Thread: Iraq/Dinar News. 09/05 to 01/14/07

Barham Salih: there are problems over the oil law but we will defeat them for the interests of all
08/11/2006

The Iraqi Deputy Prime Minister, Barham Salih, in charge of the chairmanship of the Committee drafting the new Iraqi oil law, admitted the existence of "problems" with regard to the oil draft law of Kurdistan region. He said that "despite the current problems, I am confident that good will would overcome these problems and ensure the development of this wealth and benefit from private investments so as to ensure the interests of all parties".

The Deputy Prime Minister refused to go into details of the dispute between Baghdad and Erbil on Kurdistan oil, but he stressed that "talks on the completion of the Iraqi oil law would be resumed soon, and representatives from Kurdistan will participate in them ». He added that the draft law is expected to be presented by the Commission of writing down the draft law of Iraqi oil to the Iraqi parliament before the end of the year, and it will determine the responsibility of provinces and the central government on the oil industry and the rights of each party.

However, the draft bill of Kurdistan oil is ready and expected to be approved soon. This may mean that the regional law will be issued before the law of the federal government. On his part, the spokesman of Kurdistan government, Khalid Salih, said: "His government is determined to proceed with applying its law which falls in line with the Iraqi Constitution that clearly recognizes the superiority of the regional law over the federal government law in this matter". It is noteworthy that the draft law based on Article 115 of the Iraqi Constitution, which provides that "all that was not provided for in terms of exclusivity to the federal authority falls under the power of regions and provinces which are not members in a region.

Other joint powers between the federal government and the regions give priority to the law of regions and provinces in case of disagreement between them". Khalid Salih explained that the draft bill for Kurdistan oil has not been formally presented to the Kurdish Parliament yet, but the Kurdish Minister of Natural Resources, Ashti Horami, has completed the work on the draft law and presented it to the Cabinet of Kurdistan, then to be submitted to the Kurdish Parliament in a few days. This law is prior to the draft text of the Iraqi oil law which is expected to be submitted by the central government in Baghdad and which will clarify the final form of distributing the oil wealth on Iraqi people and the role of regions in running it.

This led to some opposition among Iraqi quarters. In spite of the confidence shown by officials in Kurdistan government in continuing the development of oil fields in the region, there is a problem that may hinder the export of oil from the there and benefit from its incomes and that is the issue of transporting oil, especially that the oil pipelines belong to the central government.

A delegation, headed by the Kurdish Prime Minister Najirvan Barzani, is expected to visit Baghdad in the coming days to resolve the differences on the Kurdish draft law and consult on the formulation of the Iraqi oil law. Although the earlier draft of the Iraqi oil identified three months to resolve the differences between the central government and the government of Arbil on Kurdish law since the date of approval; however, the latest draft does not specify a period of time for that. Article 24 of the draft law explains that in case the Iraqi government and the regional one fail to reach an agreement over wealth-sharing and management of oil, the regional government will entirely run the oil operations, including the control of the oil revenues.

Abdel Aziz Al-Otari, the former Iraqi Oil Minister, explained that the current law applicable in Iraq is the "National Oil Company Law" that goes back to 1964 and which puts all the operations of oil at the disposal of the central government and the incomes go to the central treasury. As for the Kurdish oil and disagreements over the distribution of oil wealth, he said: "The issue depends on the legitimacy of such wealth and the international recognition of Kurdistan and its right to dispose of its oil".

As for the export of oil from Kurdistan region, Al-Otari explained: "transporting oil through the Iraqi oil pipelines or by trucks, in small quantities, must be done in cooperation with the neighboring countries". Valery Marcel, the competent of "oil affairs in the Royal Institute of International Affairs" in Britain, pointed out that "the bulk of the Iraqi government in its negotiations with the government of Kurdistan region is ways to transport oil".

She explained that "transferring oil to be exported via the Iraqi territories (outside Kurdistan), or via Turkey (to the port of Ceyhan), both sides have an interest in delaying the independence of the region; therefore, they may hinder the export of oil, if not in agreement with them". Marcel said that "there are several points which raised differences" over Iraqi oil: the first of those is "about the current and future fields which the constitutional interpretation concerning them is not clear".

She added: "it is possible to solve the problem of revenue-sharing mechanism, but the problem is, which income exactly would revert to what party". On his part, the spokesman of the regional government explained that Irbil has received no "formal objection or even an official comment on the law" and that so far the objections were in the form of "statements to the media"; adding "the federal government has no right to object to the law which falls within the Iraqi constitution". Khalid Salih said: "We want to avoid problems and resolve this issue through public debates".

