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

Fortune flows to Kurdistan





December 2006
Opportunities await investors in Iraq's sole region of promise, but they would be wise to proceed with caution.
Echirvan Barzani, the dapper and personable prime minister of the Kurdistan Region, clearly loves a challenge. Like Sheikh Rashid bin Saeed Al Maktoum, the visionary ruler of Dubai who is credited with transforming the emirate from a pearl diving backwater to an international business hub, Barzani intends to turn his part of the world - northern Iraq -into Iraq's commercial gateway.


He has his work cut out for him. Northern Iraq might be an oasis of calm compared with the rest of the country, but it is not immune to the chaos that reigns in the south. Infrastructure is next to non-existent, as are the legal and financial frameworks necessary to do business.


But in early July the Kurdistan Parliament passed the Foreign Investment Law, which allows for full ownership and repatriation of profits, and, in the words of Barzani, is "characterized by fairness, equitable treatment for all investors, appropriate legal guarantees and, of course, incentives for foreign businesses."


In the same vein, energetic campaigns are being waged in the US and Europe to promote what they've dubbed "the other Iraq." Investors who are being wooed are advised they should not be distracted by the often sensationalized media reports of what is going on in the rest of Iraq, as the relatively secure and stable Kurdistan Region offers lucrative business opportunities in the midst of the large-scale reconstruction efforts currently underway.


At the Second International Construction Innovations Conference, held in Illinois in October, Qubad Talabani, the son of Iraqi President Jalal Talabani, and the Kurdistan Regional Government's (KRG) representative in the US, cajoled investors not to wait for "Iraq to become Switzerland before investing," as they would lose out to foreign companies that are already beginning to do business in the region.


Opportunities are aplenty, but that is only because the country is a virtual blank slate. What destruction wasn't visited on it by Saddam Hussein the Kurds themselves have done through incessant infighting, which broke out soon after autonomy was wrested from Baghdad in 1992.


Progress now at hand. But with its newfound stability has come progress. Erbil, the capital, is casting off its dowdy provinciality. A gleaming new shopping center, the New City Mall, was recently inaugurated, a North American-style mall that is an abrupt departure from the bazaars that still supply everything from burkas to bread. Already immensely popular, the mall expects to attract big name retailers from the Gulf and Europe, and the fact that most Kurds earn between $300 and $800 a month is not proving to be a hurdle.


In fact, confidence in the future takes little account of present realities. Instead, the Dubai pragmatism of "build it and they will come" dictates decision-making.


A few months ago, the KRG announced it wanted to duplicate Dubai Media City, the sprawling complex in the UAE that employs thousands of journalists, designers and advertising people.


In the neighboring city of Suleimanieh, which has been the stronghold of the Patriotic Union of Kurdistan (PUK) - the party headed by Iraqi President Jalal Talabani - reconstruction is moving at a slower pace: the authorities are still sidetracked by internal party squabbles, and economic progress is hampered by indecision.


Typically, the PUK's AsiaCell telecoms network hasn't been given permission to operate in Erbil, and politics is the reason. Old grievances die hard, even though the two ruling Kurdish parties - the other being the Kurdistan Democratic Party (KDP) headed by Iraqi Kurdistan's President Massoud Barzani - have now united to form the KRG.


Foreign businessmen warn newcomers to exercise caution and educate themselves before venturing into this uncharted territory. Lines demarcating the jurisdiction of the Kurdish authorities and the central Iraqi government are still hazy, and political tensions between the Baghdad government and the Kurds, who want full independence, still run strong. Many of the lucrative petroleum contracts signed by the Kurdish authorities with foreign firms are not honored by the central government in Baghdad.


Handshake agreement. Because no international banks operate in the region, no letters of credit can be issued for Kurdish firms seeking to do business with foreign firms. Foreign firms must enter into an agreement on the basis of a man's honor, a risky if sometimes effective approach, or pay cash in advance.


