The Dinar Daily, Wednesday May 13, 2015
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  1. #1

    The Dinar Daily, Wednesday May 13, 2015


    US dollar USD 1166.000 1164.000

    US dollar USD 1166.000 1164.000
    Euro EUR 1299.157 1298.508
    British pound GBP 1804.968 1804.066
    Canadian dollar CAD -------- --------
    Swiss franc CHF 1251.341 1250.716
    Swedish krona SEK 140.995 140.924
    Norwegian krone NOK 154.212 154.135
    Danish krone DKK 174.084 173.997
    Japanese yen JPY 9.737 9.732
    Drawing Rights
    SDR 1637.752 1636.933

    Indicative rates - (as of) 12.5.2015 (no change as of 13.5.2015)

    Currency Auctions

    Announcement No. (2948 - most recent listing)

    The opening offers the sale and purchase of foreign currency in the window of the Central Bank of Iraq on 10/05/2015 (no change as of 13/05/2015) and the results were as follows:

    Number of banks 17
    Number of remittance companies 1
    Auction price selling dinar / US$ 1166
    Auction price buying dinar / US$ -----
    Amount sold at auction price (US$) 146,902,904
    Amount purchased at Auction price (US$) -----
    Total offers for buying (US$) 146,902,904
    Total offers for selling (US$) -----
    Last edited by pinkadonai1; 05-14-2015 at 10:19 AM.

  2. #2

    Re: The Dinar Daily, Wednesday May 13, 2015

    The Exchange Rate of Foreign Currency in Economic Feasibility Studies

    Below are the central controls related to the exchange rate of the foreign currency to convert the project inputs and outputs from foreign currency to its equivalent in the local currency, and that is by calculating the net discounted present value standard and the internal return on investments in economic analysis that governs investment projects that costs excess one million dinars.

    Estimate the shadow price of foreign currency:

    1. It is necessary to put central controls to amend the official exchange rate * to reflect the shadow price of the foreign currency, and that is considered one of the necessary requirements to implement the net discounted present value standard and the internal return rate on investment in the economic calculation stated in the instructions, paragraph nine.

    The central controls for adjusting market prices distinguished a group of outputs and inputs traded internationally, where the projects production or usage of them is reflected on the abundance of foreign currency in the economy and thus project outputs or inputs used of such are considered purely foreign currency outputs or inputs.

    * What is meant by exchange rate: the number of units of foreign currency, expressed in dollar per one dinar.In particular the following outputs and inputs of foreign currency were distinguished:

    • Export-outputs.
    • Outputs marketed locally that substitute imports.
    • Imported inputs.
    • Inputs produced locally that usually go to exports.
    • Foreign labor.

    According to the pricing rules the value of the output and input (traded) is calculated using export prices (FOB) and import prices (CIF), according to what is listed in the pricing rules.

    In other words the pricing rules calculate what the project produces from foreign currency (quantity of exports multiplied by the export price (FOB) in foreign currency or the quantity of substitute imports multiplied by the import price (CIF) in foreign currency, as well as what the project uses from foreign currency and imported inputs multiplied by the import price (CIF) in foreign currency …. etc.).

    In a later step, project outputs and inputs must be converted from the foreign currency to its equivalent in local currency (dinars) by using a specific exchange rate for the foreign currency.

    2. Justifications for exchange-rate adjustment: there are a number of important and powerful arguments which support the view that the official exchange rate reduces the real value of foreign currency for purposes of calculating the economic national profitability for investment projects and hence for the purposes of investment planning. It is demonstrated in this context to call for assessing the dinar for less than (3.208) dollar (official exchange rate) when assessing project outputs and inputs of traded goods of exports, substitute imports and imports… etc.

