economy live in a tunnel economic crisis multifaceted one manifestations of inflation and economic stagnation goal of disable a lot of production capacities, worsening unemployment and stops productive activity in the real sectors which reflected negatively on the living standards of the community and increase the number of poor people and the widening gap between the incomes of the poor and the rich and the emergence of powerful financial centers for some influential people in the state.

The observer for the movement of the exchange rate of the Iraqi currency and rising prices infer some contradiction between economic logic and the movement of prices. It is supposed to result in improvement in the exchange rate of the Iraqi dinar against the U.S. dollar to lower commodity prices, but that happens, the improvement achieved in the value of the Iraqi dinar did not stop the march of prices upward. Inflation and thus leads to gorging on scarce access of low-income people and contributes to the expansion of poverty and its extension to other categories.

The price drop foreign currency exchange leads logically to the high value of the purchasing power of the Iraqi dinar and get more goods and services, especially that the bulk of the items in the Iraqi market are imported goods denominated in U.S. dollars. This explains the contradiction presence of high inflation rates and a struggling situation experienced by the Iraqi economy.

Inflation Lalani in the Iraqi economy can not be confined by one but multiple reasons and factors. Inflation arises due to increasing consumer commodity demand and the inability of the Iraqi market to meet this growing demand. The inflation also arises from the prohibitively high prices in countries which Iraq depends on merchandise securing its imports. In this case, described inflation in Iraq imported inflation. In other cases inflation arises from the instability of the monetary policy and deficit financing and resort to external borrowing to cover the deficit in the budget. Also arises from the excessive display of large amounts of money are not matched by only small amounts of goods and services, leading to higher prices and depreciation of the currency.

The economic and monetary policy of price liberalization, trade and investment and services is a policy incapable of addressing imbalances in the economic structure of Iraq and is able to rid Iraq of its economic crisis and political, service and security because they lack the development strategy and economic vision sets priorities in economic and financial reform.

Editorial (Part2): Inflation in the Iraqi economy and how to reduce its repercussions

Posted: February 14, 2013 

 d. Accustomed Naji al-Hamdani

Part 1:

of the economic and social consequences of inflation, loss of confidence in the national currency. Sharp Valtsaad in prices weaken the purchasing power of the Iraqi dinar and investors and consumers heading toward security havens Instead, they resort to convert their savings into gold or National Real Estate or replaced in foreign currencies, leading to the emergence of the phenomenon of dollarization in the economy.

The high rates of inflation to the deterioration of the purchasing power of consumers and increase cash incomes for speculators and realtors leading to the redistribution of income in favor of categories parasitic and exploitative and leads to deepening inequality and social community due to variation sharp in the distribution of wages and wealth. And thus contribute to inflation in the increasing richness of the rich and the poor even poorer.,

and the consequences of inflation worsening imbalance in the balance of payments as a result of increasing the volume of foreign imports and declining commodity exports. Leading to increased economic dependency abroad.

inflation also leads to increase the budget deficit and public to resort to external borrowing to cover the deficit. And inflation creates an unwelcoming environment for domestic and foreign investment. Thus shrinking job opportunities and worsen unemployment.

proposed treatment

to reduce the consequences of inflation and its impact on the economy and living life requires took a package of remedial actions to eliminate tumors price and their secretions, including:

1 – Work planned for bridging the gap between supply and demand Bjanabih monetary and commodity to balance the To achieve an economic growth rate over the annual rate of increase for inflation. Recession inflationary experienced Iraqi economy leads to continued high prices because of the employment of available economic resources in the production process.

2 – support the agricultural sector and giving it priority in the allocation of financial to be a major base in the provision of food and reduce dependence on import external and thus lower prices and leakage of hard currency.

3 – State continue to work ration card system and increase vocabulary commodity quality and quantity because it contributes to securing the basic needs of the citizens and protects the poor from the consequences of inflation. The abolition of ration card will unleash sharp upward prices.

4 – In the case of inflation resulting from the increase in the rise in prices is one of inflation in the Iraqi economy. For the CBI to execute fiscal and monetary policies to influence the volume of cash in circulation. The State should take some necessary measures such as reducing government spending Albzkhi and increase taxes on luxury goods and combat the smuggling of hard currency and maintain raw materials and raw materials from theft and smuggling.

5 – can the Ministry of Finance to contribute to the reduction of the money supply offered through its sale of public debt to the public either directly or through their financial institutions, leading to the withdrawal of surplus cash in the market and reduces the amount of supply in circulation and thus contribute to the reduction of the high rate of inflation.

6 – can be applied to the principle of saving compulsory who can whereby deduct part of the employees’ salaries for a specific period and employ resources withheld in productive projects with financial returns and refund withheld to their owners with the benefits of a relative in the form of monthly payments or quarterly in order to reduce cash in circulation.

7 – the need to raise the ceiling of government spending on productive projects that lead to GDP growth, and in turn reduce spending on service projects is essential that do not affect directly on the lives of citizens.

8 – issuing antitrust law either in import or export and fight monopoly markets by some mafias and traders crises and encourage freedom of action to grant loans productivity and strengthen small businesses in order to increase domestic production.

9 – state could raise the proportion of the legal reserve in government and private banks, leading to reduced liquidity at the individuals and banks and other financial institutions. Monetary policy on addressing the issue of inflation and lower levels, especially emerging inflation of aggregate demand.

