"Tidbits From TNT" Wednesday AM 2-10-2021
TNT:
Tishwash: The Kurdistan Region delegation arrives in Baghdad to resolve the budget crisis
An informed source said that the Kurdistan Region delegation had arrived in Baghdad on Wednesday in order to resolve disputes regarding the region’s share in the federal financial budget for the current year.
The source told Shafaq News, “The Kurdistan Regional Government delegation arrived in Baghdad to finalize the agreement with the Parliamentary Finance Committee and the federal government regarding the region’s share in the budget.”
The delegation arrives a few hours after the Prime Minister of the Kurdistan Regional Government, Masrour Barzani, refused to respond to the demands of Shiite forces to hand over the oil file to the federal government.
Barzani said in a press conference in Erbil, that this matter violates the constitution and violates the rights of the Kurdistan Region, indicating that the region will depend on its financial revenues, although they are few, in case they do not reach an agreement with Baghdad, similar to past years.
Barzani accused political blocs of using this file for political bidding and propaganda for the upcoming early parliamentary elections, but he confirmed his government’s commitment to the agreement concluded with Baghdad on the budget.
Last December, Baghdad and Erbil reached an agreement on the financial budget, providing for the region to deliver 250,000 barrels of oil per day, and half of the revenues from border crossings and others to the federal government, in exchange for a share in the budget of 12.6 percent.
The agreement was included in the draft budget, but Shiite political blocs reject the agreement, which hinders its passage in Parliament. link
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Tishwash: The volume of cash dealing in Iraq
The volume of dealing in cash is very large in Iraq, and the vast majority of daily transactions are through cash without using banking transactions, noting that less than 25 percent of Iraqis have bank accounts, and after reducing the value of the dinar against the dollar by about 23 per cent, the exchange value will increase by approximately The 25 per cent, because most of the goods in the Iraqi market are imported from abroad in dollars.
This exacerbated the problem of the size and amount of the dinar exchanged in the markets on a daily basis.
To overcome this problem, we talked about some solutions. And precisely
Canceling zeros or printing a higher cash denomination, such as one hundred thousand dinars,
And in my opinion, the two solutions do not take into account the reality and future of the Iraqi economy, nor do other risks, especially in printing a large currency such as the hundred thousand denominations;
Note that large groups facilitate the smuggling and laundering process of money to increase its value and decrease its size, and thus facilitate smuggling or taking it out.
And considering the experiences of other countries,
We have seen some European countries, and for long years, stopped dealing in the category of 500 euros for the reasons mentioned above, and after that the European Central Bank canceled the issuance of this category in 2019.
As for deleting zeros, it is the goal closest to the aspiration of the citizen, as well as the dealer, because of its great facilities, especially in banking and accounting transactions, which reduces arithmetic errors and facilitates the daily dealings of the citizen and the trader.
But at the present time, any change that is added to the changes that have occurred and are expected to happen after the approval of the budget in 2021 and the entry into force of the White Paper will increase the confusion in the markets and the Iraqi economy that is looking for stability,
The solution is a practical two-year plan based on the seriousness of relying on electronic banking transactions and reducing the need for cash because of its great benefits, for example;
1) Saving the costs of printing the currency.
2) Controlling the movement of funds.
3) Control the market.
4) Reducing money laundering operations
5) Knowing the true size of income per person / company
6) Providing safety for the customer.
7) Transparency.
And after two years, the market and the citizen are ready for the process of deleting zeros.
But at the present time, neither the Iraqi economy nor the markets are ready for such a change, especially after the confusion that occurred after the devaluation of the dinar against the dollar.
Tishwash: Investment is the perfect solution to revive Iraqi industries
Investment in the industrial and agricultural sectors has become necessary to revive the national product and provide local markets with agricultural products and crops, especially after budget allocations for the past years have seen a decrease in the amounts allocated to the two sectors, with more than 40,000 plants out of work.
"Iraq is able to build a production base in various sectors, including the agricultural sector, where it can cover the country's need for various products and crops, and it can supply foreign markets with surplus," he said, pointing out that "reviving production is not a complicated matter if the necessary management is available with this development orientation that serves the country and changes the shape of the national economy and moves it to a better stage."
International experiences
"Investment can come with cutting-edge technology that saves time and effort to boost production and bring it to global averages, and here we can benefit from successful international experiences that have a positive impact on the globe," Hindas said.
Big Companies
"Iraq has a promising industrial sector that needs attention, and more than 40,000 factories are out of service, and there are factories that operate at half their production capacity and sometimes less than this percentage," said Abdul Hassan al-Shammari, a member of the Iraqi Federation of Industries.
"Investment and partnership with the international effort can move the country to the stage of actual qualitative production, especially as the major international companies are aware of the importance of the Iraqi economy and the location of the country, which can be a global industrial center that provides the country with funds that achieve a real multiplicity of resources and keep the national economy away from oil revenues," he said.
