Thread: Archive Latest News - Think Tank - 01/01/08 - 14/04/08

Slight drop in demand for dollar

Demand for the dollar slightly dropped in the Iraqi Central Bank's auction on Sunday, registering at $72.290 million compared to $75.960 million on Thursday.

"The demand hit $33.020 million in cash and $39.270 million in money transfers outside the country, all covered by the bank at a rate of 1,205 Iraqi dinars per dollar, stable for the third session in a row," according to the central bank's daily bulletin and received by Aswat al-Iraq - Voices of Iraq - (VOI).

The 14 banks that participated in the auction offered to sell 2.800 million dollars, which the bank bought all at a rate of 1,203 dinars per dollar.
Speaking to VOI, Ali al-Yasseri, a trader, said that the general bids in cash were high in today’s session making it possible for the overall demand to be almost equal to that of Thursday’s session.

The Iraqi Central Bank runs a daily auction from Sunday to Thursday.

Aswat Aliraq

Draft law to set up new national oil company at parliament - MP

Iraqi Parliament’s Oil and Gas internal committee is examining a draft law to set up a new national oil company along with the already exist two state-owned companies, an MP said on Saturday.

The draft law “included the establishment of a new national oil company which will be partly funded by the government to operate along with its already exist sisters North Oil Company and South Oil Company,” Abdel Hadi al-Hassani, deputy chairperson of Parliament’s Oil and Gas committee, told Aswat al-Iraq- Voices of Iraq- (VOI).

The parliamentarian added that the new oil company will expand to include two more companies operating in southern Iraqi provinces of Missan and Thi-Qar.

“The new oil company will be tasked with drilling oilfields and extracting, stockpiling and transferring crude,” the MP said.

As for the capital of the new company, the legislator explained, “Part of the fund will be offered by the government and the company may apply for loans as four times as the capital offered by the government once the company was set up.”

The Oil and Gas deputy chairperson told VOI “this is a prologue to enacting the oil and gas draft law.”

“Our committee requested to increase the suggested capital for the new company to enable it compete with other international oil companies,” the legislator concluded.

So far there are only two Iraqi oil companies operating in the oil-rich-country’s northern and southern regions and both are state-owned.

Iraq is waiting the enacting of a controversial draft law regulating exploration and production of oil in the country. The draft law, dubbed oil and gas draft law, was passed by the Iraqi government last July but it received criticism and rejection by some major blocs within the 275-member- Iraqi parliament.

Aswat Aliraq

Allawi: Matters getting out of authority's hands 5 years after change

Former Iraqi Premier Iyad Allawi said matters in Iraq "are getting out of the authority's hands five years after changing the former regime," warning that "the political quota system and militia policies would double the bloodshed in the country."

"Iraq, after five years, is still a state without institutions. The militias continue to pervade the government machinery and the political quota system is still the key factor in the government's activities," Allawi, the leader of the Iraqi National List (INL), told Aswat al-Iraq – Voices of Iraq – (VOI) in an interview on the fifth anniversary of the U.S. invasion of Iraq.

The INL, a party of a secularist orientation, occupies 19 out of a total 275 seats in the Iraqi parliament. The bloc is the fifth largest after the Shiite Unified Iraqi Coalition (UIC), the Kurdistan Coalition (KC), the Sunni Iraqi Accordance Front (IAF) and the Sadrist bloc, or Iraqis loyal to Shiite leader Muqtada al-Sadr.

"These entities, whether inside or outside the state apparatus, are illegal, and their emergence is a logical outcome of the militia policies," he said.

Allawi explained that the recent clashes in the city of Basra and other southern Iraqi provinces between the government forces and armed groups a couple of weeks ago were the "results of previous mistakes," noting he personally supported the "rule of law and order."

Allawi's INL had withdrawn its five ministers from the government of incumbent Iraqi Prime Minister Nouri al-Maliki in August 2007 due to what he considered as Maliki "ignoring" proposals to reform the political process.

Allawi had taken over as prime minister of Iraq's transitional government in mid-2004 after the departure of U.S. Civil Administrator Paul Bremer, who ran affairs in Iraq weeks after the U.S. forces unseated the regime of former Iraqi President Saddam Hussein.

"It is not a coincidence that security conditions in Basra and other provinces are unstable five years after the change," he said, adding he had warned of a "civil strife."

"When I was in the provisional governing council, I wrote an article in which I warned against dissolving the state institutions and the de-Baathification as well as sectarianism. When I received my duties as premier, I tried to avoid these problems," he said.

