Friday AM Iraqi Economic News Highlights 9-9-22

Friday AM Iraqi Economic News Highlights 9-9-22

Iraq Is The Third In The Arab World And Thirty In The World With Gold Reserves

Economie   2022-09-09 | 04:50   255 views   Statistics from the World Gold Council showed that the reserves of the world’s central banks of the yellow metal amounted to 35,393 thousand tons by the end of July 2022.

According to those statistics, Iraq ranked third in the Arab world, and thirty in the world, with reserves amounting to 130.4 tons until the end of last July.  The Deputy Governor of the Central Bank, Ammar Khalaf, had previously indicated to an increase in gold reserves by 30 tons.

Khalaf told the official agency, "The rise in the Central Bank's reserves came as a result of the rise in international oil prices, and this is reflected in the rise in reserves," expecting that "the reserves will reach 90 billion dollars by the end of this year."

He added that "the current reserves of the Central Bank amounted to more than 80 billion dollars," noting that "the gold reserves amounted to more than 131 tons, as it increased by about 30 tons, and this led to a higher classification of Iraq globally."   He stated that "gold is not increased continuously, but rather through long periods    LINK

Oil Prices Are Rising Again

Economie   2022-09-09 | 04:28   765 views    Oil prices rose today, Friday, supported by investor interest in Russia's threat to halt oil and gas exports to some buyers, but crude is heading for a second weekly decline, with demand affected by large interest rate increases by central banks and the impact of restrictions related to the Corona virus in China.

Brent crude futures rose 22 cents, or 0.3 percent, to $89.37 a barrel by 0635 GMT. While US West Texas Intermediate crude futures rose ten cents, or 0.1 percent, to $ 83.64.

"Basically, the sharp decline in the US Strategic Petroleum Reserve indicates that short supply remains a problem in physical oil markets, but recession fears may continue to pressure," said Tina Teng, an analyst at CMC Markets Financial Services. .

The two benchmark oil benchmarks are heading for a weekly decline of 4 percent, with the market dropping at some point this week to its lowest level since January.

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This drop has been hampered by clear supply shortages amid Russia's threat to cut oil flows to any country that supports a cap on its crude price, a small production cut by OPEC and its allies, and a weaker outlook for oil production growth in the United States.

The US Energy Information Administration said on Thursday that it expects US crude production to rise by 540,000 barrels per day to 11.79 million barrels per day in 2022, down from previous expectations of an increase in production by 610,000 barrels per day.

Analysts said that in light of supply expectations, the selling, which reduced the 50-day moving average to below the 200-day moving average in the middle of the week, may be exaggerated, as demand in China, the world's largest oil importer, could increase recover quickly.

"Chinese demand is more difficult to predict, but the reopening after Covid has previously seen a decline rather than a gradual increase in demand," said National Australia Bank  analysts.    LINK

Pharmacists Syndicate: Iraq Is At The Bottom Of The Health Reality Among Arab Countries

Political | 10:43 - 08/09/   Baghdad - Mawazine News, the head of the Iraqi Pharmacists Syndicate, Mustafa Al-Hiti, counted today, Thursday, the number of pharmacists in Iraq, while noting that Iraq is at the bottom of the health reality in the Arab countries.

Al-Hiti said, "Iraq suffers from a surplus in the number of pharmacists, as the actual need is 16,000, while we have more than 30,000 pharmacists."

He added that "there are colleges of pharmacy in Iraq whose dean does not have a doctorate, while others do not have professors who hold this degree, and this is not true, as there is no interest in this file."

And he indicated that "Iraq is below the health reality in the Arab countries, so there is no real support for the Ministry of Health, and its funding is very weak."   https://www.mawazin.net/Details.aspx?jimare=204922

Neither New Projects Nor Appointments” .. Iraq Has Repeatedly Experienced A “Dangerous Experience” Over Recent Years

Posted On2022-09-09 By Sotaliraq   The delay in approving the general budget has become a common thing in Iraq. Political and security instability, discussions and objections to it made Iraq’s budget delay for several months at the beginning of each year, turning into a mirage during 2022 in light of the inability to form a government.

