Thread: Archive News - Iraqi Dinar Think Tank - 28/03/10 - 21/06/10

Iraqi conference calls for economic reforms and fiscal and monetary

BAGHDAD: The Conference recommended that the Economic sponsored by the President of the Republic of Iraq, Jalal Talabani, for making a formal creditworthiness of Iraq by the rating agencies international credit are officially supported, especially after the emergence of institutions of national statistical enjoy an appropriate degree of Alchwevi, and the jungle in order to promote greater transparency and disclosure in monetary institutions. study also recommended the lifting of the zeroes on the Iraqi dinar in terms of timing and the expected negative impact of being supposed to be a final action, and dealing with the fluctuation of oil, but variability of the properties and deep in its market hedging, and an increased tendency for the saving of additional resources.

It is also recommended that service contracts appropriate and rewarding of the state and returns Iraq, including the high and the total investment and operating costs and payments to foreign companies represent a reasonable proportion of the revenue, so we recommend that you take on in the oil contracts, and the installation programs and restructuring in developing countries that have adopted addressed the fiscal imbalance, either imbalances economic and social development has remained the same or worsened, so you should pay attention to these imbalances when you apply some of the recommendations of the Fund in Iraq.

The Conference called upon the mobilization of economic policies, monetary, financial and institutional, legislative, thus increasing the contribution of national and foreign investment, especially in non-oil sectors to increase its contribution to GDP, and a focus on investment in infrastructure and the need for investment in a way (Build, Operate and Transfer) to relieve the pressure on investment budget in the establishment of infrastructure, especially in road and electricity projects.

Also came from the recommendations provide a favorable economic environment that promotes the case of competition between public and private sector on the basis of considerations of efficiency and productivity, to submit to market forces, giving the private sector a full opportunity to do its part in the development process, and addressing structural imbalances real economic and social, as well as addressing financial imbalances and monetary and the need for investment to increase Iraq's oil revenues in order to rid the economy of the problem of unilateral and diversification of GDP and increased reliance on key sectors such as agriculture and industry. participated in the conference 45 scholars and experts, scientific bodies and research and institutional numerous, such as the World central and Iraqi universities, research centers, the National Investment Commission, In addition to advisers in the Iraqi cabinet.

The conference discussed at its four four areas: investment and the private sector, fiscal and monetary policy, productive sectors and the focus of energy, and came out the recommendations of several expressed the final statement that it will be submitted to the House of Representatives and the new government, as noted economic expert Abbas Ghalibi decision of the Preparatory Committee and a member of the Scientific Committee of the Conference In his opening to: that the convening of the conference comes in a matter of suffering of the Iraqi economy in which the structural imbalances and structural great, especially with the presence of complications in the process of economic transformation taking place in the country, which began after 2003, which approved the constitution that the Iraqi economy will be a market economy, adding: that Iraq is on the verge of an economic revolution and expansion of the movement of investment, and that this is not only the existence of the economic reforms required.

Included business meetings readings research by dealing with the economic conditions in Iraq in its various aspects, including: reading adviser Prime Minister Dr. Abdul Hussein Al-Anbuge for consideration is marked by (reform and privatization of public companies), he dealt with private sector development program in Iraq and the most important challenges of reform and the challenges of transition towards privatization, He also touched upon the main features of the road map for corporate reform, pointed to the most important challenges of reform (operating according to commercial standards) is the lack of electricity, which led to a halt much of the available production capacities and make the production costs are high and products are not competitive in the market, as well as the domination of the ministries resolutions of the boards of directors, and the mentality of workers are not competitive and that need to market culture, and the absence of a standard which defines a comparative advantage of the product or not.

He pointed to: that the most important challenges of the shift towards privatization is: surplus labor and the lack of resolution in earnest in the ministries to get rid of public companies, and general managers of companies, many of the workers is welcome privatization and resist strongly, in addition to deficiencies in legislation.

