Editorial: What of the Iraqi economy’s market economy under the tent?
Posted 02/10/2012 12:26 PM
1 – How Iraq entered the world of the market economy?
I find it important to start to know the reader market economy before entering to talk about our topic. Not difficult today on each of using a computer to go to the free encyclopedia Wikipedia to find: the market economy or free market economy is the capitalist economy or economic system whose economic liberalism essential component in it, and the idea of a free economy is not state intervention in economic activities and leave the market adjusts itself.
And liberalism depends mainly on the idea of individual freedom, and to find out the idea of a free economy or a market economy in a positive way the definition is that an individual is born free, thus the freedom to make any economic activity.
The definition of a market economy negatively, it means that the state should not make any economic activity can an individual or group of individuals to do. This economy based on private ownership of the means of production and individual initiative, and is subject to the interaction of supply and demand and free competition and liberalization of prices within the market and depends mainly on the private property of individuals, institutions and capital. However, the market economy does not mean in any way the absence of the public sector and the state’s role in the organization of economic life. It is useful to refer to the theories of Adam Smith in this regard.
As for the foundations upon which the economy of Iraq Everyone knows perfectly well that our economy is an economy is a product except largesse by the nature of the presence of the oil wealth depleted over time under its territory and which produce 95 percent of state revenues that depend on them overall budget fully. And the fear that the supply of oil someday through the Strait of Hormuz, which is exposed to the threat to close it all the time in the light of the next war in the Gulf region. We have seen how select Israeli Prime Minister Netanyahu a date to launch this war against Iran in the next spring through delivering his speech at the UN General Assembly last month.
The war took place, what will the Iraqis then? But here I want to cut short and remind the reader how Iraq was taken and thrown in the maze of a free economy or a market economy by force without any motive or the will of the national forces. We knew how occupied by U.S. forces of Iraq and entered Baghdad on 9 April 2003 and toppled Saddam Hussein and how he became the fate of Iraq in the hands of the Administrative Governor Paul Bremer U.S. diplomat expert not only in the economy but in terrorism and little experience in building a modern state and known for Bremer he studied History at Yale University and business administration at Harvard such as former President George W. Bush himself, who made him enjoys his trust and admiration when he decided his choice to assume the presidency of the Coalition Provisional Authority in Iraq.
Hence became Bremer faces the toughest task in history . since Bremer took office as governor in Iraq and administrative faced great difficulties in the management of reconstruction work on the Japanese model or German in a country where the despot is everything in the Saddam Hussein era. Aspiration Bremer work faster and make quick decisions without regard to their practical application. He also expressed his desire to turn Iraq into a free market economy, starting with the sale of property Aldo him those decisions that were serious and fateful determined without a national government.
Because the Interim Governing Council which was formed to appoint 25 of the Iraqi figures and under the command of Bremer full became a council walking Barchadath and decisions when subjected its members to pressure the signing of the interim constitution despite reservations by them upon, because it stated that the laws and regulations, orders and directives issued by the Coalition Provisional Authority , will remain in effect, including Bremer’s decision No. 39, which is of the Iraqi constitution old even open the door to foreign investment in all sectors in Iraq to have 100 percent ownership of Iraqi companies, except companies operating in the natural resources sector any oil, as well as the treatment of foreign firms an equal footing with local Iraqi companies and give them the right to take profits, out of Iraq with allowing foreign banks to enter Iraq and ownership of local banks also 100 percent to open the way for the privatization of the Iraqi economy. In this way, the public sector was liquidated economic system was changed in Iraq, which was the property of the state of the capitalist system to a market economy.
That the reasons under which took Paul Bremer decisions to change the Iraqi economy is influenced by the most prominent who promoted this concept, but is Philip Bobbitt of neoconservatives, who said: “The nation-state Nation State will drift from its place in the twenty-first century to be replaced by what he called the state of the market Market State which he says they state borders and political system, like the nation-state, but will move the Msioulyat essential government to the private sector.
Is that the principles of market economy achieved benefit of the people of Iraq? Will able Governments multi since leaving Bremer and after the withdrawal of U.S. forces became capable to act wealth of the country or is it left to companies and foreign organizations the freedom to work and act wealth Iraq without allowing these governments be directed wealth to support the industry and reconstruction and helping the poor? It is understood that the Ministry of Industry, Ministry of Ibrahim al-Jaafari previously started in business privatization of eight companies from the public sector companies and sold. We do not know the fate solution out and who seized. said Iraqi Minister of Industry at the time that the country needs to build a new state affects the change all joints of life, including the economy.
everyone knew exactly how devastated the economy in Iraq and what has been privatized has become looting and locations of corruption., who keep a record of looting in the Integrity Committee in the Iraqi parliament in corruption cases in the rest of the provinces ستصيبه shock from the horror of what recorded robberies and failed projects at the time of the market economy in Iraq. has exited the Iraqi draft constitution, carrying Article 110, which states : “that the government and federal governments producing regions and provinces together will draw up the necessary strategic policies to develop oil and gas wealth to achieve the greatest benefit for the Iraqi people, relying latest techniques of market principles and encouraging investment.”
