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  1. The Englishman

    Russia buys first shipment of Kirkuk crude KRG Update on Oil Production and Operations KRG Update on Oil Production and Operations Tawke Licence: The Kurdistan Regional Government notes the updates by DNO and Genel Energy on November 1st regarding production increases under the Tawke Production Sharing Contract (PSC). The KRG is pleased with the efforts of the Tawke PSC Contractors in the Peshkabir area of the Tawke PSC Licence, where production has risen to over 50,000 barrels per day (bpd) within 18 months, exceeding expectations. The recent boost in production at the Peshkabir area has more than compensated for the natural decline of the main Tawke field area, where production is now down to about 80,000 bpd, from 109,000 bpd in July 2017. Overall production under the Tawke PSC Licence reached 126,000 during October, compared to 114,000 bpd in July 2017. The current average is around 130,000 bpd (click here to view the chart). Pipeline Upgrades: The KRG has also recently completed an upgrade of its export pipeline by installing another pumping station at Shaikhan, which boosts capacity of the pipeline from 700,000 bpd to 1 million bpd. This extra capacity will accommodate future production growth from KRG producing fields, and can also be used by the federal government to export the currently stranded oil in Kirkuk and surrounding areas. Oil Export: The KRG currently exports over 400,000 bpd of crude oil. The KRG’s policy of maintaining consistent and timely payments to its producing oil companies has led to more investment in its oil fields, stabilising production levels and paving the way for further production increases during 2019. These export achievements generate more revenues that will help to reduce the KRG’s overall debts and aid the economic revival and sustainability of the Kurdistan Region. The KRG’s policy of supporting its producers provides further evidence that Kurdistan’s PSCs are a win-win for investors and the citizens of the Kurdistan Region.
  2. Iraqi Parliament to Discuss Kirkuk Crisis Basnews English 31/10/2018 - 15:51 Kurdistan ERBIL — The new Iraqi parliament is expected to soon discuss the situation in Kirkuk during a special session, said deputy parliament speaker Bashir Haddad. Kirkuk is being challenged by security and administrative challenges since the Iraqi army and Iranian-backed militias of Hashd al-Shaabi have taken over the city. The disputed Kurdish province experienced several years of stability prior to October 2017 when the Peshmerga forces were in control. According to Haddad, Iraqi Prime Minister Adil Abdul-Mahdi has promised to address the crisis in Kirkuk within three months. “Also, the new Iraqi government has a plan to address the issues related to Sinjar, hoping to normalize the situation there,” the deputy parliament speaker said. “We believe that the current government of Iraq is different from the previous one,” Haddad said to show optimism about the future of Kirkuk, Sinjar and other disputed Kurdish territories.
  3. COMMODITIES OCTOBER 26, 2018 / 3:43 PM / UPDATED AN HOUR AGO Iraq to halt Kirkuk oil exports to Iran, may resume them to Turkey Ahmed Rasheed 2 MIN READ BAGHDAD (Reuters) - Iraq will stop trucking crude from its northern Kirkuk oilfield to Iran in November to comply with sanctions imposed on its neighbour by the United States, two sources familiar with Iraqi oil export operations said on Friday. Currently, Iraq is exporting less than 30,000 barrels per day (bpd) to Iran via truck, the sources told Reuters. SPONSORED “Kirkuk oil trucking to Iran will be halted in November in line with the American sanctions against Iran. (State oil marketer) SOMO plans to sell 30,000 bpd from a small oilfield near Mosul as of November as an alternative. SOMO issued the tender on Thursday,” one source said. Former prime minister Haider al-Abadi’s outgoing federal government agreed a deal in mid-October with the Kurdistan Regional Government (KRG) to resume exporting crude to Turkey’s Ceyhan port via the KRG, the sources also said. The deal is subject to final approval by newly appointed Iraqi Prime Minister Adel Abdul Mahdi and Oil Minister Thamer Ghadhban, they added. “Kurdish authorities reached a deal with Abadi’s government to resume Kirkuk exports and it was decided that the final say should be left to the new government and oil minister to sign a final deal,” one source said.