10 – in the case of continuing escalation of inflation the central bank’s demands to lift interest rates on deposits of all kinds in order to encourage individuals, companies and institutions on the savings to deposit their money in banks, and so absorbed ratios high excess liquidity from circulation and keep the central bank.

11 – central bank can do by asking securities to be sold to commercial banks in order to pull possible cash in the coffers of banks to limit their ability to get credit.

conclusion that prove it

1 – The inflation quo in Iraq and higher prices for some commodity groups is a logical consequence of the deterioration and disruption of productive forces are unable to provide quantities of goods sufficient to meet the demands of the Iraqi market.

2 – Some aspects of emerging inflation in Iraq is imported inflation due to the high total cost of imports of goods from international markets experiencing inflation and economic stagnation and unemployment and the prohibitively high prices and debt.

3 – The fact treatment of the phenomenon of inflation in the Iraqi economy is to re-spin the wheel of economic development and operation of material production sectors to finance local markets its products and needs compensation for commodity import from abroad. Vchgal available production capacities and deactivated will provide a golden opportunity to run the armies of the workforce unemployed and active movement of the local markets. Without it you can not deal with inflation and the disposal of its consequences economic and social development.

فاندماج Iraqi economy economy capitalist international make an exhibition of injury all diseases and infections of the capitalist system of inflation and recession, recession and the high cost obscene and foreign debt and a rise in prices of raw materials and foodstuffs and other consequences other inherent to the capitalist system internationally.

Therefore we do not find a real interest to our national economy from the open-door policy is planned on the outside and enter into agreements unequal achieve the interests of the stronger party which foreign countries at the expense of the national interests of Iraq.

Unlocking Iraq's true value

Unlocking Iraq's true value Photo Credit:Reuters/STRINGER Iraq

Despite ongoing challenges, fund managers remain upbeat about the prospects for Iraq, fuelled by the promise of substantial IPO activity over the coming months.
Economic forecasts for Iraq continue to make for pleasant reading. The most recent IMF World Economic Outlook predicted GDP growth of 10.2% in 2012 and 14.7% in 2013 and Iraq has one of the world's largest oil reserves.

But the IMF also acknowledges that the task of rebuilding the country remains immense and that reconstruction requires not only the rebuilding of its infrastructure, but also of its economic and social institutions and the creation of a business environment that attracts capital.

The scale of the challenge is reflected in the performance of Iraq-focused funds over the last 12 months. Northern Gulf Partners' Iraq Investment Partners fund was down 3% last year - after growing by more than 20% in 2011 - although strong final quarters enabled the Iraq Opportunity Fund and the FMG Iraq Fund to venture into positive territory. Unaudited figures for 55 North Company's Iraq Phoenix Fund indicate growth of 5%.

Invest AD's Iraq Opportunity Fund also bounced back in November, mainly as a result of positive investor sentiment in some of the larger-cap stocks, particularly Bank of Baghdad and North Bank, explains portfolio manager Sherif Salem. He adds that companies in the telecoms sector present a clear opportunity for growth in terms of both revenues and subsidies.

Telecoms Boost

"In a market dominated by the banking sector, the IPO of Asiacell could give the market a boost," adds Salem. "It is expected that it will involve the floating of a 25% stake in a deal that could be worth as much as USD 1 billion, which would immediately add depth and liquidity to the Iraqi stock market."

Shares of Asiacell Communications, in which Qatar Telecom owns a majority stake, traded higher in their market debut on February 4, after the Iraqi telco raised about USD 1.3 billion in the Middle East's largest initial public offering since 2008, according to a Zawya Dow Jones report.

The offer for 67.5 billion shares priced at IQD 22 each was fully subscribed. Qtel acquired shares worth USD 207.12 million in the IPO to increase its stake in Asiacell to 64.06%, from 60%.

Iraq's three mobile companies - Asiacell, Korek and Zain Iraq - are required to list 25% of their shares under the terms of licenses bought in 2007, and forthcoming flotations could mean telecoms become a leading theme in many portfolios.

FMG investment analyst Henrik Kahm describes Iraq as one of the fastest growing telecoms markets in the world, while he is also bullish on the banking sector. He also refers to consumer stocks as "looking interesting, but still very few options currently listed" and expects more funds to enter the market once the custody issue is resolved (see below).

There is general agreement that Iraqi assets are still undervalued. "Many companies have book value several times their market cap and companies in general are operating at a fraction of their future capacity," says Kahm.

Iraq is not a 'dirt cheap' market - banks are trading at 1.5 times trailing earnings, on average - but future growth opportunities are evident when you look at domestic credit provided to the private sector as a percentage of GDP. The World Bank puts this at 9%, compared to 56% in Kuwait, 47% in Russia and 40% in Saudi Arabia, observes Michael Daoud, vice president MENA sales at broker Auerbach Grayson.

Paul Collison, managing director of investment management firm 55 North Company, agrees that there are investment opportunities both in ISX listed stocks and in foreign-listed firms with activities in Iraq. But he adds that many investors - especially retail/individual investors - will not be able to fully understand and evaluate risks. "Furthermore, we have come across numerous situations that (upon more detailed analysis) we would short if we were able to. Many listed companies have dismal prospects so investors must be careful of company-specific situations. Some can (and will) go to zero over time and others will experience negative news and shocks to their valuations, most likely around corporate governance and other issues."