The lack of approval of the budget for the current year has caused damage to economic development in the country due to the disruption of investment projects and this will be reflected in an increase in the unemployment rate and raise poverty indicators, according to specialists.

Not approving the budget is a “dangerous” experience

The financial advisor to the Prime Minister, Mazhar Muhammad Salih, described the failure to pass the budget as a “dangerous” experience, indicating the continuation of exchange operations for public expenditures 1/12 for the next year 2023.

He said that "the economic cycle depends on government sources and therefore cannot be stopped, as the cessation of government spending ends life in Iraq, and it can be called "financial suicide", which is rare."

Saleh added that “exchange and spending operations will be 1/12 according to the year 2022 and will also include ongoing incomplete projects without new investment projects,” stressing that “the lack of approval of the budget indicates instability and lack of political security, and that a country that passes without a budget is considered a dangerous experience.” .

He continued, "Whenever the financial budget is disrupted, it means new projects that do not exist, new appointments that do not exist, disruption of government programs and a decline in economic development in general."

No new projects

The spokesman for the Ministry of Planning, Abdul-Zahra Al-Hindawi, said that “it is not possible to include new projects without a budget law, while the existing ongoing projects will be according to the Financial Management Law for the year 2019 and will be spent on them according to the percentages of completion and according to the terms of work.”

He added that "there are more than 6,000 projects under implementation, for which allocations are granted according to the stages of completion, distributed over all Iraqi governorates."

market contraction

The economist, Basem Jamil Antoine, considered that “there is no crisis in public expenditures, whether it is salaries or spending on ongoing projects in the event that the budget is not approved, but the problem lies in economic development, where there is no presence of new investment projects, which is a long period of two years.”

And Antoine continued, "The lack of projects will reflect on the market, and there will be stagnation, austerity and a major economic downturn," noting that "the private sector will not move and only salaries will remain moving in the market, while there are more than 8 million working in the market and living on the ongoing investment business. All of this will affect the increase in unemployment and the rise in poverty in Iraq.”

Food security is palliative and not treated

Economic expert Salam Sumaisem says that "the absence of an investment budget will be a defect in the general budget because the developmental aspects of society will stop."

She explained that "the existence of the Food Security Law is an urgent solution, although it gives a partial solution to address the economic aspects that suffer from paralysis due to the lack of approval of the budget, but it is considered as a pain reliever, but it is not treated, but it helps some thing to pass the stage."

And the Speaker of the Iraqi Parliament, Muhammad al-Halbousi, warned earlier last month of expected economic crises that Iraq would face if the crisis continued, noting that there are 80 trillion Iraqi dinars (50 billion dollars) in financial surplus from the revenues of oil exports for the current year, which are frozen and cannot be spent due to lack of Approval of the budget for the year 2022.

Al-Halbousi added that the financial management law, which will continue to manage the country’s financial affairs in case the 2023 budget is not approved, will not allow any additional financial spending, which will put the country in front of major economic crises from the year 2022. Political crises in the country and the disruption of constitutional institutions.   LINK

Where Is The Ministry Of Water Resources? A Report Criticizing The Poor Response To Drought In Iraq

Posted On2022-09-09 By Sotaliraq   The British newspaper "The Guardian" criticized the Ministry of Water Resources in Iraq for its failure to deal with the repercussions of the drought that hits the country's fertile lands and turns it into a barren desert, with devastating consequences for the lives of farmers who make up 18% of the population.

The British newspaper began its report, which was published today, Wednesday, in English, by saying that the green land is turning into a barren desert in the Fertile Crescent region of Iraq, due to water scarcity, while the 8,000-year-old irrigation system, in addition to poor management, exacerbates the The effects of drought, crop death and livestock mortality.