    The justifications to call for the use of an exchange rate that is lower than the official exchange rate are:

    • The use of an exchange rate that is lower than the official rate is the appropriate action at the investment planning level to translate the country’s economic strategy aiming at stimulating central investments in the sectors that encourage the development of non-oil exports, as well as sectors that encourage the expansion of domestic production base in order to reduce imports and compensate it with local commodities. This helps to reduce reliance on foreign exchange earnings from crude oil exports and increases the share of non-oil sectors in the local production.
    • The application of the amended exchange rate on project imported inputs will assist in directing investments away from aggregated sectors dependent on imported inputs and the preference of those sectors that rely on locally produced inputs.
    • The use of the amended exchange rate helps to correct the balance in favor of the traded goods sectors compared to non-traded goods.
    • The real exchange rate has declined rapidly since the early seventies, through rapid rise of the level of prices and local costs which led by the steadiness of the official exchange rate to change in prices and actual local rate costs that gave an advantage for imported goods at the expense of locally produced goods, meaning that it led to deterioration of the competitiveness of alternative replacement goods and export commodities.
    • This action shows that the official exchange rate overestimates the value of the dinar, compared to the foreign currency and from the promoting goods substituting imports and export commodities point of view of.

    And in support to this view is the state’s utilization and in a broad approach to the customs and quantitative protection policies especially for consumer goods, as well as export subsidies that exports have through an amended export exchange rate.

    3. Estimate the amended exchange rate of the Iraqi dinar to be used in technical and economical feasibility studies and for (1.134) dollar per dinar. This price should be approved for 3 years until re-appreciation by the competent authorities.

    The Republic of Iraq – Ministry of Planning


    A "flashback recap" of a Live Q and A Call from about a year ago - on THE DAILY DINAR NEWS BLOG...

    In general terms – there were three main focal points of interest I wanted to cover and then allow listeners to ask whatever questions they liked.

    1) the SIGR report…

    2) the Gold Article…

    3) the IIER report…

    I started the conversation out last night by highlighting how crazy this campaign being fielded to contact our lawmakers and bank CEO’s and tell them how unfair it is they are getting to exchange (exchange is the right terminology BTW – NOT “CASH-IN”) at 32.00 per Dinar and we are not – is. It is nuts.

    Firstly, “they” are NOT being allowed to exchange “early” – or at 32.00 per Dinar. It makes you sound “stark raving MAD” to be caught saying such things. You would be better off barking at the moon. It is demeaning to the validity of a true currency play.

    Secondly, this is entirely the wrong way to approach them. I pointed out on the call that Poppy and I fielded a very successful such campaign a couple of years ago. However, we sat down and came up with a much different approach. It was designed to get answers and to approach our lawmakers with respect and as their constituents. Not like a bunch of lunatics. We had extraordinary participation (because it made sense) and we received a good response from lawmakers. It started the conversation in a reasonable manner.

    I asked one caller – “when was the last time you asked a banker for money and told him how unfair it was if he didn’t give it to you”??? Obviously – we chuckled…

    Another caller asked me if (as DC had relayed) – the “zero’s were raised” and the lower denominations were in circulation??

    I said plainly “no”…lower denominations being in circulation would (at the very least) imply there had been a value change. If there were no value change the lower denoms would not only be of little value, they would be such a hinderance – people might even throw them away just to get rid of them. So no – no lower denoms. I told the caller to check the website for “real” info on rate change.

    The “zero’s being raised” or “deleted” – as explained by any reasonable researcher, economist or authority – is simply the process removing the large (3 zero notes) from circulation.

    Referring to an Enorrste post from today on
    THE DINAR OBSERVER DAILY(you may want to put this on your favorites and check in several times a day – we to it often )

    “…I have never found a single article from the CBI or the IMF that equates “delete the zeros” to the idea of “move the decimal point.” Instead, the statements overwhelmingly come out to mean “remove the large notes from circulation.”

    Also – this recent internal memo put out by Wells Fargo is likely “push back” from this recent campaign. I pointed out that Pinnacle Bank published an article by an “affiliate” in their internal publication and then “highlighted it” in a similar internal memo a couple of years ago. It is just a defense mechanism. I’m sure Wells is tired of having their name dragged through the “internet rumor mill”. This is highly likely the reason for their vigorous denials about handling it in the future. They get so many useless calls – it isn’t worth the headache. Can you blame them??

