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Iraq's financial crisis between funding the war and Iran's influence
July 17, 2015
With the resulting devastation and destruction and the continuation of the war and military operations and control losses «Daash» over large areas of Iraq and the exploitation of its resources and the theft of some state institutions funds, in addition to the loss of large amounts of oil revenues due to lower prices, as well as carrying the burden of the economic and social deterioration in the light of the continued financial corruption and waste of public funds, much-needed government of Prime Minister Haider Abadi liquidity to fill the year's budget deficit in 2015 in excess of $ 25 billion, but the face of the growing cost of military steadfastness in the fight against terrorism.
Therefore, studying Finance Minister Hoshyar Zebari available sources to secure necessary to satisfy the government and enable it to continue paying dues imposed by the funds, has finally got the World Bank's approval to provide loans to Iraq worth $ 1.7 billion, and hoped to get loans from the International Monetary Fund up valued at about $ 4.5 billion, note that the Fund had reached in early June (last June) to deal with him regarding an initial loan of $ 833 million program.
As the Iraqi people rich, because of the currency in circulation size in the market more than $ 80 billion, is divided between the banking sector (state banks and private) and between citizens who are unaware of how to invest in such difficult conditions experienced by Iraq, Zebari announced plans to issue bonds worth five billion dollars sold to citizens in two phases, to begin «promotional tour» at the end of July or in early August 2015, the government is assisted by three international banks to arrange this version which is «JP Morgan», and «Deutsche Bank» , and «Citibank», as well as utilize Bmasstin credit rating two «Fitch» and «Moody», to get the rating «technical» contributes to attract investors.
Prior to the Iraq that was forced to repay some of the debt owed it to oil companies across the quantities of production, especially as the amounts due until the end of last year, amounted to about $ 27 billion, but it seems that the Ministry of Finance did not stop at this, as Zebari finally announced that his government intends to secure funds exceptional by selling oil from the reserve of Basra, on the basis of «payment in advance», and for the first time, while seeking to amend the exploration contracts management method and production with companies introducing revenue sharing, because falling prices make the Baghdad pay larger amounts for companies compared to what you would pay on the basis of production sharing contracts .
The estimated oil reserves is installed in Iraq by about 150 billion barrels, accounting for the largest conventional oil reserves in the world after Saudi Arabia and Iran. But, can you Abadi government achieve its objectives in addressing the financial crisis and secure the necessary liquidity to domestic and foreign payments?Iraq is rich state, and the promising investment opportunities and attractive Iraqis to investors, Arab and foreign, and proved the ten-year period from the start of the US occupation and the overthrow of Saddam Hussein's regime and the end of 2013 the ability of Iraqis to adapt to the security and political developments, it was noted that in 2013 Register »amounted to about 9 economic growth« record percent according to the IMF report.
With Iraq out of Chapter VII of the United Nations after undergoing his more than 23 years after the invasion of Kuwait, he began looking to attract Arab and foreign investments for the implementation of 740 projects worth $ 32 billion, as part of an investment map will continue in two phases, the duration of each five-year period, and includes a number a large oil and electric projects, so that some companies were started sending its engineers and workers to the Iraqi sites.
In order to finance these projects, to increase the production of oil in a gradual form for up to nine million barrels per day in 2020, Iraq's plans, but the military operations and the intensification of land battles and aerial bombardment, especially in areas near oil wells in Mosul and Kirkuk, led to a reduction of production and reliance Only the South Oil in the Basra area, which has produced about 2.5 million barrels per day, and in addition to that came falling prices, which reduced the Iraqi treasury revenues, compounded by the inability of its budget for 2015.
There is no doubt that the financial and economic danger lies in the attempts are underway to hold a political deal parliamentary ratification of the final accounts for the past years and the silence on the hundreds of billions of dollars wasted, which is likely to politicians, senior benefited from it, as well as out large sums of money, part of which went to the neighboring countries, especially Iran, which has benefited from its control over Iraq, which it considers the most important windows to at least partially compensate for losses resulting from the application of international sanctions against it, and save the beleaguered economy.
Iran trade recorded with Iraq a major development in recent years, using all available windows, and statistics indicate that trade between the two countries jumped from $ 750 million in 2005 to more than $ 13 billion in 2014, and is expected to head the Chamber of Commerce Tehran Yahya Al-Ishaq access to $ 25 billion annually in years, with reference to the seriousness of the great imbalance in the unequal balance of trade in favor of Iran.
And speaks Baghdad full frankly about accusing a number of deputies who deal with commercial banks to conduct operations related to money laundering and smuggling to neighboring countries, in the absence of transparency, the primary responsibility of the government is to learn the beneficiary of these funds and identify the participating countries, with reference to the political sources tend to accuse Iran due to the need to finance the necessary military, political and economic plans in Iraq, Syria, Lebanon, Yemen, and other countries, to serve political influence.