Financial allocations
Nada Shaker, a member of the parliamentary economic and investment committee, said: "The financial allocations contained in the 2021 draft budget to raise the level of industry and agriculture below the level of ambition, because the advancement of these two areas needs a revolution.
It's real."
"The local product in terms of quality is much better than imported goods, but it lacks support and protection," She said, adding that "supporting local industry will contribute to significantly reducing unemployment, as well as controlling the prices of homemade materials and goods." link
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Tishwash: The Iraqi government launches a new financial reform committee that includes the World Bank
Mubasher: The Iraqi government announced during its weekly meeting, headed by Mustafa Al-Kazemi, today, Tuesday, the inauguration of a new financial reform committee.
In a statement issued today, Tuesday, the Iraqi government stated that it had been decided to form a committee under the name of the "Supreme Committee for Reform", led by the Prime Minister.
The Council of Ministers indicated that the Supreme Committee for Reform will include:
- Minister of Finance as Vice President
- Minister of Planning as Member
- Minister of Oil as Member
- Secretary General of the Council of Ministers as Member
- Central Bank Governor as Member
- Executive Director of the Supreme Committee for Reform as Member and Rapporteur
- Adviser to the Prime Minister for Strategic Affairs as Member
- Adviser to the Prime Minister for Economic Affairs Member
- Head of the Legal Department In the General Secretariat of the Council of Ministers as a member
- two experts named by the Prime Minister as members
The Council of Ministers indicated that each of the two main international organizations (the International Contact Group, the World Bank Group) would be represented as observers, without either of them having the right to vote.
The Council stated that the Supreme Committee for Reform undertakes the following tasks:
-Supervising the implementation of the reform program as a whole, and the projects it consists of, according to the plans and timelines approved by the Supreme Committee for Reform, including adding, deleting or amending new projects.
Ensure the availability of administrative and financing approvals in a timely manner during the implementation of projects, and take the necessary measures to overcome emerging obstacles.
- Coordinating the work of the various bodies responsible for implementation and support, defining the duties of each and achieving integration between them.
Monitoring good performance and implementing accountability in accordance with the law.
Submit periodic reports on the progress of the reform program to the Council of Ministers.
The government stated that Cabinet Resolution No. (12) of 2020 will be canceled, and the Supreme Committee for Reform will replace the Emergency Cell for Financial Reform formed according to it.
She indicated that the meetings of the Supreme Committee for Reform will be held at the invitation of the president or his deputy with the approval of the president, and with the presence of at least half of its members, including the president or his deputy, in the absence of the president, provided that decisions are taken by the majority of attendees, including the session chair.
The government set some controls for the committee, which are as follows:
- Committee meetings are held quarterly at least.
- The Supreme Committee for Reform has an executive director concerned with the Prime Minister and linked directly to him and authorizes the necessary powers to implement the committee's decisions and achieve its goals, and is tasked with following up the implementation of its decisions and conducting its daily affairs under the supervision of its president.
- The Supreme Committee for Reform may form work teams or sub-committees to carry out specific tasks, and grant it the necessary powers to achieve its goals and facilitate its work.
- The supreme body has the right to host whomever it deems necessary to attend its meetings, in order to achieve its tasks.
- The Prime Minister authorizes the powers of the Council of Ministers for the purposes of the Supreme Committee for Reform.
The government indicated that a cell called "Reform Management Cell" would be formed, headed by the Executive Director of the Supreme Committee for Reform, to be located in the Prime Minister's Office and undertake the following tasks:
- Provide support to the officials of the reform program projects and the relevant executive teams, with the aim of improving performance and ensuring that the best implementation paths are chosen to achieve the set goals.
- Enhancing communication between project officials and work teams on matters pertaining to each project, and coordinating the interconnectedness of the various projects within the reform program in order to enhance integration and synchronization in implementation.
Dealing with developments directly as a first level for reporting and solving problems.
Tracking the implementation of basic activities, professionally assessing performance, and submitting periodic reports to the Supreme Committee for Reform, including reporting on progress rates, obstacles, anticipated risks and suggested solutions.
- Helping in determining the procedures required of the project official in the event that implementation is delayed or deviated from the correct path.
- Follow-up and accountability of the officials of the reform program projects in the event of delay in achieving the goals approved within the approved timetable.
- Any additional tasks assigned to the cell by the Supreme Committee for Reform.
The Council of Ministers indicated that the Executive Director of the Supreme Committee for Reform has the authority to contract with experts and executives without pay, and he has the right to duly contract for a fee with the approval of the Supreme Committee for Reform.
All government agencies are obligated to give the reform program priority, cooperate and coordinate with the Reform Administration Cell, and submit the required reports and data within the specified timeframes, including naming an official with a grade of no less than a general director for each project, according to the Council of Ministers.
The Cabinet concluded that the required work teams, human and material resources will be allocated to ensure that the reform program proceeds according to the approved plans. link
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