TNT – “Tidbits from TNT” Saturday 5-11-2024

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Tishwash:  A $700 million agreement is signed between Iraq and Italy to finance these projects

Today, Saturday, the technical advisor to the Prime Minister, Muhammad Al-Daraji, announced the signing of an agreement between Iraq and Italy to finance industrial projects worth $700 million, while he confirmed the signing of memorandums of understanding to equip Iraq with (6) Italian factories for the private sector.

Al-Daraji said in an interview followed by Al-Eqtisad News, “Under the guidance of Prime Minister Muhammad Shiaa Al-Sudani, an agreement was signed between the Supreme Committee for Sovereign Guarantees and the Italian Shasa Credit Corporation on behalf of the Italian government to finance industrial projects in Iraq worth $700 million,” noting that “The agreement was signed between the Trade Bank of Iraq (TBI) and two Italian banks to finance these projects.”

He added, “As part of the government’s initiative to support the private sector, memorandums of understanding were also signed between Iraqi businessmen and businessmen from Italian suppliers of production lines and factories to supply 6 factories to Iraq,” indicating that “these factories include glass products, medicines, slaughterhouses, poultry and egg rearing, and gas processing.” The facility, an iron factory, and a pharmaceutical factory.”  link

Shybaby:  Iraq requests end of UN assistance mission by end-2025

BAGHDAD (Reuters) –

Iraq has requested that a United Nations assistance mission set up after the 2003 U.S.-led invasion of the country end its work by the end of 2025, saying it was no longer needed because Iraq had made significant progress towards stability.

The mission, headquartered in Baghdad’s heavily fortified Green Zone, was set up with a wide mandate to help develop Iraqi institutions, support political dialogue and elections, and promote human rights.

Prime Minister Mohammed Shia al-Sudani said Iraq wanted to deepen cooperation with other U.N. organisations but there was no longer a need for the political work of the U.N. assistance mission, known as UNAMI.

The mission’s head in Iraq often shuttles between top political, judicial and security officials in work that supporters see as important to preventing and resolving conflicts but critics have often described as interference.

“Iraq has managed to take important steps in many fields, especially those that fall under UNAMI’s mandate,” Sudani said in a letter to U.N. Secretary-General Antonio Guterres.

Iraq’s government has since 2023 moved to end several international missions, including the U.S.-led coalition created in 2014 to fight Islamic State and the U.N.’s mission established to help promote accountability for the jihadist group’s crimes.

Iraqi officials say the country has come a long way from the sectarian bloodletting after the U.S.-led invasion and Islamic State’s attempt to establish a caliphate, and that it no longer needs so much international help.

Some critics worry about the stability of the young democracy, given recurring conflict and the presence of many heavily armed military-political groups that have often battled on the streets, the last time in 2022.

Some diplomats and U.N. officials also worry about human rights and accountability in a country that frequently ranks among the world’s most corrupt and where activists say freedom of expression has been curtailed in recent years.

Iraq’s government says it is working to fight corruption and denies there is less room for free expression.

Somalia’s government also requested the termination of a U.N. political mission this week. In a letter to the Security Council, the country’s foreign minister called for the departure of the Nations Assistance Mission in Somalia (UNSOM), which has advised the government on peace-building, security reforms and democracy for over a decade. He provided no reason. 

Metro Portal (newsroomlabs.com)

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Tishwash: They prefer to put their money in their homes.. When will the banking sector gain the trust of Iraqis?

The citizen prefers that keeping his cash in his home is a guarantee of its security, rather than having it in institutions that they do not trust in to house this money, which has led to the impeding the growth of the banking system in the country, while the Iraqi government is trying to attract cash liquidity by automating the citizen’s daily transactions. Through electronic payment cards and other plans to restore this trust between the citizen and the Iraqi banking system.

Banks, in turn, increased the number of their bank branches. Many private banks were opened throughout Iraq to enhance accessibility and enhance financial inclusion, while observers explained that the citizen must give these banks an opportunity to achieve economic growth in the country, while others attributed the lack of this confidence to weakness. The scarcity of banking services made them unable to attract citizens and merchants, in addition to the high interest rates on loans and advances.

Support banks

While the majority of banks in Iraq represent 90.5% (67 out of 74 banks) of the total number of banks. It is owned by the private sector and also owns the capital of the banking sector in Iraq.

Banking expert Saif Jawad Al-Halafi confirms, “One of the foundations of banking is banking comprehensiveness in diversifying the banking services provided to the public, and that the bank does not depend in making profits on a banking operation that it monopolizes as a result of the availability of external regional factors affecting Iraq’s foreign trade movement.”

