Thread: Iraq/Dinar News until 6/17/07 8:30 PM CST

Originally Posted by Hkp

Iraq gov''t proceeds with key laws, reconciliation efforts -- Maliki

POL-LD IRAQ-NEGROPONTE
Iraq gov't proceeds with key laws, reconciliation efforts -- Maliki
(with photos) BAGHDAD, June 12 (KUNA) -- Iraq's government is carrying on with enacting important laws for welfare of the Iraqi people such as the oil and gas law, as well as boosting national reconciliation, Prime Minister Nouri Al-Maliki said.

Al-Maliki's statement was made on Tuesday during talks in his office in Baghdad with the US Deputy Secretary of State John Negroponte who arrived earlier in the day on a previously unannounced visit.

"The (Iraqi) national unity government proceeds with enacting new laws that serve the present and future interests of the Iraqi people, such as the laws on oil and gas, accountability and justice and provinces," the Premier told the UN official.

He added that his government was "boosting efforts for reconciliation, regardless of the regional interference and conspiracies impeding the political process" in the country.

"Several missions are ahead topped with developing our security bodies and armed forces to combat the terrorist al-Qaeda, Saddamists and militants, and extend the rule of law nationwide," Al-Maliki noted.

The Iraqi Premier referred to "the success by the national unity government overcoming the biggest danger, sectarian war, through the national reconciliation initiative supported by all the Iraqi people and political powers." Al-Maliki expressed appreciation the US support to the political process and reconstruction in Iraq.

Negroponte renewed the US backing to the Iraqi people and government to achieve security and stability in the face of challenges and external interference The surprise visit by the senior American official came a day after Britain's future prime minister Gordon Brown visited the country and held talks with the local leaders urging them to press ahead with measures to restore order and achieve political reforms.(end) ahh.
msa


KUNA 121300 Jun 07NNNN

Kuna site|Story page|Iraq gov''t proceeds with key laws, reconciliation...6/12/2007

All I can say is WOW, what a great find. I see 3 key points, 1. Oil law looks done and if not very close. 2. No civil war. 3. Openly admitting the needs of the people. GREAT STUFF

Basrah contains huge oil wealth

Its rocks contain more than 65 billion barrels Translated by IRAQdirectory.com - [12/06/2007]


Oil researcher, Ahmad Al-Husseini, said that geological studies "in Iraq showed that there are

about 530 geological complexes of good prospects for oil; about 115 sites have been drilled so far with reserves estimated at about 3,111 billion barrels of oil, which leaves 415 locations requiring exploration." He pointed out, "reserves in the 415 sites unexplored for various reasons are estimated at over 215 billion barrels." He believed that regions and provinces rich in oil "will include in future nearly two thirds of Iraq."

Al-Husseini pointed out, in a symposium organized by the University of Babylon on the oil and gas law and attended by oil and economy experts, that oil reserves in Iraq "are parallel to those discovered in Saudi Arabia which is today the top producer of oil in the world." He said that current producing fields are "concentrated in the provinces of Basrah and Kirkuk, versus little production from a few other fields located in the provinces of Maysan, Baghdad, Salahaddin, Diyala and Mosul." He said, "the present discovered and undeveloped fields are deployed in all Iraqi provinces but four: Qadisiyah, Babil, Anbar and Dohuk".

The expert noted that Basrah "holds the largest oil wealth in Iraq. According to the statistical data, it has 15 oil fields, including 10 producing ones and even they are still waiting for development and production, while the rocks in these fields contain over 65 billion barrels of oil which comprise about 59% of the total Iraqi oil reserve. Also, the oil reserves in the provinces of Basrah, Thi-Qar and Maysan represent 79.4 billion barrels, or 71% of the total reserve in the country,"

He pointed out that these figures mean that "the largest part of oil reserve is concentrated in the south and somewhat in Kirkuk where it is estimated at 13.45 billion barrels, which is about 12% of the total proven reserve of Iraqi oil, while the Kurdistan region contains 3.16 billion barrels, or 3% of the total."

[Ed. Note: recently estimates of large unproven reserves in Anbar were revealed, adding about 100 bbl to the Iraq total.]


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Zubai meet Bengroponte Croker and discuss developments

(صوت العراق) - 12-06-2007

(Voice of Iraq) - 12-06-2007

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The Secretariat of the Council of Ministers
Office Sallam Zubai
Deputy Prime Minister

______________________

________________________________________
Zubai meet Bengroponte Croker and discuss
Developments in the political and security situation

______________________

________________________________________
Sallam Zubai received in his office today, Mr. John Negroponte and Deputy Secretary of State.
The Zubai and Negroponte meeting lasted about an hour during which addressed a number of security issues and developments in the political arena and the draft national reconciliation plan and the imposition of the law in both the core security and service.
Negroponte focused on the need for everyone to participate in the political process Based on the project, which came after democratic elections official in Iraq.
For his part, Deputy Prime Minister issues overall Iraqi scene and said that the real success is that it must be transformed blood and money offered sacrifices to reap the fruit and added that there were challenges to our government, which must take its valuable real activation of the project of national reconciliation, which is still moving steps Slow.
Zubai also touched on another set of files including problems in the detainees and the security agencies on the basis of correct and the threats posed by terrorist groups, in addition to the role of Iraqi clans and how to deal with the government awakening and war against terrorism.
During the meeting, discussion of international intervention in Iraq and external problems behind it.
It was also emphasized the need to strengthen bilateral relations between Baghdad and Washington in all areas of cooperation.

Office of Public Information

Translated version of http://www.sotaliraq.com/

Time for results, US tells Iraq PM


Baghdad
June 13, 2007

THE top American military commander for the Middle East has warned Iraq's Prime Minister that his Government needs to make tangible political progress by next month to counter growing opposition to the war in Congress.

