The dollar creates a “problem”.. Five complications facing financial investment in Iraq

Baghdad today – A member of the Parliamentary Agriculture Committee, Representative Hussein Mardan, said today, Friday (August 25, 2023), that there are five complications facing financial investment in Iraq.

Mardan said in an interview with “Baghdad Today”, that “investment in its general sense needs a stable environment, and with a reading of the situation in Iraq after 2003, which was characterized by repeated security unrest, gives us an indication of the magnitude of the challenges, especially since any investment needs years in order to provide its environment.”

He added, “Corruption is one of the most prominent complications facing financial investment in Iraq, as well as legislation, laws, and flexibility in dealing with banks, not to mention the presence of countries that use currency as a “geopolitical” weapon in crises, which makes the matter open to challenges.”

Mardan pointed out, “Iraq’s location and natural resources are important incentives that can be invested in creating a positive climate in attracting financial transactions, but on the other hand, the matter faces complications, the most prominent of which is the need for a banking environment with strategic depth.”

Iraq is the second largest oil producer in OPEC, with an average of 4.5 million barrels per day, of which it exports about 3.4 million barrels, as the Iraqi government relies on revenues from the sale of crude to cover about 95 percent of its expenditures, and oil reserves in Iraq are considered the fifth largest oil reserves. Confirmed in the world, amounting to 145 billion barrels.

In the same regard, the economist, Adel Al-Dalfi, says that incoming (foreign) investment in Iraq will have a major role in reviving the economy, especially since the Iraqi economy is a rentier economy that depends on oil, and therefore it is necessary to face the challenges associated with that in the context of the decline and rise in prices. Oil, and the economy is constantly dependent on these indicators.

The economist refers to the plan of the Prime Minister, Mohamed Shia Al-Sudani, to diversify the economy and develop non-oil sectors, with the aim of opening a broad climate for Arab and foreign investors and overcoming the difficulties in front of them, through several measures, including the amendment of Resolution No. 245 of 2019, which determined The capabilities of the National Investment Commission, and the amendment came to grant the Commission wide powers of administrative and legal movement, by offering to reduce bureaucracy in the procedures taken.

Among the measures that Al-Dalfi refers to, in the context of encouraging foreign investment, is the encouragement of the Central Bank to grant loans to investors if the completion rate of existing projects reaches 25 percent.

And the Iraqi economist adds: “These measures contribute to employing the labor force and building Iraq, which has not missed real projects for development and construction since 2003,” explaining that the recent package of amendments would change many things in Iraq. It also points to attracting Baghdad to a number of businessmen and companies, providing them with various capabilities and facilitating investment avenues within that vision.

A number of businessmen visited Iraq recently, including Egyptian businessman Naguib Sawiris, who announced on his Twitter page about a “giant project in Baghdad”, as part of a group of projects that the government aims to attract foreign investment to.

Baghdadtoday.news

Lavrov: BRICS agreed to establish alternative financial systems to Western ones
Arab and international

Economy News – Baghdad: Russian Foreign Minister Sergey Lavrov revealed agreements reached with BRICS countries to strengthen the group’s financial ties and move away from the dollar.

Lavrov said, “There is an agreement to work hard to form alternative financial systems, and this will be a contribution to facilitating the work of the New Development Bank of (BRICS).”

Lavrov indicated that energy issues will become more urgent after Saudi Arabia, Iran and the UAE join BRICS, and pointed out that all participants support not changing the name of BRICS after entering new countries.

Lavrov likened the “BRICS” to the football team after the joining of the six new countries, bringing the number of its members to 11, as the number of members of the football team.
This week, the city of Johannesburg in South Africa hosted the “BRICS” summit, where representatives of member states discussed strengthening economic and trade ties, and it was announced that new countries would join the group.

Economy-news.net

80 billion dinars in “fines” imposed by the Iraqi Central Bank on banks and exchange companies

The Central Bank of Iraq announced that the fines imposed on banks and non-banking institutions (exchange companies) amounted to about 80 billion Iraqi dinars during the past seven months.

And a table for the bank showed that the fines imposed on banks and financial companies during the past seven months, starting from January 2023, and until the end of last July amounted to 79 billion and 777 million and 817 thousand and 397 dinars, indicating that “the fines also included 318 administrative penalties for these banks and institutions.” Non-banking distributed between warning, warning and respite.

