Thread: Archive Latest News - Dinar Think Tank - 27/08/08 - 15/01/09

Iraq participate in the eighth meeting of the Arab Business Council - Russia

Ismail said Acialki board member of Chamber of Commerce of Baghdad, an Iraqi delegation on the participation in the activities of the eighth meeting of the Arab-Russian Business Council, which meets in Moscow for the period from October 22-23.

Acialki said in a press statement: "The delegation of the Federation of Iraqi Chambers of Commerce and includes the heads of chambers of commerce in the provinces will take part in the activities of the eighth meeting of the Arab-Russian Business Council administered by the Chamber of Commerce annual Moscow."

The Acialki: "The Iraqi delegation will introduce the delegations participating in the meeting, representing the Arab chambers of commerce, could enhance trade relations and cooperation with the industrial and commercial enterprises in the Russian Federation."

The Acialki to the letter carried by the Iraqi delegation invited Russian investors to invest in industrial projects and urban and agricultural Iraq, with the facilities and guarantees created by the Iraqi investment law for foreign investors, especially as the actors in Russia specialized expertise in the environment of Iraq and its prospects are promising future In the various fields of investment

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

Experts: dinar Bekaz lifted and the central change

Gave the Iraqi economy, experts blamed the Central Bank that his "deflationary" led to the disruption of development, as has its dependence on the dollar grant auction exchange rate "not true" for the value of the dollar "brought Bekaz" of the dinar, calling on Central to change monetary policy.

He said the economic advisor to Prime Minister Abdel Hussein Al-Anbuge "The Central Bank monetary policy of withdrawing liquidity from the market led to the disruption of overall development in the country," where the central adopt a "vision that the monetary inflation in Iraq, but the reality is another theory reflects the fact that we have a real inflation Stems from a structural imbalance and lack of investment, which prompted the withdrawal of liquidity to lift interest rates, "he said.

He told Al-Anbuge (Voices of Iraq) that the central bank "more than three years without a deflationary policy is to get positive results, which confirms that inflation is not critical," pointing out that "The exchange rate is not true because the price of building the Central price support policy Exchange of the dollar during the auction, meaning that the dinar lifted Bekaz does not reflect the real power by the Central Bank. "

He said the exchange rate "if we get real goods and services, including more of our money, which separated the dinar's exchange rate of inflation."

He noted that Al-Anbuge to address the high prices, Iraq, "the Atkmen through the treatments in cash but through real actions" in the sense that "there is no problem in supply deal with but by increasing domestic production stability of the financial and monetary Velayati through cash only, there should be spending Investment. "

And the alternatives available to the Central Bank policy adviser to the prime minister said it was "lies in the adoption of expansionary fiscal policy supported by expansionary monetary policy is also to build infrastructure and development to push forward, I do not think that the economy needs a stable monetary only as useful as backward in the level of development."

He said the rise in the general level of prices "can not be seen by the low exchange rate of the dollar only citizen does not have the details of this process, which is a contradiction between the view of the situation as it expected to see the low prices of goods commensurate with the rate of decline of the dollar against the Iraqi dinar."

He added that "(citizens) should be viewed from all aspects of the process because the cost of imports increased security, transport and electricity all of which reflected negatively on the prices of goods is done on them instead of the opposite happening."

In turn, economic researcher Ray Hilfi Abdul-Jabbar said there are reasons behind the inverse relationship between the decline in the dollar and high prices in the market.

He told Al (Voices of Iraq) that "the conflict between fiscal and monetary policies of the bank is one of causes linked to the situation and not in direct inverse is also assumed to be" where "fiscal policy of pumping cash new market by increasing expenditures lead to inflation reflected negatively on the goods inside the market Local. "

He noted that this was "contrary to the Central Bank, which is deflationary monetary policy to reduce liquidity ratios," which is "has nothing to do with the low price of the dollar caused a kind of inflation derivative called inflation."