Said one European worker in Suleimanieh, who had been forewarned and acted on it: "Our company got a pretty good deal with the local government. We do the work only if we have been paid for it in advance, otherwise we stop everything. We've seen what happens to other companies, and we don't want that to happen to us. Payment is a big problem here ... and if they don't pay you, you have no legal recourse in Kurdistan. All you can do is cut your losses and leave."


Inevitably, given the parlous state of the legal structure, corruption has surfaced. It doesn't help that much of the business world revolves around the Barzani family. In an interview in May, Prime Minister Nechirvan Barzani, who is the nephew of President Massoud Barzani, tried to play down suggestions that the Barzanis were an oligarchy: "Anyone who calls himself Barzani may not necessarily be related to the family. It is a big clan. If you ever visit the Barzan you will find many people who call themselves Barzani but who are unrelated to the family."


Even so, bigness seems to be the sticking point. Small local firms complain that the new foreign investment law will make it harder for them to compete with experienced outsiders from Baghdad and elsewhere for the most lucrative government contracts. They believe the KRG must safeguard the local economy by requiring foreign investors to partner with local firms.


"The KRG should follow the model of successful Gulf countries, where you can't even own a taxi cab without giving a 51 percent share to a local businessman," says Chato Dizayee, the managing director of Broosk Trading & Contracting, the Dubai-based e-commerce software developer. "For example, in the UAE, you need a local sponsor to do any kind of business. Why not do the same here? Why not force foreigners to forge joint ventures with local businessmen?"


Smooth operators. Already several large Baghdad businesses have relocated to the Kurdish Region, bringing their manpower with them. During Saddam Hussein's rule, these firms built bridges and other infrastructure commissioned by the government and supplied the army. Their staff members are seasoned operators and highly skilled.


Dizayee, who opened his Erbil office in 1998, says, "Small local businesses are feeling the pressure. Those local businessmen who started up recently don't have as much experience as Baghdad companies that had the benefit of years of dealing with the contracts of the Iraqi army."


In the tenders for government projects, all investors - whether, Kurdish, Iraqi or foreign - compete on an equal footing. From there on in, however, the professionals are soon separated from the amateurs. The professionals use their supply lines to bring in their materials and equipment sourced from reputable companies. The amateurs succumb to the "bazaari" mentality, buying cheaper, often Chinese-made, materials and equipment locally. The KRG government is powerless to stop the practice.


"The government may not be able to stop the import of cheap TVs and other household things, but for specialized machinery and other strategic [goods], we must start to reconsider our way of thinking," says Dizayee. "I am the sole agent for my products in this region, and when I sell anything to any office or ministry, I give them a certificate of origin, even when they don't ask for it. I give it and I advise them to ask for it in the future."


Setting a good example. Dizayee suggests the government begin by buying approved materials and equipment for its projects in order to set a precedent for the private sector to follow. "Most people don't realize the long-term benefits of investing in better quality materials," he says. "It is ironic because the average farmer in Kurdistan may spend more money on a better tractor because he knows what's good and what's bad; but many local businessmen still haven't caught on. In the construction industry, for example, they are still buying cheap Chinese goods or, even worse, they bring in old, used equipment left over by neighboring countries, such as the UAE or Jordan."


Can the turbulent region hope to attract foreign direct investment? While the Kurds have managed to ward off terrorist infiltration so far, the political future of "Kurdistan" remains uncertain. The Kurdistan Region's relations with its neighbors are nascent at best, which means disputes have not yet reached a diplomatic outcome. Turkish firms may have availed themselves of most of the big contracts in Kurdistan, but the Turkish government is still fuming over the KRG's reluctance to do anything about the PKK guerrillas hiding in the northern reaches of the border country, even though the central Iraqi government has outlawed the group.

