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More Iraqi News Monday PM 1-25-21

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The Erbil Stock Exchange And The Devaluation Of The Dinar

Monday 25 January 2021 68  Erbil: Sundus Abdel Wahab The stock market in the center of the city of Erbil, the center of the Kurdistan region, is witnessing a state of cautious anticipation by traders and citizens when buying hard currency “dollars”, or selling it according to the customer’s need, as the financial market was affected by the decision of the Central Bank to change the exchange rate, having its negative effects in the governorates markets The country and then pushing the federal government to harness all the economic, political and administrative joints, to redress the accelerating collapse in the general situation in the country, especially the economic one.

Stock exchange and currency

The researcher and specialist in the economic field, Farman Dashti, told “Al-Sabah” that since the past five years, local markets have been accustomed to a fixed price for selling the dinar against the dollar, as the exchange rate in the exchange offices was 1,200 dinars against one dollar or about this price.

Since 1996, the stock market in Erbil has not witnessed a rush of buying or selling dollars from citizens, as is the case now, in the hope of achieving the largest gains, and benefiting from the recent decision by the federal government to reduce the price of the dinar against the dollar by nearly 20 percent.

Salaries of employees and retirees

Dashti added, “It is the responsibility of the government to provide salaries for employees, retirees and those covered by social care from oil imports and other imports such as taxes and customs,” noting that “the decrease in the cash liquidity available to the federal government from hard currency, in turn, led to a decline in the country’s stock of this currency from 80 to 50.” Billion dollar”.

The dollar and the neighboring countries

One of the other undeclared reasons that led to this decision was to limit the smuggling of hard currency to neighboring countries, the specialist explained, and that the country lost a lot of its money received in hard currency for the benefit of those countries through smuggling or exaggerated import. The local currency will make smuggling a useless and unprofitable process.

Realistic and radical solutions

Dashti said, “Despite the huge inflation of the dollar and affecting a large segment of society, it is the solution to a financial and economic disaster that may happen soon and it has been realized with this decision,” adding, “It is necessary that the local economic reality and industrial and commercial development within the country be promoted from In order to avoid the crisis and the difficult financial circumstance the country is going through. ”

Exchange and sudden decision

In turn, Muhammad Abdel-Wahhab (an employee in the exchange office in the stock market) told «Al-Sabah»: «It was more appropriate for the central government to take the decision gradually, and the central bank had to implement this step seriously in the past years».

He added, “The reduction in the price of the dinar against hard currencies should be gradual and not surprisingly, which created a shock for all Iraqis and was not limited to currency dealers in the stock market.”    LINK

International Institute: Iraq Faces Challenges From Multiple Fronts

Time: 01/25/2021 00:32:51 Read: 2,626 times    {International: Al Furat News} The sharp decline in oil prices and production after the Corona virus pandemic has paralyzed the Iraqi economy, as oil represents 65% of the Iraqi GDP, 95% of total exports, and 90% of government revenues, according to a report issued About the Institute of International Finance.

In 2020, coronavirus cases and deaths resulting from it in Iraq were among the highest in the Middle East and North Africa region, as enforcement agencies were unable to enforce social distancing or at least wear masks. This was with the government’s attempt to commit to paying wages and pensions to more than 90% of the people, and to increase spending capabilities on health and the social sector as a kind of response to the epidemic and trying to stimulate non-oil economic activity.

The Institute of International Finance expects the Iraqi economy to contract by 11.2% in 2020, which is considered the worst performance since 2003, as the real oil GDP contracted by 12.4%, largely due to the decision of the OPEC + coalition to reduce production, while Non-oil GDP may have contracted by 9.3%.

Looking ahead, the International Institute of Finance expects the Iraqi economy to grow by 1.6% in the current year 2021.

The main drivers and drivers of this expected growth include a significant improvement in oil exports, a recovery in public investment rates, which decreased by more than 50% in 2020, and a shift in the current account balance. From a surplus of 3.5% of GDP in 2019 to a deficit of 10.2% in 2020 despite the sharp decline in imports.

On the other hand, with limited capital inflows, capital reserves decreased by $ 14 billion, to reach $ 9 billion.

The sharp drop in oil revenues doubled the deficit in GDP to 15.6%, which was largely financed by domestic borrowing.

This huge deficit, along with the devaluation of the Iraqi dinar, led to a significant jump in government debt levels from 54% of GDP in 2019 to reach 94% of GDP in 2020.

The depreciation of the Iraqi dinar is expected to lead to a modest recovery in export levels. Oil and current prices could put the fiscal position in more sustainable conditions. The International Institute of Finance expects the fiscal deficit to shrink from 16% of GDP in 2020 to 8% in 2021, provided that average oil prices reach $ 46 per barrel, and it could decrease by an additional 1% if the average price of a barrel of oil reached 57. In dollars, the devaluation will also lead to achieving a financial balance of 5% of the gross domestic product due to the high oil revenues in Iraqi dinars.