 Noting that, “The investor has the right to reap profits, but our banks also have the right, even if they are marred by some wrong banking behavior for a certain period, they have the right to be included with everyone in enjoying all the banking services available in the Iraqi banking arena and in foreign trade, from opening credits or transfers.” “External”.

Maintaining the banking sector

Al-Halafi explains in an exclusive interview with Al-Mada that “all Iraqi banks must be supported without exception, whether they are fully owned by Iraqis or there are foreign contributions participating in Iraqi capital.” Pointing out, “There is a crowd of depositors and investors in these banks, and the government must provide all full support to all of them because one of the basics of the Iraqi national security standard, and one of the most important points, is to maintain the strength of the banking sector without being subjected to pressures or tremors that overthrow some.” Banks, because you will affect the rest of the Iraqi banks as a whole.”

Al-Halafi continues, “The journey of establishing Iraqi banks and the Baghdad stock market is an arduous journey, the journey of which began with the late Hassan al-Najafi, so we must support our banks, whether that is with constructive criticism or correction.” Stating, “What is sad is that the Iraqi banking sector is older than all neighboring countries, and for this reason we never allow our banks to let us down because they are our security and the future of Iraqi foreign trade, and they have the right to contribute to all banking and economic activities without exception, especially in the upcoming Al-Faw port project.” And also the path of development.

risk

While most Iraqis avoid crediting their assets to traditional commercial banks because of their doubts and the political differences that arise from time to time, in addition to the fact that there are those who have religious reservations.

The financial advisor to the Prime Minister, Mazhar Muhammad Saleh, stated that “the vision of the government curriculum is moving towards implementation with consistent steps, all of which lead towards successive reform applications and according to a systematic and comprehensive structure that addresses the details of the national economy and according to the priorities drawn up from the beginning.” Pointing out, “It is known that the contribution of government sectors to the country’s gross domestic product is about 63%, as the Iraqi economy is the fourth economy in the world in terms of the government sector’s dominance in generating gross domestic product.”

Saleh added in an interview with Al Mada, “Economic reform inevitably begins with the government economy, which has the greatest contribution to the growth of the country’s national income.” Noting that, “With a closer look, the reform priorities started today from the government finance sector, and we mean government banking activity, which currently dominates 85% of banking operations in the country, but operates with capital or ownership rights that constitute only 22% of the total banking capital.” In the country, which made it restricted in the development of general economic activity and the development of the market economy, and since finance is an activity that precedes real productive activity in terms of importance and logic, Prime Minister Muhammad Shiaa Al-Sudani adopted a scientific and practical approach by moving towards reforming the government commercial banking system.

Achieving financial inclusion

The lack of experience, lack of services, and lack of banking culture led to a collective alienation from the entire banking sector, which hindered the development of this important system in the country.

As Saleh returns to update (Al-Mada), that “to begin with, one of the largest international companies specialized in reform studies and financial, accounting and administrative auditing was commissioned to prepare an accurate assessment of the reality of government banks in order to achieve comprehensive reform processes for the government banking system itself, and at the forefront of that is Generating a government commercial bank that directs directly towards the market economy and financing trade and investment, achieving financial inclusion, enhancing the levels of credit granted to the market, and introducing advanced technologies, financial applications and payment systems into this new banking system that will work on broad foundations of banking governance, compliance and driving growth and development rates. Sustainable economic growth, in addition to adopting the necessary legal applications to enhance property rights and raise their capital to record levels in accordance with the principles of banking (Bazal) that are applied globally.”

He added, “Also, providing mechanisms for its openness and integration with the global banking market. It is no secret that the other and important aspect of government banking reform will undoubtedly lead to the birth of banking specialized in government financial operations, exercising exclusively banking functions related to government operations, and at the same time helping in the development of treasury account mechanisms.” The unified TSA is the account that gives public finance the real-time ability to know the country’s government cash flows with high efficiency.”

He concludes his speech by saying, “The reform processes will also include, in the stages of their work, specialized banks such as the Industrial, Agricultural, and Real Estate Bank, as they will operate in the future as a development bank, in which property rights will be strengthened by making them a profitable and strong public shareholding company that contributes to financing private investments in economic development through grants.” Flexibility and adequacy in granting credit for productive investment operations, with a view consistent with the targeted growth rates in gross domestic product, which is indicated today by the National Development Plan 2024-2028, and future national development plans.”

It is noteworthy that Iraq includes 72 registered banks, including 38 banks participating in the auction for selling American currency at the Central Bank. However, the US sanctions that recently affected 14 banks, and other banks that were subject to similar sanctions months ago, led to the number of banks participating in the The currency auction is now being sold by only 18 banks.  link