Allawi was one of 25 members of the so-called Iraq governing council, set up by Bremer months after the coalition forces occupied the country. The council was disbanded in mid-2004 after the formation of the transitional Iraqi government.

"The security agencies are incapable of maintaining security and the government organizations are falling short in providing socio-economic services," he said.

Allawi viewed the toppling of former Iraqi President Saddam Hussein as a "historic event" but was followed by "political failures," adding "matters were going from bad to worse: the services are totally off and security conditions are still deteriorating."

He believes that there were "four strategic mistakes" committed during and before those past five years that caused the aggravating conditions in Iraq.

"The first of these mistakes was the absence of a clear post-war policy, including the question of setting up a national Iraqi government. The second was the disbanding of Iraq's institutions, whether directly, such as with the army and the police, or indirectly like the ruling Baath Party. The third was the sectarian quota system adopted by the U.S. Coalition Provisional Authority (CPA) and the formation of a governing council on that basis," said Allawi.

Bremer had issued a still-controversial decision in early May 2003 to disband the Iraqi army, security agencies, the Information Ministry, and the Baath Party. Bremer also banned the Baathists from any political activities or government positions.

"The fourth mistake was to remain silent over regional interference in Iraq's internal affairs until it became part of the Iraqi reality," he said.
On whether these mistakes should be blamed on the U.S. side or Iraq politicians, Allawi said "both are to blame," indicating that the Iraqi political powers and the United States, which committed strategic mistakes, are both responsible.

"Definitely there was a misunderstanding between the two sides since the very beginning. Bremer should not be blamed. He was representing the U.S. policies in Iraq and accordingly he acted in line with these policies, although he managed to maintain a razor-thin margin of independence," he explained.

"Bremer's decisions, contrary to what some might believe, were not individual. It was true that he committed some individual mistakes but he was actually implementing U.S. policies."

Allawi accused the United States of causing several complications by "decisions to dismantle the state."

He said Bremer "contacted all political leaders, including myself, and asked whether we wanted to form a national government. I asked him two questions: one about the financial, security and military might of this government and the other about the beginning and end of its powers. He replied that he had no answer for these two questions."

According to Allawi, this mirrored "zero clarity in the U.S. stance as far as arrangement of affairs in Iraq was concerned."

On whether the political powers then had an opinion in that state of affairs, Allawi replied that the political leaders have adopted "significant decisions before the war and had a vision about what Iraq should be after the war."

"Unfortunately, the United States did not leave much space for the opposition leaders to carry out its projects in a national government," he said.

Allawi's National Accordance Movement (NAM), the most prominent group within his INL, was one of the Iraqi opposition factions in exile. He attended opposition congresses held in London.

Aswat Aliraq

Armed organizations try to control areas in Baghdad – spokesman

An official security spokesman said on Sunday that some armed organizations try to wield power over areas in Iraq, adding the Iraqi government is still continuing its military operations to impose law and order.

"Iraqi Prime Minister Nouri al-Maliki has reiterated the need to continue military operations by government forces to impose law and order, and that this security campaign did not target any certain political bloc," Sheikh Tahseen al-Shikhli, the civil spokesman for Operation Fardh al-Qanoon (law imposing), said in a press conference on Sunday.

"The government would fight all groups carrying arms and causing unrest and fomenting violence on the Iraqi streets," said Shikhli in his first press conference after he was freed from his kidnappers.

Asked on the government's performance to provide services to the citizens, Shikhli replied that the government "has failed to offer services, particularly in the impoverished areas inhabited by followers of Shiite leader Muqtada al-Sadr, which caused some terrorists to foment sedition amongst the Sadrists and tamper with security."

Aswat Aliraq

A call for establishing a large investment bank in Najaf

Economists and academics of Najaf governorate called for establishing a large investment bank to finance Iraqi and non-Iraqi companies wishing to invest in Najaf. This came during an economic seminar held by Najaf Chamber of Commerce.

Dr. Abdul Ameer Zahid, the seminar lecturer, said, “businessmen all over the world are huge economic field minds which can be whole when integrated with academics who look for good economic realities; therefore, it seems suitable to think of establishing a large investment bank supervised by a Board of Trustees, enabling us from collecting our money which is scattered in banks here and there inside and outside Iraq, so we can finance our investments and ensure the Kuwaiti, Emirati and other investors that there is a reliable source of funding to deal with.”