The institute noted that Iraq needs more public investment to repair the war-damaged infrastructure and strengthen the provision of basic public services, including electricity. On the other hand, current spending needs to be redirected to health, and spending on wages and pensions, which represent 65% of total public spending, will be reduced.

Oil prices in the public finances are still good, but higher than the expectations of analysts at the Institute of International Finance.

Analysts at the Institute of International Finance estimated the average price of oil at $ 63 in Iraq’s 2021 budget, supported by a 13% increase in the budget without oil revenues, a 10% increase in government spending, and an increase in oil exports by 2%.   LINK

The Financial Committee Reveals What Happened In Its Meeting With The Kurdish Delegation

Political| 03:51 – 01/25/2021  Baghdad – Mawazine News   The Finance Committee revealed, on Monday, what happened in its meeting with the Kurdish delegation.

A member of the committee, Representative Shirwan Mirza, said, “The meeting was positive and discussed many issues related to the Kurdistan Region’s share of the federal budget for 2021.”

He added, “The members of the Finance Committee directed some questions to the Kurdistan Regional Government delegation, which in turn confirmed that he would respond to these questions at the next meeting.”

Mirza pointed out that “the meetings of the Kurdistan Regional Government delegation with the Finance Committee will continue Monday and tomorrow Tuesday to reach an agreement on the outstanding financial files between the Kurdistan Regional Government and the federal government.” Ended 29 / A 43

https://www.mawazin.net/Details.aspx?jimare=139209

Parliament: Finance Does Not Know The Real Revenues And The Size Of State Employees

Monday 25 January 2021  131  Baghdad: Ahmed Abd Rabbo  The Finance Committee in the House of Representatives is moving towards compressing expenditures in the 2021 draft budget, including what it called “government luxury”, offset by an increase in revenues of up to 120 trillion dinars.

The Parliamentary Committee indicated that the Ministry of Finance had failed to deliver accurate and true data on the volume of revenues and public expenditures, stressing that it did not know the size of the employees.

On Sunday, the committee hosted officials of the Central Bank, the Counter-Terrorism Service, and the Director of the Oil Marketing Company (SOMO), to discuss the provisions of the budget, as part of its sessions to end the discussion of the project, so that it will later be presented in Parliament.

The First Deputy Speaker, Hassan Karim Al-Kaabi, called, during his presidency of a committee meeting, to “the necessity of expediting the drawing up of a common vision between the executive authority and the private sector as it is the real partner to activate the economy and overcome the current financial crisis.”

For his part, a member of the committee, MP Naji Al-Saeedi, told “Conscious”: “The deficit in the budget is greatly exaggerated, and that part of it is not real,” pointing out that “the main objective of the work of the Finance Committee is to reduce the deficit.”

He added, “Reducing the deficit will be through reducing public (operational) spending and the so-called government luxury expenditures, and maximizing public revenues.”   LINK

After Claiming That He Was Infected With Corona, He Evaded Questioning By Parliament … The Head Of The Media And Communications Commission Flees To Lebanon With His Family In Najaf

Ali Mohsen Radi416 2021-01-25  A document issued by Al-Karkh’s health revealed that the head of the Media and Communications Commission, Ali Al-Khuwailidi, had traveled to Lebanon to evade the questioning of the Iraqi parliament, which refutes his infection with Corona virus

Al-Khuwaildi had submitted a book to the House of Representatives in which he claimed that he was infected with Corona virus, and that raised suspicion of the Presidency of Parliament, which led to the latter’s request to confirm his health condition, so that the book of the Al-Karkh Health Department came to deny Al-Khuwailidi’s claim, as a medical detachment went to his residence in Baghdad to show that he had traveled to Lebanon And that his family moved to Najaf, and when the detachment asked for the family’s address in the governorate, the guards at Al-Khuwaildi’s house refused to give their address.

The House of Representatives questioned Al-Khoweildy in absentia yesterday to find out about the violations he had committed inside the commission, especially the mobile phone company deal, as well as other files tainted by major financial corruption    http://burathanews.com/arabic/news/385085

Oil Minister: Affirms Iraq’s Keenness To Cooperate With Sober International Companies To Develop Its Oil And Gas Fields

Monday 25, January 2021 17:05 | Economical  Views: 114   Baghdad / NINA / Oil Minister Ihsan Abdul-Jabbar Ismail discussed with the representative of Halliburton Fahd Nassar, to enhance joint cooperation in the field of oil and gas.