And the table indicated that “the month of April witnessed the highest fines on banks and non-financial institutions, as these fines reached 17 billion and 440 million and 383 thousand and 447 dinars, with administrative penalties amounting to 17 penalties, while the month of June witnessed the lowest fines, amounting to 8 billion and 353 million and 387 thousand and 476.” dinars with administrative penalties amounting to 50 penalties.
The table did not show the names of the banks on which fines and administrative penalties were imposed.

The Association of Investors in the Iraq Stock Exchange had criticized early last June, the Central Bank of Iraq to increase fines on banks, noting that it will affect the profitability of investors in the shares of these banks.

SOTALIRAQ.COM

Al-Sudani: Iraq has promising opportunities, and the government supports the investor and the private sector

Information / Baghdad… The Prime Minister, Muhammad Shia’ al-Sudani, launched Thursday, the executive work on a huge tourist complex project in the center of the capital, Baghdad, which includes a large hotel, a residential complex, and various tourist facilities.

The media office of the Prime Minister stated in a statement received by Al-Maalooma, that “the Prime Minister laid the foundation stone for the project that is being implemented by the Qatari Investment Holding Company, which is the first Qatari investment business and projects in Iraq, as part of the government’s directions to enhance opportunities, work towards economic integration, and improve An attractive investment environment for the contributions of Arab and foreign companies to infrastructure projects in Iraq.

He added, “The Prime Minister welcomed, in his speech during the ceremony, the brothers from the sisterly State of Qatar, and appreciated the spirit of initiative and persistence in implementing the first cooperation between Iraq and Qatar.”

And he indicated that “the President of the Council thanked the government team; the Mayor of Baghdad, the Chairman of the Investment Commission, the Director of the Prime Minister’s Office, and the advisors, who prepared all the requirements related to the allocation of land and the granting of investment licenses in a record time.”

Al-Sudani said, according to the statement, that “Iraq has many promising opportunities, and the government provides facilities and support to serious companies,” stressing that “the government will support the investor, the company, and the private sector that is serious about implementing investment projects, in Baghdad, the provinces, and the Kurdistan region of Iraq.”

Almaalomah.me

Al-Fateh: America is looking for pretexts to impose hegemony on Iraq

Information / Baghdad… The representative of the Al-Fateh Alliance, Muhammad Karim, confirmed today, Friday, that the US administration is looking for pretexts, especially in the field of the dollar currency, in order to take some decisions that are intended to impose hegemony and control over Iraq.

Karim told Al-Maalouma, “America does not want to remove Iraq from under its control at all and seeks to create some pretexts to try to impose hegemony, as happened in the dollar file and the sums of oil revenues.”

He added, “American practices are intended to clamp down on Iraq, especially in the financial aspect, as it failed in the past period to impose sanctions on some Iraqi banks without giving the government room to impose disciplinary measures towards those banks.”

And he indicated that “the attempt to continue to impose the American opinion exists by taking the dollar as a card against Iraq, with the aim of controlling, dominating and raising the exchange rate, although these funds deposited with it are Iraqi funds for oil imports.”

Almaalomah.me

7 times more.. Iran announces the release of its money withheld in Iraq

Shafaq News / The Iranian Ministry of Foreign Affairs announced, on Friday, that within about a month, about 7 times the Iranian money held in Iraq was released.

The political assistant to the Iranian Foreign Minister, Ali Bagheri Kani, said in an interview with the Iranian semi-official “Mehr” agency, that: With the exception of South Korea, part of our money is also in Iraq.

He added, “In the understanding that we concluded with the American side about Iran’s money held in South Korea, the issue of Iran’s money in Iraq was also raised, and its release began.”

Bagheri Kani added, “Since the past three weeks, we have been able to release nearly 7 times the total money that we used in Iraq last year, in the process of economic activities, and of course we expect an acceleration of the liberation process.”

On August 11, official Iranian media revealed the details of the agreement reached by Tehran with the United States of America under the auspices of a third country, which provides for the exchange of prisoners between the two countries and the release of Iranian funds frozen in South Korea and Iraq.

The official Iranian News Agency, “IRNA”, quoted an official source familiar with this agreement, as saying, “This agreement requires Iran to release 5 American prisoners in exchange for the release of 5 Iranian prisoners in the United States of America.”

He explained that “in addition to that, 6 billion dollars of Iranian funds frozen in South Korea will be released, along with a large part also of Iranian funds in the Iraqi TBI Bank,” noting that “the first stages of the process of releasing Iranian funds in European banks have begun.” “.