    Further, for any bank, lawmaker, adviser or official to state the “Dinar is a scam” is nearly as foolish as some of the internet “Gurus”. It is the official currency of a COUNTRY. I pointed out (below) the post from yesterday’s
    – highlights page 94 of the quarterly SIGR report to THE US CONGRESS in April of 2012…
    __________________________________________________ _____________


    We are seeing and hearing that the inflation rate is still climbing and they are pushing to get us our money?? This report is from page 84 of the massive SIGR report.

    BGG ~
    This is a screen shot from the “Special Inspector General for Iraq Reconstruction” – Apr 2012, quarterly report to Congress. For members of our Government to say they have no idea what is going on here – means they haven’t read some very basic documents presented them.
    __________________________________________________ ______________

    I pointed out (last night) this is a highly speculative investment. We are, in no way, guaranteed anything. However, this SIGR report gives us some valuable insights…

    1) This is information given to the US CONGRESS on a quarterly basis… I find it hard to believe such an information source would intentionally mislead Congress. They tend to frown on such behavior. Which goes directly to the validity of this adventure – against all advice from Wells Fargo or other such naysayers.

    2) It points out there having been a legitimate “plan” – or time frame in motion…having been projected to be done in 2013. We are obviously in “over time” now.

    3) It gives us an idea as to who is in charge…the CoM – or Council of Ministers. Who do they answer to?? Maliki. Period. When is he likely to push this forward?? Historically – he has been a “weak Dinar” policy advocate. However, rumor from his own inner circle admits he can’t win a third term in office without some currency reform.

    I fully expect him to use every tool in his “wheel house” to win – his recent moves in Anbar and the disputed territories prove as much. Currency reform has to be a “biggie”. Though this WAS their thinking a couple of months ago – there is no promise it is still part of their political calculus. We shall see.

    4) Though no guarantee of the actual future plan they wind up engaging – this report points out an increase in value that would have taken the Dinar from “one-tenth of a cent” to a value “of slightly less than $1″..

    __________________________________________________ ______________


    Coins put on the market !!

    Nora Albjara member of the committee of economy and investment in the House of Representatives revealed that the central bank completed its preparations for the issuance of metal coins of seven small groups, in conjunction with the implementation of the project to delete the three zeroes from the paper currency is currently in circulation.

    She said in her statement Albjara "The project will take between four and five years, and which will be the launch of the categories of small coins gradually."

    He predicted the financial expert Hilal Taan inflation rate declines, with the issuance of metal coins of small denominations in the daily financial transactions, remarkable that 3% of the value of inflation in Iraq due to the presence of large cash block.

    The economic expert on behalf of Jamil Anton, noted that he may not find metal coins accepted by a lot of Iraqis, especially young people, due to the existence of an entire generation of Iraqis had not trading coins due to stop use since the early nineties of the twentieth century


    CBI is preparing to issue a monetary metal parts

    Metal coins from the category of 25 fils were in circulation until the nineties of the last century

    Nora Albjara member of the committee of economy and investment in the House of Representatives revealed that the central bank completed its preparations for the issuance of metal coins of seven small groups, in conjunction with the implementation of the project to delete the three zeroes from the paper currency is currently in circulation.

    She said in her statement Albjara Radio Free Iraq, "said the project will take between four and five years, and which will be the launch of the categories of small coins gradually."

    He predicted the financial expert Hilal Taan inflation rate declines, with the issuance of metal coins of small denominations in the daily financial transactions, remarkable that 3% of the value of inflation in Iraq due to the presence of large cash block.

    The economic expert on behalf of Jamil Anton, noted that he may not find coins accepted by a lot of Iraqis, especially young people, due to the existence of an entire generation of Iraqis had not trading coins due to stop use since the early nineties of the twentieth century.


    Another "FLASHBACK"...

    Economists Divided Over Deletion Of Zeros

    By Amina al-Dahabi for Al-Monitor.