  4. Interview New Iraqi government likely open to renewed oil negotiations with KRG By Hiwa Jamal 20 hours ago Amer Abdul-Jabbar (left), a former Iraqi minister of transportation, speaks with Rudaw anchor Hiwa Jamal in Erbil in October 2018. Photo: Rudaw Former Transportation Minister of Iraq Amer Abdul-Jabbar sheds light on lost oil and aviation revenues in former governments. He explains that only 50 planes a day were flying in the skies of Iraq when he first became minister of transportation, an amount he increased to 500 during his tenure. This has led to massive increases in revenues, although he is unaware of where the funds have gone. On the topic of oil, he says he has much experience and would offer advice to former Iraqi PM Haider al-Abadi through informal means like text messages, but much of his advice was ignored. He sees new PM Adil Abdul-Mahdi as ‘more moderate’ which could allow for an improvement in energy sector relations between Erbil and Baghdad. Abdul-Jabbar considers himself to be an ‘independent’ who can work and foster ties between the two governments. He claims there was more corruption in Abadi’s government than in his predecessor Nouri al-Maliki’s. Rudaw: Is the Iraqi government benefitting from its airspace which is used by international airlines? Amer Abdul-Jabbar: Iraq has a strategic airspace which is the busiest, quickest and calmest route that connects north of the world to the South, vice versa, and the West with the East. Iraq is a hub for these flights. The Iraqi airspace was under embargo from 1991 to 2009. When I became minister in July 2008, I put together a team and was leading the team. We met with the International Civil Aviation Organization, the International Air Transport Association (IATA), and International Aviation Safety Assessment (IASA). Consequently, we resolved some of the problems we had. This led to the lifting of the European embargo on Iraqi airspace in 2009. The embargo was re-imposed on Iraqi airspace after my duties as minister came to an end in 2015. The Iraqi Aviation Authority was established in 1940s and had no technical violations until the end of 2010. Yet, IASA reported and documented more than 230 violations of the Iraqi Aviation Authority from 2011 to 2015. That led to the embargo being imposed again on the Iraqi airspace. What were the reasons behind these violations? There were numerous violations. A gap emerges when you change the head of the aviation authority, who should be someone with When I became minister in 2008, there were 50 planes using the Iraqi airspace a day and the fee for each plane was $50. I asked why it was only $50. experience in aviation or at least a person who knows English very well because of continuous correspondence with international organizations and other global aviation authorities. It is not easy to just make a decision to change the head of such an establishment. Who will benefit from changing the head of such an establishment? When you have a minister affiliated with a political party, the party then tries to employ its own members at the respective ministry. Political parties appoint managers who aren’t certified. They then ask them to study at a private university to obtain a degree. There was someone who graduated from university in 2012, and was appointed as a general manager in 2013. Was the change related to income? Yes. When I became minister in 2008, there were 50 planes using the Iraqi airspace a day and the fee for each plane was $50. I asked why it was only $50. Was the fee for a plane $50 per day? Yes. There were 50 planes using the Iraqi airspace every day and the tax for each flight was $50, which was the fee set by the If they had worked according to our plans and the number of planes using our airspace had reached 4,000 by 2016 and each was being taxed $900, the annual revenue because of Iraqi airspace would have been $1.314 billion by now. previous regime. No one had changed that. I looked at the fee neighboring countries were charging. Some were taxing $375. We increased the fare to $375 and then thought about increasing the number of flights using Iraqi airspace. We then started giving special offers to aviation companies across the world. In the offers, we detailed the benefits of using Iraqi airspace. But these companies wanted reassurances. I explained to them the distance between planes flying in Iraqi airspace was 1,000 feet on both right and left sides. This is while the distance between flying planes in European airspace is only 200 feet. The number of aviation companies using Iraqi airspace then increased after they became certain of its safety. The number of planes using Iraqi airspace consequently reached 500 in 2010. This means revenues of $68 million if each