Hilfi pointed out that "the State in 2003 after the market rose out of the private sector has controlled the market" and that the goods "are mostly imported or purchased, the currencies of neighboring countries while the trader Slath conduct does not sell at a low dollar in Iraq, but the high price of the dollar to the States Buy, the dollar is still strong in the neighboring markets. "

He considered that "the low exchange rate does not mean that the dinar value went up, we are not dealing in foreign dealings," that the high prices "have not reached the food, but even gold prices increased in Iraq due to increased demand for storage to ensure that more of the value of the dollar."

Hilfi and that there should not be overlooked variable is a significant "increase in crude oil prices which reflected negatively on the prices of fuel, we believe that commodity prices rose," as the relationship between the dinar and the dollar "are isolated and jailer Central Bank is far from the Iraqi market."

He suggested that "the solution lies in the coordination between fiscal and monetary policies through the Ministry of Planning" in addition to "State intervention to save the consumer determine the prices of goods as found in many countries and revive the agricultural and industrial economy to avoid the import of goods from abroad in dollars."

The director of the Economic Section of the Institute of the Arab Najm Research Abdel Rahman al-Mashhadani, said that "the problem lies in the relationship always be a direct correlation between the decline in the exchange rate and improve the value of Dinaraeraki."

He said: "The inverse relationship is maintained by the property the Iraqi market, because direct correlation in all the countries of the world", pointing out that the relationship is "the direct correlation we have except in the case of the high exchange rate was low but getting a corresponding decline in prices a problem suffered by Iraq since Altsainat Merchants do to prevent sales to decline once the dinar. "

The other reason for high prices, according to al-Mashhadani, was "high demand for the Iraqi market, so demand is constantly rising, even if prices rise This is a result of improved living standards and increase the salaries of staff."

He noted that it would "give greater flexibility to the trader in raising the price because there are always buying, not to mention the food which Insusceptible demand any case," expected "further rises in commodities, especially because of construction-oriented government and private construction."

Mashhadani rejected the idea of state intervention in determining the prices of goods as "state policy towards the free market, privatization and intervention would contradict the words" in addition to the "market competition is able to solve the problems of price himself."

The State's general policy of "Bungled" and that "there is no point in the direction of a specific policy or the future of economic policy in Iraq."

http://translate.google.com/translat...language_tools

Options available in the state budget for 2009

Watching politicians, economists and public citizens news budget in 2009 and forthcoming put the question to the Council of Ministers, which is taking place in the minds of many on the balance of 2009: What's fiscal revenue expected

What scenarios spending? And so that we can contribute to shed light on these questions must first identify some of the assumptions in order to identify expected income and price appreciation is, the volume of oil exports, the value of other government revenue.

The first assumption: the quantities of crude oil source. Currently amounts of the limits of exporting 1.9 million barrels per day (rate of exports from the southern port million four hundred thousand and sixty-one barrels a day, and the rate of exports from the northern port at the Turkish port of Ceyhan three hundred and eighty thousand barrels per day). It is possible But expected to increase exports to 2 million bpd in 2009.

The second assumption: The export of crude oil prices. The problem is that there are fluctuations in the prices of both directions, is expected to be the prevailing price in the next year, the limits of $ 100 a barrel, after taking into account discounts in place, there are two options: either the adoption rate of $ 80 Or $ 85 per barrel.

Third assumption: the respect of other government income, and will assume value of 4 billion dollars.

When taking the previous assumptions, we find that there are four scenarios for the calculation of income

A. When the net price of $ 80 crude oil and the quantity of exports 1.9 million barrels per day, and therefore the amount of revenue is expected to 59,231 billion dollars.

B. When the net price of $ 85 crude oil and the quantity of exports 1.9 million barrels per day, and therefore the amount of revenue is expected and 62,651 billion dollars.

T.. When the net price of $ 80 crude oil and the quantity of exports 2 million barrels a day, and by the amount of revenue is expected to 62,111 billion dollars.

Th. When the net price of crude oil and the amount of $ 85 million bpd of exports, and therefore the amount of revenue is projected billion dollars and 65,711 dollars.
Four scenarios for the expected 2009 revenue in the table as No. 1.