In a closed-door conversation that mixed gentle coaxing with a sober appraisal of politics, the commander, Admiral William Fallon, told Prime Minister Nuri al-Maliki that his Government should try to complete a law on the division of oil proceeds by next month.

Admiral Fallon also said that Iraq's Shiite-dominated Government had consolidated power and should have the confidence to reach out to its opponents. "You have the power," he said. "You should take the initiative."

The admiral's appeal, which was made in the presence of Ryan Crocker, the American ambassador to Iraq, a senior political adviser to the command, and this reporter, elicited an assurance from Mr Maliki that he hoped to make some progress over the coming weeks. But he also offered a lengthy account of all the tribulations facing the Iraqi Government, including tenuous security, distrustful neighbouring Sunni states, and a complex legal agenda.

"There are lots of difficulties that are not well understood from outside," Mr Maliki said. "Still, we're trying hard."

Admiral Fallon, who is in charge of the US Central Command, used a whirlwind trip to Iraq to reinforce Washington's public and private message that political progress was lagging. It is a message that has been delivered by several other American officials, but the deadlines have often been allowed to slip. This reporter, who is accompanying Admiral Fallon on his trip to Iraq, was allowed into the meeting. It was only at the end of the meeting that American officials agreed that it could be on the record.

At times, the two sides appeared to be operating on different clocks. While Admiral Fallon emphasised the urgency of demonstrating results, Mr Maliki cast the political process as a long journey from dictatorship to democracy. "The end result will be marked in history," said Mr Maliki, who was flanked by his national security adviser, Mowaffak al-Rubaie, and two other aides.

Time for results, US tells Iraq PM - World - theage.com.au

Originally Posted by rvalreadydang

The House stripped the President of all the powers and functions and coercive granted leave until the election of a new president

المذكور،Russian-special : After the resolution adopted by the Iraqi parliament at its open of (37) on June 11 this month and which was an extension of the meeting Sunday, no longer Mahmoud Almchidani Chairman of the House of Representatives actually voted Iraqi (119) of the total (163) members in favor of granting leave open to Mr. Mahmoud Almchidani at the suggestion of the Accord Front, until the selection front a new candidate for the presidency of the Parliament, The wording of the draft resolution presented by Dr. Fouad Massoum head of the Kurdistan Alliance and praised by a large number of members, according to the second paragraph of the resolution,

فانس.The Mahmoud Almchidani been divested of all his functions and powers as the Chairman of the House and moved his powers and functions to Sheikh Khaled al-Attiyah, first deputy chairman of the House until the election of a new President of the Council.
.Although President Accord Front, a few members of the Iraqi Islamic Party had voted for the resolution was proposed by the Accord Front, but the proposed win a majority, has raised some sort of resentment by a number of deputies and the left front hall meeting of the Board.
.This meeting was presided over by Sheikh Khalid al-Attiya was voting on a series of proposed laws which were awaiting ratification by the House of Representatives. فقد 2005.The Council voted on a draft Code of Criminal Procedure military proposal Act to amend the High Criminal Court No. 10 of 2005. ”.The cancellation of a series of decisions dissolved Revolution Command Council, including resolution No. (199) for 2001 on the change of nationalism, where the former regime had issued to achieve the objectives of the Arabization process, which affected large parts of Iraq has stated in the rationale, "that the cancellation of this decision came for violating the provisions of the Constitution and the concepts of democracy and human rights principles, in order to erase the traces of racist policies of the former regime."
.It also approved to rescind resolutions 690 and 981 for the year 1283 to 1980 and 1019 to 1979 and 1253 to 1985.
كما.Also, the Board completed the second reading of the draft law on accession to the International Agency for Investment Guarantee and the second reading of the draft law on Iraq's accession to the Islamic Corporation for Insurance of Investment and Export Credit. ".An informed source told (Russian), it is premature to be talking about an alternative candidate for the Speaker of Parliament, especially that Mahmoud Almchidani belongs to the dialogue one of the components Accord Front, which insists that this site while its share in the source said : "It is difficult to choose a suitable person for this post among the members of the dialogue and agreed upon by all parties to compromise and political blocs." .The movement of a number of members of block consensus on other blocs to drum up support for themselves only that the process of selecting an alternative candidate to Mr. Mahmoud Almchidani takes time might go more than two weeks and needs to bargain and perhaps change some of the sites functional until stability name acceptable to all.


What president who is almawhoever?
Translated version of http://www.sotaliraq.com/

here is something else that obviously needed to be done before a public announcement. see there are many things to consider when wondering what the holdup is.

Originally Posted by rvalreadydang

The House stripped the President of all the powers and functions and coercive granted leave until the election of a new president

المذكور،Russian-special : After the resolution adopted by the Iraqi parliament at its open of (37) on June 11 this month and which was an extension of the meeting Sunday, no longer Mahmoud Almchidani Chairman of the House of Representatives actually voted Iraqi (119) of the total (163) members in favor of granting leave open to Mr. Mahmoud Almchidani at the suggestion of the Accord Front, until the selection front a new candidate for the presidency of the Parliament, The wording of the draft resolution presented by Dr. Fouad Massoum head of the Kurdistan Alliance and praised by a large number of members, according to the second paragraph of the resolution,