flight is charged $375. Where did this money go? Did the country benefit from it? The income would go to state treasury. According to the plan we had designed, more than 4,000 planes were expected to use Iraqi But during Abadi’s cabinet, the whole budget was turned into functioning budget due to plummeting oil prices and corruption became endemic. airspace by 2016. The problem started after the head of the civil aviation authority was changed and I left the ministry. Only then did the number of planes using Iraqi airspace dropped. The number dropped to 70 in 2016 and to 37 in 2017. Each plane was giving a fare of $375 for using Iraqi airspace until early 2018, while airspace fares in neighboring countries had reached $900 by that time. If they had worked according to our plans and the number of planes using our airspace had reached 4,000 by 2016 and each was being taxed $900, the annual revenue because of Iraqi airspace would have been $1.314 billion by now. Haider al-Abadi’s cabinet is said to have had a better performance than Nouri al-Maliki’s. But according to your figures, Abadi’s cabinet was worse. Right? I am speaking about 2016 and 2017. The question concerns the head of civil aviation authority and director of the airline. If 75 I once asked the prime minister’s advisors whether they knew anything about SOMO. They don’t know anything about the company or its policies percent of our plan was a success by 2016, 3,000 planes would have used the Iraqi space a day. If you multiply 3,000 by 900, it would be $985 million a year, nearly a $1 billion. We lost this large revenue due to the lack of competent people in the sector. Abadi removed the head of civil aviation authority under the guise of a reform campaign. Then he removed the two deputy ministers of transportation along with their advisors. He removed 123 persons at the ministry of transportation alone and they were not even replaced. They instead appointed inexperienced people, which finally led to a reduction in income. The current minister of transportation has neither deputies nor advisors. If we compare the Abadi cabinet with that of Maliki, we can see there was investment budget during Maliki’s. But during Abadi’s cabinet, the whole budget was turned into functioning budget due to plummeting oil prices and corruption became endemic. There was more corruption during Abadi’s cabinet than there was during Maliki’s. The corruption levels during Abadi’s cabinet were more dangerous than those during Malki’s. Can you speak about the corruption in the oil sector in Iraq, especially as regards SOMO? I once asked the prime minister’s advisors whether they knew anything about SOMO. They don’t know anything about the company Why should we send information by a text message? It is advisors that are supposed to provide this information so that the country benefits from it. or its policies. They don’t know how the company sets its prices, how it calculates the amount of oil exported, how they conduct quality control for oil sales, when they reduce oil prices, and how it exports the oil. I worked in the oil sector for a long time. I began as an assistant engineer and ended up as general manager. I worked for an OPEC company. I have seen more than 100 harbors where oil is sold and exported. That is why I speak from experience. Advisors don’t have this kind of information. $1 billion has been wasted every year in the airline industry. The flight monitoring body was dissolved and turned into a company. Every party then started to open their own companies to invest in the airline industry. I made it known that there was cash in the sky, and now I don’t want to draw their attention to another kind of investment by touching on the mechanisms used to export oil. Baghdad has been constantly asking the Kurdistan Regional Government to hand over it oil reserves to SOMO. How could they ask for such a thing when they don’t know anything about the company is doing business? The government in Baghdad doesn’t know anything about oil sales of the Kurdistan Region. But SOMO does. However, neither the prime minister nor his advisors know anything about the works of SOMO. But the company itself is experienced in the business and has many competent people working for it. Why has SOMO kept the prime minister and his advisors in the dark about its business? Leaders, including the prime minister, president of the republic and speaker of the parliament, appoint advisors not to benefit from The people from Baghdad were defending the position of Baghdad, and Salih was defending the Kurdistan Region. their advice, but to get them to benefit financially from the country’s riches. Dr. Haider al-Abadi became acting oil minister after Dr. Adil Abdul-Mahdi resigned. I then sent him