Iraqi Economic News and Points To Ponder Friday AM 6-7-24


Iraqi Economic News and Points To Ponder Friday AM 6-7-24

Investment Law In The Balance Of The Economy

 Economical 06/06/2024  Dr.. Adnan Hadi Jaaz  There is no doubt that investment is one of the most important factors that can contribute effectively to correcting the defect in the structure of the Iraqi economy, diversifying sources of income, and reducing dependence on oil.

 Reaching this goal is one of the most important strategic goals that contribute to Iraq’s stability and development and confronting economic, political and social crises.

Therefore, the law that is drawn up to attract investment must direct the financial surpluses of Iraqi society and make them move in the direction that uses capital efficiently and achieves the maximum for Iraq. Possible benefit.

 Private sector investments, whether local or foreign, are among the most important factors that can be relied upon to solve the problems of the Iraqi economy.

 The private sector is the second wing of the economy, and reality and history have proven that its distance from the economic scene was one of the biggest historical mistakes in Iraq.

 However, in a quick reading of the new investment law, we are disappointed according to our vision and economic ambitions, and fears have increased for the future of this country’s economy, and  in this article we try to explain the reasons for this not optimistic vision.

 According to our reading, the proposed investment law is nothing more than a law for investment in residential cities, which is not considered a channel for transferring the financial surpluses of Iraqi society into the hands of a small, non-productive group, some of whom are foreign.

The investor in building residential cities can import all the materials he needs for the project without any return to the state or the state treasury.

 He can grant the land for free, and we all know that the lands overlap and there is no difference between what is inside the basic design and outside it. Obtaining financial facilities and soft loans.

After 25% of the project is completed, he has the right to withdraw the capital and profits in full.

 He has the right to employ foreigners, and of course these facilities will be used to import many times the materials and goods that the investor needs, which is the biggest source of increasing his profits and exporting foreign exchange many times the amount he obtained. Return as well as remittances of foreign workers.

 As for what was mentioned in the privileges, he has the right to use what he increased from the land after the completion of the residential project without restricting or even specifying the land.

 This is a lot of talk.

 If we assume that he decided to build facilities that are not appropriate for the privacy of Iraqi society, or any of the investments that are not appropriate for them to be in residential areas.

 Does the law allow us to prevent it? The second question is: He has the right to invest the surplus, regardless of its size: five, ten, or even twenty dunams, and perhaps more!

All of this is for the sake of producing housing units that are so far beyond the capacity and capacity of the middle class and even those with above-average incomes, and so far we only see from it an increase in the well-being of the wealthy by isolating them and settling them in private cities and in return absorbing the community’s financial surpluses and exporting them abroad.

Is this goal worth all these high economic costs?

 Yes, it can stimulate the economy and increase growth if Iraq produces what the real estate sector needs, and  therefore we say that it is an expansionary financial policy that aims to increase growth rates and income by increasing production rates and thus increasing employment and income rates in a way that contributes to solving the unemployment problem that haunts the political class and always threatens it. By failure.

 If we

     give the land for free with exemptions from taxes and fees, in addition to an

     interest-free loan to the investor, and we

     allow the employment of foreigners, and we

     allow the export of foreign exchange, which is the financial surpluses of citizens and the loans that came from the Central Bank and Iraqi banks,  then all these sacrifices are for the sake of increasing the well-being of the wealthy, nothing more and nothing less.

 There is a real solution to the problem of housing the poor and the middle class, and even

 if the needs of these segments are to be met, there are shorter and much less expensive ways, as the cost is great and very significant for the economic policy in general.

 If we assume for the sake of argument that the visionary aims to increase the supply of housing units until it exceeds demand, then the gradual decline in prices will begin.

I believe that with the presence of crazy financial surpluses, including money laundering and the legalization of corruption funds, and some segments on which there are no restrictions, and they are many without detail, this is what I call the effect.

 The double negative of this money is that it deducts from public funds and exploits citizens.