Also read Dr. Abdullah Al-Bandar, a member of the national Estmar consideration is marked by (the developmental role of investment in light of the global crisis), which put the number of questions including: Does the investment is synonymous with development. Stressed in his argument: that many of the makers of economic policies and particularly in Arab countries thought that the development is synonymous with investment, and they thought whenever we invested more, picked up our steps on the path of development, the fact is that the development of a civilizational project integrated, and the investment only one dimension in this project, which is the economic dimension, pointing out: The masses using the achievement of development requires a huge investment, and most importantly is the type of investment and the productivity, said in urging that the investment will be (Magic Wand), which will complete the tasks of development.

Read the Director General of banking and credit control / agency in the Central Bank of Iraq Walid Idi Abdel Nabi study tagged: (foreign investment and its expected role in the development of the Iraqi economy), said: "The debate still exists on the importance of foreign investment and feasibility of economic and social development in host countries has a long friction exists between the objectives and interests of the Parties various investment, this despite the fact that foreign direct investment had exercised Doramanma in the growth of the economies of multiple in certain sectors, fields of oil in the Arabian Gulf and tea plantations in India, but there are some negative economic, social and political situation of this investment".

Noting that the overall development concept contemporary: the community-conscious and permanent addressed by the will of an independent national in order to find structural shifts and changes political, social, economic, allow the achievement of a steady growth in the capacity of the community, and continual improvement of the quality of life.

Also read the managing director of Iraq to the development of small and medium-Shirvan Anwar Mustafa consideration is marked by (The role of small and medium enterprises in the development of the private sector), which he said: in place economic reforms in Iraq of topics so vital, the role of sector small and medium enterprises in economic reforms, which sector is important and very vital it is possible to reduce many problems unresolved problem of underemployment is rampant in Iraq dramatically, it could have added to the output of the total Iraqi significant value and reduce the drain on foreign exchange that goes beyond the borders run across a lot of manpower Iraq, and reviewed the researcher Studies Tweed Mazhb him.

Also saw the meetings of the Conference discuss the research presented in the central sectors of production, energy, oil, where he read Dr. Mohammad Saleh Al-Quraishi, consideration is marked by (growing economy between the market mechanism and government intervention .. the perspective of economic policy for growth and development) said: that economic growth and development in the national economy of N.okia reality only the existence of a comprehensive political harmony with the economic system that seeks to achieve deems political, but there must be a political system that does not carry a discrepancies in the overall orientation to accommodate the economic trend as well, a point that makes us stand in front of political and economic system, and their significance and their interaction together, Stability macroeconomic is a necessary condition.

Read Researcher Farouk Saleh Ramadan consideration is marked by (bank loans to the agricultural sector) in which he said: that the process lending in the agricultural sector is the main theme for its development because of agricultural projects to fund and support the players by the state or by donors or lenders, because the work in the sector Agriculture needs to be a large capital, and automation of a variety of large territory, seeds, fertilizers, fodder, medicines and veterinary vaccines to combat pests and diseases, land reclamation, the establishment of channels of irrigation work and Mpazl to improve soil fertility, and build residential units for farmers and workers in enterprises, as well as work in earnest in facilitating the grant process or lending , and the delivery of the necessary funds to the intended recipients real producers.

He said the Ramadan that banks and finance companies Financial seeks to give credit activity, be it in the agricultural sector or other sectors to achieve quality performance and speed of e.xecution and payment in a timely and Supply in the projects the real profit-guaranteed study of the expected cash flows of the borrower in an objective, and most importantly, the study actual need for funding and the time required for the payment of the agricultural sector and the many projects that need funding in the different deadlines and may be short-or medium-strategic projects that require long-term loans.

In conclusion, Ramadan discussed by stressing the importance of the funding in the agricultural sector is affected by many scale profitability and precautions of credit risk, so the officials working in the administration of credit, to be their expertise and experience fully in the examination of the estimates, financial statements, all craft, so is the harmonization of cost and financial benefits, in order to are making the right decision at the right time.

