Iraqi News Highlights Thursday Evening 6-1-23
Iraqi News Highlights Thursday Evening 6-1-23
Tlm724 Administrator Bondlady’s Corner
In Detail.. The International Monetary Fund Issues Its Report On The Iraqi Economy And Issues A Number Of Warnings
Money and business A team of International Monetary Fund experts, led by Tukhir Mirzoev, warned that the fluctuations in the foreign exchange market and the reduction in oil production affected the momentum of growth in Iraq, warning of the expansionary plans of the Iraqi authorities in public finances that could lead to an exacerbation of the level of inflation. In the short term, and to impose significant risks to macroeconomic stability in the medium term.
And he considered, in a report issued by the Fund, that the discipline of public finances and wide-ranging structural reforms are crucial factors to reduce weaknesses in the Iraqi economy, to enhance its resilience in the face of crises, and to achieve sustainable and more inclusive growth for all.
The report comes after a visit to Amman, Jordan, during the period 24-31 May, with the aim of discussing the latest developments and economic prospects with the Iraqi authorities, as well as discussing plans related to policies in the coming period.
At the end of this mission, Mirzoev issued the following statement:
"The growth momentum of the Iraqi economy has slowed down in recent months. After recovering oil production last year and restoring the level it reached before the outbreak of the Corona pandemic, production is expected to contract by 5 percent in the year 2023 in light of the OPEC + decision to reduce the volume of oil production." ,
and the interruption of the Kirkuk-Ceyhan oil pipeline from work.The fluctuations in the foreign exchange market rates, following the application of the Central Bank of Iraq to stricter controls to combat money laundering and terrorist financing on foreign currency sales, had a negative impact on the import-based non-oil sectors.
A contraction in real non-oil GDP by 9 percent (on a year-on-year basis) during the last quarter of 2022, canceling the growth achieved during the first three quarters of the year.With signs of stabilization of the foreign exchange market, in light of the measures taken by the Central Bank of Iraq, the non-oil real GDP is expected to resume growth, reaching 3.7 percent in 2023.
After the inflation rate rose to 7 percent in January On the second of January, inflation began to moderate in a way that reflects the decline in commodity prices at the international level and the increase in the exchange rate of the Iraqi dinar by 10 percent. The inflation rate is expected to average 5.6 percent during the year 2023.
"Favorable conditions in the oil market have supported Iraq's financial and external centers, but structural imbalances have continued to widen. In the year 2022, surpluses in public finance and external current account balances amounted to 7.6, or 17.3 percent of the total GDP, Respectively, due to the record rise in oil revenues, the foreign exchange reserves of the Central Bank of Iraq increased to reach 97 billion US dollars (equivalent to the value of 11 months of import), which includes financial savings for the government amounting to 16.3 billion US dollars ( At the same time, the significant expansion of public finances has increased the non-oil primary deficit from 52 percent to over 68 percent of non-oil GDP in 2022.
“The fiscal expansion will further increase, as proposed in the draft budget law for the year 2023, the size of the primary non-oil deficit in public finances to reach 75 percent of non-oil GDP, and the total deficit in the balance of public finances to 6 percent. 5 percent of GDP.
The combined effects of the increase in government spending, the increase in the exchange rate of the Iraqi dinar, and the decrease in oil production combined would increase the price of a barrel of oil required to achieve balance (zero deficit) in public finances, to 96 US dollars.
"In the short term, the implementation of the Iraqi authorities' plans for public finances could push the inflation rate upward, and return the foreign exchange market to volatility.
As for the medium term, the continuation of the current policies in light of a great deal of uncertainty about the path of Oil prices in the future pose serious risks to macroeconomic stability, and except in the case of a significant increase in oil prices, the current public finance situation could lead to an escalation of the deficit and an increase in fiscal pressures in the coming years.
A tighter fiscal policy is needed to strengthen the resilience of the economy and reduce the government's dependence on oil revenues while preserving urgent social spending needs.