The draft law specifies neither the share submitted by the central government to Kurdistan from of the oil revenues nor the share specified to the Iraqi government from the oil revenues of Kurdistan. Article 5 of the Kurdish draft law states that "the regional government would share the oil revenues with the Iraqi people, according to the Iraqi Constitution", without specifying percentages. Supplement (a) states that the distribution of the Kurdish government's quota of "all government revenues from Iraqi fields will be equitable proportion".
Khalid Salih explained that these ratios were not specified because they must be debated in Kurdish Parliament to reach a final percentage; while Marcel said that this must be clear in the law of Iraqi oil from Baghdad.

However, the draft law determined that 10% of all income will be annually distributed to "every citizen in Kurdistan region", in addition to the allocation of 7% of an investment fund "for the coming generations of the citizens of the Kurdistan ", also, the allocation of not less than 1.5 per cent of oil revenues to "citizens of the Kurdistan who have suffered or still suffering from difficulties because of the policies of the former Iraqi regime".

The American Deputy Minister of Finance, Robert Kimitt said earlier that the controversy between Baghdad and Erbil is not about the distribution of wealth, but on the right of awarding contracts to international companies for exploration and extraction of oil in Kurdistan region. He added: "There is a general agreement on the distribution of income, but there is still some debate on the responsibility of the government and the region on contracts and which international companies to explore oil wells".

He believed that these discussions "come in the context of the general debate on federalism in Iraq". The second part of Section VII of the Kurdish draft law, states that the Minister of Kurdistan is responsible for negotiation and approval of any oil agreements, and implementing them. Article 80 of the draft states that any agreements made by the Iraqi government on oil in Kurdistan region, must be reviewed and "put under the control of the regional government".

Mohammed Ali Zenni, the oil expert in the "Center of Global Energy Studies" in London, pointed out that the situation in Kurdistan is unique, saying: "usually oil operations are run by the central government; for example, oil in Britain, located in the North Sea, which dates back to Scotland, is supervised by the central government in London". As for the taxes owed to the operations of oil industry, Part V of item 49 of the Kurdish draft law states that, "taxes of the regional government will be the only ones" applied to the oil operations, and the item from article 115 and the second part of Article 121 of the Iraqi Constitution, allow that.

The last article says that "the regional authority has the right to amend the application of the federal law in the region, in case of contradiction or conflict between the federal law and the regional one on issues that do not fall within the exclusive competence of the federal authorities". On his part, Hega Idah, director of the Norwegian company "DNO", one of the most prominent foreign oil companies in Kurdistan region, said that his company is continuing its work and excavation in the region, without fearing the problems that may arise from the new draft law. He added: "differences will not hinder our work. Our contract with Kurdistan government corresponds to the Iraqi constitution, and these differences will be resolved in time".

He explained: "We depend on what we hear from Kurds". He pointed out that his company had contracts with the Iraqi Oil Ministry, "during the past year and a half we have not seen any indication of resentment from the Ministry concerning our work in Kurdistan". He confirmed that it is expected to start oil production in the first quarter of next year, after the discovery of oil in the fields of Taqtaq Hink talkie in Kurdistan. He added that "DNO" assessed the fields and expects to explore more oil wells by the end of the current year. Barham Salih expressed his wish to resolve any disagreements over Iraqi oil. He stressed that it is time for the Iraqi oil wealth to become a blessing and not a curse, causing more problems for the country because of the conflicts over who controls it.

http://www.iraqdirectory.com/DisplayNews.aspx?id=2520

Sorry posted this in the wrong part

Economists, concerned Iraqis and foreigners disagree on the subject above while some of them believe that Iraqi government has rushed to resort to the IMF and the World Bank to reschedule its debts on the terms of implementing the policy of economic reform; however, only (11.6) billion dollars of the foreign debts have been quenched as a first stage, and this only makes (7.8%) of the foreign debt. It is a small percentage in return for submitting to the conditions of the economic reform policy, which include:

1- raising support for the prices of fuels and other services.
2- Canceling the ration card.
3- Privatization of the public sector and transfer most of its business to the private sector.

However, the application of these procedures in light of the current circumstances of the country and this speed has serious negative repercussions on the Iraqi society who is suffering already. It is unreasonable to convert a centrally planned economy based on the absolute leadership of the public sector for four decades into a liberal economy based on free market economy, overnight. After the events of 9\4\2003, Iraq suffered from political and economic shocks that are intolerable for a developing country like Iraq.