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Formality crowned the efforts of fiscal and monetary policies must be to reduce inflation

Project is to drop three zeroes from the Iraqi dinar projects strategically in line with the development which is expected to be witnessed by the Iraqi economy in the next stage. This procedure is not new in the global economic experiments, there are a lot of experience was highlighted by the experience of Germany after World War II.

Terms of solving the mark and then replace Alrajksmarck solution Aldug Mark misplaced. In 1924 Mark was Alrienten new equivalent trillion × 1210 of old b.rands. In Hungary Forint replace Alpinko solution, and in Austria schilling solution replace the Crowne, and finally deleted Turkey in recent years, six zeros from the currency.

The process of deleting three zeros from Iraqi dinar final procedural process for the treatment of the phenomenon of inflation, which hit the Iraqi economy during the eighties and nineties of the last century, with accelerated rates of inflation increased at serious to become one of the most pressing economic problems. Costs are high for the wars is one of the most powerful source of inflationary pressures.

Indeed, he has increased the index to consumer price three times in the eighties, and rose up to (300) during the time period (1991-2002), the government has exhausted the economy Bmjhodat additional spending by doubling the war.

In such an economy-heavy military spending, the additional government expenditures, also have a role in raising the output prices and, therefore, the continued increase in public expenditure led to a continuing tendency to increase prices and inflation. As a result of structural imbalances and the depletion of foreign reserves reached the exchange rate in 1995 to more than (2800) dinars per dollar, and then improved slightly after the implementation of the Memorandum of Understanding with the United Nations in 1996, and in 2003 reached approximately (1896) dinars per dollar.

It should be emphasized that the treatment of the phenomenon of inflation should be preceded by the process of removing zeros and concerted efforts of the monetary and fiscal policy to achieve this goal, the pressures of inflationary might arise from a number of reasons for working at the same time even though they differ in kind and degree from one country to another in the same country From time to time.

The entrance Cash believes that the authorities responsible for the money supply should adopt targets for the increase in the money supply so as to be consistent with the rate of increase in gross national product, and then trying to make reductions to the expansion of cash consistent with the target level.

Given the fact that inflation causes several Vinabgy the knowledge that treatment of each type of these species varies somewhat depending on the different type, if the cause of inflation is excessive government spending, funded through the budget deficit and the consequent increases successively in the money supply and increases in wages and salaries , the treatment not be successful if you think the government to reduce expenditure only, or the money supply as recommended by the entrance of cash. Monetary policies, restrictive fiscal and processors are typical when the reason is excess demand, but this type of policy can not be used freely when the reason inflation cost.

After the enjoyment of the Iraqi Central Bank independence true under the new law gave the goal of price stability and reducing inflation rates weight the largest in the strategy of monetary policy, is the auction of foreign-exchange tool provided in the current circumstances to control monetary expansion, and the auction is to cover the costs of imports, as well as contributing to reduce the money supply.

It should be noted the need for effective coordination between fiscal and monetary policies must be to get rid of excess money supply. The objective of monetary stability must be consistent with the goal of the level of foreign reserves in order to avoid impeding trade and account for external shocks and therefore, the use of a tool auction must be consistent with the minimum target for the reserves of foreign countries. This policy has achieved, in addition to the effective operation of the open market a remarkable success in controlling monetary growth and improve the purchasing power of the Iraqi dinar. After the dollar was equivalent to 1896 in 2003 became the equivalent of 1177 dinars by the end of September 2008, as estimated by the CBI that the core inflation rate was 12% (excluding fuel prices and transportation) in August 2008, and whether the calculated inflation rates by the Bank Central or the Ministry of Planning does not appear that there is a tendency for price rises continued to evolve into runaway inflation.