فانس.The Mahmoud Almchidani been divested of all his functions and powers as the Chairman of the House and moved his powers and functions to Sheikh Khaled al-Attiyah, first deputy chairman of the House until the election of a new President of the Council.
.Although President Accord Front, a few members of the Iraqi Islamic Party had voted for the resolution was proposed by the Accord Front, but the proposed win a majority, has raised some sort of resentment by a number of deputies and the left front hall meeting of the Board.
.This meeting was presided over by Sheikh Khalid al-Attiya was voting on a series of proposed laws which were awaiting ratification by the House of Representatives. فقد 2005.The Council voted on a draft Code of Criminal Procedure military proposal Act to amend the High Criminal Court No. 10 of 2005. ”.The cancellation of a series of decisions dissolved Revolution Command Council, including resolution No. (199) for 2001 on the change of nationalism, where the former regime had issued to achieve the objectives of the Arabization process, which affected large parts of Iraq has stated in the rationale, "that the cancellation of this decision came for violating the provisions of the Constitution and the concepts of democracy and human rights principles, in order to erase the traces of racist policies of the former regime."
.It also approved to rescind resolutions 690 and 981 for the year 1283 to 1980 and 1019 to 1979 and 1253 to 1985.
كما.Also, the Board completed the second reading of the draft law on accession to the International Agency for Investment Guarantee and the second reading of the draft law on Iraq's accession to the Islamic Corporation for Insurance of Investment and Export Credit. ".An informed source told (Russian), it is premature to be talking about an alternative candidate for the Speaker of Parliament, especially that Mahmoud Almchidani belongs to the dialogue one of the components Accord Front, which insists that this site while its share in the source said : "It is difficult to choose a suitable person for this post among the members of the dialogue and agreed upon by all parties to compromise and political blocs." .The movement of a number of members of block consensus on other blocs to drum up support for themselves only that the process of selecting an alternative candidate to Mr. Mahmoud Almchidani takes time might go more than two weeks and needs to bargain and perhaps change some of the sites functional until stability name acceptable to all.


What president who is almawhoever?
Translated version of http://www.sotaliraq.com/

president of the house of representatives. speaker. whatever you wanna call him. he was the one who backhanded another parliamentarian.

Former director Iraq's national oil company says chances of compromise on oil policy are dim

The Associated Press
Published: June 12, 2007

WASHINGTON: A drafter of stalled Iraqi legislation to set ground rules for the country's oil policy said Tuesday "there is no sign of a compromise" that would lead to final approval by the parliament.

The pessimistic assessment by Tariq Shafiq, who runs a petroleum consulting firm in London and offered his advice to the Iraqi government, conflicted with frequent forecasts of a breakthrough by Iraqi officials.

Shafiq blamed the holdup on a lack of security in Iraq, where he said "people do not know if they are going to live the next day," as well as on corruption.

Under Prime Minister Nouri al-Maliki, "we are now in a worse situation than a year ago," he said at a news conference at the Center for Strategic and International Studies, a Washington think tank, attended by several American oil company officials.

Iraq is one of the world's leading oil producers. It has proven reserves of 115 billion barrels of petroleum, third in the world behind Saudi Arabia and Iran, and the potential for nearly doubling that amount in an oil-hungry world.

If approved, the new law — Shafiq helped draft the original legislation — is expected to encourage foreign oil companies to invest in Iraq and spur the country to attain its goal of doubling current production of 2.5 million barrels a day by 2010.

Iraq's oil infrastructure has been under repeated attacks from insurgents. Shiites and Kurds dominate the two major oil regions in southern and northern Iraq and are resisting national control, Shafiq said.

"A compromise must be found" to balance regional interests with the responsibility of the federal government to be the "custodian" of the country's resources, Shafiq said.

Last week, oil ministry spokesman Assem Jihad said, "We hope the ratification of this law will be achieved in no more than one month from now."

"This law is considered a major national project and achievement," he told The Associated Press.

Asked if he agreed, Shafiq said, "I wish I shared the optimism of the minister. I am not very optimistic."

Former director Iraq's national oil company says chances of compromise on oil policy are dim - International Herald Tribune

Syrian Arab Republic, IMF Article IV Consultation, Mission Preliminary Conclusions

May 16, 2007

1. The Syrian economy did remarkably well in 2006. De****e an unsettled regional environment, the economic recovery that started in 2004 remained on track. Non-oil GDP grew at a brisk pace (tentatively estimated at 6-7 percent), job creation picked up steam driving unemployment below 10 percent, private investment gathered momentum, and exports made strong gains, particularly in some Arab markets. The surge in the volume of investment approvals hints at brightening investment prospects with companies jockeying to position themselves in the fledgling market. Not only was Syria able to raise the living standards of its own citizens, it also offered shelter, food, medicine, schools, and ho****als to the 1½ million Iraqis that sought refuge in Syria. De****e the large demand shock this represented, inflationary pressures have been fairly contained thanks to tighter credit policy and fiscal discipline.
2. This economic revival owes much to the reform impetus initiated 2-3 years ago and sealed by the adoption of the ambitious 10th 5-year development plan. Broad-based reforms have made significant changes in the economic and financial landscape. The exchange rate has been effectively unified and virtually all restrictions on access to foreign exchange to finance imports have been eliminated. Most economic sectors have been opened to private enterprise, boosting the contribution of the private sector to non-oil GDP above 80 percent. A dynamic private banking sector is now leading financial sector growth, and the Damascus stock exchange is set to open early next year after being closed for 40 years. A new investment law has liberalized the investment regime further, created a one-stop-shop for investors, and put foreign and domestic investors at par. Complex, opaque and prohibitive taxation has been replaced by more efficient and equitable taxes and tax administration has been modernized to support the new tax legislation. In addition, law number 51 enacted in October, 2006 unified tax incentives for investment. The local industry has been exposed to greater international competition through several rounds of tariff cuts—which brought the average tariff rate to 14½ percent down from close to 20 percent three years ago and the maximum rate from 225 percent to 60 percent; a reduction in the number of prohibited imports; a relaxation of import licensing procedures; and a simplification of customs clearance. Strides are being made in building the regulatory frameworks to govern the new market economy, most notably in the banking, insurance, and capital markets, and in housing and real estate. Last but not least, improvement in the efficiency of the taxing system and strict fiscal discipline ensured a timely adjustment to a large and precipitous loss of oil revenues.
3. Notwithstanding the progress in the reform agenda the remaining challenges are still daunting. According to the latest projections of oil production, government revenues from oil, which have fallen more rapidly than initially anticipated, are projected to decline by a further 5 percentage points of GDP in the next 10 years, while the net oil import bill could reach US$6 billion (about 7-8 percent of GDP) ten years from now. Macroeconomic instability will heighten and the growth momentum will falter if the government will to undertake the difficult fiscal reforms ahead wanes and if the structural reform drive is not sustained and accelerated. Under this scenario, time could be bought by drawing down the large stock of international reserves. This would support the nominal exchange rate for a few years, but monetary financing of the widening budget deficit will fuel inflation and crowd out the private sector through an appreciation of the real exchange rate, dampening the economy's growth potential. Once international reserves are exhausted, a forced adjustment through an inflation-cum-depreciation spiral would become unavoidable. An additional cumulative fiscal adjustment of some 10 percent of GDP in the next 10 years is needed to avert this scenario.