According to the latest statistics of the Ministry of Planning and Development Cooperation in Iraq, (60%) of the citizens are below the poverty line. So, if the ration card is abolished and subsidies on fuel prices and services are removed, how many will their percentage be? Moreover, the unemployment rate was between (40% - 50%), when taking these measures, the increase would amount to more than that; this means that poverty line will increase and thus increasing rates of crime and corruption since Iraq is considered one of the young population nations whose population pyramid has a broad base and unemployment are concentrated in the younger ages, that (3) out of (4) Iraqis under the age of 25 are unemployed. The concentration of unemployment in this group of age had very dangerous political and social consequences since unemployment is considered a fertile environment for the growth of crime, extremism and violence which emerged strongly to the surface in Iraq, particularly after the events of 9\4\2003 and left serious negative effects on Iraq. There are many examples for such dangerous consequences, like: (the revolution of bread in each of Egypt and Tunisia, and the revolution against raising fuel prices in Yemen, etc.).

Despite all this, we believe that Iraq can achieve benefits when joining the IMF and the World Bank. There will be a genuine development, as the case now in some Gulf countries, Emirates for example, through encouraging investments in vital and important sectors, such as the agricultural, through many inducements like the granting of loans and tax exemption etc... The remaining investments are left free to supply and demand. Since Iraq has natural resources of cheap prices, surely the costs of production will be much less than other countries; therefore, it is possible to manufacture materials then export them. Thus, why do we, now, import cement of bad types when we already have the fine raw materials for manufacturing this material? ِ Another benefit of the accession, is that we will get cheap raw materials to help our industry, and we will also import expertise and technology to create developed industry and agriculture.

But what is happening in Iraq now is that some places are built and others are demolished. Therefore, Iraq is at an important crossroads that requires from everyone, especially economic policy-makers in the country, to review the ideological basis and economic theories which they use to form the policies and the applications should be compatible with the concepts of modernization and reform promoted for, and this is one of the biggest economical challenges that we face today.
Thus, the deteriorating reality between the suffering of the society and with the requirements of the economical policy of the State, raise a question: what do we do to walk out of this crisis without a flaw negatively affecting the economic process of the citizen and the state as well?


Prepared & Translated By:
IRAQdirectory.com Team
Iraq Daily Business Updates


I think that all they need to do is to Reval the Dinar and fix all of the problems.
Great luck to all
Trapper

Announcement No.(801)

D.G. of Foreign Exchange Control

The 801 daily currency auction was held in the Central Bank of Iraq day Wednesday 2006 / 11/ 8 so the results were as follows :

Details Notes
Number of banks 20 -----
Auction price selling dinar / US $ 1466 -----
Auction price buying dinar / US $ 1464 -----
Amount sold at auction price (US $) 97.010.000 -----
Amount purchased at Auction price (US $) 3.000.000
Total offers for buying (US $) 97.010.000 -----
Total offers for selling (US $) 3.000.000 -----

Cash amounts sold to the bank and its customers were USD(40.950.000) at a rate of(1466+1+10=1477)IQD\USD .
The amount sold to make transfers abroad was USD (56.060.000) at a rate of (1466-2)+ one dinar as a bank fee and exempt the transferred amount from conversion fee.


D.G. of Investments

Daily price Bulletin buying and selling Wednesday 2006/11/8

Currency
Currency Code
Selling Price In IQD
Buying Price In IQD

US Dollar
USD
1468.000
1467.266

European Euro
EUR
1879.921
1878.981

The above price represent reference rate and does not from any commitment on the Central Bank of Iraq.

Originally Posted by Trapper t

Sorry posted this in the wrong part

Economists, concerned Iraqis and foreigners disagree on the subject above while some of them believe that Iraqi government has rushed to resort to the IMF and the World Bank to reschedule its debts on the terms of implementing the policy of economic reform; however, only (11.6) billion dollars of the foreign debts have been quenched as a first stage, and this only makes (7.8%) of the foreign debt. It is a small percentage in return for submitting to the conditions of the economic reform policy, which include:

1- raising support for the prices of fuels and other services.
2- Canceling the ration card.
3- Privatization of the public sector and transfer most of its business to the private sector.

However, the application of these procedures in light of the current circumstances of the country and this speed has serious negative repercussions on the Iraqi society who is suffering already. It is unreasonable to convert a centrally planned economy based on the absolute leadership of the public sector for four decades into a liberal economy based on free market economy, overnight. After the events of 9\4\2003, Iraq suffered from political and economic shocks that are intolerable for a developing country like Iraq.