a message informing him of an error in the way SOMO was operating and explained to him how they could increase the oil price. Abadi had later sent the message to SOMO which led to the price of an oil barrel increase by 30 cents in a short period of time, which would mean an annual income of $383. He replied, thanked me and acknowledged they benefitted from my instructions. Why should we send information by a text message? It is advisors that are supposed to provide this information so that the country benefits from it. You have abundant experience in the oil sector. How do you think oil relations between Erbil and Baghdad can be improved? What should they do in order to reach an oil deal? I was once on the same panel as Dr.Barham Salih in the office of Dr.Ibrahim Bahr al-Ulloum, discussing relations between Erbil and Baghdad and the prospects for improving these relations. The people from Baghdad were defending the position of Baghdad, and Salih was defending the Kurdistan Region. Al-Ulloum was chairing the panel, who invited Amer Abdul-Jabbar to speak. And I told Salih I had a solution for the complex relations between Erbil and Baghdad and asked him to testify to an event that happened during Maliki’s cabinet where we were together in the council of ministers. He asked me to go ahead and say it. I said: “When the problem of falling oil prices emerged, the finance minister said they cannot pay salaries of employees until the end of the year if oil prices don’t change and oil exports do not increase.” Then Maliki asked if there was anyone who could resolve the problem. Salih said Abdul-Jabbar could solve it in front of more than 100 There are many problems between Erbil and Baghdad, but the most important one is oil. politicians. I then wrote a report detailing the failures of the ministry of oil and outlines mechanism to resolve the problems. When I submitted the report, Salih asked why I hadn’t signed it. I told him they were party men, and I was an independent minister affiliated with no parties and hence my signature was of no value. I asked him to sign it so that his position strengthens. Salih signed the report under his name and then submitted to the prime minister who later formed a committee of experts on the matter. After they investigated the matter, they realized all my information was correct. Then they decided to increase oil production from 1.85 million barrels to over 2 million. In the meeting, I suggested that a team headed by Dr. Ibrahim Bahr al-Ulloum be formed to resolve problems between Erbil and Dr. Adil Abdul-Mahdi is more moderate. The same team headed by Ulloum can be formed again and we could resolve the oil problem through cooperation between the two. Baghdad, and we too be part of the team. Ulloum has a doctorate in the field of oil and was minister of oil. He is also like by both the Kurd and Arabs. There are many problems between Erbil and Baghdad, but the most important one is oil. We said we would work to resolve the oil problem between the two. The majority of problems would dissolve and end if the oil problem is resolved. Salih said Dr. Amer Abdul-Jabbar is an expert, he had confidence in him, and that they had worked together in the council of ministers. He invited Ulloum and me to visit Kurdistan. Then I visited Dr. Hussein al-Shahristani and shared the idea with him. I asked him to give us the green light and support us in this initiative, and he said it was up to me and that I could visit the Kurdistan Region as an ordinary citizen. I am a minister. How can I visit them as an ordinary citizen, I replied? I asked him to approve my suggestion so that we resolve the problems. He said in a cold manner that he would hopefully get back to me. He didn’t encourage me to go ahead with my initiative. The file was later closed. But Dr. Adil Abdul-Mahdi is more moderate. The same team headed by Ulloum can be formed again and we could resolve the oil problem through cooperation between the two.
  5. Thursday, October 04, 2018. After ISIS: Q&A With Iraq's Central Bank Governor Ali Mohsen Ismail Al-Allaq Central Bank of Iraq Governor Ali Mohsen Ismail Al-Allaq tells Global Finance how his institution is working to support financial inclusion and economic diversification in the wake of his country’s victory over ISIS. OCTOBER 01, 2018 Author: GORDON PLATT Global Finance: Will higher oil prices translate to stronger economic growth for Iraq, and will this trickle down to the average Iraqi? Ali Mohsen Ismail Al-Allaq: Given our previous experience of depending heavily on oil proceeds, we are focused on enhancing financial inclusion and diversifying our economic sector both to grow Iraq’s economy and to address unemployment. In fact, the 2016 standby arrangement between Iraq