PART II : Hence we know that the principles of free market means delivering the country’s fate in the hands of foreign companies do not unrelated to the interests of Iraq and Iraqis. FIA considers it would defend these interests after received these companies nerve Iraqi economy and seized control of the oil wealth and controlled the destiny? will not forget how focused Bremer to call for the study of privatization Iraq’s oil industry government-owned, and opening to foreign investment by that holds the Iraqi government permanently in governing the country. has reached the number of decisions taken by Bremer to 98 decision weeks before leaving his duties in Iraq and I am not here studying these decisions serious known to all. never forgot Bremer until Multi taxes which issued a law specifying the 15 per percent maximum tax, in line with the policy of privatization of the Iraqi economy, which turned whereby more than 500 state-owned enterprises to the private sector.
what achieved by Iraq permission from the market economy? The answer came from Bremer himself in his book which was released two years ago under the title: Ami in Iraq, which drew the most criticism to Iraqi politicians working to take care of the market economy today and benefit from the looting of wealth and many examples are innumerable (1)!
2 – Iraq and the chaos of the market economy
After that follow the economic news in Iraqi newspapers and statements by Iraqi officials in the Parliament, we learn the aspects of chaos the Iraqi economy, which attest to the lack of experience Almsiwoln entrusted to them Almsiwolh addition to weak government measures that hover around the scourge of corruption scandals devastating march the country’s economic. Not possible knowledge of all aspects of this mess, but I will follow what comes news about the crucial issues of interest to the Iraqi citizens and the country’s economy.
Will not go away Vsakedm another reader regarding issues of the Iraqi economy, but which was heard by everyone on the draftAct made by Prime Minister Nuri al-Maliki to parliament recently.
He stressed economists that despite the importance of this law to bring more of the operating companies advanced in establishing projects strategy could benefit to Iraq in the future and the pursuit of law to establish important projects of the country by international companies, but it could clog the country indebtedness extra by the principle of payment on credit, which can be large and would have on the country for the benefit of companies that will work within the law, suggesting that is achieved number thoughtful of projects each year, provided not affect the budgets of the country’s financial, and only a burden on Iraq’s revenues in the coming years (2 ).
Through this approach, we find that economists have given the alternative for this project to be timid and without stirring. As critic Adnan Hussein has warned of the fall of the law at the mercy of thieves Baghdad and the scourge of rats corruption when he wrote sarcastically: Certainly we need to comprehensive national program and quick to set up infrastructure.
Need major projects for electricity and drinking water, irrigation, industry, agriculture, oil and minerals, transport, environment, telecommunications, transport, health and culture, education, literacy, housing, sanitation, training and rehabilitation. That most objectors objected that the law could open the door to financial and administrative corruption welcome from the current doors open do Msariaha knowledge and familiar masters of the state and with the full involvement of some of them.
The past ten years almost lost, nothing of value done by successive governments. Projects targeted by the law would cost trillions of dollars. To ensure that you go infrastructure projects to companies sober and guaranteed, safe and reliable would be required to verify the state in all cases financial and administrative corruption that has wasted hundreds of billions of dollars in less than ten years only, Fjrman corruption at large will remain lookout for infrastructure projects.
As one lawmaker said in parliament that he keeps files show levels of public spending in the country and the size of the corruption that nation affected.
He stressed that “nearly $ 600 billion spent by successive Iraqi governments since the Governing Council Bremer and so far polyvinylchloride general of the country,” adding that this “amount equivalent to the money spent on updating the countries of Europe and developed since 1960 and until 2006 (3).
This project did not come from a vacuum, but that the state began allocating huge sums in order to attract companies to invest in Iraq. has said Planning Minister Ali Yousef Shukri allocate $ 275 billion of investment over the next five years. He explained during his participation in the conference of finance and investment, which was held in London between 18 and 19 of the last month that the allocation of these funds will have a positive impact on the pay and the pace of development to Imam these amounts came under preparation and the Ministry of Planning Development Plan for the years 2013 to 2017 and that will give the investment area large, well, inviting foreign companies to take advantage of these opportunities (4).
Hence, we find that our minister has opened the floodgates to foreign companies to invest in Iraq during the next five years at a time when the economy is still Iraq lacks more ingredient in dealing with these companies. .
So why all this mess and where our experts Iraqis them? in a debate with me one economist Iraqi Kamil Adhadh on the subject of market economy and law structures greeting mentioned thanked him for his values that allowed me to summarize it as follows: see advocates free market economy that order do this market should check the conditions, inter alia, to provide the infrastructure and complete information to producers and consumers with the availability of their awareness, but the question now is available such conditions in a country like Iraq after the occupation and before when he was living under an economic blockade of an international for 17 years? Of course not.
In a country with a yield depends on depleted resources are oil, owns and manages the government’s vast resources, but is located on this government has an obligation to employ them and invested for the purposes of industrialization and development? If Iraq weak in its infrastructure must play key roles in government guidance and development of the economy as a prelude to the development of the private sector.