Has shown the past six years of confusion in the relationship between fiscal and monetary policies must be The picture was clear to the extent that reveals limits of the relationship in addressing the economic problems faced by the Iraqi economy. The people of some economists and there is nothing contradictory in the treatment, especially the phenomenon of inflation stasis .. Authority of Finance to give priority to tackling unemployment, and thus trying to follow an expansionist policy is the carry high rates of inflation compared to decline in the future after supply to expand commodity resulting from the increased production, while the view of monetary policy the opposite and trying to deal with inflation first and believes that the financial environment, monetary stable is a condition head of production, as well as the fact that the Iraqi economy is not flexible for several reasons, and therefore, this expansion is not appropriate now and will inevitably lead to inflation.

Faced with that, the incompatibility of two policies mean altitude possible in the rates of inflation as a result of the expansionist policy of financial power, so you should take several actions, the process of deleting zeros other rings; it must adopt a plan to stimulate the recycling process, productivity and overall economic, in various agricultural and industrial sectors and service and deliberative, banking and investment, thereby promoting each episode the other in ushering in each reservoir, capacity and channels, actors, and a strategy for economic and human development to allow effective use of financial resources derived from a crude oil and to achieve capital accumulation, which sings the national wealth, should also improve economic performance through the establishment of a comprehensive renaissance in the sectors of Iraq's national income to develop a positive performance in the real value of income and no monetary value.

It should also adopt long-term plan for the implementation of the project, to avoid any free commuting is reflected on the ground of cash, due to the large mass of cash in the Iraqi market, which tend to marginally exchange dealing, rather than the use of advanced banking payment.

Finally, it should be noted that of the most important problems that can accompany the process of deleting the zeroes are the accounting problems of the many that have accompanied it, and of re-assessment of debt and financial obligations between individuals and institutions. If a financial institution has granted a loan of ten million dinars When deleting zeros will recovered ten thousand dinars, which means the language of accounting loss for the lending institution the amount of nine hundred and ninety-nine thousand dinars.

This may be remedied this problem by providing a new currency, according to a special project to re-pay existing contracts of old currency. In this context, some countries (eg Argentina in 1985 and Brazil in 1986) designed a kind of monetary reform is more complicated for the return of long-term loans to pay the new currency, but the interest rate is adapted to a new format.

In general, the countries which tried hyperinflation was suffering from a level too low international reserves making it in the position of defending a weak exchange rate and stable prices, which paid for the use of technical and financial assistance from international and regional organizations has enabled it to balance of payments support.

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so does anybody care to decipher what was said in the above article???....lol....it is all confusing to me....i guess time will tell about the removal of the zeroes or not to remove the zeroes.....God knows as slow as these people are it might take years before anything is done....lol...GO DINARS...Pat

Originally Posted by bigopie

so does anybody care to decipher what was said in the above article???....lol....it is all confusing to me....i guess time will tell about the removal of the zeroes or not to remove the zeroes.....God knows as slow as these people are it might take years before anything is done....lol...GO DINARS...Pat

Hi Pat,

Hope all is well, and no doubt, this is the same double talk about zeros and new currency, and new currency means new value no matter how you cut it in my opinion. And with the currency removal equipment contract bid by CBI, it is all about connecting the dots, even if they are small dots. lol Something is about to happen is how I read it all, now if we only knew what. lol

Success to all, Mike

Iraq completes 25% of Nasiriya oil field development plan

Iraq says it has completed 25% of the plan to develop its Nasiriyah oil field.

The field’s development is carried out by the state-owned South Oil company. The field, which currently produces 10,000 barrels a day, is expected to increase output to 50,000 in 2011, according to the company’s Director-General Dhia Jaafar.

The company has drilled four oil wells and more will be drilled this year, Jaafar said.

Iraq’s National Drilling Company is involved in the field’s development as well as other state-owned enterprises, he said.

Iraqi state-owned firms decided to develop the field on their own when talks with a Japanese-led consortium failed to reach an agreement.

Japanese firms Nippon Oil Corporation, Inpex Corporation and JGC Corporation, were involved in negotiating an engineering, procurement and construction (EPC) deal with Iraq.