4. Analysis of recent economic developments is increasingly constrained by data weaknesses. These have been amplified in the recent past as the acceleration of structural reforms has severely tested the ability of a weak statistical infrastructure to cope with the changes. The situation in Iraq added to the challenge. The main drivers of the ongoing economic revival, namely exports, private investment, and private sector activities in general are not adequately surveyed. Pervasive subsidies and weak accounting standards in public enterprises (PEs) are a major challenge to the weak methodological framework underlying the compilation of the national accounts and introduce a significant margin of error in growth estimates. The move to a new CPI, although based on a more representative consumer basket, has unfortunately introduced uncertainty about the level of inflation and its trend. Revisions to weak customs data—to account among other things for the intensification of shuttle trade with Iraq—have blurred the picture as to the underlying strength of the non-oil current account balance.
5. Economic analysis and macroeconomic management are complicated in this statistical vacuum, and the authorities are encouraged to be vigilant in monitoring the state of the economy, particularly inflation and foreign trade. Utmost priority should be given to mobilizing the needed expertise to upgrade statistics. Pending tangible improvements in the quality of the data, research units at the Deputy Prime Minister's Office, the Ministry of Finance (MoF), the Central Bank, and the State Planning Commission should not be constrained by the use of "official data" and should be encouraged to work closely together to fill in the data gaps with economic analysis and consistency checks among the key sectors (fiscal, monetary, external, and real sectors) to come to a reasonable understanding of current developments. Given the data weaknesses, the mission's assessment is only tentative.
I. Recent Developments and Near-term Outlook
6. Staff estimates growth of non-oil GDP at around 6-7 percent in 2006. Given a 6½ percent drop in oil production, this would be consistent with an overall growth of 4½ -5 percent. Growth appears to have been mainly driven by private consumption and non-oil exports and may have been supported by some strengthening of private investment. Private consumption was boosted by employment and wage gains, a good harvest (particularly for olives whose production doubled); and the boom in real estate and rental prices, which translated into a significant wealth effect for property owners; amidst the influx of Iraqis. The strong performance of non-oil exports, which are estimated to have increased by about 30 percent in 2006, reflects the surge in exports to Arab countries, which were boosted by stronger demand as well as the granting of free access under the Great Arab Free Trade Area.
7. The improved business climate might be supporting a steady growth in private investment, but a real take-off does not seem to have materialized yet. Nonetheless, the impressive volume of approved projects under Law No 10 in 2006—which reached SP 470 billion (US$9.2 billion and 26 percent of GDP) more than 2½ times the level in 2004—and their diversity augurs well for growth prospects in the near- to medium-term.1 Almost three-fourths of the volume of these investments are in increasingly diversified industrial projects (including cement, steel, food processing, pharmaceutical, textile, and power generation), and another 20 percent are in the transport sector. Investment in the much publicized real estate projects (consisting of commercial, recreational, and other services associated with government housing projects) represented only about 15 percent of the total approved projects in 2005 (SP 60 billion) and their social returns—which are feared to be low in some circles—may actually be quite high if they are part of a well diversified investment strategy. The share of foreign direct investment (FDI) is estimated to have remained fairly stable at about 20 percent.2 Diversity in the investment strategy is also evidenced by the equally strong growth in investment approvals in tourism. Prospects in that sector are strengthening, with the ministry of tourism now preparing to launch mega projects, based on the success it achieved in attracting investors' interest in smaller projects.



8. The build-up of inflationary pressures since mid-2005 seems to have abated in recent months. While average inflation increased from 7.2 percent to 10 percent in 2006, trend inflation as measured by the increase in the price level in March 2007 compared to March 2006 has come down to 4 percent, bringing average inflation to below 8 percent. Half of the increase in inflation in 2006 is attributed to an increase in food prices, which may have reflected weather-related shortages plus stronger domestic demand as well as demand from neighboring countries hit by similar inclement weather. The increase in the dollar price of imported non-fuel commodities together with some pass-through of the exchange rate depreciation at end-2005 may have been additional contributing factors.





9. The large influx of Iraqis put strong pressures on the economy. The number of refugees grew by 40 percent in 2006 to about 1.5 million (8 percent of the Syrian population). In addition to contributing to inflationary pressures, including notably in rental and real estate prices, the surge in refugees strained government expenditures, particularly on energy and food subsidies, and spending on health and education.



10. Credit policy played a useful role in controlling domestic demand. State banks were instructed to slow their lending to the private sector, which helped cool the credit boom experienced in 2004-05. The actual pace (18½ percent), while still fast, reflects the process of financial re-intermediation related to the nascent private banking sector, whose loan portfolio increased by more than 100 percent, accounting for almost half of the credit growth in 2006. The increase in net lending to the public sector contributed the largest share in the increase in money. Administered deposit interest rates, which turned negative during most of 2006, are now back to positive territory, thanks to the deceleration of inflation.





