More Iraqi News Sunday Evening 3-27-22
More Iraqi News Sunday Evening 3-27-22
TLM724 Administrator BondLady’s Corner
Despite The Embargo On Russian Oil, Iraq Is Outside The World's Plan To Increase Supplies And Fill The Shortage
Reports| 05:07 - 03/21/2022 Special- Mawazine News The European Union foreign ministers will meet, at a later time, to determine the possibility of imposing a ban on the import of Russian oil amid warnings of high prices to record levels and the start of Western countries to resort to Middle Eastern countries to increase supplies in isolation from Iraq.
And last week, British Prime Minister Boris Johnson visited Saudi Arabia and the UAE to ask them to increase supplies and compensate for Russian oil, but he noticed that Iraq was not being taken into account, even though Iraqi oil matches the specifications of Russian oil, which can be refined in Europe.
An Iraqi official at the Ministry of Oil said in an interview with Mawazine News that "the neglect came due to several reasons, including the weak Iraqi external position in the oil markets , and the presence of oil exchanges in the Gulf that the UAE and Saudi Arabia exploit to supply oil, unlike Iraq, which sells a small percentage of its oil in the stock exchanges."".
He adds, "The second thing is that these countries have great relations with major oil companies, and the recent period most of the major companies began to withdraw from Iraq as a result of security and political conditions and the exposure of their headquarters to bombing in Basra, especially if we note that a company such as Shell bought Russian oil and buys oil from other countries.
Others due to banking and commercial facilities.
As for the economic expert, Hamza Al-Jawahiri, he confirms to / Mawazine News / that "there are Iraqi shortcomings that prevent it from increasing the volume of its oil exports."
Al-Jawahiri adds, "Iraq suffers from a noticeably weak infrastructure, and there are pipelines that are unable to increase the volume of exports if international sanctions are imposed on Russian oil."
He pointed out that "dealing with Russian companies operating in the Iraqi fields will not be affected by any international decision, especially since Iraq gives them oil instead of money." Ended 29 / h
https://www.mawazin.net/Details.aspx?jimare=187952
Exchange Rate.. Look Ahead
Wed, Mar 9, 2022 11:44 AM Abdul-Zahra Muhammad Al-Hindawi For more than a year, the talk and debate about the exchange rate change that took place before the end of 2020, did not stop, under very complicated circumstances, in which the country was facing a dangerous slide, after oil prices continued to collapse, accompanied by severe repercussions resulting from the continuation of the Corona pandemic.
Perhaps changing the exchange rate was the most effective solution, in order for the state to be able to confront this crisis, after the public debt rates rose, and the foreign exchange reserves began to decrease, with the Central Bank.
Certainly, the decision was not easy, and everyone was aware of its immediate, difficult repercussions, and this is a natural result of any complex treatments of this kind..
And after about 15 months of the change, and with the unprecedented rise in oil prices, the voices demanding a return to the price rose again. The dinar is back to what it was before the change, so is a decision like this possible??
I think that the matter is not as easy as those who claim to return to the past, as there are many reasons that prevent this, among them, that the process of changing the value of the currency, up and down, loses its prestige, and that more than a year has passed since the change process, witnessed many internal contracts
And the foreign affairs, all were concluded according to the current price, and accordingly, lowering the price again, will create a severe state of confusion, which will cast dark negative shadows on the economic scene, and will expose the Iraqi economy to aftershocks that may be violent, at a time when the government is still dealing with the repercussions resulting from raising the price.
The year 2020 related to government contracts, and damage to contractors, and on the other hand, the budget still faces a not small deficit, noting the ruling spending doors which are very wide and large (operating spending), this was offset by a sharp rise in food, consumer and construction prices worldwide during The past two years, accordingly a return to the price
The old price will not contribute to reducing the prices of these materials, as much as the state of confusion that will result from this measure, and the average selling price of Iraqi oil, during the past year 2021, ranged between 65-70 dollars per barrel, at a time when the oil market cannot be trusted, as prices may be exposed To a state of collapse at any moment, as a result of the accelerating events the world is witnessing.
So, what is the solution?..the solution lies in activating the non-oil development sectors,
supporting vulnerable segments, through the social protection network,
improving the level of the ration card,
encouraging more investment in all sectors,
giving the private sector the space required to revitalize the economic movement, and providing more decent job opportunities.. https://nnciraq.com/116553/
Al-Kadhimi Consultant Sets Tracks For Investment Of Financial Abundance From High Oil Prices
Wednesday, March 23, 2022 1:03 PM National Position / NNC / Select the prime minister's economic advisor, Mohammed Saleh's appearance on Wednesday, two tracks for investment of financial abundance from high oil prices.
"There are two directions on the employment of the current financial abundance, caused by higher oil prices in the global market and benefit from the growth and stability of the national economy," Saleh said in a statement to the National Center.
He explained that "the first track requires backup financial resources in which the budget is one of any harmful fluctuations against the future oil cycle and an unexpected sudden, and in a manner that maintains the financial sustainability of the country without stumbling in public expenditure and revenues."
"The second direction, requires that the expansion is exclusively in the field of investment spending and projects of national income and helps to operate the labor force and raise economic growth and economic development, according to a minute and balanced financial equation, the Law of Financial Management No. 6 of 2019 Draw their borders and objective settings in maintaining public money, good use and management."
Oil prices are witnessing a significant rise.
The West Texas WTIs for the front month rose $2.18 or 1.94%, to $114.30 a barrel on the NIMEX Stock Exchange, Brent crude futures rose $ 2.51 or 2.26%, to $118.23 a barrel at 04:30 GMT.