The field has reserves of about 4.4 billion barrels of crude. The Japanese planned to produce 100,000 barrels a day by the end of 2011.

http://www.azzaman.com/english/index...04-27\kurd.htm

Al-Hashemi to call for urgent Presidential Council meeting

Iraqi Vice President Tareq al-Hashemi will call for an urgent Presidential Council meeting to discuss the latest political developments, spokesman for the media office of al-Hashemi said.

“Al-Hashemi will call for the meeting to discuss the latest political developments and the current situation,” Abdulelah Kadhem said in a statement received by Aswat al-Iraq news agency.

The Judiciary Appeals Commission on Monday decided to cancel votes that were won by Iraqi politicians during the parliamentary elections due to their affiliation with the dissolved Baath Party.

The decision embraces 52 politicians.

http://en.aswataliraq.info/?p=130872

Allawi calls on the United Nations to intervene in the Iraqi political process

The leader Iyad Allawi's Iraqi list, the list has asked her lawyer raised an appeal to challenge the decision issued by the dimensions of fifty-two candidates in legislative elections.

Allawi said that his list would invite the United Nations to intervene to save the political process in Iraq as still subject to Chapter VII of the Charter of the United Nations, and because the process of counting the votes had been politicized, he said.

Allawi said at a press conference in Ankara Monday he was concerned about some of the forces that dominate the political process in the country.

http://radionawa.com/ar/NewsDetailN....924&LinkID=158

Shaways chairing a meeting of the Economic Commission

Chaired by Deputy Prime Minister Nuri al-Rose Shawis meeting of the Economic Commission Monday.

A statement by the Information Office of the Deputy Prime Minister, in light of the objectives of the initiative aimed at revival of agricultural fields of agricultural production The Committee discussed the subject of the prices of strategic crops in the light of proposals by the ministries of commerce and agriculture.

The statement added that the committee examined the proposals submitted, taking into account the importance of the topic and its impact on different areas of the Iraqi economy and the desire to continue to encourage the peasants, farmers, and after the study commissioned local production and global prices of grain, the Committee to provide appropriate recommendations to the Council of Ministers for approval.

http://radionawa.com/Ar/NewsDetailN....928&LinkID=155

The continuation of negotiations between Iraq and Iran on the development of joint oil fields

Baghdad and Tehran is seeking to complete the negotiations, which began two years ago between energy officials in both countries to agree on a formula to develop joint oil fields on the border between the two sides.

The Ministry of the Iraqi oil that it continues negotiations with the Iranian side to reach an agreement on joint development of oil fields between the two countries.

The Under Secretary for extraction, Abdel Karim and coffee in a press statement that negotiations are continuing for more than two years, "There is a road map for the implementation of joint studies to start up and to agree on a joint mechanism to develop the fields."

He assured my fault that the signing of joint contracts between Iraq and Iran needs to be a set of prior steps before reaching the final wording of these contracts, pointing out that such language need a lot of steps, including agreement on specific mechanisms and exchange of information and the formation of technical teams together.

With regard to the power processed to Iraq by Iran, he explained my fault that there are serious efforts to increase it, where "there is processing of the Iran-powered electricity to some of the known sites in Iraq, and there is an Iraqi delegation would travel to Iran soon to increase this amount."

It is noteworthy that the Iranian side had earlier announced its readiness to conduct joint negotiations with Iraq in the areas of oil and electricity at the time of resumed when Iraq on Monday oil exports from the northern Kirkuk oilfields to the Turkish port of Ceyhan after a bombing at a pipeline carrying oil in Nineveh province, last Thursday.

http://radionawa.com/Ar/NewsDetailN....926&LinkID=155

CBI dollar sales up to $176m

The Central Bank of Iraq’s (CBI) dollar sales went up to $176.200 million in its daily auction on Tuesday, compared to $133.840 in the previous session.

“The demand hits $2.180 million in cash, covered at an exchange rate of 1,183 Iraqi dinars per dollar, and $174.020 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 13 banks that participated in today’s session offered to sell dollars.

http://en.aswataliraq.info/?p=130848