    The Central Bank of Iraq (CBI) has been attempting to delete three zeros from the Iraqi currency since 2003. This project has raised many concerns among the Iraqi public and within the business community, and Iraqi economists are divided…

    …Haider al-Abadi, the head of the Iraqi parliamentary Finance Committee, told Al-Monitor that while deleting zeros from the current currency is possible, this has been postponed until after parliamentary elections. He noted that studies are being carried out to ensure that, following the currency change, counterfeiting is limited and that Iraqis don’t go back to trading in the old currency.

    The step to delete zeros from the currency has been postponed several times, leading the parliamentary Economic Committee to demand that the CBI accelerate this project, as Al-Sharqiya reported. In a news conference held July 6, the Economic Committee confirmed that the deletion of zeros will lead to an increase in the value of the Iraqi dinar and will have positive repercussions, including a reduction in unemployment and poverty rates in the country.


    Crush Expected When Kuwaiti Banks Reopen Today

    March 24, 1991|From Reuters

    KUWAIT CITY, Kuwait — Thousands of Kuwaitis are expected to jam the country's banks today when they open for the first time since the end of the Iraqi occupation.

    Customers will be allowed to withdraw funds and to swap pre-invasion money for a new currency issued to make more than $1 billion in pre-invasion dinars stolen by the Iraqis worthless.

    "We expect a rush of people," said Issam Asousi, an executive with the Bank of Kuwait. He said it could be a chaotic first week because customers have a lot of questions about their accounts.

    Kuwaiti banks continued operating during the seven-month Iraqi occupation under managers brought in from Iraq, but they have been closed since the U.S.-led alliance ousted the Iraqi army from Kuwait a month ago.

    When the banks reopen today, customers will be able to withdraw up to 4,000 Kuwaiti dinars, equivalent to about $14,000 at pre-invasion exchange rates from their accounts, and to exchange a like amount for foreign currency.

    Balances of customers' accounts will go back to what they were on Aug. 1, a day before the invasion.

    Clients will not be able to exchange Iraqi currency issued during the occupation, when Baghdad pegged the rates of the strong Kuwaiti dinar to the far less valuable Iraqi dinar.

    The new Kuwaiti money will be exchanged for old at a one-to-one rate.

    BGG ~ Thanks to wmawhite for some facts on the subject.

    Hi BGG,

    Just thought I would drop you an email. I listened to the call, and was interested in what was said about Kuwait, if I may - I will add my 2 cents worth.

    You were spot on with what you said, I have a close friend who's father made a killing on the KWD. He bought from people who had fled the country and he paid pennies on the dollar (we are in Australia). He took the chance that Iraq would be kicked back out and he was right.

    When the money was reinstated, he exchanged it for AUD at a rate in the mid 3s. The interesting thing about it is, Iraq invaded in November 1990 (I think), they were kicked back out at the end of Feb 1991, the banks reopened with a brand new KWD in late March, that's not a bad time frame to get a currency designed, printed and made ready to use, also the time that the old KWD was valid was initially only for 2 months, then extended to 6, so it was valid until Sept 1991, interesting I think.

    Also the other thing that seems to be a "fact" in Dinar land is Bill Clinton used the Kuwait RV to pay off the debt. However, Clinton was not President in 91, he did not take office until 93, even I know that and I am an Aussie.

    Anyway thanks for the site and enjoy listening to your calls.

    Kind Regards,

  3. #3

    Re: The Dinar Daily, Wednesday May 13, 2015

    Dhi Qar Council disrupt the official working hours on Thursday, the anniversary of the death of al-Kadhim

    Long-Presse / Dhi QarDecided Dhi Qar Provincial Council, on Wednesday, the official working disabled on Thursday to mark the anniversary of Imam Imam Musa al-Kadhim, while pointing out that the decision to exclude the security and health departments.A member of the Dhi Qar Council, Hassan Ali al-Waeli in an interview with the (long-Presse), "The provincial council has decided to disable the official working hours on Thursday day on May 14, in government departments and institutions, schools and universities on the occasion of the anniversary of the death of Imam Musa al-Kazim.

