Thread: Archive News - Iraqi Dinar Think Tank - 01/10/09 - 27/03/10

Use of US Dollar to Be Eliminated in Iraq

CONTINGENCY OPERATING LOCATION BASRA, Iraq – United States currency may soon become difficult to find in Iraq as part of an effort to protect Soldiers and increase the value of the Iraqi dinar.

Sgt. Brittany A. Raimer, a dispersing manager with the 368th Finance Management Company, out of Wichita, Kan., 36th Sustainment Brigade, 13th Sustainment Command (Expeditionary), said eliminating the use of U.S. currency on the battlefield will help to stimulate the economy of Iraq.

"One of the main focuses of finance is to ultimately eliminate U.S. currency from the battlefield," said Raimer, a Lake Charles, La., native.

"Our government is implementing the use of the Iraqi dinar, to both undermine the dependency the Iraqi nationals have on American currency and to back the Dinar, greatly increasing its weight on the market."

The use of electronic fund transfers to pay vendors and contractors, and urging service members to rely on the Eagle Cash Card, rather than cash, are two major changes that have been implemented in Iraq to eliminate the use of cash, said Raimer.

"The Eagle Cash Card enables personnel to have a direct link to the bank account without the hassle of hard cash," said Raimer. "The stored value card has been instrumental in effectively moving toward a cashless battlefield."

Sgt. Toni M. Guillery, a dispersing agent with the 368th FM Company and a Lake Charles, La., native, said the Eagle Cash Card is designed to help prevent service members from losing money or being robbed while in country.

"Carrying a single card is better than carrying a wad of money in your pocket, but one concern that I do have is ... on the kiosks, you have to use a pin number in order to access the money, but when you go to vendors, you do not," said Guillery. "If you [fill the card] up to the max, and you lose that card, and somebody picks it up and finds it and they are a dishonest person, they can go and spend that money."

Guillery said the unit only disburses U.S. cash to service members who are about to go on mid-tour leave or re-deploy.

Guillery said the unit disburses less than $10,000 in U.S. cash per month, but disburses more than 351,000,000 (IQD), the equivalent of roughly $300,000, per month.

The current exchange rate is 1,170 to $1, said Guillery.

Raimer said the transition away from the U.S. dollar has aided the progression of the banking industry in Iraq.

Raimer said, "The progression [away from U.S. currency] has greatly supported the modernization of the banking system, thus improving and instilling trust in the local economy."

http://dvidshub.net/?script=news/news_show.php&id=44644

Iraq says can be top global oil producer in 6-7 yrs

Iraqi Oil Minister Hussain al-Shahristani said on Saturday he expected Iraq to become the world's top oil producer in six to seven years, and that OPEC should take into account Iraq's need to rebuild its economy.

Emerging from the shadow of war and keen to generate petrodollars to rebuild, Baghdad looks set to lift capacity to 12 million barrels per day in six or seven years, strengthening its hand for future negotiations on output quotas with OPEC.

"We can't find a reason to prevent Iraqi production becoming higher than any other OPEC state or even states outside OPEC. We expect that to happen in the next six to seven years with coordination and agreement with other OPEC producers," he said.

Iraq has signed a series of oilfield development deals with global oil firms -- which bid on prime fields at two energy auctions last year -- in a nation with the world's third largest crude reserves, emerging from years of conflict and sanctions.

Unlike OPEC's 11 other members, Baghdad is not subject to the output targets the group uses to set supply levels. OPEC exempted Iraq in the 1990s, when it was under sanctions.

"Iraq has been deprived of having a fair export level over the last years, during which we were not able to produce or export oil while other states got benefit from this and were able to export at higher levels," Shahristani told reporters.

"OPEC should put into consideration Iraq's need for oil revenues to rebuild its economy and country. Iraq has a definite need for these revenues."

Iraq said last week it expected to present to OPEC partners in 2011 ideas for guidelines on new quotas when Baghdad's plans to boost production capacity take shape.