Northern Gulf Partners portfolio manager Bartle Bull reckons telecom IPOs and the continuing extraordinary growth in assets, deposits and profits of Iraq's top banks are the next big investment story for Iraqi funds.

To this list, Collison adds completion of a critical mass of the oil and gas export infrastructure from Kurdistan to Turkey, and enactment of federal oil and gas law. "As hydrocarbon production ramps every quarter, incoming cash flows become extraordinary relative to the size of the country's GDP, let alone the market valuation of its stock exchange," he said.

Suppressed Consumption

Daoud says the main investment story in Iraq for the last several years and for the foreseeable future is suppressed consumption because of previous wars and the sanctions imposed on Iraq from 1990 to 2003.

"Now this consumption is driving growth, alongside the rapid increase in oil and gas exploration and production. It is very hard to play specific sectors or themes in Iraq as the market is heavily dominated by banks, which constitute around 60-70% of the market cap and most of the activity on the exchange. The one name that I like outside of the banks is Baghdad Soft Drinks."

For investment funds, Daoud accepts that the majority of investment is still going through companies listed on the ISX, but adds: "if you are talking about general investments going into Iraq, I would say it is off the exchange."

Indeed, Bull concludes that the real foreign investment in Iraq to date has been direct investment, in private equity opportunities and oil. "With the Asiacell IPO and the follow-on opening up of the ISX to other capital raising, 2013 will be the year that public markets start to catch up as a way into Iraq's economic boom."

Custody conundrum

One of the issues affecting Iraqi investment, and a challenge preventing to the creation of more dedicated Iraqi funds, is the continued absence of the major custody agents.

"Custody arrangements are generally not recognised in Iraq; the registered holder of securities being regarded for all purposes as the true legal and beneficial owner of said securities," explains Khaled Al Saqqaf, partner & head of Iraq office of law firm Al Tamimi.

The Iraq Securities Commission recently issued ISX Custodian Instructions No. 17 of 2012, which regulates the licensing of custodians in Iraq. However, these instructions do not provide any guidance as to the permitted activities of such custodians, continues Al Saqqaf.

"In particular, it remains to be seen whether the relevant authorities find that such custodians shall be entitled to hold shares on behalf of others. In the past, custody arrangements have been limited to providing assistance to investors in opening accounts, obtaining an investment number and/or relaying orders to brokers."

Henrik Kahm of FMG is relaxed about the situation, pointing out that his firm is comfortable settling all trades directly with the Iraqi central depository system. "Given the large pending IPOs in the telecom space, we envision these liquidity events to add to the level of attractiveness of a pending custodian to emerge sooner rather than later."

Bartle Bull of Northern Gulf Partners is also unconcerned, and suggests that those who stay away because of custody are losing out to those who find good brokers and enter the market. "The ISX is providing a workaround, allowing investors to block broker sales of the stocks beneficially owned by investors."

However, Paul Collison of 55 North Company describes the custody situation as a "deal-breaker" for many. With very few exceptions, even the emerging markets groups within global institutional firms will be unwilling to invest without custody, he suggested.

© MENA Fund Manager 2013

Parliamentary Finance Committee calls for deepening cooperation between the banks to enter the global market

Published on Saturday, 02 February / February 2013 19:18

The decision of the Finance Committee called parliamentary Ahmed electrodes, Saturday, to deepen the cooperation between the private banks and the Iraqi government and open more channels for cooperation through the development of banking systems, to enter the global market and the exercise of sophisticated transactions.

The electrodes for “obelisk”, “All government banks and cadres have seen in many of the sessions external mechanisms to deal modern financial in Lebanon, Egypt, Britain, Japan and other” stressing “the need for the country to deepen banking cooperation between the government and private banks Iraqi to create mass financial banking able to fight the investment arena and attract capital through guarantees and acceptable terms. “

The electrodes that “Parliamentary Finance Committee has plans with the Ministry of Finance in this direction in order to mix banking expertise with the Iraqi international expertise to take advantage of the strengthening of the foundations investment and financial”, but he also said, “To be the Iraqi banking sector is able to grant large loans and guarantees can be provided and thus encourage investor entering the country. “

The Baghdad Economic Forum recommended in banking (13 January 2013) to expand to banking legislation and the introduction of a number of laws relating to civil banks at the conclusion of its work in the capital, Baghdad.

Editorial: Iraqi economy in the world’s fastest-growing at a crossroads

Screen Shot 2013-02-02 at 11.40.31 AMDate: Thu 01/17/2013 03:00 pm

D. Kamal Basri
Dean of the Iraqi Institute for Economic Reform

Iraqi economy in the world’s fastest-growing

Issued by the Bank of America Merrill Lynch (BAML) in the United States report shows that Iraq will Achieve the highest growth rate for the years 2012-2013 in the world, data showed Wall Street bank (Wall Street bank’s data) that Iraq will achieve the highest growth rate in GDP (GDP) for 2012, which amounts to 10.5%, and China ranked second at 7.7% and the top ten economies in the world will not exceed its estimated growth rate of 5.5% for the same year.