Key priorities include diversifying fiscal revenues, reducing the huge wage bill for government employees, and reforming the pension system To make it financially sound and more inclusive.While the IMF mission supports the government's plan to increase the volume of social assistance, it recommends a stronger level of targeting, to ensure that aid is directed to the most vulnerable citizens.
“Improving public financial management remains critical. In this context, the IMF mission warns of the need to be cautious about planned creation of new extra-budgetary funds, which raises concerns about governance and efficiency, and strongly recommends that all Government expenditures through the budget.
Furthermore, the mission is urging full implementation of the Government Guarantees Management Framework, including taking parliamentary pre-approval of the annual ceiling and the list of government guarantees as part of the budget law.In addition, there is a need to accelerate efforts to Establishing the single treasury account with the aim of strengthening public financial management.
The mission welcomes the progress made by the Central Bank of Iraq in the area of improving liquidity management, anti-money laundering and counter-terrorist financing frameworks, and stresses the importance of close coordination between the stances of monetary and public financial policies in managing the Iraqi economy.
“Creating an enabling environment for private sector development will be paramount to achieving sustainable and more inclusive growth. Priorities in this area include continued efforts to strengthen governance and reduce corruption, restructure large state-owned banks to improve access to finance, and reform the labor market with the aim of promoting job creation Employment in the private sector, improving the ability of the electricity sector to recover costs to enhance its ability to meet demand in a sustainable manner, and improving the broader business environment.
The Fund's team of experts stands ready to support the Iraqi authorities in their reform efforts, and would like to thank them for the frank and fruitful discussions during the mission.
Views 67 Added 06/01/2023 - https://economy-news.net/content.php?id=34525
An Economist Identifies The Advantages Of Establishing A Pioneer Bank To Finance Small Projects
Economy News / Baghdad The economist, Durgham Muhammad Ali, praised the Central Bank's announcement of its support for the establishment of a Riyada Bank to support microcredit.
Ali told Al-Eqtisad News, "The bank's idea is good for activating small projects and eliminating unemployment, because borrowers need training in order to provide them with skills that enhance the mechanisms for benefiting from these loans," calling on state departments to "support this project, and borrowers with the aim of speeding up the process." its implementation process.
The Governor of the Central Bank of Iraq, Ali Mohsen Al-Alaq, announced the establishment of the Riyada Bank for Social Development, and the new bank will work to support the segments of Iraqi society, pointing out that the bank has social and economic dimensions, and the Central Bank of Iraq will provide the necessary support through various initiatives for the success of this project.
On the sidelines of the opening of the annual Iraqi banking conference organized by the Association of Private Banks, the governor said, "The initiatives of the Central Bank of Iraq are the largest in the history of Iraq," revealing "the completion of new projects, including the establishment of the Riyada Bank for Social Development in line with the vision and initiative of the Prime Minister in the project."
government (leadership) to support youth,” stressing that “the bank will be the first in Iraq to care for low-income people through soft loans and simple guarantees in support of the vulnerable segments, and to diversify the non-oil economy through small and micro projects to activate the private sector and reduce unemployment and poverty rates.”
He pointed out that "the Central Bank of Iraq put the final touches to prepare a national strategy for bank lending." Views 85 06/01/2023 - https://economy-news.net/content.php?id=34522
The Central Bank Of Iraq Organizes A Workshop For Banking And Financial Institutions
June 01, 2023 The Central Bank of Iraq, in coordination with the Anti-Money Laundering and Terrorism Office, organized a workshop for banking and non-banking financial institutions.
The workshop dealt with the participation of the results and the measurement of the threats and risks surrounding the financial sector, with the direction of monitoring the necessary treatments in order to alleviate their risks.
It is noteworthy that the establishment of this workshop was a continuation of the plan to publish the results of the national evaluation of the dangers surrounding this vital sector.
The Central Bank of Iraq Information Office 1 - June – 2023 https://cbi.iq/news/view/2349
The Central Bank Announces The Entry Into Force Of The Cabinet's Decision Regarding The Use Of Electronic Payment Devices
Economy| 09:32 - 01/06/2023 Baghdad - Mawazine News The Central Bank announced, on Thursday, the entry into force of the Cabinet’s decision regarding the use of electronic payment devices (POS).