The OPEC oil producers group is likely to try to get Iraq to curb output rather than pump all its extra capacity onto the market, analysts say.

"We are not interested to flood the market with oil. Our future policy is to get higher revenues for Iraq rather than higher production and flooding the market," Shahristani said.

http://uk.reuters.com/article/idUKLD...*****Channel=0

Finance: The Minister will hold meetings with the heads of m.obile phone companies to confirm the advancement of service delivery

A source at the Ministry of Finance Minister Baqer al-Zubaidi, held numerous meetings with the heads of m.obile phone companies in Iraq aims to highlight the advancement of service delivery.

A source at the ministry told the independent press (Iba) today, Sunday, the minister stressed during his meeting with proof Shawi, the CEO of Communications and Media Commission that the issue of follow-up performance of the m.obile phone companies as they relate to the need to provide services to citizens, and it was through his chairmanship of the Ministerial Committee to follow up stressed to think seriously "work towards the immediate launch of new licenses include working in the field of advanced systems of communications.

The minister called for coordination with the Ministry of Communications to enhance the performance of terrestrial and s.atellite communications to serve the Iraqi citizens and achieve important revenues to the treasury. Indicating that the first auction of the state has made nearly four billion dollars.

It should be noted that companies operating in Iraq is Zain and Asiacell and Cork and our communication and security.

http://www.ipairaq.com/index.php?nam...onomy&id=20680

CBI’s dollar sales drop on Sunday

The Central Bank of Iraq’s (CBI) dollar sales fell to $77.529 million in its daily auction on Sunday, compared to $159.081 million in the previous session.

“The demand hit $2.690 million in cash, covered at an exchange rate of 1,170 Iraqi dinars per dollar, and $74.839 million in foreign transfers outside the country, covered at an exchange rate of 1,173 Iraqi dinars per dollar,” according to a CBI news bulletin received by Aswat al-Iraq news agency.

None of the 10 banks that participated in today’s session offered to sell dollars.

http://en.aswataliraq.info/?p=126182

Oil companies in Basra to build housing units for their personnel

A number of oil companies in Basra have submitted a project proposal to build a residential compound for their personnel in the province, a local official said on Sunday.

“The project includes the establishment of 1,500 housing units on an area of 2,473 donums,” the deputy head of the investment commission, Jalal Tema Nouri, told Aswat al-Iraq news agency.

The project has been put forward by three companies, Nouri added.

http://en.aswataliraq.info/?p=126180

Oil firms missing targets face 'huge fines' - Iraq

Oil companies have committed themselves to the ambitious targets set in deals signed this month with Iraq and face fines of billions of dollars if they miss them, the Iraqi oil minister said on Sunday.

"These production target figures are contractual and were set in the contracts with the companies. The companies are obliged to implement them otherwise they should pay huge fines worth billions of dollars," Oil Minister Hussain al-Shahristani told Reuters.

http://uk.reuters.com/article/idUKLD***U09320100131

Economist: Iraq on right path to revamp economy - more lop talk

The Iraqi economic expert Magid Sowari said that the Iraqi economy is progressing as a result of the economic policy adopted by the Iraqi government which is represented by improving and enhancing the performance of banks and opening the bank loans to give more chances for actual work. Sowari talked in an interview done by the correspondent of the Independent National news Agency of Kurdistan (AKnews) in Baghdad "Shawkat Al Bayyati" about the Iraqi banks association and its needs to activate its role:

Shawkat Al Bayyati: Is there any approval on the Iraqi stock committee law and what are the implications on the Iraqi economy?
Magid Sowari: In general the law of Iraqi stock committee was approved by the body itself and was discussed with various parties and submitted to the State Consultative Council and till now there are no news whether it was approved or not and it had addressed very important issues for the interest of the Iraqi financial market and for organizing the body and regulating the market of Iraqi Stock Exchange.In general it is a good law and I think that it can join the Iraqi commission market which can not develop if the Iraqi economy didn't develop and increase the number of companies participating in the Iraqi market and activate the private economy thus activating the role of the Iraqi stock committee.