and the IMF, which proposed a set of standards and objectives for sound economic recovery policy, was formulated as a response to the sharp decline in oil prices and Iraq’s need to defend its existence in a costly and devastating war against ISIS. We strive for a system where Iraqi citizens’ employment and welfare are not dependent on one commodity. This is a work in progress, but we have already made positive steps in this regard. In 2016, the central bank released its ambitious five-year strategic plan, focusing on a group of actions and measures to stabilize and control the financial and banking market. This plan also targeted areas that were considered new to the Iraqi market and culture, specifically concepts of financial inclusion. Iraq’s economy is highly cash-intensive, and more than 90% of the population does not have a bank account. Given these circumstances, the central bank has been working with the Iraqi government to ensure that all government employees receive their paychecks directly into a bank account. As a result, more than three million government employees are now accessing and utilizing electronic accounts and banking services. The central bank also established a compulsory insurance fund for commercial banks, to protect creditors and depositors should a bank declare bankruptcy. GF: Are economic diversification efforts in the region making fast enough progress? Al-Allaq: Given the trying circumstances we went through in Iraq, we understand the importance of diversifying our economy and it remains one of my strongest priorities. I am planning for more progress on this issue and on a more rapid timeline, especially following our December 2017 victory in regaining control over our territory from ISIS. This critical step has allowed us to address economic diversification by rehabilitating our agricultural sector and taking steps to support businesses owned by Iraqis. Specifically, the central bank for the first time in its history created a special program with commercial banks to stimulate the private sector with low-interest loans, which benefited thousands of private businesses and created thousands of job opportunities. Still, we continue to be focused on this issue. We also continue to work to enhance our regulatory environment to welcome foreign direct investment and international business, which has a direct contribution both to our reconstruction and development, as well as the diversification of Iraq’s economy. In the region generally, economic diversification efforts need to move faster—this is a challenge my regional counterparts and I are all working to overcome—and the more we do so together and the more trade and investment in which we can engage with each other, the better off we will all be. GF: Will protectionism and rising interest rates weigh on global economic growth? Al-Allaq: I would argue that every central bank governor in the world struggles with maintaining a good balance between protecting domestic industries and manufacturing, while actively participating in international trade. In Iraq, we are focused on both increasing our investments abroad as well as FDI in Iraq, and we know that this exchange will be beneficial in the long run. Certainly, rising interest rates slow global economic growth, which is why over the last several years, the Central Bank of Iraq has placed a heavy emphasis on upholding a steady inflation rate under 3%. We have been able to keep Iraq’s inflation rate low particularly due to our efforts to strengthen and stabilize the Iraqi dinar, and to reduce public spending by the Iraqi government. Regarding this point, the central bank helped make sure the Iraqi government remained within its budgetary and deficit targets by issuing treasury bonds worth more than $2 billion, which were used to pay back creditors and government external contractors as well as farmers.
  6. The Englishman

    Announcement of the largest bloc

    Kurdish PM, Iraqi Counterpart Discuss Erbil-Baghdad Relations BasNews 30/07/2018 - 16:39 Kurdistan ERBIL - Kurdistan Region PM Nechirvan Barzani met on Monday evening with his Iraqi counterpart Haider al-Abadi in Baghdad for talks on Erbil-Baghdad relations and political process in Iraq. During the meeting, where the country's president Fuad Masum was also attending, officials reiterated that discussions between the sides should be continued until reaching a resolution for the issues, according to the statement. The statement added the current collaboration between the Peshmerga and Iraqi forces have to be protected so as to fight against terrorism across the country. They also exchanged views on the formation of the future Iraqi government, stressing on building a government that will serve all Iraqis equally.