According to the latest statistics of the Ministry of Planning and Development Cooperation in Iraq, (60%) of the citizens are below the poverty line. So, if the ration card is abolished and subsidies on fuel prices and services are removed, how many will their percentage be? (that is why they must RV) Moreover, the unemployment rate was between (40% - 50%), when taking these measures, the increase would amount to more than that; this means that poverty line will increase and thus increasing rates of crime and corruption since Iraq is considered one of the young population nations whose population pyramid has a broad base and unemployment are concentrated in the younger ages, that (3) out of (4) Iraqis under the age of 25 are unemployed. The concentration of unemployment in this group of age had very dangerous political and social consequences since unemployment is considered a fertile environment for the growth of crime, extremism and violence which emerged strongly to the surface in Iraq, particularly after the events of 9\4\2003 and left serious negative effects on Iraq. There are many examples for such dangerous consequences, like: (the revolution of bread in each of Egypt and Tunisia, and the revolution against raising fuel prices in Yemen, etc.).

Despite all this, we believe that Iraq can achieve benefits when joining the IMF and the World Bank. There will be a genuine development, as the case now in some Gulf countries, Emirates for example, through encouraging investments in vital and important sectors, such as the agricultural, through many inducements like the granting of loans and tax exemption etc... The remaining investments are left free to supply and demand. Since Iraq has natural resources of cheap prices, surely the costs of production will be much less than other countries; therefore, it is possible to manufacture materials then export them. Thus, why do we, now, import cement of bad types when we already have the fine raw materials for manufacturing this material? ِ Another benefit of the accession, is that we will get cheap raw materials to help our industry, and we will also import expertise and technology to create developed industry and agriculture.

But what is happening in Iraq now is that some places are built and others are demolished. Therefore, Iraq is at an important crossroads that requires from everyone, especially economic policy-makers in the country, to review the ideological basis and economic theories which they use to form the policies and the applications should be compatible with the concepts of modernization and reform promoted for, and this is one of the biggest economical challenges that we face today.
Thus, the deteriorating reality between the suffering of the society and with the requirements of the economical policy of the State, raise a question: what do we do to walk out of this crisis without a flaw negatively affecting the economic process of the citizen and the state as well?


Prepared & Translated By:
IRAQdirectory.com Team
Iraq Daily Business Updates


I think that all they need to do is to Reval the Dinar and fix all of the problems.
Great luck to all
Trapper

Exactly. RV the Dinar.

This tackles the inflation which is the main source of the poverty.

So they tackle inflation, tackle the poverty, it will stop a lot of violence, it will increase the unemployment when economy starts booming and it will decrease the corruption because this is increasing by the increasing poverty.

You don´t hear me complain if they do it this week! But just do it and soon!

Originally Posted by CharmedPiper

Announcement No.(801)

D.G. of Foreign Exchange Control

The 801 daily currency auction was held in the Central Bank of Iraq day Wednesday 2006 / 11/ 8 so the results were as follows :

Details Notes
Number of banks 20 -----
Auction price selling dinar / US $ 1466 -----
Auction price buying dinar / US $ 1464 -----
Amount sold at auction price (US $) 97.010.000 -----
Amount purchased at Auction price (US $) 3.000.000
Total offers for buying (US $) 97.010.000 -----
Total offers for selling (US $) 3.000.000 -----

Cash amounts sold to the bank and its customers were USD(40.950.000) at a rate of(1466+1+10=1477)IQD\USD .
The amount sold to make transfers abroad was USD (56.060.000) at a rate of (1466-2)+ one dinar as a bank fee and exempt the transferred amount from conversion fee.


D.G. of Investments

Daily price Bulletin buying and selling Wednesday 2006/11/8

Currency
Currency Code
Selling Price In IQD
Buying Price In IQD

US Dollar
USD
1468.000
1467.266

European Euro
EUR
1879.921
1878.981

The above price represent reference rate and does not from any commitment on the Central Bank of Iraq.

Again high numbers and 3.000.000 again!!

I didn´t expect a RV today because of ISX trading session.

But could something be in the make are they preparing something?