The same source reported that in 2013 the will of the Iraqi economy highest growth rate equal to 8.2%, followed by China. The expected growth referred to above is due mainly to the success of the oil ministry, which led to the increase in oil production to more than 3.3 million barrels per day, has been achieved this progress by decades licensing rounds concluded by the Iraqi government with international oil companies to develop the fields.

The truth is that Iraq has made ​​progress in the political, economic, At the political level achieved significant progress through: the development of the practice of the individual to freedom of personal, intellectual and political, and democratic practices and of the referendum on the constitution and the holding of general and local elections, as well as the adoption of legislation supportive of decentralization, even Iraq has become truly a milestone in the Arab region, despite the challenges and shortcomings plaguing through the political process. On the economic front Iraq achieved various Successes for the period from 2004 -2011:

1 decline in the unemployment rate from 51% to 15%. 2 reduced poverty from 54% to 23%. 3 low rate of inflation from 65% to 6% . four high sanitation and sewer system from 6% to 36%. 5 high production of electric power from 3,500 to 7 500 MW. 6 high per capita GDP from 3000 to five thousand dollars. seven reduced Iraq’s debt of $ 127 billion to $ 54 billion.

But the ability Aljhazaovernma to provide basic services is still below the required level due to lack of access quantum leap in the governance of public institutions, where we find that 20% of families is dissatisfied with health services and housing, and 30% of the level of educational services, and 60% for other services all the water and electricity (according to data from the Ministry of Planning).

The danger lies upwardly Spiraling and the enormous revenues oil, with the continued reluctance of the public and private sector in the implementation of service projects (which would provide basic services to citizens), and the continuing weakness in the application of vocabulary governance in public institutions, will lead to fueling the political divide and the sectarian and ethnic into conflict not know Mdyate (According to reports by the World Bank).

Indeed now that Iraq is at a crossroads and either of the following situations:

1 – optimistic: This situation requires: (a) raise the human development indicators by Investing in the necessary infrastructure for the purpose of access to the provision of basic needs of the citizens of public services, especially education to raise its potential intellectual and scientific support for the development and good governance and the rule of law. (B) reform the laws and procedures that are impeding the development in order to create a supportive environment for the advancement of economic activities to find a competitive base in a globalized world. According to the above conditions are expected to vary rates of GDP components so that the contribution of oil below 30%, and with the imposition of achieving this case means a great deal of development and economic well-being of the citizen.

2 – missed opportunity: the case achieved by supporting reform of the laws to change, but far from achieving human development and the rule of law. In other words that the government undertake the necessary actions by the legislation of laws and procedures in support of economic reform, but the absence of the rule of law remains (quotas) and good governance challenge in the implementation of economic projects, including infrastructure. And it is expected to be the contribution of oil in GDP by more than half.

3 – disappointment: is a situation that can not be achieved by supporting reform of the laws to change, but are evolving human development and the rule of law. The disappointment comes from the progress of human development indicators and provide queens rule of law and good governance can not find legal environment chock interview and incubator for change and development. The structure is expected to be dominant GDP him to a lesser extent by the oil sector, due to the increased contribution of other sectors relatively .

4 – despair: is a situation that does not happen reform of the laws do not occur advanced in human development and the rule of law. In this case, the ratio of the contribution of the oil sector on the rest of the tyrant components of GDP and more than 50%. Perhaps the situation that Iraq is going through the time being, which is characterized by: non-recognition and legislation important laws such as the law of oil and gas, infrastructure and law of parties and others, and the continuation of low human development indicators (due to poor delivery of public services) represents the fourth case “despair.”

The foregoing, we find that it requires a decisive and realistic solution is embodied in adopting a new approach to speed up the building of infrastructure . This solution includes the adoption of “private sector participation contracts for the year” as a strategic option in the current phase, and as an alternative to the style of the existing contract and through which can overcome all problems of inadequate government allocations, and address the lack of efficient performance in the implementation of projects. And through these contracts rehabilitate the private and public sectors, and through Twining local institutions with foreign companies contracted, and the fruits of these contracts of technology transfer and modern traditions.

Based economic development in many countries of the world on the leadership role of the government (as is the case in Singapore, Malaysia, Brazil and China), and in Iraq has become in the aftermath of the political process and its negative impacts on non-decision-making and legislation necessary laws, no secret that it requires leadership unconventional but professional – impartial Technocratic political affiliation. Past years have revealed that political competition which flooded the institutions and personnel departments do not have the ability to deliver appropriate background and to pick out the fruits of training and rehabilitation. Also prevented the existing policy of attracting qualified Iraqi material and give them the privileges enjoyed by the political class (as happened in countries such as Turkey, Malaysia and Korea). Each estimate, by the Council or the reconstruction is sparing the country from the risk of decisions or inappropriate policies.

Finally, democracy in Iraq is still reduced and the National Action monopoly through partisan political action (which is still not done regulated by law!), Either non-governmental institutions and non-political are trapping procedures and laws is not as flexible as it does not have any government support. The oppression of non-governmental organizations in this form will deprive citizens to know the truth about the way things happened the dimensions of the enactment of the infrastructure, and Disrupt the repair of the ration card, and delayed Fueling economic development policy. The support of civil society organizations representing the contribution in building the edifice of democracy and development.

EU amends Iraqi sanctions: Specific restrictions on economic and financial relations with Iraq

Screen Shot 2013-02-02 at 11.44.55 AMThe EU Foreign Ministers Council meeting here Thursday announced that it has amended regulation 1210/2003 concerning certain specific restrictions on economic and financial relations with Iraq.