11. Timely and significant fiscal adjustment largely offset the decline in oil revenues, thereby containing the fiscal deficit. Over the last three years, fiscal policy had to contend with a loss of oil revenues in excess of 10 percentage points of GDP.


This has reflected both a sharp contraction of oil production from about 480 thousand barrels per day to about 400 thousand and a galloping growth in domestic demand (an annual average rate of 10½ percent) owing to a decline in the prices of refined products in real terms, increased smuggling to neighboring countries, and the impact of the Iraqi refugees. A cumulative improvement in the non-oil budget deficit of 7 percentage points of GDP narrowed the non-oil budget deficit to about 10 percent of GDP, strengthening significantly the medium-term prospects of fiscal sustainability.
12. The quality of the fiscal adjustment was commendable. During the last three years, corporate income tax rates have been lowered drastically—with the top marginal rate coming down from 65 percent in 2003 to 28 percent in the latest amendment—and tariffs rates have been reduced significantly. Tax administration improvements together with higher growth fully compensated for the cut in rates and helped maintain a stable tax intake as a percent of GDP and increase its total volume. The bulk of the fiscal adjustment has been contributed by caps on investment spending and an increase in dividend payments from profitable public companies, mainly in telecommunication, which boosted nonoil revenues by close to 3 percentage points of GDP during 2004-06. The compression in capital spending is largely believed to have represented cuts in wasteful spending, and at 9 percent of GDP, its level in 2006 is still fairly high. The creeping rise in current expenditures reflected mainly the increase in subsidies to loss making PEs and pension and social assistance payments.