    Waeli said that "the decision was made to allow the people of the province to perform the rituals of the visit," pointing out that "the decision excludes security and health services."Muslims and salutes the Shiites in Iraq and around the Muslim world the anniversary of the martyrdom of Imam Musa Bin Jaafar Kadhim, the seventh Shiite imams who died in prison in Baghdad in the twenty-fifth of Rajab 183 AH, which will coincide with this year in the 14th of the month of May 2015.

    And Imam al-Kadhim, is Musa ibn Ja'far al-Sadiq bin Mohammed Baqir bin Ali carpet Bin Al Hussein the martyr bin Ali bin Abi Talib, was born (b Aloboa), a position between Mecca and Medina in the seventh of Safar 128 AH and continued Imamth 35 years after his father, Imam Jafar Sadeq, He died in prison in Baghdad in the twenty-fifth of Rajab 183 AH at the age of 55, he has spent 15 years in the prisons of the Abbasids, and was buried in the cemetery of Quraish in Baghdad, which was named after that old Kadhimiya.

    Last edited by pinkadonai1; 05-13-2015 at 10:11 AM.

  4. #4

    Re: The Dinar Daily, Wednesday May 13, 2015

    Misanion demanding the abolition of the new tariff for causing prices to rise and Council prepared by the "unfair" and vows by refusing to

    Long-Presse / Maysan Stressed citizens and traders Misanion, said on Wednesday that the new tariffs have led to a sharp rise in the prices of goods and commodities to maintain, (320 km southeast of Baghdad), compared to previous months, demanding its abolition, while likely a member of the provincial council rejected the application of those tariffs, returned it was "unfair" the right of citizens.

    He said the citizen cream Darwish Bahadli, in an interview to the (long-Presse), "The Maysan markets witnessing a big increase in the prices of goods and commodities and vegetables as a result of the new tariff imposed by the Government on the entry of materials from the border crossing points," adding that "the tariff caused upheaval in the markets It claimed the lives of low-income basis primarily because politicians do not feel the suffering of the citizens. "
    He was surprised Bahadli, from "The government applied tariffs on central and southern regions of the tariff under the pretext of being a stable and secure position, while excluding them western and northern areas of the reasons Mpehh", returned to it, "she recalled the days of Saddam's Baathist regime who hunger sons of the south and kill them."

    For his part, said Mohammed Abdullah, one of the importers of vegetables, in an interview to the (long-Presse), "The first government application of the new tariff on all provinces, including those of the Kurdistan region, equitable for all", warning of the consequences of an "exit demonstrations may develop for the civil suit to cancel the tariff unfair disobedience. "

    He called on Abdullah, the provincial council to "work the new tariff along the lines of the Basra Governorate Council rejected being negatively affect the citizens," stressing that "fruits and vegetables prices rose to double the previous price as a result of those tariffs, adding to the suffering of the poor and low-citizens income".

    Meanwhile, he said a member of the Maysan provincial council, Rahi Abdul Wahid Albzona, in an interview to the (long-Presse), "The application of tariff negatively
    Impact on prices, especially for vegetables which Tstod from Iran through graying port," adding that "the imposition of tariffs will lead to a halt Import Alchw which Aachiha citizen because of political ".

    He guessed Albzona, that "the provincial council prevents the application of the new tariff at its next meeting, and will be required border port and the Department of Customs so," calling on the federal government to "reverse the decisions which affect citizens and put them in a box of danger and deprivation and hunger, and to be fair in the development of solutions that serve the community. "

    He announced in the Council of Ministers (the third of February 2015) consent to the inclusion of imported goods and materials which are found those with Iraqi companies tariff law.

    The council in Basra, new in (the fourth of May, the current 2015), rejected the application of the new tariff, while the center was accused of targeting the province, (590 km south of Baghdad), economically and Shell border outlets, student application of the law in all parts of Iraq without exception , including those in the Kurdistan region.

    The Ministry of Finance announced, in (the 30th of December 2014 the past), the imposition of tariffs on imported goods starting from 2015, and by no more than about 20% of their value, indicating that the fees will be imposed on all border crossing points, including the Kurdistan region.