Zahid called the College of Management and Economics at the University of Kufa to open a consultant office to carry out an economic feasibility studies for the growth of economy in the province of Najaf and especially the private sector. He also called for the technical institutes to open a training workshop in each Institute to attract unemployed youth in order to reduce the problem of unemployment.

He pointed out that there are three types of economies: economics at the level of the individual, economics at the level of the group and the another at the State level; he wondered how to balance the economic laws and explained that any interference with the law of supply and demand is considered a forced intervention, even if performed by the States.

http://www.iraqdirectory.com/DisplayNews.aspx?id=5848

Update......

Iraq cleared for next steps to WTO Accession

Members of the World Trade Organization (WTO) working party in Iraq on 2 April 2008, supported Iraq's rapid accession to the WTO and argued it would contribute to the country's integration into the world economy.

Iraq's Trade Minister, HE Dr Al-Sudani, stated that Iraq was determined to overcome the country's difficult circumstances to move forward on the accession process and added that Iraq's membership would represent a significant addition to the international community.

At this stage of the accession, members examine all aspects of Iraq's trade and economic policies to assess their conformity with WTO principles.

Since the first working party meeting held in May 2007, Iraq has provided members with a legislative action plan which shows the state of play of the ongoing legal reforms. Iraq also provided information on its sanitary and phytosanitary (SPS) measures, technical barriers to trade (TBT) and the trade-related aspects of intellectual property rights (TRIPS) as well as information on its domestic support and export subsidies in agriculture.

Members requested more information on Iraq's pricing policy, investment rules, import licences, customs law, state trading enterprises, regulations on tariffs, free zones and telecom licences.

Iraq has met with several members on the margins of the working party. Market access negotiations will start once Iraq tables its initial offers on goods and services. A WTO statemtn said there have been some discussions but no concrete proposals for the moment.
this support.

WTO members and international organisations have been providing technical assistance to Iraq. The Chair of the working party, Claudia Uribe, Ambassador for Colombia, has urged members to continue and step up
In the next steps, Iraq will update its legislative action plan, as appropriate, and will continue providing information to members. No date was decided or the next meeting.

A working party to examine the application of Iraq was established at the General Council meeting of 13 December 2004. Iraq submitted a Memorandum on the Foreign Trade Regime in September 2005, Foreign Trade Regime in September 2005, followed by Replies to Questions raised by WTO Members in November 2006.

Iraq cleared for next steps to WTO accession

Iraq seeks to resume pumping oil from Bazrgan field

An official in the Iraqi oil sector said that Iraq aims to complete repairing the oil pipeline, which was damaged in a sabotage attack in the south of the country, on Wednesday and resume pumping 100 thousand barrels per day delayed because of the attack. A subsidiary oil pipeline in the Bazrgan field stopped pumping last Thursday due to that sabotage attack.

The official added that Iraq had used quantities of oil stored in tanks to compensate for the stalled production and maintain the level of exports since Thursday.

http://www.iraqdirectory.com/DisplayNews.aspx?id=5837

Iraq Oil Profits Being Misused?

The Iraqi government is expecting large profits this year because of U.S government spending on military fuel. The U.S is spending close to $153 million per month for fuel that is being extracted from Iraq. U.S officials added that currently Baghdad is unprepared to manage this revenue. Officials also mentioned that the government of Iraq will build up the capacity in due time to handle and use oil profits in a constructive way.

Adm. William Fallon, who is the top U.S military commander in the Middle East said that this money is not “just sitting in banks trying to get somebody rich on interest income.” He further commented, “It's because they're in a holding position now until they can figure out how to effectively disburse these moneys.”

Stuart Bowen, special inspector general for Iraq reconstruction said that Baghdad has been producing the high quantities of oil in recent months. This has been peak production ever since the war started five years ago.

Iraqi officials have disclosed that they have earned approximately $35 billion from oil revenue last fall. Bowen added the overall profits will reach close to $60 billion.

Sens. Carl Levin, D-Mich, and John Warner, R-Va, want to look deeper in to the matter by investigating how Iraq handles this money. Iraq pays for fuel that is required by its own army. It also heavily depends on U.S dollars to provide citizens with basic amenities. There is a large quantity of funds, close to $45 billion, required for reconstruction.

Levin and Warner wrote in a letter to the head of the Government Accountability Office describing that, “it has been overwhelmingly U.S. taxpayer money that has funded Iraq reconstruction over the last five years, despite Iraq earning billions of dollars in oil revenue over that time period that have ended up in non-Iraqi banks".