Originally Posted by CharmedPiper

Announcement No.(801)

D.G. of Foreign Exchange Control

The 801 daily currency auction was held in the Central Bank of Iraq day Wednesday 2006 / 11/ 8 so the results were as follows :

Details Notes
Number of banks 20 -----
Auction price selling dinar / US $ 1466 -----
Auction price buying dinar / US $ 1464 -----
Amount sold at auction price (US $) 97.010.000 -----
Amount purchased at Auction price (US $) 3.000.000
Total offers for buying (US $) 97.010.000 -----
Total offers for selling (US $) 3.000.000 -----

US Dollar
USD
1468.000
1467.266


The above price represent reference rate and does not from any commitment on the Central Bank of Iraq.

And the rate lowered 2 points for the second straight day.

At this rate (2 per day) the Dinar will be at 1:1 with the USD in 2 and a half years...

Basra battle will resolve the future of Iraqi oil and the entire State

Began the second day of the conference «investment in the oil of the Middle East» in the «Royal Institute for International Studies» in the British capital yesterday for a heated meeting of Iraqi oil, in a climate of pessimism with the deterioration of the security situation. The participants at the meeting that the future of southern Iraq. most notably Basra governorate, will affect the whole country. He said a researcher from the University of IE «» British Yahia Said that «Basra battle will not end, P 60% of Iraqi oil there ». He added : «99% of oil production in Iraq from Basra, and 97% of revenue comes from the Iraqi economy this production, Therefore, the independence of Basra means to starve the entire Iraq ». The Iraqi Oil Minister Issam Chalabi, the former Iraqi oil that the law drafted to provide the prospective Iraqi Parliament before the end of this year, «The first point that will affect the Iraqi oil industry». He stressed Chalabi, in his opening of the meeting on the «» difficulties caused by the Constitution of Iraq to regulate the oil industry because of its lack of clarity in this regard, describing the constitution as «time bomb from the outset». Chalabi said of the Middle East «» that «Iraqi investment law would attract foreign investment companies in the short term, He put the country will achieve the security that ». Chalabi said that the investment is the talk «» the paper even settle Iraq's future political and security.
The Rad Kadiri, Director of the Middle East Section in the company «Bi F S Energy» «American battle started between the various parties to control the South Oil». He added : «federal and weaken the Iraqi central government has become a reality because of the control of local parties to the natural resources». He analyst from «Center for Global Energy Studies» Muhammad Ali Zinni to be «the entire Iraqi economy depends on Iraqi oil, There is no other source to fill the position, Therefore, it is affecting the whole of Iraq ». He said oil expert Walid Khadduri key dates that would determine the future of oil in Iraq. I «mid-2007 referendum on the future of Kirkuk and the second was after 18 months while the federal mechanism will decide in Iraq». For his part, A former Iranian ambassador to Britain, Seyed Mohammad Hussein عادلي that the oil weapon and threat prevention of oil exports «the most important factor we have in the face of the American threat». He refused عادلي assumption that Iran is interfering the affairs of Iraq to influence the United States, saying : «instability of oil exports from the Gulf to the West is much more important than any effect we have on Iraq or other countries».

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Originally Posted by webinvestor

And the rate lowered 2 points for the second straight day.

At this rate (2 per day) the Dinar will be at 1:1 with the USD in 2 and a half years...

With this speed Iraq will be the first country with only Foreigner citizens because all the Iraqi people died by poverty.

Iraq's Ambassador to Belgium to meet representatives of the Belgian companies
In coordination with the Arab Chamber of Commerce Belgian Aluxmburgeh Alsverabraghi met in Brussels with representatives of a number of companies, banks and the presence of the Belgian Minister of State, Mr. Robert Arben, an official at the office of Iraq in the Belgian Foreign Ministry. The Ambassador reviewed at the beginning of modern political and security conditions in Iraq. The achievements made on the road to the consolidation of democracy in various stages of the political process. The ambassador welcomed the contribution of Belgium in the Iraq reconstruction and investment in various fields, pointing to the investment law, which was approved by the House of Representatives recently, and the great opportunities provided by the occasion and to ensure investor rights.
Ambassador also responded to questions and queries present assure them that Iraq is viewed with appreciation to each of the stands side in the current circumstances through which it is facing terrorism cautioned terrorism from the world.
He also pointed out that Iraq welcomes the training opportunities that could be provided for Belgian companies in various fields, as did many other members of the European Union

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get the blasted thing enacted already

Originally Posted by webinvestor

And the rate lowered 2 points for the second straight day.

At this rate (2 per day) the Dinar will be at 1:1 with the USD in 2 and a half years...

I wouldn't worry too much....at that rate they will have starved their citizens. I have no idea what the purpose of these high auctions are but they must feel it is more important than feeding their own.