This will permit the transfer of frozen funds to the successor arrangements to the Development Fund for Iraq put in place by the GOI under the conditions set out in UNSC resolutions 1483 (2003) and 1956 (2010),” said the short statement without giving any details.

The Council also extended the sanctions against persons responsible for the misappropriation of Tunisian state funds, including former Tunisian President Zine El Abidine Ben Ali, by 12 months, i.e. until 1-31-2014.

Editorial: Monetary policy and its consequences on the Iraqi dinar

Font Size:01/22/2013 (23:00 pm)
D. Accustomed Naji al-Hamdani

Seen monetary and fiscal policy since 2003 a major shift in the banking sector has taken the Iraqi government some necessary measures derecognition foreign exchange controls and the lifting of restrictions on the movement of trade, capital and support and encourage private companies in the banking sector to move from a system exchange controls system to the open market as one requirements of a market economy.

And the Central Bank of Iraq as Iraqi state bank, which formulates monetary policy, he dealt with this policy. Under this approach open to the capitalist West, monetary policy assumes Iraqi currency float and be subject to the law of demand and supply and non-interference in determining the exchange value of the Iraqi dinar against foreign currencies, including the dollar. Currencies cash exposure in the markets as exposure to any items of other commodities which practically leads to monetary instability. Demand and supply that determines the value of the currency. Accordingly, it is expected that the Iraqi currency is exposed to more pressure because of the inflamed political crisis and instability that leads to security stagger markets and rising prices of goods and services and go about asking for more than the dollar.

Despite the huge accumulation of cash balances of the Central Bank of Iraq, which constitutes a solid cover of the Iraqi currency, the dinar is under severe pressure. Dropped its monetary value in recent from 1170 to 1320 dinars to the dollar did not quite live up to the level of competitiveness currencies. The relative stability of record of the dinar exchange rate in some years it has been at the expense of draining small amounts of foreign reserves and no thanks to the efficiency of monetary policy and right that turned the central bank into a mere ATM.

As confirmed by the Iraqi Central Bank, the monetary reserves had reached in 2012 about 70 billion dollars and 31.5 tons of gold, according to these huge funds are supposed to enjoy the Iraqi dinar a significant competitive capabilities in the foreign exchange market and cash worth more than the value of the dollar. The question here is why descend the value of the dinar to a further deterioration with this huge amount of reserves?

The shift towards a market economy and opening up to the capitalist West imposed on the central bank keep up with this transformation and independent monetary policy for governmental guidance and shift towards monetary instruments indirect order to achieve monetary stability and tackle inflation and stimulate economic growth and other targets that aim to achieve.

It is clear Allko in the work of the central bank in achieving these goals being implemented monetary policies governed directives and policies of international financial institutions, which hamstrung the ability to take measures to stop the leakage cash abroad, estimated at more than $ 260 million per day according to the bulletins daily announced by the central bank. And must realize that hundreds of millions of dollars that leaks out is part of the oil imports, which should invest in the development of the national economy and enhance the value of our national currency and conservation of deterioration and collapse.

The central bank is required to intervene to maintain cash reserves and stop the deterioration suffered by the Iraqi dinar and determine the value of reciprocity versus Nzirath of foreign currency, commensurate with the huge assets that you have to believe the Iraqi currency stability and confidence as the key currency in the financial trades.

Despite assurances by senior officials of the Central Bank of Iraq for the durability of the Iraqi dinar because protect a discreet cover of hard currencies is that the market indices refute these allegations and confirms that the value of the dollar rises and the value of the dinar in the deterioration.

That monetary policy followed the central bank aims to achieve economic stability through access to a fixed exchange rate and stable dinars through the accumulation of cash reserves of hard currency and thereby turn the dinar to offset the dollar and that this trend did not achieve economic stability desired in a country like Iraq, which suffers from structural imbalances in the productive sectors and unemployment rife. The stability of the exchange rate of the national currency is linked to many factors, including the strength of productive activity in the commodity sectors agricultural, industrial and service sectors of electricity, water, housing and sanitation, education and health that generate cash incomes commensurate with their output, leading to a balance.

Fluctuations in the exchange rate of the dinar, which represents the external value of money and the lack of firmness in the local market in recent led to negative consequences was the rising prices of goods and services and weaken confidence in the Iraqi currency and erosion entering the poor as a result of rising prices and the dollarization of the economy. Also led to increased demand for foreign currencies it boosted the status of the dollar in the Iraqi market. Has led commodity shortages in supply-related import external and its inability to meet the total demand of the Iraqi market to increase inflation. And thus became imported inflation and inflation related to high cost and the deterioration of gross domestic product.

That the central bank demands to strengthen the value of the Iraqi currency and not to provide justifications for the deterioration that has plagued the value of the currency. Monetary policy Vartbat and Iraq’s financial institutions international capital funding raises the question about the feasibility of this policy and its ability to enhance the value of the national currency and achieve monetary stability. It is the consequences of opening up to the capitalist system to move all diseases of the capitalist system and the financial and monetary crises to the Iraqi economy and the plight of Iraqi parents are exempt from the consequences of the monetary and financial crisis plaguing the international capitalist system.