    And it includes the province of Maysan, the border port of gray hair, (80 km southeast of the city of Amara), who enter the way hundreds of trucks laden with goods and commodities exported from Iran to Iraq.

  5. #5

    Re: The Dinar Daily, Wednesday May 13, 2015

    Kurdistan Regional Government meets with representatives of the Kurds in Baghdad

    Khandan - met the Kurdistan Regional Government, with representatives of the Kurds in the Iraqi parliament and the federal government on Wednesday, in the city of Arbil. , said Ares Abdullah a member of the Iraqi Council of Representatives for the Patriotic Union of Kurdistan bloc's "Khandan", said the meeting today between the provincial government and representatives of the Kurds in officials Baghdad comes within the framework of continued meetings between the two sides and to be held every month or two between the two sides.

    He said Abdullah, he said that the meeting, which is still going on, and discusses the latest developments in general and the outstanding issues between the KRG and the federal government, particularly with regard to the share of the province of the budget and the issue of the export of oil . Regarding the delegation visited the Kurdistan Regional Government to Baghdad, said the Erez MP Abdullah, he said the delegation will visit Baghdad whenever necessary.

  6. #6

    Re: The Dinar Daily, Wednesday May 13, 2015

    Samarra Operations forces. Archival photo.

    Iraqi forces kill 32 terrorists, remove 44 IEDs in al-Karma area

    By Amre Sarhan - May 13, 2015

    ( Anbar – On Tuesday, Iraqi Ministry of Defense announced, that the army forces have managed to kill 32 terrorists and dismantle 44 IEDs in the area of al-Karma.

    The ministry said in a statement obtained by, “A security force under Baghdad Operations Command managed to kill 32 terrorists and treat 3 booby-trapped houses, in addition to destroying a shelter for the terrorists and the dismantlement of 44 improvised explosive devices (IEDs), as part of the military operation Fajr al-Karma in the area of al-Karma.”

    The statement added, “The heroes of Samarra Operations had also managed to remove 13 improvised explosive devices and treat 5 booby-trapped houses in the district of Yathrib.”

  7. #7
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    Re: The Dinar Daily, Wednesday May 13, 2015

    Parliamentary Finance: Central Bank will print large cash categories to create the removal of zeros

    Tomorrow Press / Baghdad said the Parliamentary Finance Committee member Masood Haider, Tuesday, the central bank decided to print large cash categories to create the removal of zeros from the currency in the coming period, stressing that the decision thoughtful and maker and to be implemented. He explained Haider for "tomorrow Press," that " Finance Committee discussed with the Governor of the Central Bank on the Keywords in its last meeting the subject of currency printed in the case of the availability of financial liquidity, "noting that" the central bank decided to reprint some of the larger denominations to create the removal of zeros from the currency in the coming period.

    " He added that "due Categories printed and fifty-one hundred thousand Iraqi dinars, "pointing out that" the thoughtful decision maker and for more than two years and only implementation remain. " %2F%25D8%25A7%25D9%2584%25D9%2585%25D8%25A7%25D9%2 584%25D9%258A%25D8%25A9-%25D8%25A7%25D9%2584%25D8%25A8%25D8%25B1%25D9%2584 %25D9%2585%25D8%25A7%25D9%2586%25D9%258A%25D8%25A9-%25D8%25A7%25D9%2584%25D8%25A8%25D9%2586%25D9%2583-%25D8%25A7%25D9%2584%25D9%2585%25D8%25B1%25D9%2583 %25D8%25B2%25D9%258A-%25D8%25B3%25D9%258A&edit-text=&act=url
    Last edited by pinkadonai1; 05-13-2015 at 01:07 PM.

  8. #8

    Re: The Dinar Daily, Wednesday May 13, 2015

    Hezbollah Brigades elements. Archival photo.

    Hezbollah Brigades foil ISIS attack in Fallujah

    By Abdelhak Mamoun - May 13, 2015

    ( Baghdad – Hezbollah Brigades in Iraq announced on Wednesday, repelling an ISIS attack southeast of Fallujah from four axes, confirming that the clashes are still ongoing.