On July 11, Prime Minister Muhammad Shia’ al-Sudani announced Baghdad’s contact with the US regarding the payment of Iran’s dues for Iraq’s gas imports, amounting to 9 billion and 250 million euros, adding that Iraq had paid “up to one billion and 842 million euros in the seven-month period of The life of the government according to the agreed mechanism.

Al-Sudani added that a delegation from the Central Bank of Iraq and the Iraqi Trade Bank left Iraq for the Sultanate of Oman with the aim of “agreeing on a formula for transferring these funds to the Sultanate of Oman in agreement with the US Treasury.”

Shafaq.com

Banking reform file.. The Governor of the Central Bank discusses it with the World Bank delegation

The Governor of the Central Bank discusses it with the World Bank delegationHis Excellency the Governor of the Central Bank of Iraq, Mr. Ali Al-Alaq, received today, Thursday, a high-ranking delegation from the World Bank headed by Mr. Farid Belhadj, Vice President of the World Bank for the Middle East and North Africa.

During the meeting, they discussed the efforts of the Central Bank of Iraq to organize and consolidate external transfers in accordance with compliance requirements and international standards, and to encourage merchants to enter the electronic platform to buy dollars by providing facilities and simplifying tax and customs procedures that the government is making anticipated amendments to.

The meeting discussed granting small loans through the “Riyada” bank, which will be responsible for providing various loans with the support of the Central Bank of Iraq and private banks, and working to establish a loan guarantee company, as well as paying attention to compliance and risk standards for the development of the banking sector.

The meeting dealt with the conditions of government banks, which constitute approximately 80% of the size of the Iraqi banking sector, and dealt with plans to improve their work, including amending their internal systems to implement institutional governance issued by the Central Bank, and plans to restructure those banks.

In turn, the World Bank delegation praised the efforts and procedures of the Central Bank of Iraq at all levels, expressing its readiness to provide any advice or technical expertise in these areas, and to continue implementing the programs it is working on with the Central Bank.

The Central Bank of Iraq,
Media Office,
August 24, 2023

cbi.iq/news/view/2405

The balance is tilted towards postponing it again.. The oil and gas law is entering a difficult labor

Information / Baghdad… The government’s statements and declarations confirm its move towards resolving all outstanding problems between Baghdad and Erbil in order to prepare the appropriate ground for approving the oil and gas law without leaving any obstacles that lead to the rejection of the law when it is submitted to the House of Representatives with a view to passing it.

At a time when political parties ruled out the agreement of the center and the region to approve this law, which was confirmed by parties affiliated with the Erbil government, expecting that the law would be postponed to another parliamentary session.

The leader in the coordination framework, Turki Jadaan, told Al-Maalouma, “The number of outstanding points in the oil law reaches 14 points, half of which have been exceeded through meetings and discussions between specialized technical committees.”

He added, “There is political support from all parties in order to overcome all differences and obstacles to reach a space of acceptance that supports the option of approving it during 2023, as discussions are currently underway.”

Jadaan indicated that “there are expectations that an initial report on the size of what has been achieved will be submitted next September to the government in order to discuss the possibility of resolving what remains in coordination with the political forces.”

On the other hand, former MP Jassim Al-Bayati told Al-Maalouma, “The negotiations on the oil and gas law will not reach any good stages, as the opportunity that the Kurds had in 2008 when this law was sent to the House of Representatives for the purpose of its legislation will not return again.” “.

He added, “The Kurds rejected the law in the aforementioned year, despite a vote on it in the Council of Ministers, and preparations for it to be passed in Parliament.”

Al-Bayati pointed out that “it is impossible for the law to come back again to be in the interest of the Kurds, at a time when they are demanding that the law meet their interests far from consensus or passing a numerical majority in the House of Representatives.”

On the other hand, a member of the Kurdistan Democratic Party parliamentary bloc, Representative Mahma Khalil, told / information /, that “approving the oil and gas law is one of the most important economic laws that regulate the relationship between the center and the region, and there is an intention among the political forces to approve it.”

Khalil added, “This matter is difficult to achieve during the current parliamentary session, as the adoption of the law needs careful scrutiny in line with technical and political goals.”

A member of the Kurdistan Democratic Party expected, “political differences will emerge when discussing its details.”