That the central bank can resort to the use of his tools available cash as a price discount, reserves and other tools available to stop cracking in the national currency and its repercussions on the living conditions of the poor and downtrodden and those with limited income by controlling the money supply and take quick steps to enhance the value of our national currency and the tightening measures pumping foreign currency and sold in accordance with the legal requirements necessitate coupling to obtain foreign currency for the importation of goods and basic products contribute to support economic activity as a means of production and raw materials are not available in the Iraqi market and within the activity of industrial and agricultural production.

Hundreds of millions of dollars flowing formally abroad not only imports offset poor and depressed commodity markets in neighboring countries as a means to cover up the smuggling of large amounts of hard currency that goes into the pockets of mafias and thieves market profiteers people. An activity and mastermind of the scheme by some regional and international powers to weaken the Iraqi currency and the destruction of the national economy and sustain existing crises.

However the sharp rise in the current political crisis is expected to witness the Iraqi dinar more volatility in the exchange rate against the dollar and will be reflected in the rise of consumer prices and core rents, shops and business service daily and will lead to the deterioration of the purchasing power of entering poor that suffer mainly of the many pressures of life.

That the government is required to pursue sound financial policy able to create internal and external balance to support monetary policy. The economy of Iraq is still economical ريعيا constitute its oil imports 98% of its national income, and the economy strong is not measured by the extent of state ownership of billions of cash balances, but that the strength of the economy and ensure its stability and the stability of market prices determined by the strength and vitality of its sectors productivity industrial, agricultural and ability to self-sufficiency .

That the management of foreign reserves efficiently requires a sophisticated banking system and is capable of mobilizing and allocating financial resources efficiently to serve the purposes of productivity and development and to respond to financial crises and potential cash. Monetary policy in Iraq is facing major challenges as inflation and fluctuating prices and the lack of coordination between monetary and fiscal policy and the phenomenon of dollarization in the economy.

The rehabilitation of factories and plants Iraqi and re-operation and the establishment of industrial parks and huge agricultural and provide the investment climate welcome attraction for the local private sector and foreign and monetary policy and financial independent of outside interference will lead to the creation of economic cycle contribute to increased demand for the Iraqi currency and the rise of the Iraqi dinar against foreign currencies. The stability of the value of the currency and competitiveness one of the key indicators on the effectiveness of monetary policy and right.

Finance Committee Member: House of Representatives will begin law establishing the Council for Economic Reform after approving the budget

Date: 12/29/2012 08:39:40 Saturday

Baghdad (news) .. Said a member of the Committee on the economy and investment MP / National Alliance / Abdul Abbas Xiaa, ending discussion of the draft law for the establishment of the Council for Economic Reform by the State Council, likely sending it to the House of Representatives in the coming days.

Said Xiaa (Agency news): The House of Representatives now busy to discuss and approve the budget bill being is one of the important laws of the country, adding that the rest of the other laws have been postponed until the adoption of the general budget.

He added: that one of the laws which will be put to the House of Representatives after the adoption of the federal budget is the law of economic reform, which includes the establishment of the Council on economic sectors according to deliberate steps and fixed and not random.

And stressed: that passing this law will give a big boost to the national economy to turn it from a totalitarian central to a free market economy in accordance with international standards and sound steps.

He pointed out: that the State Consultative Council to discuss the establishment of law ended the Council of Economic Reform and will be sent to the House of Representatives during the next few days, and will be discussed and voted on after the adoption of the federal budget.

Governor of Baghdad: the country’s economic growth is increasing every year (8%)

Date: 11/02/2012 08:15:10 Friday

Baghdad (news) .. The Governor of Baghdad Salah Abdul Razzaq, that the country is witnessing an evolution of great economic terms of oil production and the stability of the dinar exchange rate against the dollar, which lasted for five years, indicating that the rate of economic growth of the country is increasing annually by (8%).

said Abdul Razak (News Agency News): There are indications that Iraq is undergoing evolution economic including increased oil production, which is now the second largest oil producers in OPEC after Saudi Arabia, which produces far more than (3) million barrels of oil will rise to more than (6) million during the past next five years.

added: that the stability of the dinar against the U.S. dollar, which continued for five years after the dinar was deteriorating either international currencies difficult, pointing to the issuance of international reports confirm that the rate of economic growth in the country has (8%) per annum.

and how Rehabilitation Baghdad International Fair said Governor: There are efforts being made ​​by the province of Baghdad and in collaboration with the Ministry of Commerce for the rehabilitation of buildings and halls Baghdad International Fair shortly, where he was the division of labor to three meals per day have been employed more than (1500) factor of engineers, technicians and craftsmen and workers from different disciplines, so conservative reaches the completion of rehabilitation according to a specific standard has not been achieved again in all of Iraq’s provinces


Iraq Central Bank to substitute damaged currencies for new ones

29-10-2012 - 08:00


| Source:  



Iraq’s Central Bank announced on Saturday that it has signed a contract with a British company to substitute the damaged Iraqi currencies for new ones. The exchange will take place early November. Damaged currencies constitute 1% of the currencies used in the market, the bank noted.

“Iraq’s Central Bank contracted with a British company specialized in printing currencies to reprint small currencies of 250 and 1000 Dinars instead of the damaged currencies in the market. This British company is renowned in this filed and is responsible for printing around 60% of the world’s currencies”, Central Bank deputy governor Mathhar Mohammed said in a statement to Alsumaria.