S.B: Do you have a certain vision for setting up the Iraqi bank asssociation?
M.S: the Iraqi banks association is found and it includes 23 private banks and its role in the banking arena is good, but it needs to activate more the role of the Banks Association and it is a basic issue organizing the banks operation, but the main problem is not in the banks themselves but in the uncertain economic situation in Iraq.The Banks association organized the works of the banks, but the most important problem that the banks association and the Iraqi banks faced is to open accounts for governmental departments and private funded departements in private banks and the Association succeeded in this battle in order to reach a solution that all self-financing departments have the potentials to open accounts in private banks

S.B: What is the future of the economic of the State?
M.S: I think that there is no economic policy in Iraq and this is the main problem where there is no centralized economic planning and no clear view for the Iraqi economy and for its needs to get in the current phase better economic,social and humanitarian developement. Unfortunately a lot of money fhave been spent since 2005 and so far that are estimated of 300 billion dollars where 32 billion $ were spent from 2005 to 2009, but the main problem is 230 billion $ but what are the results that have been achieved? 64 came up as grants for reconstruction and about 64 and 46 billion as investment allocations from 2005 to 2009 and $ 110 billion were spent on reconstructing Iraq. In fact, we are talking about the need for 200 billion dollars and what are results that have been reached in this field, in addition to that there is no identification for the Iraqi reconstruction process. What does reconstructing Iraq mean?There must be determination for what is found in order to reach the desired goals.

S.B: What would you do to attract the investors especially that the country needs this role to develop the Iraqi construction?
M.S: The basic problem is in the subject of investment. Iraq succeeded in attracting investments in the oil field but there was no investment environment,neither from the role of investment nor from the investing policy in Iraq, so I wonder why do we talk about the internal or external investment while there is no specific plan, and 700 projects were shown for the investment conference in Washington, but what is the size of the projects that arrived to Iraq? The National Commission for Investment is a transitional phase and so far there is no good preparation for it.

S.B: Some European banks promote that it will provide loans for (5000) housing units in Karbala province,is this true?
M.S: The credibility of these banks will be in their implementing and thus the Iraqi side will have to allocate lands, and the problem is not in signing the contract but in implementing it, or at least to get rid of the bureaucratic procedures.

S.B: How do you look at the American-Iraqi convention and its relationship to the future of the Iraqi economy?
M.S:The convention between Baghdad and Washington aims to support the Iraqi economy represented by protecting the Iraqi funds held abroad, and there is great support from Washington for this issue but we must work with Washington, then who opposes the help of the largest country to Iraq?

S.B: What are the priorities that the Iraqi government should do to get out from the economic crisis?
M.S: There is no clear methodology to attract investment in the Iraqi economy and so far there are no clear processes for human development where there have been positive and negative decisions, and there are many problems that face Iraq the most important is the lack of clear decisions and no solution for these issues.

S.B: What is your opinion about canceling the zeros from the Iraqi dinar?
M.S: In fact, there are many experiments, including the experience of South America and Turkey where 6 zeros were cancelled from its currency, and most of the savings used the Iraqi dinar, but the process needs time and it is positive if it came true and will certainly gives more trust in the Iraqi dinar and help in shaping a new successful economic policy if we take into account that the Iraqi dinar is not the smallest cash unit.

S.B:Many seminars and conferences discussed the Iraqi economy, but what is the solution?
M.S: The problem is not discussing the problem but to solve it completely. Every one speak about the need of improving the private and public sectors, and the basic problem is diagnosed for the government and the E.xecutive bodies. In fact, we need clarity in vision to solve these problems.

http://www.aknews.com/en/aknews/9/107399/

Iraq Proves the Pessimists Wrong

We often hear about the supposed “unraveling” of Iraq—a regular trope of veteran defense writer Tom Ricks, among others. No doubt there is cause for concern—ranging from bombings that kill dozens, even hundreds, to candidate disqualifications that threaten the integrity of upcoming elections. But as General David Petraeus notes in this interview published last Monday in the Times of London, Iraqi politicians have shown an impressive ability to overcome crises that could lead to the resumption of civil war. Speaking of the 500 candidates disqualified for Baathist links, Petraeus said:

"I’m considerably much less worried than I was say last weekend when this was all really appearing that it actually could boil over and result in a reversal of the effect of two and an half years of reconciliation among different groups. It appears however in the last 48 to 72 hours that Iraqi leaders have really gripped this issue.