 It works to increase prices in a way that cannot be kept up with in the real estate sector, and real estate in Baghdad and Basra are the best examples.

 Therefore, this goal is difficult to achieve and requires a long period of time or for these cities to reach remote areas. Too far.

 We must be patient in approving this law, and we must push financial surpluses of all kinds in another, more efficient direction, as  they are an important financial resource and the key to solving many of Iraq’s economic, political and social problems.

 We push them towards industry, especially with goods that meet the needs of the real estate sector and modern agriculture that meets the market’s need, and this is something that can be achieved.

 Easily with the very large profit opportunities from the very large movement of the real estate sector due to the support of the financial and monetary policies represented by the initiatives of the Central Bank, then

 it can be said that Iraq is pursuing a financial and monetary policy with clear features and results for the present and the future, and that these reasons for the investment law are somewhat logical.   

Indicators Of The Growth Of Bank Cards In Iraq

 June 06, 2024  The Central Bank of Iraq announces indicators of the growth of bank cards with the total number of them issued for the years (2018 – 2023), which show an increase in the number of cards over the past years.  Central Bank of Iraq  information Office  June 6, 2024

 Indicators of the growth of bank cards in Iraq Clip_image004

The Iraqi National Bank: We Do Not Deal With Companies Suspended By The Central Bank

June 6, 2024 Last updated: June 6, 2024   Independent/- The National Bank of Iraq confirmed that it does not deal with companies that the Central Bank of Iraq has stopped from entering the window for buying and selling foreign currency, pointing out that

 this comes in compliance with international standards for combating money laundering.

 The bank said in a statement,

“This confirmation is based on the National Bank of Iraq’s firm commitment to good governance and full transparency in implementing the instructions of the Central Bank of Iraq, and the bank’s keenness to apply the highest international standards to combat money laundering and terrorist financing.”

 Commenting on this decision, the bank’s authorized director, Ayman Abu Dhaim, stressed the importance of adhering to the principles of good governance as a basic pillar in all of the bank’s activities, saying:

 “We believe that good governance enhances trust with our customers and partners, and contributes to enhancing financial and economic stability.

 Transparency in implementing the instructions of the Central Bank of Iraq represents an integral part of our strategy to maintain the integrity of banking operations.”  Abu Dhaim explained,

 “The National Bank of Iraq adheres to the highest international standards in combating money laundering and terrorist financing, and follows strict procedures in auditing all financial transactions and verifying the sources of funds to ensure that they are not used in illegal activities.

 It also works to regularly update its systems to comply with best practices.” International and the instructions of the Central Bank of Iraq.

 Abu Dhaim pointed out  “the importance of the due diligence procedures followed by the bank to ensure the safety of customer funds and companies’ assets,” and said:

 “We are keen to implement due diligence procedures accurately, as we periodically examine transactions and ensure their compliance with national and international standards.”

 These measures contribute to enhancing confidence in our financial system and ensuring the safety of our customers’ funds.”  Abu Dhaim stressed,

 “The National Bank of Iraq places the interest of the national economy and the safety of the banking sector at the top of its priorities, and that

 its commitment to the instructions of the Central Bank of Iraq comes within the framework of this keenness to enhance financial stability and combat illegal practices.”الأهلي-العراقي-لا-نتعامل-مع-الشركات-ال/    

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Provoking Thoughts and Points To Ponder On Adversity:

The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.  – Martin Luther King, Jr.

Great occasions do not make heroes or cowards; they simply unveil them to the eyes of men. Silently and imperceptibly, as we wake or sleep, we grow strong or weak; and at last some crisis shows what we have become.  – Brooke Foss Westcott

What does not destroy me, makes me strong.  – Friedrich Nietzsche

I long ago came to the conclusion that all life is six to five against.  – Damon Runyon

(Adversity is) the state in which a man most easily becomes acquainted with himself, being especially free from admirers then.  – Samuel Johnson

Adversity has the same effect on a man that severe training has on the pugilist – it reduces him to his fighting weight.  – Josh Billings