The new currencies will be handed early November after many Iraqis found many difficulties to use the currencies of 250 and 1000 Dinars for they were mostly torn and damaged.

*****************************************************************************************           Najaf PC holds meeting to discuss financial budget of 2013

Baghdad Iraq on October 15, 2012.

najaf pc holds meeting to discuss financial budget of 01 Najaf PC holds meeting to discuss financial budget of 2013

Najaf ( -The provincial council of Najaf province held a meeting to discuss the financial budget of the province for 2013.

The media director of Najaf provincial council, Mohamed al-Khuzai, stated to on Sunday ”The provincial council of Najaf province held a meeting on last Sunday attended by the Governor, Adnan al-Zurfi, to discuss the financial budget of the province and the complementary budget,” noting that “The complementary budget was estimated of about IQD (450) billion.”

He added that ”The meeting also included discussing the future investment and construction projects and the funds which can be allocated for each project.”

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Parliamentary economy: inflation rate in Iraq is unacceptable

The time on Wednesday, September 19 / September 2012 07:17

Baghdad / Orr News

Committee considered the economy and investment parliamentary current inflation rate in Iraq as unacceptable, calling on the government to prepare a strategy to double the economic GDP in order to improve the standard of living and Alrvahe citizen.

The member of the Committee of Economy and Investment parliamentary Abdul-Abbas the estrus, government to “draw a strategy and put laws diversity of GDP, which depends mainly on oil.” Estrus said “GDP is one of the economic criteria, and affect the per capita income and the budget and welfare measures for the citizen,” he said, adding that “revenue needed to sustainable development, such as agriculture, industry, generating profits on the citizen and the country.”

He pointed out that “Iraq’s dependence on oil in danger of crises result link this product economic crises and political in the region and the world,” warning “accreditation President on oil, because it at our peril, is linked to the global market mainly, and perhaps in any crisis we lose 80 percent of our domestic “.

The MP said the state law that “Parliament is expected from the government to prepare develop laws and the diversity of GDP or contribute to its development,” stressing the need to “find organization plans in coordination between the executive and to facilitate the preparation of parliamentary legislation law.”

As for the high rates of inflation, considered estrus current ratio as “unsatisfactory, given that the budget measure on inflation 5 percent, a rate acceptable to Iraq,” noting that “the responsibilities of the central bank is to determine the exchange rate of the dinar, and the interest rate, and the reduction of the inflation rate, in addition to managing cash reserves and a host of other tasks. ” “We want the central bank to take the reins, and work to reduce the inflation rate reasonable.”


Deputy of national economic reform act: new will remove foul economic progress

Date: 2012-09-19 11: 09: 15 Wednesday

Baghdad (News) … According to Deputy Economic Committee member/National Alliance/Salman al-Musawi, the economic reform act will transform Iraq’s economy from a Socialist totalitarian economy to a free market economy and private sector.

He said al-Musawi (News Agency news) on Wednesday: the new economic reform act will be the key to all prevailing economic problems before 2003, which led to the reversal of all economic aspects, explaining that the law will write all economic legislation adopted before and after 2003.

And: the new reform law would be split into three parts the old laws should repeal laws and laws must be amended and must work within the economic reform.

He: that the goal of the new economic reform act is to kill routine economic and obstructive to support and encourage the private sector and delete all laws that hinder the economic process and to address problems of public sector companies.


U.S. Chamber of Commerce: Iraq at the gates of an economic boom can not be overlooked


BAGHDAD / JD / .. confirmed U.S. Chamber of Commerce in Jordan, said Iraq on the eve of an economic boom can not be overlooked, noting that Jordan qualified than others to take advantage of the opportunities that exist in Iraq.

said Chairman American Chamber of Commerce in Jordan Mohammad Batayneh during a meeting with Prime Board of Directors Capital Bank Basem Khalil Al Salem: that Iraq today at the gates of an economic boom big Jordan can not be overlooked especially that many of the other markets that were available traditionally started drying up and Jordan qualified than others to take advantage of the opportunities that exist in Iraq.

praised the services provided by Capital Bank to its customers, especially regarding the Iraqi market, at a time when they need it the Jordanian economy to take advantage of these great opportunities in next to us and which we are linked by economic and trade relations, social and document many older.

The Capital Bank’s fourth-largest bank in Jordan in terms of the bank’s capital Jordanian only content in the Iraq through bank Ahli Iraqi, which enabled him to make it the experience and knowledge in the Iraqi market and building a strong network of relationships with various sectors, where is always trying to share his experiences in the Iraqi market with its clients and partners to provide all means of support for them to expand their business activities and development in the market Iraqi.