It turns out now that each party has at least double-digit numbers of individuals on this particular list of over 500 names and that it is reportedly 55 per cent or so Shia and 45 per cent or so Sunni. So if it ever was as was reported a predominately Sunni list and predominately focused on sidelining Sunni candidates that is not the case now and it appears there is going to be, as has been the case in Iraq on a number of previous occasions when there has been quite considerable political drama, that Iraqi leaders will resolve the issue without unhinging and undoing again two and a half years of very hard work at reconciling all of the factions inside the new Iraq."

I noticed another sign of how “the new Iraq” is making progress in this Wall Street Journal article about the rush of foreign airlines to increase service to Iraq at the same time that Iraq Airways is building up its fleet by placing an order with Boeing.

“It’s a good market,” said Turkish Airlines Chief E.xecutive Temel Kotil. Turkish was one of the first foreign carriers to serve Baghdad after the end of Saddam Hussein’s regime in 2003 and it plans in March to start flights to Basra, in southern Iraq. “We want to serve many Iraqi cities,” Mr. Kotil said, adding that most of the carrier’s passengers are Europeans."

It’s not only Turkish Airlines that thinks Iraq is a good opportunity. Other carriers already flying there include Bahrain’s Gulf Air, Lebanon’s Middle East Airlines, and Austrian Airlines. And, reports the Journal, “German giant Deutsche Lufthansa AG recently announced that it aims this summer to start serving Baghdad and Erbil, pending regulatory approval. Austrian Airlines, a unit of Lufthansa, is increasing flights to Erbil, the one Iraqi city it serves. Upscale Qatar Airways also is examining the Iraqi market, officials said.”

A fragile but working democracy, an increase in foreign investment, a steep decline in attacks over the past several years—all these are signs that Iraq is hardly unraveling. That doesn’t mean that it is on a one-way flight to Nirvana. American vigilance and involvement remain essential. But an awful lot has gone right recently—more than I would have predicted back in 2007, when the surge was just beginning. Perhaps, just once in the Middle East, the pessimists will be proven wrong.

http://www.commentarymagazine.com/bl...hp/boot/227596

Iraq: The Pace of Oil Expansion
Iraq's two oil licensing rounds have set the stage for the biggest, fastest oil expansion ever seen

-- a boost of 9.5 million barrels per day that would blast production to 12 million b/d within seven years, according to official targets. Baghdad's actual performance is likely to be far more restrained, while still involving considerable growth, according to Energy Compass calculations. Some industry experts reckon total flows in excess of 6 million b/d are easily achievable in that period -- on a technical level -- assuming Opec doesn't shackle Iraq before it gets there.

Under a best-case scenario prepared by Energy Compass, the potential for an Opec quota decision arises as early as 2012, when Iraqi production would push past 3.5 million b/d, placing Iraq on par with Iran, its neighbor and former foe. Parity between Iran and Iraq has historical standing in Opec affairs dating to the 1970s and 1980s, and is considered a key marker by other Opec delegations (EC Nov.6,p3).

Under Energy Compass' alternative "shortfall scenario" -- which includes logistical and other constraints -- the Opec debate is delayed only slightly. This scenario assumes that early growth stays largely on track, but that serious shortfalls emerge in later years due to operational obstacles, insufficient water injection, export capacity constraints and potential reservoir performance issues.