    The brigades said in a statement received by, “We managed to repel ISIS attack on the Structures Complex southeast of Fallujah of four axes,” pointing out that, “ISIS used three car bomb in the attack.”

    “The clashes are still ongoing until now,” Hezbollah Brigades added.

    The military operations continue in Al-Anbar province to hunt down ISIS elements and liberate the remaining areas of the province from ISIS’ grip.

  9. #9

    Re: The Dinar Daily, Wednesday May 13, 2015

    ISIS trains children on the use of weapons and suicide bombings.

    ISIS forces Yazidi children to change religion, train them on suicide bombings

    By Abdelhak Mamoun - May 13, 2015

    ( Dohuk – Yazidis office of detainees in Dohuk revealed on Wednesday, that ISIS has opened special centers for Yazidi children to be trained on weapons and suicide bombings, and forced them to change their religion, stressing that the terrorist organization brainwashes the Yazidi children in these camps.

    Office official Hussein Qaiadi said, “ISIS has established special training centers for abducted Yazidi children is in the Syrian town of Raqqa,” noting that, “The Yazidi children receive mandatory training on weapons and suicide operations.”

    “ISIS brainwashes these children and force them to change their religion through a variety of means,” Qaiadi added.

  10. #10

    Re: The Dinar Daily, Wednesday May 13, 2015

    Iraq: Baghdad-Erbil relations grow sour

    13 May 2015 14:46 (Last updated 13 May 2015 14:54)
    Kurdish regional government says, failing payment from Baghdad, it will take a political decision to solve its economic crisis.

    ERBIL, Iraq

    Relations between the central government in Baghdad and the Kurdish regional government in Erbil are growing sour as Erbil awaits full payment for oil, according to statement by the Kurdish regional government.

    Unless Baghdad begins to make timely and full payments, the Kurdish regional government has warned that it will find other solutions for the problem.

    Erbil and Baghdad had reached an agreement in December 2014 whereby the Kurdish region would export 550,000 barrels of oil per day under the supervision of SOMO, State Organization for Marketing of Oil, which is responsible for marketing Iraq's oil. In return, Baghdad would allocate 17 percent of the national budget to the Kurdish region.

    But when Erbil started exporting to different countries via Turkey, Baghdad failed to send the full amount of Erbil’s share, citing obligations on its funds.

    According to Kurdish officials, Baghdad is supposed to send a monthly amount of $1 billion to Erbil. However, Erbil received only $500 million in three months with total amount of $1.5 billion.

    The Kurdish region is suffering from the non-payment, and the Kurdish government is struggling to pay the salaries of Peshmerga, police and civil servants. The cabinet of the Kurdish regional government met Tuesday to discuss this issue.

    Barzani also said that the Erbil government could take a political decision and find another way to solve the economic need in the region, according to a statement on the Kurdish government’s official website Wednesday.

    "The central government’s problem is that it thinks that the region has no other option, and deals with the region as it wants to, and this is wrong. The region has other options and we will make our decision," Barzani said.

    "But we still seek to reach a solution with the Iraqi government, and we will visit Baghdad," Barzani said.

    Kurdish regional government' natural resources minister, Ashti Hawrami, accused the central government of looking for excuses to escape payment, and of not calculating the amount of oil supplied by the region correctly.

    According to the Ministry of Natural Resources, the region has exported 16.3 million barrels of oil in April through SOMO. Baghdad claims it had only received 15.3 million.

    Replying to these accusations, a central government spokesman accused Monday the regional government of failing to send the agreed upon amount of oil.

    Speaking on television, spokesman Saad Hadisi placed the blame for the stalled agreement on Erbil.

    "In the past three months, the KRG didn't stick to the agreement regarding oil delivery. It has been a week since the regional government could finally send the agreed amount, so this is the reason why the central government has not sent the KRG’s total share of the national budget," Hadisi said referring to the regional government by its initials.

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