Table No. 1 clear the area can move, including the various spending options. In fact, there is a set of indicators that should be taken into consideration in the policy of expenditure, namely:

First: the economic challenges facing Iraq situation of poverty and poor government services, and weak productive sectors of the economy.

Second: international commitments and conventions of the International Monetary Fund and the International Covenant and the policy pursued by normalization with the World Trade Organization.

Third: the new principles of economic policy altogether, which reflected the government's policy of central planning practices and deepen decentralization (support of provincial councils in the administration of their provinces / regions), the gradual withdrawal of government from direct management of economic institutions, and provide the conditions necessary to promote the private sector (through the simplification of legislation and procedures Governmental organizations and activate the investment law, fighting corruption and providing soft loans) and the rationalization of government support and policy shift their support to support a totalitarian.

Based on the above and to the government can carry out its responsibilities, it is a goal of balancing the oil sector to give priority to this sector's role in providing foreign currency and other economic sectors, nutrition, and other priority electricity sector, which has a role to revive the economy and reduce the suffering of everyday citizens, and other more Give the basic building infrastructure (transport, health, water, education and housing).

For the purpose of throwing a picture of some of the options available to assume the status of cautious revenue is the net price of $ 80 crude oil and the quantity of exports 1.9 million barrels a day, and it is expected the revenue 59,231 (including other income). To plan the policy of public spending in 2009, should increase allocations assume operational and financial investment of all ministries by sectors or specific allocations of 2008.

Because of privacy known to the electricity sector, oil will further adopt the following investment allocations (mindful into consideration the implementation rate): 100% (electricity) and 70% (oil), as indicated below:

1 - Increase operational PROFILE 5% and 10% investment (except oil 70% and 100% of electricity), so that public spending limits of 59,714 billion dollars.

2 - Increase operational allocations 10% and 20% investment (except oil 70% and 100% of electricity), so that public spending limits of 66,438 billion dollars.

3 - Increase operational allocations 10% and 25% investment (except oil 70% and 100% of electricity), so that public spending limits of 68,589 billion dollars.

4 - Increase operational allocations of 15% and investment 30% (70% excluding oil and electricity 100), so that public spending limits of $ 73,162 billion, the deficit will be 12.027 billion dollars.

Four default options of public expenditure in 2009 as in Table No. 2.

It should be noted, the assumption that the rate of growth of operational and investment allocations, does not mean stability, or one application to all ministries, as per the Ministry of privacy that must be taken into account. Aleya and the percentage increase given to the Ministry should be higher or lower than the rate provided for, but must That the rate of rates increases equal to the ratio stipulated.

According to estimates from the Ministry of Planning and investment costs of reconstruction 2007 - 2010 equal to 178 billion dollars. While monitoring what was valuable for 2007 and 2008, exceeding the 17% allocation necessary for the reconstruction. Confirms the presence of large investment gap.

This is clear that options are limited, and the importance of inward investment, particularly for the oil sector and electricity.

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

Crossing the International plans to invest 500 million dollars in Iraq

Company said the crossing international investment - a joint venture between the two Aldar Properties and Sorouh Real Estate - it intends to develop a project in Iraq this year not less than 500 million dollars.

The Managing Director Yousef Al Nowais Reuters on the sidelines of Cityscape real estate exhibition in Dubai "We want to establishing a multi-purpose in Baghdad before the end of the year ... would be a massive project worth more than 500 million dollars."

"The people (in Iraq) need to take up residence in homes of appropriate after the war that destroyed their homes and Arabs are making efforts now to work to achieve stability in Iraq."

Has both the home and edifices 30 percent stake in the crossing and the rest owned by Reem Investments, Reem and global capacity and Holding.

The company projects under construction and development value of 11.5 billion dollars in Morocco, Libya, Tunisia, Jordan, Qatar and Belarus.

Nowais said the crossing was studying development projects in Egypt and Algeria. Earlier this month, said that the crossing intends to invest at least $ billion in real estate projects over the next three years.

Translated version of http://www.iraqdirectory.com/DisplayNewsAr.aspx?id=7038

Iraq removes separation wall

Iraqi recruits took position at a checkpoint in Baghdad on Monday where was set the separation wall in Al Fadel District between Sunnis and Shiites, which was removed this week.