Both decades settled by more than 7% on Monday, where more supplies' disorders have affected the market. https://nnciraq.com/118356/
His Idea Goes Back Decades.. A Parliamentary Move To Activate The Iraqi Sovereign Fund
Thursday, March 24, 2022 11:04 PM National News Center /NNC/ After Iraq has gone through economic crises, sometimes political and security, it seeks to establish the Generations Fund to face the depletion of oil.
This government approach was welcomed by the economic and parliamentary circles because of the benefits it may achieve for the Iraqi economy and for future generations.
The Iraqi government intends to establish the first sovereign wealth fund to be financed from surplus financial budgets with the aim of building a coherent financial barrier that prevents economic collapse, as well as the possibility of investing these funds in reviving the local economy and addressing crises that may arise as a result of falling oil prices.
Parliamentary action to activate the sovereign fund
Today, Thursday, a member of the Sadrist bloc, Raed Al-Fatlawi, called for the necessity of activating the sovereign fund.
Al-Fatlawi said in a statement to the "National News Center": "This fund is supposed to be established at an early date to solve many economic problems and the days of the ISIS war," adding that "now there is a good opportunity with the oil conditions and the economic situation for Iraq is better in light of a war." Russia and Ukraine, which have been somewhat misguided.”
He continued, "The rise in oil prices is in the interest of Iraq, and this fund is to secure the future of future generations and also fill the lack of services," noting that "there is a parliamentary movement on this fund to work on it soon."
Al-Fatlawi indicated that "the most important obstacles to the establishment of this fund are political and security ones, and during the past years, between 2014-2021, they did not allow the establishment of the fund due to the lack of financial abundance."
What does the sovereign fund of Iraq provide?
Adviser to the Prime Minister, Mazhar Muhammad Salih, explains to the “National News Center” that “sovereign wealth funds or social wealth funds go to state-owned investments that invest the country’s available cash interests and transfer them to various real estate and financial assets or assets such as stocks, bonds, precious metals, or in Alternative investments such as private equity and hedge funds.
He continued by saying: "Sovereign wealth funds existed in order to maximize the sources of wealth themselves, meaning financing most of the world's sovereign wealth funds from the proceeds of exports of raw materials or oil owned by the state."
And he indicated that, “at the level of Iraq, the effective Financial Management Law No. 6 of 2019 provided the opportunity to invest financial returns that exceed financing expenses, in the fiscal year by establishing a sovereign fund,
in other words, the legal basis is now available through the text of the Administration Law The effective finance itself in this regard and there are no obstacles, and that the law of the Central Bank of Iraq in force through its discreet foreign investment department possesses the means, financial tools and efficient investment management in managing the sovereign fund with the various financial and investment tools available, and similar to its great capabilities in managing the country’s reserves of foreign currency currently, which are Its management is quasi-sovereign wealth fund.”
He pointed out that “despite the foregoing, it can be said and based on the financial management law in force and referred to above, the increase in total revenues (the basis of which is certainly oil revenues),
that is, when it is outside the limits of financing the federal public budget expenditures or exceeds the limits of planned financing, will be subject to provisions Article (19) / Second of the effective Financial Management Law No. (6) of 2019, which states: When the actual revenues exceed the estimates in the Federal General Budget Law for the fiscal year, and after covering the actual deficit, if any, the surplus is provided for use in the budgets of the following years in the (Fund). Sovereign).
This means, in all cases, the generation of official reserves that will be used for spending in the coming years through a sovereign savings fund managed according to the best international practices in managing and investing the official reserves of countries, and benefiting from the investment returns of those official foreign reserves or disposing of them in financing the budgets of the coming years and achieving what is called financial sustainability.
Certainly, the priority will go towards the sustainability of financing investment projects that contribute to the development of national income and the economic prosperity of our country.
In other words, if the 2022 fiscal year ends, for example, without approving the general budget (and starting spending with a ratio of 1/12 of the actual current expenditures for the past year), i.e. for the year 2021, the financial returns go to a fund or reserve account that represents the sovereign wealth, and certainly the priority It will go towards the sustainable financing of investment projects that contribute to the development of national income and the economic prosperity of our country.
Political reasons for not establishing the fund
To this, the expert in economic affairs, Salama Sumaisem, points out, “The Sovereign Fund, before it is formed, needs political management.
Successive governments from 2003 until now must have the political will to rehabilitate this fund once Iraq has experienced great periods of financial prosperity, due to the increase in oil revenues.”
She explained, "Local governments did not think about establishing this fund, stressing that the issue is political and there is a need to establish a fund there."
Sumaisem added, "There is a proven fact that oil is a wealth that is permeable.
The energy pattern has been transformed into other alternative types, the most important of which is clean energy.
Therefore, the historical responsibility and the students require the establishment of a fund that serves future generations, adding that now it does not exist." through the financial market to finance this fund.” https://nnciraq.com/118574/
The Association Of Banks Organizes A Meeting Aimed At Reaching The Low-Income Classes
Sunday, March 27 2022 12:27 AM Baghdad / National News Center
The Iraqi Private Banks Association organized, today, Saturday, a meeting between the Arab Gulf Program for Development “AGFUND”, for the purpose of discussing the establishment of a specialized microfinance company in Iraq.
And the Central Bank of Iraq stated in a statement, received by the “National News Center”, that “in the presence of the Deputy Governor of the Central Bank, Ammar Hamad, the Association of Iraqi Private Banks organized a meeting between the Arab Gulf Program for Development “AGFUND” in the presence of its chief advisor, Badr Al-Din Abdul Rahman, and private banks operating in country, for the purpose of researching the establishment of a specialized microfinance company in Iraq.
The statement added that "the company aims to reach the low-income classes and micro-enterprises in society, and lend them to finance their projects or establish new ones, and enhance the concept of financial inclusion." https://nnciraq.com/118809/
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