Unrestrained, Iraq would rival Saudi Arabia's current production in 2014 and its capacity two years later in the best-case scenario, but would fail to match the kingdom on either count in the shortfall scenario. The two scenarios offer an insight into how Iraq's production might ramp up without Opec constraints. But the profiles will change over time as work on the ground advances.

An Opec allocation of 4 million-5 million b/d for Iraq could be a blessing in disguise for those companies that pitched ambitious production targets to score awards. This was especially the case with the first-round contracts for Rumaila (2.85 million b/d target), Zubair (1.2 million b/d) and West Qurna-Phase 1 (2.325 million b/d). Some insiders say more likely figures for these giant southern fields may be closer to 1.9 million b/d, 900,000 b/d and 1.2 million b/d, respectively. The plateau target figures in the second round were less inflated, but oil ****utives say inadequate infrastructure and logistical bottlenecks are more likely to prevent companies from cranking up these largely untapped fields. More rapid results will come from first round fields that are already up and running.

Rumaila, Iraq's biggest producer, is expected to deliver the quickest gains. Partners BP and China National Petroleum Corp. (CNPC) can start to recover costs and get paid for their services once flows rise 10% above initial production of 1.066 million b/d. State South Oil Co. (SOC) head Dhia Jaafar tells Energy Compass he expects that to happen swiftly -- even before the end of this year. The immediate plan is to work over existing wells and BP has already issued a raft of tenders.

For all 10 of Iraq's development projects, extensive drilling programs come top of the list -- and there will be a race for rigs and crews. For the prized fields in the south, which contain mainly heavy oil that is poorer in quality than other Mideast structures, the drilling effort could prove hard work. "Ask yourself what it took to get some of the largest Saudi oil fields on stream -- in an unobstructed manner," says a Western oil ****utive. "Build-ups to rates of this magnitude in Iraq will take longer." It took Saudi Aramco about five years to develop the Khurais oil field to its full rate of 1.2 million b/d.

Major fields in Saudi Arabia had initial well rates in the tens of thousands of barrels per day, whereas Iraq's giant southern fields will average 1,000-5,000 b/d, says Peter Wells, founding director of geological consultancy Neftex Petroleum. On the production side alone, Iraq will need about 10 times the number of wells to match the Saudi level and perhaps 20 times when water or gas injection -- likely to be required even in the early stages -- is included. To get an extra 1 million b/d initially, assuming operators cherry-pick the best reservoirs first, Iraq will probably require 300-600 wells, he estimates -- which would involve some 80-150 rigs operating over a two-year period. Scale this up to 4 million-5 million b/d of new oil, involving other reservoirs, and some 200-400 rigs would have to work flat out over a five-to-10 year period.





http://www.energyintel.com/DocumentD...ment_id=656444

Adel Abdul-Mahdi: Launch of the broad investment and the creation of mega-projects sponsor the absorption of hundreds of thousands of unemployed

Vice President Adel Abdul-Mahdi said the general situation in the country needs a comprehensive reform program based mainly on the launch of the movement of great economic and social being of activating the agricultural, industrial, service and other fields.

Saying, a statement by the Presidency of the Republic received by the independent press (Iba) today, Sunday, a copy of that Abdul Mahdi stressed during his meeting with a large group of elites and the scientific competence and academic and cultural rights in Dhi Qar, the importance of launching a grass-roots initiatives of the Organization, considering it an important tributary streams from development and economic advancement.

The statement noted that Abdul-Mahdi attended a seminar dealing with issues and concerns of the Iraqi citizen, and reviewed the most important problems facing the development processes and the promotion of economic, scientific, and social service in Dhi Qar, where the figures showed that participating province is still suffering from severe shortages in health and education services, educational and cultural Although some of the projects completed in recent years.

The statement quoted Abdul-Mahdi as saying that "investment is a key pillar in the development and reconstruction, but that depends on the elimination of obstacles and constraints, particularly the bureaucracy and the mentality of the past that is still ruling in most of the joints and state institutions."

http://www.ipairaq.com/index.php?nam...onomy&id=20715