The minister affirmed, according to a statement by the ministry, Iraq’s keenness to cooperate with sober international companies to develop its oil and gas fields.

For his part, the company’s representative expressed his hope to expand the horizons of bilateral cooperation by participating in investment projects to develop the oil and gas sector.

https://ninanews.com/Website/News/Details?key=883992

The Stock Market Index Decreased By 0.27%

Market  Economy News – Baghdad The stock market index fell, on Monday, by 0.27% after 15 companies entered the red.  During Monday’s session, 2.5 billion shares were traded, worth 1.1 billion dinars.

Fifteen companies entered the red zone, if the Petroleum Products Transport Company topped the losing companies by 17.91%, followed by the Islamic Atta Bank Company by 7.14%.

While the value of the shares of 8 companies, topped by the shares of the Middle East Bank Company, rose by 9.09%, followed by Gulf Bank shares by 7.69%.

In turn, foreign investors sold 105 million shares, worth 59 million dinars, after executing 21 deals on shares of 6 companies.   Number of observations 85 Date added 01/25/2021

https://economy-news.net/content.php?id=23807

Calls To Cut Interest On Financial Loans

Monday 25 January 2021  36   Baghdad: Haider al-Rubaie  Specialists in banking affairs stressed the need to pursue a financial policy to reduce the value of interest on loans granted to citizens, employees and the private sector, stressing that “improving” the interest rate is sufficient to enhance economic growth, move the market wheel and provide many job opportunities for the unemployed, indicating at the same time that lending The industrial and agricultural sectors, with a low or no interest margin, would move the wheel of production in these two sectors.

These calls came after the widening of the complaints of the beneficiaries of the financial loans granted by government and private banks, which impose interest, some of which reach 10 percent, which crippled the aspirations of many employees and citizens, and undermined the efforts of industrial and agricultural development.

The cost of borrowing

The banking expert, Abdul-Hussein Al-Mandhari, said during an interview with Al-Sabah that “it is difficult in the current situation for commercial banks to reduce interest rates on loans granted to the public, attributing this to the high cost of lending and the scarcity of cash liquidity, indicating that some banks grant interest within limits 5 percent for savings deposits and more than that for fixed deposits according to their duration, and to these benefits are added to the operational costs that banks spend when granting loans.

From the central bank or the Ministry of Finance to activate the economic wheel or to reduce pressure on citizens to encourage them to request bank loans, noting at the same time that the monetary mass outside the banking sector is estimated at more than 70 percent, and banks seek to withdraw it to enhance its liquidity and grant its credits.

Reducing benefits

The banking expert, Abd al-Rahman al-Sheikhly, did not deviate much from the previous opinion, when he stressed in a statement to “Al-Sabah” the need to reduce the interest obtained on loans, pointing out that “many private banks that grant loans are obliged to collect high interest Because these funds belong mainly to depositors who charge interest on them, sometimes reaching 7 percent. ”He added,“ Therefore, when those banks lend these sums “deposited with them” to citizens, the ceiling of the interest charged from

Al-Sheikhli believes that the funds available at government banks, which are granted to citizens in the form of loans, should be low interest rates, given that these funds belong to the state. It is now granted without interest to anyone who buys a housing unit from investment projects, describing it as “positive and good.”

The spokesman for the Prime Ministry and Minister of Culture, Hassan Nazim, in a press conference, announced after the cabinet session last week, activating the initiative of the Central Bank to lend citizens to build and buy housing units without interest, in addition to lending industrial businessmen at a rate of only 3 percent.

The minister pointed out, “Activating the work of the committee supervising the loans of the central bank’s initiative that provided facilities to citizens,” while indicating that “among these facilities is that the loans for the purchase of housing units in investment complexes are without interest and amounting to 125 million dinars, with a payment period of 20 Year for the bank Real estate ”.   LINK

Parliament Discusses Two Versions Of The Federal Court Law

Monday 25 January 2021  89  Baghdad: Muhannad Abdul-Wahhab  The House of Representatives is discussing two versions of the Federal Court’s law, one from the government and the other from the Presidency of the Republic, while the Parliament’s law affirmed that passing the bill needs consensus Prior politician.

A member of the committee, Hussein Al-Uqabi, said: “The committee met to discuss the data of the law, and its priorities and some paths were identified to speed up the approval of the Federal Court’s law,” indicating that “the file needs compatibility between the political blocs, as it is a central and strategic law and one of the state’s priorities.

He added that “the formulas reached by the Legal Committee regarding the Federal Court Law are represented in two tracks. The first is the legislation of the original law that arrived from the government years ago and should be enacted by two-thirds in accordance with the constitutional article 92, and the second is the legislation of a law that arrived from the Presidency recently.”   LINK

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