Members of awakening councils stood as well in front of the checkpoint in Al Fadel Dsitrict.

It is to be noted that since April 2007 US Forces set a number of separation walls and checkpoints in different districts of Baghdad to separate between Sunnis and Shiites after violence escalated. The removal of the wall points out to security improvement in the country.

Despite that separation walls and checkpoints have helped in reducing violence, these measures were subject to major criticism by citizens who said they were impeding their circulation.

http://www.alsumaria.tv/en/Iraq-News/1-23216-Iraq-removes-separation-wall.html

Update.......

The Presidency proposed to sign a memorandum of understanding between Iraq and Egypt

Vice President Tareq al-Hashemi that the visit of Egyptian Foreign Minister Ahmed Nazif and Minister of Petroleum widely welcomed in the community, including the Iraqi Presidency Council. Stressing that this visit is to complete the talks by the delegation in Baghdad with Prime Minister Nuri al-Maliki.

The al-Hashemi was the proposal to the Egyptian foreign ministry of Foreign Affairs of Iraq signed a memorandum of understanding will eventually lead to the revitalization of relations on various levels of political, security and economic, stressing that the proposal came from the Presidency and was welcomed by the Egyptian side.

Translated version of http://radionawa.com/(X(1)A(DQGHcwBgyQEkAAAAMzEzYjliNmEtZjA5Yy00MGViLTl hNTMtMDYyMGU0NjA1MmJlGI3GnxqCglBrihW1yPBQOM7IBXg1) )/Ar/NewsDetailN.aspx?id=21471&LinkID=99&AspxAutoDetect CookieSupport=1

Iraq opens door to foreign investment
Development of the energy sector in Iraq has proven cumbersome and highly controversial. The lack of regulations and oil laws, and the dominance of energy nationalists within the country, has prevented the signing of any production agreements that would enable the country to ramp-up production of oil and gas and thus provide critically needed financial assistance in the war-torn country. Instead, Iraq witnessed a third consecutive drop in monthly oil export rates in August, with only 1.75 million bpd.

Still, the picture is not wholly bleak. News of Shell’s recent signing of a heads of agreement with Iraq’s Ministry of Oil, has raised the hopes of many IOCs. The agreement allows for the establishment of a JV between the South Gas Company of Iraq and Shell for the processing and marketing of all associated natural gas produced in Basra in Southern Iraq.

“I think this provisional agreement is very significant and Shell has been very intelligent in adopting a strategy of pursuing gas contracts, instead of concentrating solely on oil like most other IOCs,” said Samuel Ciszuk, energy analyst – MENA, Global Insight.

In line with the rest of the Middle East, the gas industry has remained very much under the radar in Iraq, despite the push for energy nationalism in the country. It seems that Shell has been wise in its decision to push for gas contracts and has in the process side-stepped many of the issues dominating the oil sector.

Given that Shell will not be involved in the production of gas itself, it is much more likely that it will be able to progress with the JV. It will then simply monetise the gas that someone else has already produced. Such a plan is surely far less politically tumultuous than an agreement pertaining to production and there is still huge financial potential for Shell given its 49% stake in the JV. Regardless, it will be interesting to see if figures promoting energy nationalism within Iraq will pick-up on the deal and wreak any havoc.

For a time, it did seem that developments were being made in developing the oil sector, most notably with Iraq’s Oil Ministry offering short-term one year contracts to IOCs in June. Talks were underway with Exxon Mobil, Chevron, Shell, Total, BP and several smaller companies, but progress was tiresome and the Oil Ministry decided to call off the signing of any deals at the start of September.

Whilst in relative terms, when compared to industry standards, the year long deals were not particularly lucrative, they were still noteworthy. The six deals on offer were for work to increase Iraqi oil production from existing oil fields by approximately half a million bpd and could be seen as an opportunity for IOCs to gain a foot-hold in the energy-rich country.

“It would have been very difficult, and highly contested, to give away such short-term contracts given domestic pressure and a certain amount from the US. Right now the Iraqi government seems content to look for technical service agreements with IOCs rather than production sharing agreements,” explained Ciszuk.