They further added that, "At the same time, our conversations with both Iraqis and Americans during our frequent visits to Iraq, as well as official government and unofficial media reports, have convinced us that the Iraqi government is not doing nearly enough to provide essential services and improve the quality of life of its citizens".

The senators have predicted that Iraq will earn at least $100 billion from oil revenues in 2007 and 2008. However, government and military officials have to say that Iraq is going to face difficulties in managing these funds. They convey that the problems related to the distribution of funds are not due to the laziness or corruption. However, Baghdad is unable to properly allocate these resources. This failure can be largely attributed to the inability of Iraqi officials in handing this matter.

OilVoice | Iraq Oil Profits Being Misused?

Update......

Iraq Parliament discusses oil-related, Pipeline Laws

A parliamentary committee is working on a pair of oil-related draft bills, one to re-establish the state-run oil company and another to fight oil smuggling, a senior lawmaker said Saturday. Abdul-Hadi al-Hassani, deputy chairman of the committee on oil, gas and natural resources, said legislation to re-establish the Iraqi National Oil Co, was likely to be presented to parliament on Tuesday. The measure is part of a four-bill package, which also includes legislation to regulate the country’s oil sector, reorganize the Oil Ministry and distribute revenues among Sunni, Shiite and Kurdish regions. Al-Hassani said he was uncertain when the other three bills in the package would be ready for parliament to discuss. The bill to regulate the oil industry has been bogged down since February 2007 because of opposition from the Kurds.

Al-Hassani said parliament began discussing the proposed anti-smuggling bill this week in hopes of boosting government efforts to curb oil smuggling. The law would call for tight penalties against smugglers ranging from fines to years in prison and confiscation to boats that are used for smuggling. He said that there is no accurate study on how much Iraq loses due to oil smuggling but his committee estimates the figure at nearly 10 percent of total revenue – or about $5 billion (3.2 billion euros) a year. The Iraqi oil sector has been hampered by decades of neglect and lack of investment during Saddam Hussein’s rule. Since the 2003 US-invasion, attacks on oil infrastructure have held back production, which recovered prewar levels only at the end of last year. Iraq sits on the world’s third-largest oil reserves, totaling more than 115 billion barrels. Its average production for February was 2.4 million barrels per day and exports averaged 1.93 million barrels per day.

Meanwhile, Oil prices leapt above 106 dollars in New York Friday as investor sentiment was driven by the weak US dollar, tight energy supplies and more bad news on the US economy. New York’s main oil contract, light sweet crude for delivery in May, jumped 2.40 dollars to close at 106.23 dollars per barrel. London’s Brent North Sea crude for May rallied 2.38 dollars to 104.90 dollars at the settlement.

Arab Times :: Iraq parliament discusses oil-related, pipeline laws

Update.......

Iraq studies two crude Draft Laws

A parliamentary committee is working on a pair of oil-related draft bills, one to re-establish the state-run oil company and another to fight oil smuggling, a senior lawmaker said yesterday.

Deputy chairman of the committee on oil, gas and natural resources Abdul-Hadi Al Hassani said legislation to re-establish the Iraqi National Oil Company was likely to be presented to parliament on Tuesday.

The measure is part of a four-bill package, which also includes legislation to regulate the country's oil sector, reorganise the Oil Ministry and distribute revenues among Sunni, Shiite and Kurdish regions.

Al Hassani said he was uncertain when the other three bills in the package would be ready for parliament to discuss.

The bill to regulate the oil industry has been bogged down since February last year because of opposition from the Kurds.

Al Hassani said parliament began discussing the proposed anti-smuggling bill this week in hopes of boosting government efforts to curb oil smuggling.

The law would call for tight penalties against smugglers ranging from fines to years in prison and confiscation to boats that are used for smuggling. He said that there is no accurate study on how much Iraq loses due to oil smuggling but his committee estimates the figure at nearly 10 per cent of total revenue - or about $5 billion.

The Iraqi oil sector has been hampered by decades of neglect and lack of investment during Saddam Hussein's rule. Since the 2003 US-invasion, attacks on oil infrastructure have held back production, which recovered to pre-war levels only at the end of last year.

Iraq's average production for February was 2.4 million barrels per day (BPD) and exports averaged 1.93m BPD.

</title> </head> <body topmargin="0" leftmargin="0" rightmargin="0" bottommargin="0" marginwidth="0" marginheight="0"> <div align="left"> <table border="0" width="1000" cellspacing="0" cellpadding="0" id="table1"> <tr> <td valign=top> <div align="lef