Iraq will be at the forefront of polarized to invest in the near future

Posted: September 19, 2012 

Morning newspaper

Said Deputy Prime Minister for Economic Affairs Rose Nuri Shaways that Iraq will be at the forefront of polarized to invest in the near future.

said Shaways in a speech to the Conference and Exhibition on banks and financial and investment in Iraq in London: “The efforts are still intense to improve the performance of banks in Iraq to be of help in achieve investment and development programs in light of the expected increase in revenues from oil exports, which will hopefully be up to (6) million barrels in 2017 (an increase of more than double what it is now – the year 2012), and it certainly will use the bulk of these revenues to cover the needs of the citizen Iraqi who is still suffering from a lack of infrastructure services in many facilities. “

He Attorney: He “In light of the need for development programs required by the Iraqi reality the result of what has passed through the wars and destruction, it has resorted Iraq in recent years to borrowing and contracts payment on credit , and is considering resorting to unorthodox methods to cover its development programs, particularly the style of service contracts (BOT), the fact that broadband projects planned outweigh potential Iraq financially and operationally, and must use governments and foreign companies to contribute including is capable of and in the interest of all parties ” .

and added by saying: “We have fully convinced that Iraq would be at the forefront of polarized to invest in the near future after making amendments in the laws related, primarily the Banking Act and the Investment Law and Tax Law and Minerals Act, labor law and legally public and private companies and others, in addition to memorandums of understanding bilateral concluded between Iraq and the countries interested Bmstthmreha. “

and stressed Shaways the government’s keenness to continue its guidance in economic reform Pan sectors of the state and the financial sector and banks because of its share is important in this policy strategy has received support from the World Bank and other donors to implement the strategy sector reform banking, as the government continues to implement these trends effectively been achieved tangible progress in question and efforts are still being made ​​in this regard. “

He also noted that public companies owned by the state has had its share is the other, where the U.S. Agency for International Development (USAID) to prepare the roadmap of how to dispose of these facilities, and that the subject under study by the Council of Representatives, and the character of the act is to transform state enterprises into joint stock companies in partnership with the private sector and this would promote the adoption of the private sector also would activate the Iraqi market for securities, which is the foundation money market Iraq.


Shaways confirms from London serious government reforms of the financial sector and banking

Future news agency – 09/19/2012
London / With: Deputy Prime Minister Ruz Nuri Shawis “the government is serious in continuing financial sector reforms and banking and support efforts to improve the banks Iraqi civil to be able to contribute to an effective and serious in the process of building modern Iraq.”

said Shaways in a speech at the conference and exhibition on financial The banks and investment in Iraq is being held in London for the period from September 18 to 19 current “The Iraqi government appreciates the efforts by the private sector and serious in supporting foreign investment sober and protection to ensure the interests of all parties,” according to a statement by his office today

and the statement noted that “the Deputy House Speaker Qusay al-Suhail and Ministers of Planning and Development Cooperation and Construction and Housing and Chairman of the National Investment Commission in Iraq and a number of consultants and general managers and the Minister of State for Trade and British representatives of major international companies and banks in the world attended the conference.


Efforts to improve the performance of the banking sector to the global counterpart

09/19/2012 12:02 am

To qualify in the implementation of development programs

BAGHDAD – Hussein Tgb Tamimi
heading efforts economists and money into researching how to bridge the wide gap between the performance of the domestic banking sector and his world.

This focus of the meeting that was conducted by the morning with a representative of the Association of private banks in Iraq at the Economic Commission for private sector in the Council of Ministers, a banking expert Nawzad dry, which stressed the importance of adopting action plans aimed at raising the efficiency of all workers in the private banking sector. Dry believes that actually requires a stand at the global developments in the international banks and the role of electronic systems to provide faster services to the beneficiary, and this requires the development of human resources bank because it represents the need to serve the development process of economic advancement that was sought by the country in the coming period. The main problems faced by the banking sector is not to provide expertise bank local competition of international experience, pointing out that the training of staff of private banks need long periods, and is available from training courses is not commensurate with the size of employees in the banking sector.

revealed dry for the past few days saw meetings with the International Monetary Fund and was our requirements far from loans and financial aid but focused towards organizing training courses for cadres banking in general and training in international centers specialized would raise the efficiency of workers and access them to experience the state in the nature of services provided to customers.

He noted that banks that rely sophisticated systems gain the trust of customers and multiply their numbers, especially after the prompt service internationally accredited and pointed out that some international organizations international ones (usaid) and Lebanese banks and Jordanian dealing with local banks have some courses specific size cadres something positive in the opening credits and money laundering, but they need to experience and more capabilities.

He continued dry modern saying: that Iraqi private banks and under economic transition is limited and disproportion size of the Iraqi economy, which is one of the giant economies in the region, noting that the banking sector today is in need long cycles and intense knowledge of international banking standards, is also seeking private banks to obtain a confession from the government as well as private sector, which has become a trusted best banks out of the race after the adoption of some advanced systems. Praised Dry to direct the central bank to increase the capital of the private banks, which is one outlets gain the confidence of the government and customers beneficiaries working with private banks, indicating that the private banks offer some services offered by banks, especially as the number of customers does not favor electronic trading with the bank to mistrust sometimes .

In this way we need to culture handle mail and this is the important banks in the first place, the media and in cooperation with banks in the first place. Predicted dry that occupies banks civil in Iraq privileged position in the operations of future economic development by and fit banking services provided by private banks, which offer better services from public banks Despite recent experience.

and the reality of the bad debts that hinder the work of banks said that the size of these debts take much shrink from the previous result of the crackdown and the cooperation of the judiciary to speed up the liquidation problems and civil fairness banks. Also, the problem of fraud taking place in official documents decreased significantly because of the audit emphasized during the last period on the books issued from various destinations.

Dry noted that in the capital of private banks has expanded after the broad participation of shareholders and thereby reducing the risk rate.