Almaalomah.me

Economist: Washington imposes its authority on Iraqi oil revenues

Information / Baghdad… Economic affairs researcher Muhammad Al-Saadi explained, the extent to which it is possible to obtain oil revenues from importing countries directly without placing these funds with the US Federal Bank.

Al-Saadi told Al-Maalouma that “China, India and other Asian countries import Iraqi oil in large quantities, but Iraq receives the revenues through the US Federal Bank, which makes Washington an authority over those revenues.”

He added, “The dollar, as an American currency prohibited in some countries, Iraq can benefit from such a procedure by selling oil in exchange for goods, goods and raw materials needed by the Iraqi industry, or introducing companies from those countries and engaging them in the field of construction, construction and project implementation.”

And he indicated that “the continuation of selling oil in exchange for obtaining dollars may not be a good idea, as it is possible to obtain projects, goods and goods instead of oil revenues in dollar currency.”

He pointed out that “Iraq has large reserves of hard currency with the US Federal Bank.”

Almaalomah.me

International companies in the Kurdistan Region urge respect for their rights when enacting the oil and gas law

Shafaq News / The Kurdistan Petroleum Industry Association (IPCOR), on Monday, called on the governments of Baghdad and Erbil to preserve the contractual rights in the new oil and gas law to be legislated.

The union, which represents companies including “DNO”, “Genel Energy”, “Gulf Keystone Petroleum”, “HKN Energy” and “ShaMaran Petroleum”, said in a statement received by Shafaq News agency, “We urge the integration of companies’ rights into the Iraq budget and any future laws.” Oil and gas control in federal Iraq and the Kurdistan Region.

“It is essential for the future of the industry in these regions, and the many jobs that support them, that the outcome of the negotiations include recovery of costs and profits to which international oil companies are entitled under existing production sharing contracts,” he added.

The Kurdistan Regional Government and the Iraqi federal government held a meeting on the fifth of August to discuss drafting a new oil and gas law. During the meeting, they agreed to form a committee to draft an oil and gas law to help resolve the dispute over the constitutional rights of the Kurdistan Region over oil and revenues.

Since 2005, the Iraqi parliament has not been able to pass the draft law and the Kurdistan Region approved its own law and started its independent export through Turkey.

The dispute between Baghdad and Erbil over oil exports escalated last March, when the Court of Arbitration in Paris ruled against independent oil exports to Kurdistan under its 2007 law, prompting Turkey to halt oil exports via the Iraq-Turkish Pipeline (ITP).

So far, talks between Baghdad, Erbil and Ankara have failed to find a solution to resume oil exports. Moreover, according to the Iraqi budget law, the Kurdistan Region is required to deliver 400,000 barrels of oil per day.

A representative of the “IPCOR” consortium said in a statement to “Standard & Poor’s” that the oil companies “want to guarantee their contractual rights, including cost recovery and entitlement to oil, and protect them in the discussions between Erbil and Baghdad.”

“The international oil companies in Kurdistan must be compensated for the real costs, just as they are in federal Iraq. Our investments have fully funded the entire sector and there are solutions that will guarantee future foreign investment in the Iraqi energy sector,” he added.

He pointed out that “the PSC (professional standards) model used in the Kurdistan Region has a competitive investment structure that is widely used in oil regions around the world.”

He continued, “Within the framework of the security companies of the Kurdistan Region, the international oil companies bear all the financial risks, and in the event of success, the Kurdistan Region retains the majority share of the reward.”

“To provide international oil companies with confidence in their contractual right to recover costs and receive profit payments from successful projects, the Kurdistan Company PSC model is governed by English law, with disputes settled through international arbitration at the London Court of International Arbitration,” said the Epicor consortium.

The oil companies also said that it would not be possible for the Kurdistan Region to provide 400,000 barrels of oil per day to Baghdad, without the international oil companies operating in the Kurdistan Region.

“To achieve this, the Kurdistan Region will depend on production from fields run by the International Olympic Committee,” he said.

“Despite the political, security and geological challenges in the region, the sector operated by the ICRC has developed from almost nothing 15 years ago to produce about 250,000 barrels of oil per day,” he added.

“As (oil) the most important industry in Kurdistan by far, the oil and gas sector now provides tens of thousands of high-quality jobs directly through the IOCs themselves as well as indirectly through service companies and contractors and in the communities surrounding our operations, homes and offices,” he added.

Moreover, due to the cessation of oil exports, foreign companies operating in the Kurdistan Region had to implement cost-cutting measures, which led to staff layoffs.

Shafaq.com