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July 17, 2015
With the resulting devastation and destruction and the continuation of the war and military operations and control losses «Daash» over large areas of Iraq and the exploitation of its resources and the theft of some state institutions funds, in addition to the loss of large amounts of oil revenues due to lower prices, as well as carrying the burden of the economic and social deterioration in the light of the continued financial corruption and waste of public funds, much-needed government of Prime Minister Haider Abadi liquidity to fill the year's budget deficit in 2015 in excess of $ 25 billion, but the face of the growing cost of military steadfastness in the fight against terrorism.
Therefore, studying Finance Minister Hoshyar Zebari available sources to secure necessary to satisfy the government and enable it to continue paying dues imposed by the funds, has finally got the World Bank's approval to provide loans to Iraq worth $ 1.7 billion, and hoped to get loans from the International Monetary Fund up valued at about $ 4.5 billion, note that the Fund had reached in early June (last June) to deal with him regarding an initial loan of $ 833 million program.
As the Iraqi people rich, because of the currency in circulation size in the market more than $ 80 billion, is divided between the banking sector (state banks and private) and between citizens who are unaware of how to invest in such difficult conditions experienced by Iraq, Zebari announced plans to issue bonds worth five billion dollars sold to citizens in two phases, to begin «promotional tour» at the end of July or in early August 2015, the government is assisted by three international banks to arrange this version which is «JP Morgan», and «Deutsche Bank» , and «Citibank», as well as utilize Bmasstin credit rating two «Fitch» and «Moody», to get the rating «technical» contributes to attract investors.
Prior to the Iraq that was forced to repay some of the debt owed it to oil companies across the quantities of production, especially as the amounts due until the end of last year, amounted to about $ 27 billion, but it seems that the Ministry of Finance did not stop at this, as Zebari finally announced that his government intends to secure funds exceptional by selling oil from the reserve of Basra, on the basis of «payment in advance», and for the first time, while seeking to amend the exploration contracts management method and production with companies introducing revenue sharing, because falling prices make the Baghdad pay larger amounts for companies compared to what you would pay on the basis of production sharing contracts .
The estimated oil reserves is installed in Iraq by about 150 billion barrels, accounting for the largest conventional oil reserves in the world after Saudi Arabia and Iran. But, can you Abadi government achieve its objectives in addressing the financial crisis and secure the necessary liquidity to domestic and foreign payments?Iraq is rich state, and the promising investment opportunities and attractive Iraqis to investors, Arab and foreign, and proved the ten-year period from the start of the US occupation and the overthrow of Saddam Hussein's regime and the end of 2013 the ability of Iraqis to adapt to the security and political developments, it was noted that in 2013 Register »amounted to about 9 economic growth« record percent according to the IMF report.
With Iraq out of Chapter VII of the United Nations after undergoing his more than 23 years after the invasion of Kuwait, he began looking to attract Arab and foreign investments for the implementation of 740 projects worth $ 32 billion, as part of an investment map will continue in two phases, the duration of each five-year period, and includes a number a large oil and electric projects, so that some companies were started sending its engineers and workers to the Iraqi sites.
In order to finance these projects, to increase the production of oil in a gradual form for up to nine million barrels per day in 2020, Iraq's plans, but the military operations and the intensification of land battles and aerial bombardment, especially in areas near oil wells in Mosul and Kirkuk, led to a reduction of production and reliance Only the South Oil in the Basra area, which has produced about 2.5 million barrels per day, and in addition to that came falling prices, which reduced the Iraqi treasury revenues, compounded by the inability of its budget for 2015.
There is no doubt that the financial and economic danger lies in the attempts are underway to hold a political deal parliamentary ratification of the final accounts for the past years and the silence on the hundreds of billions of dollars wasted, which is likely to politicians, senior benefited from it, as well as out large sums of money, part of which went to the neighboring countries, especially Iran, which has benefited from its control over Iraq, which it considers the most important windows to at least partially compensate for losses resulting from the application of international sanctions against it, and save the beleaguered economy.
Iran trade recorded with Iraq a major development in recent years, using all available windows, and statistics indicate that trade between the two countries jumped from $ 750 million in 2005 to more than $ 13 billion in 2014, and is expected to head the Chamber of Commerce Tehran Yahya Al-Ishaq access to $ 25 billion annually in years, with reference to the seriousness of the great imbalance in the unequal balance of trade in favor of Iran.
And speaks Baghdad full frankly about accusing a number of deputies who deal with commercial banks to conduct operations related to money laundering and smuggling to neighboring countries, in the absence of transparency, the primary responsibility of the government is to learn the beneficiary of these funds and identify the participating countries, with reference to the political sources tend to accuse Iran due to the need to finance the necessary military, political and economic plans in Iraq, Syria, Lebanon, Yemen, and other countries, to serve political influence.
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