13. The growth outlook for 2007 remains favorable. The critical mass of reforms implemented in recent months, the continued direct and indirect support of aggregate demand from the Iraqi presence, and favorable growth prospects globally and in the region are expected to continue to underpin private consumption and non-oil exports, as well as a possible strengthening of private investment. These factors could sustain the growth momentum at about the same pace as in 2006.3 Any slowdown of capital inflows associated with the Iraqis will dampen aggregate demand directly and through second round effects, including an unwinding of the wealth effect induced by the real-estate boom. However, a normalization of the political situation in Iraq could open a large market for Syrian products.
14. To keep inflationary pressures in check, macroeconomic policies should remain appropriately tight. The current level of benchmark interest rates is appropriate and state banks' lending should remain in line with the monetary objectives. Fiscal policy should aim to reduce the overall budget deficit to about 5 percent of GDP mainly by phasing out petroleum price subsidies and further rationalizing of expenditures. Civil service wage policy, which leads wage policy in the rest of the economy, has a major role to play in curbing inflation, by ensuring that wage increases do not run ahead of productivity gains.
II. Building for the Future
15. Syria needs to continue to grow faster but it also needs to grow better in the coming years. The growth acceleration in the past two years seems to have been largely driven by private consumption, with an initial impulse originating from the influx of Iraqis. For this growth to strengthen and solidify, it is important that the sources of growth be rebalanced toward investment and durable gains in external market shares. Stronger investment growth and higher productivity are the bedrocks of high and sustainable growth in the long run.
16. To rebalance growth, Syria should continue to strengthen its macroeconomic policy frameworks and to accelerate structural reforms. Policies geared toward accelerating reforms and preserving financial stability could validate investors' expectations and strengthen savers' confidence about returns on Syrian assets. A positive synergy—such as the one witnessed in the rapid take-off of private banking—between an increased willingness on the part of savers to invest their funds in Syria rather than abroad or in idle foreign currency, and an increased willingness of investors to take the risk of starting new projects could turn the promise from the large increase in investment approvals into a reality.
17. The remainder of this statement focuses on: (i) policies to protect fiscal solvency, (ii) a more explicit monetary policy framework in the context of the unified exchange rate regime to anchor price stability, and (iii) key structural reforms.
Fiscal sustainability
18. The timely adjustment to the secular trend decline in oil revenues in the past three years is highly welcome. Looking forward, there is a need to sustain this effort as oil revenues continue to dwindle. Addressing all the pockets of inefficiency in public spending associated with technical losses and across-the-board subsidies to consumers, producers, and public employment will achieve durable fiscal savings while enhancing the supply side of the economy. A large share of the freed up resources could be channeled to finance targeted support to the most vulnerable segments of society and to productive expenditures on basic infrastructure, higher education, and research and development. This will complement private investment by enhancing its potential returns.
19. In this regard, a comprehensive public expenditure review is essential. It should focus on: (i) settling the inter-enterprises arrears among PEs and stopping any such accumulation in the future as this practice dampens incentives for sound and transparent financial management and leads to a lack of accountability; (ii) reviewing the efficiency and effectiveness of expenditures in major sectors such as education, health, and public transportation with a view to reprioritization and deep reforms; and (iii) reviewing the social protection system—the current system is mostly based on rationing (coupons) and on inequitable and inefficient price subsidies. It needs to be reformed toward means-tested targeted transfers.
20. Phasing out the inequitable petroleum price subsidies (PPS), whose cost exceeds 15 percent of GDP, is a key pillar of fiscal reform. Beyond large fiscal savings, it would provide significant efficiency gains, improve equity, entail a smaller negative fiscal impulse, and contribute to BOP adjustment. We are encouraged to know that some preparatory work is being done to launch this reform, and urge the authorities not to delay it further. Each day the public coffers loose SP 750 million (i.e. close to US$15 million, three times the annual budget devoted to promoting tourism) on a policy that has lost all purpose, while so many legitimate claims on public money remain unfulfilled.
21. Stepping up preparations to introduce a VAT is needed to ensure that the VAT is phased in on time to help offset the future drain on oil revenues. The mission agrees that an ill-prepared launch could damage the credibility of this new tax, and indeed many steps, including the adoption of a tax procedures code and an integrated IT system, have yet to be completed. However, preparation could move much faster, if the authorities were to choose a simple design, an option that would very much be in line with the new vision driving tax policy reform toward simpler taxes and lower rates. A uniform rate with very few exemptions lowers the compliance costs on taxpayers and the burden on the tax administration and closes loopholes, which create opportunities for corruption. Concerns about social equity are best addressed by excises on luxury goods, well targeted spending programs, or by enhancing the progressivity of income taxes.
22. The authorities view the PE reform as an important element in the reform program. For that the authorities issued:
• Law # 2 in early 2005 for PEs which further their financial independence including their ability to borrow from the banking sector, to engage in joint venture with the private sector and to contract private management teams.
• Law # 54 of October 1st, 2006 (Basic Finance Law) which gave PEs real financial autonomy including full responsibility for financing their activities and the right to keep their operational surpluses. The law would be implemented starting with the 2008 budget and the MoF is currently working on issuing a law that would resolve the financial obligations of PEs vis-à-vis the Public Debt Fund.
While appreciating these important steps, the mission encourages the authorities to restructure enterprises that can be restructured and develop case-by-case solutions, including liquidation, to deal with the rest. In addition, the mission encourages the authorities to consider privatizing selected enterprises.
Strengthening The Monetary/Exchange Rate Framework
23. The Central Bank of Syria (CBS) has done a commendable job over the past two years in managing the exchange rate arrangement. Progressive liberalization of access to foreign exchange for current account transactions and skillful exchange rate management dismantled barriers within the previously segmented foreign exchange market and gradually guided the parallel market rate closer to the official rates. This process culminated in an effective unification of the exchange rate and progress toward current account convertibility at the beginning of this year. Progress toward unification and current account convertibility remained on track de****e politically driven jitters in the foreign exchange market, which resulted in a weakening of the currency in late 2005. Since the unification early this year of key rates used for trade, the central bank has continued to manage the exchange rate with a view to ensuring orderly conditions in the foreign exchange market and a fairly stable exchange rate.
24. Credibility of the new foreign exchange system will be enhanced, if all the remaining restrictions on current account transactions are lifted and if the recent liberalization is given a legal shape in the form of a new foreign exchange law. Lifting the remaining restrictions on current account transactions (such as the restrictions on access to foreign exchange to finance car imports, payments and transfers on the invisibles account, and remaining multiple currency practices) would have a very limited impact on the balance of payments, if any. Their removal would enable Syria to accept the obligations under Article VIII of the IMF Articles of Agreement and hence join the 166 members of the IMF (out of 186), which have already done so. The enactment of a new foreign exchange law, which would abrogate the complex and arcane set of foreign exchange laws and regulations and enshrine the principles of full current account convertibility, a unified exchange rate, and the standard provisions for the repatriation of profits from FDI, would send a strong signal about the irreversibility of reforms and the authorities' commitment to re-entry into the global economy. This is essential for the stability of the foreign exchange market and for attracting larger volumes of FDI.
25. Adopting a central bank law that enshrines price stability as the main objective of monetary policy will be key to strengthen the credibility of the monetary policy framework. This requires building consensus about a clear mandate for the central bank as a core institution of a market economy. Because the best way in which monetary policy can contribute to long run growth is by instilling confidence in the future through maintaining price stability and avoiding price level shocks that upset business planning and redistribute income and wealth in an arbitrary way, an overwhelming number of countries have embraced the idea that the primary objective of the central bank should be to maintain price stability. Full government support to assigning this clear mandate to the central bank is important to gain credibility of monetary policy with the markets and has to be backed by a disciplined fiscal policy to help achieve the inflation objective. If assigning this clear mandate to the central bank has the full support of the authorities, the central bank should be granted autonomy in discharging its mandate, subject to full transparency and accountability provisions. Autonomy hinges critically on giving full responsibility and authority to the central bank to decide on an appropriate stance for monetary policy and exchange rate management. It is also critical to grant the central bank the operational autonomy to set its own budget within agreed guidelines with the government. This will allow the central bank to hire and retain highly qualified staff by improving the wage structure to better match that of the private sector and devoting more resources to training. Both of these improvements are necessary if the central bank is to manage successfully the more complex monetary and financial system that is now beginning to emerge.
26. Continuing to use the exchange rate as the main nominal anchor of the monetary policy framework will serve Syria well in the near-term. Given the rudimentary monetary instruments, the exchange rate is the only nominal variable the central bank can target effectively for the moment. This policy has proved effective in the past in achieving price stability, as the exchange rate had a strong correlation with inflation, and much stronger than any other possible nominal variable. However, greater exchange flexibility will be needed in the future to facilitate adjustment, which may well be required, given the prospective depletion of oil reserves and further trade liberalization. The gradual move toward greater exchange rate flexibility will also be beneficial to avoid getting trapped in "fear-of-floating" effects. Exchange rate flexibility will enhance the incentives for financial intermediaries and their clients to internalize the risks from dollarization. Lack of flexibility could lead to moral hazard and incite banks and the corporate sector to take excessive exchange rate risk, leading to a fast spread of dollarization. The degree of dollarization of bank deposits has already tripled in the last three years and is at 20 percent system-wide and at over 50 percent for private banks.
27. A move towards greater exchange rate flexibility would require a number of steps. The foreign exchange market needs to be developed, including market infrastructure to support the pricing and management of foreign exchange rate risks. The central bank needs to develop market-based instruments of monetary control to manage liquidity; ensure an efficient allocation of liquidity through price clearing mechanisms rather than administrative quantitative allocations; and to allow the authorities to signal policy intent through changes in the key policy interest rates. In the near term, the CBS could consider liberalizing deposit rates for all maturities except on short-term deposits, which would still allow the central bank to determine the benchmark interest rate. This will give flexibility to banks to adjust the structure of their interest rates in line with market conditions. The central bank could also introduce deposit facilities, including possibly a short-term facility for overnight deposits that would seek to guide the interbank money market rate (using a pre-announced rate) and a longer term facility which would be designed to mop up excess liquidity.
28. The mission urges the authorities to move swiftly on the much delayed agenda of launching a government securities market. By accepting to pay a market-determined price for liquidity as does the private sector, the government will send a strong signal about its commitment to fiscal discipline and to an optimal allocation of liquidity. Some of the additional interest payments on the new marketable securities will be offset by increased dividend payments from the CBS and state banks and higher taxes from private banks. Moreover, the development of a T-bill market will provide an efficient benchmark yield curve and a risk-free rate of return—both necessary for the proper pricing of financial assets, in addition to facilitating the conduct of monetary policy and the development of money and interbank markets. Dealing with the foreign assets held at the Commercial Bank of Syria (CboS) and the nonmarketable old "treasuries" currently held by the CBS and other state banks offer an excellent opportunity to introduce negotiable and tradable government securities—a step that could be followed shortly after by regular auctions of new securities. The authorities expect to start the T-bill market in 2008.
Financial Sector Development
29. Notwithstanding the commendable efforts made to develop the financial sector4, there are still numerous impediments and several sources of vulnerabilities:
• Future development of a competitive banking sector will be constrained by the lack of rapid progress in state banks' restructuring. This will continue to fuel resistance to greater competition as under increased competition, the inefficiencies of state banks will lead to a loss of market share and hurt their profitability.
• Slow progress in developing market-based instruments of monetary control is increasingly at odds with the rapid advance of private banks. Moral suasion and controlling deposits rates are not the tools to manage liquidity in an increasingly market-driven banking sector; the former is totally ineffective, and the latter constrains competition. Moreover the absence of market-based instruments imposes heavy costs on banks in managing Syrian pound (SP) liquidity, discouraging the mobilization of deposits and lending in SP, leading to the perverse effect of encouraging dollarization.
• Sizeable risks would mount if progress in building up regulatory and supervisory capacity does not keep pace with financial liberalization. Systemic risks could go undetected, and excessive risk taking in some banks could threaten their solvency.
• Lastly, slow progress in developing the payment system imposes large costs on banks.
30. As a priority, the central bank needs to build capacity to conduct effective banking supervision. Although the building blocks for better supervision are being put in place, regulatory forbearance remains, undermining the impact of the supervisory process, for example, in the evaluation of minimum capital adequacy, credit quality and other activities; particularly relevant for the weak public sector banks. Equally worrisome is the limited ability of bank supervision to assess the adequacy of banks' internal controls and their risk management practices. The CBS's supervisory role is also undermined by the existence of other regulatory agencies and weak operational independence.
Trade Liberalization And the Business Climate
31. Building on the progress achieved so far, further efforts in trade liberalization should focus on removing the remaining nontariff barriers. Remaining trade-related barriers, in particular licensing requirements for imports and non transparent fees, need to be phased out as they increase transaction costs. To fulfill the commitment made last year, the system of industrial quotas needs to be eliminated at the earliest.
32. Moreover, as regards customs tariff reform, additional steps could be envisaged, such as: (i) further reducing the tariff dispersion as the actual dispersion increases effective protection and hampers long-term industrial development; and (ii) moving faster to achieve the authorities' aim of reducing the number of bands from 12 currently, to 5-6.
33. Notwithstanding the good progress achieved so far in improving the business climate and reducing the costs of doing business, a lot more remains to be done. Syria still ranks 130 out of 175 countries in the World Bank's Doing Business 2007 report, and compares unfavorably to other competitors in the Middle East and North Africa region. Removing barriers to competition in product markets and tackling major weaknesses such as the high costs of contract enforcement, trading across borders, starting a business, and property registration can have a large payoff in increasing labor productivity and promoting the Syria's export potential. The authorities are encouraged to speed up the process of adopting the new competition law, and the needed amendments to the company law. The central bank could play a catalytic role in setting up a credit registry.
34. We wish the authorities success in pursuing their reform agenda, and thank them for their generous ho****ality, their excellent cooperation, and the high quality of the discussion.