The British report dealt with the story of the farmer Abdul Hadi Muzhir, who was digging a well on his farm, 16 meters deep in the ground, but despite this depth, not a single drop of water appeared, indicating that Iraq witnessed a dry summer season, but the Muzher family has been in this place for four generations. She lives on growing wheat, vegetables and raising cows, and considers this year to be particularly exceptional.

The report quoted Mezher, 35, as saying that "the green land has turned into a barren desert. I don't remember seeing anything like this in my life."

The report pointed to a decline in the water level in the Tigris and Euphrates rivers, where the ancient civilizations of Mesopotamia flourished on their banks 8000 years ago.

The British report indicated that government officials say that the reason behind this is the spread of water dam projects in the sources in neighboring Turkey and Iran, which represents a long-term problem, but it is exacerbated by the mismanagement of water resources and the increasing decline in the amount of rainfall.

After the report mentioned that Iraq is considered the fifth country most exposed to the climate crisis, and that it is at the same time an oil-rich country that generates revenues of $ 10 billion per month, it pointed to the spread of corruption and the failure of governments to prepare to deal with what experts warn is coming.

The report quoted Iraqi water engineer Nazir Al-Ansari, a professor at Lulea University of Sweden, as saying that "the officials do not look at the future of the country, and that all that matters to them is the extent to which they benefit from the positions they occupy," adding that "the people who took over the Ministry of Water (Resources) They have no experience."

Al-Ansari considered that the rainfall in Iraq will decrease by 15-20% during the current century, which means that the water in the Tigris and Euphrates rivers will decrease by up to 73%, which will have serious repercussions on groundwater levels.

However, the British report considered that the consequences were already devastating for farmers who depend on river water. For example, Muzhar crops did not achieve the hoped-for success during this year, which made his family of 13 people, without financial income, and forced him to start selling his meager cows. For a small amount compared to its usual price.

The report quoted Mezher as saying, "The main responsibility lies with the government to secure the infrastructure...there is no planning and no support for farmers."

According to the report, the agricultural sector has deteriorated for decades due to conflicts, lack of investment and global warming, while farmers’ profit margins have been declining due to increased expenditure costs and agricultural import prices, adding that the Iraqi government, instead of resorting to developing the agricultural sector, has reduced the area of ​​land allocated for agriculture by an amount The current half of the year in the context of dealing with the phenomenon of drought, which represents a painful blow to the agricultural sector, which occupies 18% of Iraqis.

The report pointed out that the Mezher farm is located to the west of the ancient city of Babylon, whose empire was established during the second millennium BC through King Hammurabi's expansion of irrigation networks during the Sumerian era, adding that Iraq still depends on the same irrigation methods.

In this context, Al-Ansari said that the irrigation techniques currently used, which were used 8,000 years ago, have very high water loss rates.

The report indicated that irrigation water flows through a network of open channels, which leads to an increase in evaporation rates when temperatures exceed 50 degrees Celsius during the summer. The report continues that more water loss occurs when water reaches the fields, as farmers use flood-reliance techniques, instead of drip irrigation or the more accurate and economical sprinkler.

The report goes back to the Mezher farm, where crops withered, including the grass intended to feed livestock, noting that one of the cows was so lean that it could not stop standing while its calf was begging for milk that it was unable to produce.

It's the first victim, but I expect more by the end of the summer," Mezher said, pointing to his cow.

Because Mezher could not afford the cost of fodder, he sold 11 of his 17 cows for less than $20 each, even though the price of each one is usually between $800 and $1,000.

The British report concluded by noting that water scarcity has exacerbated old tensions between farms located on irrigation canals, as accusations are being made that water diversions are being carried out to a greater extent than is acceptable. Oversight by the government to impose penalties on those who use excessive water.”

The report concluded by saying that tens of thousands of people in southern Iraq have already been displaced due to the scarcity of water, with many taking refuge in crowded cities facing a lack of jobs and services, which is causing unrest.

However, Mezher still refuses to give up the farm, saying, "This is the land of my ancestors." LINK