And, though an ethnic Kurd has been made President of Iraq and is urging Iraqi solidarity at a time when sectarian tensions are at their highest, the KRG is working against him by taking unilateral decisions such as ordering the removal of the official Iraqi flag from Kurdish territory, thereby arousing the ire of even those Iraqi Arabs who were never allied with Saddam Hussein's Baathists.
Tanya Goudsouzian Suleimanieh

© Arabies Trends 2006

Iraqi finance staff jailed for corruption
Dec. 20, 2006 at 12:08PM
Five senior Iraqi Ministry of Finance officials were sentenced in Baghdad to three years in prison for corruption and spending unauthorized funds.
Without naming the defendants, Kuwait's KUNA news agency said Wednesday the undersecretary of the ministry of Finance and four others were sentenced by the Central Criminal Court.
The other defendants reportedly worked as the director general's assistant of the accounting department, accounting experts and the rapporteur of the private sector committee.
Elsewhere, former Minister of Electricity Aiham Alsammarae broke out of a Baghdad prison Sunday, where he had served several months of a 2-year sentence for corruption.
He holds dual U.S.-Iraqi citizenship and from an unknown location told the Chicago Tribune by telephone Tuesday he planned to return the Chicago area in the new year.

WASHINGTON [MENL] -- Iran maintains thousands of intelligence agents in Iraq, a report said.

The Saudi National Security Assessment Project has released a report that detailed Iran's intelligence presence in Iraq. Authored by Nawaf Obaid, a leading Saudi consultant based in Washington, the report asserted that Iran has at least 5,000 agents, responsible for helping establish Shi'ite death squads.

The report cited the Al Quds Forces, identified as a special command division of Iran's Islamic Revolutionary Guard Corps. Obaid said Al Quds mainly functions as the special foreign intelligence division of IRGC and specializes in unconventional warfare.

"[It] has a close relationship with the Badr Organization and the Mahdi Army, as well as with smaller Iraqi Shi'ite militias," the report said. "Members of the Al Quds Forces organized what came to be known as the death squads under the former Iraqi Interior Minister."

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Iraq's oil revenues may generate $ 3500 for every citizen


Said analyst for Texas-based energy Tuesday that the plan accepted in Washington for the distribution of oil wealth of Iraq directly to the Division had put $ 3500 annually in the hands of every Iraqi citizen deep. The analyst said veteran Del Astevz that appreciation based on the oil price of 60 dollars a barrel and production costs ten dollars a barrel and the assumption that the ten million Iraqis will be in the age to qualify for a share of oil wealth for the country. Iraq produced 2.2 million barrels of oil per day and exports 1.5 million barrels, according to the report of a study of Iraq, which was issued earlier this month. Estimates vary, the average annual income in Iraq varies considerably, but in the maximum amount of $ 1500 annually. He said Astevz told Reuters in an interview that the best way to manage the distribution of wealth may be giving money to those who register to participate in the elections and the vote bank account is maintained and thus promotes social participation and stability. He said, "when people understood that the money coming to them, they will seek to protect the resource of income and want to have a government capable of settling disputes." Against says that the distribution of those funds would be difficult because of problems related to corruption and things of transport and communications, but the idea gained adherents discuss with the United States a way to eliminate the chaos that followed the war in 2003, which dropped the dictatorship of Saddam

جريدة المواطن العراقية

Originally Posted by goldraker

So after tomorrow the CBI is closing down until 01/08/2007?

I highly doubt it. If you look at CBI's website, you will notice that their auctions carried on during these days in all previous years. It should be as always, only Friday and Saturday off.

Stocks rise in Iraqi oil at Ceyhan




London, December 20 December / Reuters /-aviation source said today, Wednesday, that Iraq's stocks of Kirkuk crude in the Turkish port of Ceyhan rose to 3.5 million barrels after the resumption of exports through the northern pipeline for a short period.
8.The panel NAVIGATION pointing to pump crude from Kirkuk, started on 17 and stopped again on 18.