1 Quoted figures for investment approvals include the cost of fixed capital and the working capital for one production cycle. A more useful aggregate to monitor would be the cost of fixed capital, only, as it provides a better proxy for investment proper, as opposed to intermediate consumption.
2 Data existed on the volume of investment in joint venture projects, where the share of the foreign partner is greater than 10 percent. It is believed that the actual share of foreign partners is about 70 to 80 percent.
3 Given the projected 7 percent decline in oil GDP, this would be consistent with overall growth of 4½ percent.
4 Six private banks started operations and others, including Islamic banks, are expected to start their operations in 2007. In addition, the insurance sector witnessed important developments in 2005-06 including the establishment of supervisory authority, opening the sector for private investment, licensing eight private insurance companies. More companies are expected to be licenced in 2007 including Takaful/Islamic insurance.

Originally Posted by PAn8tv

The most important events and activities of the ministries and state institutions (Voice of Iraq) - 11-06-2007
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Republic of Iraq
Presidential Office
Press Office

Ministries : the most important events and activities of the ministries and state institutions
June 11, 2007

1. The Ministry of Defense
The activities of the ministry :
Call 1-Command Air Force NCOs professionals to transport aircraft and misdemeanors firm members of the army of former Iraqi volunteered to classified Air Force.
2-Iraqi army forces killed 12 terrorists and arrested 49 suspects.