The bank confirmed, in a statement, a copy of which Mawazine News received, that “Cabinet Resolution No. (23044) for the year 2023 entered into force, represented by increasing the number of electronic payment devices (POS), which are used as of 6/1/2023 in government institutions.”
And the private sector to promote a culture of electronic payment and collection, and reduce the use of paper money in collection and commercial transactions.
The bank indicated that “it has been going on for years to provide this service in accordance with its powers, and in compliance with the decision of the esteemed Council of Ministers, as it has started since the beginning of this year to expand the scope of work, hold workshops and launch incentive initiatives to implement financial inclusion and enhance the use of electronic payment by citizens in ministries.”
And the bodies and state departments that work with collection and financial collection, such as the Ministry of Interior, Electricity and Oil, the Housing Fund, the Municipality of Baghdad, and the Ministry of Commerce. The citizen has the right to choose to pay in the way that makes it easier for him.
And he continued, "There are other government institutions and departments that will join the (POS) service during the next few days, in implementation of the aforementioned Cabinet decision."
The Central pointed out that "there is a great response from the private sector, commercial centers, licensed delivery companies, taxi companies licensed by the competent sectoral authorities, and some universities and private hospitals, by providing point-of-sale (POS) devices in their work."
The statement stated, “The bank has provided the necessary infrastructure and support for the launch of this project in its expanded form, and its continued development according to the best international technologies and specifications in service of the public interest, and facilitating procedures for electronic cash circulation through bank cards.”
The service to the bank holding the account of the billed government entity shall be after the completion of processing and settlement operations in payment systems of high reliability and security, affiliated to the Central Bank of Iraq, and in accordance with international best practices. https://www.mawazin.net/Details.aspx?jimare=228102
The Central Bank Promotes The Use Of Payment Devices (POS) In Accordance With The Decision Of The Council Of Ministers
Thursday 01, June 2023 09:46 | Economical Number of readings: 446 Baghdad / NINA / The Central Bank of Iraq announced that Cabinet Resolution No. (23044) for the year 2023 has entered into force, represented by increasing the number of electronic payment devices (POS), which are used starting from 1/6/2023 in government institutions and the private sector to enhance the culture of payment and collection. electronically, and reduce the use of paper money in collection and commercial transactions.
In a statement, the bank confirmed that it has spent years providing this service in accordance with its powers, and in compliance with the decision of the Council of Ministers, as it has started since the beginning of this year to expand the scope of work, hold workshops and launch incentive initiatives to implement financial inclusion and enhance the use of electronic payment by citizens, in ministries, agencies and state departments.
Those working with collection and financial collection, such as the Ministry of Interior, Electricity and Oil, the Housing Fund, the Municipality of Baghdad, and the Ministry of Commerce.
The bank added, "Every entity that provides its services or has a financial collection with citizens directly, will work through electronic payment devices (POS), and the citizen has the right to choose payment in the way that facilitates it," revealing at the same time that there are other institutions and government departments that will join the (POS) service. POS) within the next few days, in implementation of the decision of the Council of Ministers.
The bank indicated, "There is a great response from the private sector, commercial centers, licensed delivery companies, taxi companies licensed by the competent sectoral authorities, and some universities and private hospitals, by providing point-of-sale (POS) devices in their work."
He explained that he had provided the necessary infrastructure and support for the launch of this project in its expanded form, and its continued development according to the best international technologies and specifications in service of the public interest, and facilitating the procedures for electronic cash circulation through bank cards, indicating:
“The transfer of money electronically from the cards of the beneficiaries of this service to the bank.” The holder of the billed account of the government agency will be after the completion of processing and settlement operations in payment systems with high reliability and security, affiliated to the Central Bank of Iraq, and in accordance with international best practices. https://ninanews.com/Website/News/Details?key=1057034
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