.He continued, we do not know why.
.He went on to say that about 350 thousand barrels of Kirkuk crude was pumped to Ceyhan during the operation of the line for the stock hit about 3 g five million barrels.
وم.It stopped before pumping through the pipeline on November 21 November, one day after the operation. Earlier in the November attack using mortar to set fire to storage depots in the northern city of Kirkuk.
تخريبيةThe disruption of the pipeline for most of the time since the invasion by the United States-led the country in March in March 2003 due to sabotage attacks

Translated version of http://www.alsharqiya.com/display.asp?fname=aboutus%5C2006%5C008.txt&storyti

Maliki Poland calls for investment in Iraq



Baghdad-East : العراق.The Iraqi Prime Minister Nuri al-Maliki, after meeting with his Polish Yaroslav Kajinski, who arrived Wednesday in Baghdad on a surprise visit his country's desire to attract Polish companies to invest in Iraq.
".Al-Maliki said during a joint press conference with Polish Prime Minister that there is willingness to cooperate with the Polish companies in the areas of oil and gas in the military sphere. "
".He asked the companies to come to Iraq to discuss with the ministers concerned in this area and we should not be confined to cooperation in the field of oil. "
".He stressed that there Maliki military deals between Iraq and Poland to import weapons and helicopters in the military cooperation with the Iraqi Ministry of Defense. "
".The Maliki that Iraq was looking forward to closer relations with friendly countries, including Poland. "
".For his part, the Polish prime minister, said the talks touched on all areas in a practical and detailed. "
وردا ".In response to a question about the future of Polish troops deployed in southern Iraq, said that his country was ready to economic cooperation with Iraq, "explaining that there are safe areas in which investment can, but this does not mean that we want to start this cooperation now."

Translated version of http://www.alsharqiya.com/display.asp?fname=aboutus%5C2006%5C008.txt&storyti

According to a report by the weekly magazine Newsweek that the Iraqi economy is growing strong, despite the violence that has engulfed the country.
.The report cited company Iraqna mobile phone which hit profits during 2005, 333 million dollars, with the report of the Ministry of Foreign Affairs of American high proportion of participants in the service of the mobile phone from 1.4 million to 7.1 million subscribers over the past two years only.

GTTSo the Council of Ministers has approved authorization of the Ministry of Electricity validity of the contract with the company GTT .Italian for the rehabilitation of the gas units to be built in the session and Dobbs invading sets of about 55 million euros.

من.On the other hand, a source at the General Company for the manufacture of grain that continue to set the size of the engineering and installation of a modern 20 in a number of governorates in Iraq.

.In the same context, the company announced that it has equipped the quantity of approximately 12 thousand tons of flour within the quota in October 2006.

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Originally Posted by ErelisLT

I highly doubt it. If you look at CBI's website, you will notice that their auctions carried on during these days in all previous years. It should be as always, only Friday and Saturday off.

Well I do remember reading that on here a couple of days ago.......

And it was not the ISX, that I read. I hope that it was incorrect info!

Mr. Hashim Shibli, Iraqi Justice Minister-President of the Supreme Committee for the implementation of Article 140 of the Iraqi Constitution - that the recommendations of the Baker-Hamilton does not affect our work and we are working in accordance with the Iraqi constitution and will continue to discharge our duties.
وقال لـIda said in a statement to Al PUKmediaPUKmedia انالعليا .The Supreme Committee discussed at its usual today, Wednesday, 20 / 12 several topics and important issues, including the ratification of the special committees branch offices of the Higher Committee for the implementation of Article 140, which was formed on the basis of the collection of information and documents, archives and presented in the form of reports to the higher committee, in addition to the discussion of the activities of branch offices.

م.Head of the Higher Committee for the implementation of Article 140 competent to normalize the situation in Kirkuk and the role of the activities of the offices of Kirkuk and Khanaqin, Sinjar, in the execution of their duties.

.Ida announced that the Committee withdrew $ 25 million of the amount appropriated for the commission of $ 200 million to carry out its functions, and will withdraw from what we need sums of money for the implementation of our work, pointing out that they did not encounter any obstacles to the implementation of the above-mentioned article.

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