2. The Ministry of Agriculture
The activities of the ministry :
1 - Ras Mr. undersecretary of the ministry, Dr. Subhi Mansour Jumaili meeting to study the issue of giving allocations dangerous for veterinarians, these formulations derived from common diseases among animals and humans as well as it may be subjected Vets difficulties by working in various areas of rural and desert areas and other capital .. As Mr. Wakil another meeting of the National Commission for the registration and accreditation of pesticides.
2-taken from the report of the Directorate of Agriculture in Missan governorate on the operations of harvesting crops of wheat and barley, where she participated in the harvest (284) Harvester back to the people to maintain with (31) Harvester imported from neighboring provinces and marketing of crops, farmers continue to marketing outlets affiliated to the Ministry of Commerce.
3 - The vast wheat in the province was (360) million square meters and an area of barley (280) thousand dunums. Another aspect of the plan within the Directorate of Agriculture in 2007, they carried out explanatory fields to farmers to spread the cultivation of rice crop type (Yasmin) in both Hungary and Kahla and Slasher, Qal'at Salih and justice taking into account the conduct of all agricultural operations, the presence of a number of neighboring farmers and add potassium sulphate fertilizer as well as Samadi urea and perseverance.

3. The Ministry of State for Tourism and the
The activities of the ministry :
Aad Ishtar Sheraton Hotel downtown Baghdad into service after rehabilitation and maintenance because of its exposure to damage, the impact of car bomb attacks targeted led to the suspension from duty, and the Sheraton Hotel, one of the cultural landmarks of the city of Baghdad. He said the hotel manager, Mr. Prince Abdul Mohsen Hassan he was (8) terrorist attacks, most recently in 10-25-2005. The rate of destruction of 80% of the work except civil structures. The damage included glass and Alskouk secondary, elevators, halls and the demolition of printing and other service divisions, said in a press conference, that the hotel is now ready to receive the delegations, conferences and cultural activities and concerts citizens and gown as it was in the custody of the former pointing. He Elian funds allocated for the rehabilitation of one million hotel and (600) thousand dollars.

4. The Ministry of Education
The activities of the ministry :
1 - The Ministry of Education decided to postpone the final exam ministerial rule of Islamic education for the preparatory phase both in the scientific and arts only, said by the Information Bureau of the Ministry. He stressed that the test will be on Saturday, instead of on 07/01/2007 06/12/2007 The source stressed that the other school materials remain as is according to the timetables and dates previously announced.
2-Huguette Ministry of Education / Educational Directorate General of Babylon football and basketball centers Champion Iraq, which first took place in the cities of Karbala and Najaf.
3-for the guidance of the educational importance in helping the student's adjustment with the schools and the environment in which they live and thus directing them toward the study and the profession that are consistent with their abilities and potential truth met with the Ministry of Education / Educational Directorate General of Babel with members of the profession subsidiary of educational guidance to deliberate on some topics concerning educational counseling.
4-in the activities of the Ministry of Education / Educational Directorate General of the Rasafa memorial is the first of five schools affiliated to it as well as courses for the development of teachers in the Directorate of the Department of preparation and training.
5-A delegation from the Special Education in the Directorate of Educational Najaf General Directorate of Educational Babylon The aim of this visit is to contribute to the exchange of experiences and creating a spirit of common national interest and the need for special education and the establishment of an educational and instructional.

5. The Ministry of Finance
Activities minister :
The Finance Minister Baqer Jabr Al-Zubaydi that fiscal policy pursued by the Ministry of Finance to lift the pace of implementation of the budget 2007 budget Alastthmarihetruckzt particularly for the provision of basic services for the Iraqi people and completing reconstruction of infrastructure and activate the Iraqi economy, particularly activate the private sector to increase its role in the development of the Iraqi economy. This came during the minister presiding over to the Iraqi side at the meetings held in Amman for the period from 4-June 10, 2007 with IMF experts to conduct a review of the implementation of the Fifth Iraq's obligations under the Convention on the back (SBA), signed by Iraq with the International Monetary Fund in December of 2005.
6. Baghdad Secretariat
Activities of the Secretariat :
1-Service continued production units, a Chamber of Baghdad Secretariat and the supporters responsible for repairing machinery and equipment repair work in the machinery and equipment involved in the implementation of the plan of service accompanying the plan to impose the law. Transfer Information Office of the Secretariat of Baghdad, the report prepared by the Service for its activities during the past week included a lab reform mechanisms reform (40) of the total car idle (42) entered the plant and remaining in the way of reform and return to work. The report added that the repair shop received heavy machines (8) heavy machinery were all repaired and returned to work in addition to the lab generator reform (11) generating idle entered the lab and returned to work in sewage plants. The report explained that the repair shop Algowatts engines managed during the week, said one of the reform Algowatts and the remaining two on track for completion in the workshops sustainability of Perpetuating a patrol car (618) and the mechanism to maintain the permanency of its work properly. It had also held two woodworking, metalworking many businesses, welding and support for the rest of workshops and labs in addition to the maintenance of pedestrian bridges and rail fences.

7. The Ministry of Health
The activities of the ministry :
1-position daily to the injured and martyrs (terrorist operations) at 9:00 pm on 10/6/2007 to 6/11/2007 9 on the injured (142), martyrs (34).
2-day position of the Institute of Medical center at 8:00 pm on 10/6/2007 to 6/11/2007 8 on unknown identity (10), unknown (13), Total (23).

theres another wonderful meeting.

Originally Posted by PAn8tv

The article (140) of the Parliament of Kurdstan establish mechanisms
(Voice of Iraq) - 12-06-2007
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The article (140) of the Parliament of Kurdstan establish working mechanisms

Arbil : The Committee for the follow-up article (140) Kurdstan problem in the Parliament held a meeting chaired by Dr Kamal Kerkuki Vice President of the Parliament of Kurdstan, and the Commission affirmed the implementation of all paragraphs of Article (140) of the Constitution in a timely manner. Committee members and the values of the four resolutions issued by the Committee on the implementation of Article (140) problem by order of the Council of Ministers of Iraq, federal .. On another matter They said members of the Committee Cordstanih Kirkuk. And their voices are calling for the conversion of Kirkuk to the autonomous region and the postponement of a referendum on the determination.