The Iraqi Government’s recent US$3 billion 20-year agreement with China’s CNPC provides evidence of its swerve away PSAs. CNPC had originally signed PSA, but agreed to convert it into a technical agreement and accept a rate of return that looks extremely low by industry standards.

Still, it is understandably, rather difficult to push-forward with any production deals when there are no formalised oil laws in place to regulate and guide, and the issue remains so contentious within regional, let alone national boundaries.

Until fundamental laws can be determined, the CNPC deal seems to have set the standard for IOCs in regards to what they can expect by way of oil deals.

Given the relatively small amount of revenue that is up for grabs through technical service deals, it may well be that the majority of IOCs see too few incentives to enter Iraq’s beleaguered energy scene.

Iraq opens door to foreign investment - Energy - ArabianBusiness.com

Update......

Iraq project steams ahead in record time
Dana Gas and Crescent Petroleum have announced the start-up of natural gas production, processing and transportation by pipeline from their joint project in Kurdistan, Iraq.

The 180 km pipeline was installed in a record 15 months despite undulating terrain and the threat of landmines.

The two UAE firms are investing US$650 million under a strategic alliance and service contracts signed with the Kurdistan Regional Government (KRG) in April 2007, making it the largest private-sector investment in Iraq today and the largest private-sector oil and gas project in Iraq in several decades.

“We are very proud of this historical milestone, as the first companies from the Middle East to invest in Iraq’s oil and gas sector. We wish to thank the leadership and cooperation shown by the KRG, and also all of our staff, our contractors, and local officials for their support in this remarkable joint effort,” said Ahmed Al-Arbeed, upstream ****utive director, Dana Gas.

In addition seismic surveys and production wells were carried out, and ***** new gas processing facilities were installed. The initial primary phase gas production is at 75 million cubic feet per day, and will rise in stages to 300 million cubic feet per day within the first half of 2009, as the power plants become fully operational. Dana Gas and Crescent Petroleum will be adding further processing capacity to handle the additional gas quantities.

“This is the first project of its kind in Iraq, and it will provide important economic and social benefits for the Kurdistan region and all of Iraq”, added Mr. Majid Jafar, ****utive Director Crescent Petroleum. “We aim to now build on these achievements in the Kurdistan Region and across Iraq, with our strategic focus on maximizing economic benefit and addressing local needs.”

Iraq project steams ahead in record time - Energy - ArabianBusiness.com

Abu Dhabi Crown Prince makes surprise Iraq visit
Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed Al-Nahayan paid an unannounced visit to Iraq on Tuesday that he said was aimed at "confirming our total support" for the war-ravaged nation.

Iraqi Prime Minister Nuri Al-Maliki, who welcomed the crown prince at Baghdad international airport, said he was appreciative of the support from the United Arab Emirates, of which Abu Dhabi is the capital.

"This visit is an important step in developing and enhancing relations with the brother state, the UAE, especially in political, economic and commercial fields," Al-Maliki was quoted as saying in a government statement.

It said the crown prince, who is also the number two in the UAE armed forces, would be finalising a location for a UAE diplomatic mission in Baghdad.

On Sept. 4, Abdullah Ibrahim Al-Shehhi presented his credentials as UAE envoy, becoming the first Arab ambassador to be stationed in Iraq in two years. He had been named in July.

"Our visit is to confirm our total support for the national unity government and to develop political and economic relations," the crown prince said, according to the Iraqi government statement.

In July, the UAE announced a $7 billion debt forgiveness for Iraq.

The crown prince's visit came hot on the heels of a visit by Egyptian Foreign Minister Ahmed Abul Gheit on Sunday.

Washington has been pushing its Sunni Arab allies to send ambassadors to Baghdad as a counterweight to Shi'ite Iran.

The UAE withdrew its most senior diplomat - a charge d'affaires - from Baghdad in May 2006 after another diplomat was kidnapped by Islamist militants and held for two weeks.

Abu Dhabi crown prince makes surprise Iraq visit - Politics & Economics - ArabianBusiness.com

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