  7. The Englishman

    Announcement of the largest bloc

    Nechirvan Barzani, Abadi meet in Baghdad to discuss Erbil-Baghdad relations Baxtiyar Goran | An hour ago Share share A meeting between KRG Prime Minister Nechirvan Barzani and his Iraqi counterpart, Haider al-Abadi, in Baghdad on July 30, 2018. (Photo: PMO) Kurdistan Iraq Erbil Baghdad Relations A+AA- ERBIL (Kurdistan 24) – Iraqi Prime Minister Haider al-Abadi on Monday received his counterpart from the Kurdistan Regional Government (KRG), Prime Minister Nechirvan Barzani, to discuss relations between Erbil and Baghdad. Both prime ministers spoke about the political situation in the country in general and some other common dossiers between the Federal Government of Iraq and the KRG, the Iraqi Prime Minister’s Office said in a statement. “The meeting reiterated the importance of continued communication and exchange of dialogue in a way that strengthens joint national work,” it added. Barzani and Abadi also emphasized maintaining cooperation between Iraqi security forces and the Kurdistan Region’s Peshmerga to eliminate any terror threats after efforts to achieve victory against Islamic State extremists. According to the statement, both leaders shared similar views on dealing with the challenges facing the country. They also addressed ways to move forward with the formation of the next government that meets the demands of the Iraqi people through support for the economy, construction, provision of services, and employment opportunities. Fuad Hussein, the Chief of Staff to the Kurdistan Region Presidency, accompanied PM Barzani on his visit to Baghdad. Relations between the Kurdistan Region and Iraq are slowly improving since ties deteriorated when Kurdistan held a historic independence referendum last September. Baghdad rejected the legitimacy and results of the vote, despite an overwhelming 93 percent voting for secession from Iraq. In response, the Iraqi government imposed a set of punitive measures on the KRG, including border closures, an international flight ban, and the use of military force on Oct. 16, 2017, to regain control of disputed territories. Editing by Karzan Sulaivany
  8. Business Giant tourist city project on Lake Dukan gets $1.6 billion investment By Rudaw 1 hour ago KRG deputy PM Qubad Talabani (C) and investor Faruk Mustafa (2nd L) cut a ribbon to mark the start of the massive tourism project on Lake Dukan, July 29. Photo: Rudaw video ERBIL, Kurdistan Region – Plans to build a gigantic tourist city on Lake Dukan, one of the Kurdistan Region’s most beautiful, unspoiled nature spots, made a great leap forward on Sunday when telecoms magnate Faruk Mustafa announced a $1.6 billion investment in the site. Hundreds of thousands of tourists are expected to flock to the 3,250 hectare lakeside complex each year when it is complete. “The project includes building hundreds of flats, houses, villas, two cable cars, one island, and many other interesting places,” Mustafa, owner of Asia Cell and chairman of the board of Faruk Holding Company, told Rudaw. At an event in Dukan on Sunday unveiling the new investment, Qubad Talabani, the deputy prime minister of the Kurdistan Regional Government, said the tourism sector is a top priority. “We as the government gave priority to the tourist sector. And this is because of two reasons. One is that it will create wealth and also it will create employment,” he said. The Kurdistan Regional Government (KRG) approved the project in 2013, but it was delayed by land disputes and the process of compensating local land owners. The project is expected to create 26,000 jobs. “As we could provide 30 percent of Iraq’s demand in the manufacturing sector, with this project we can become an alternative tourist destination to Iran and Turkey,” Mulla Yasin, spokesman for Kurdistan’s Union of Investors, told Rudaw. Conservationist groups have regularly criticized government failures to enforce environmental protection laws. They are concerned unchecked tourism investment could harm Kurdistan’s untouched natural beauty.
  9. Business Saudi Arabia eyes Kurdistan as starting point for investing in Iraq By Rudaw 1 hour ago A delegation of Saudi officials and businessmen is visiting Erbil. Photo: Mohammed Shwani/Rudaw ERBIL, Kurdistan Region – A visiting delegation from Riyadh agreed with KRG officials to open economic ties with the Kurdistan Region as a starting point for Saudi investment in Iraq. "Following the completion of the first round of a conference of Saudi investors with members of the Kurdistan Regional Government and businessmen, we followed that there are very important investment opportunities in the Kurdistan Region," Sami Bin Abdullah al-Obeidi, head of the Kingdom of Saudi Arabia’s Commerce Chambers, told journalists on Tuesday. Obeidi is visiting Erbil along with Abdulaziz al-Shammari, Saudi ambassador to Iraq, Faysal al-Oteibi, Saudi consul general to the Kurdistan Region, and other officials from the kingdom. After a conference with KRG officials and members of the Kurdistan Region’s business community, Obeidi described the business environment in the Kurdistan Region as very suitable, especially considering "very robust ties" between Riyadh and Erbil. The Kurdistan Region offered over 1,500 projects in tourism, agriculture, and other sectors in the conference with Saudi investors. No agreements were immediately made. Saudi Arabia pledged over a billion dollars for rebuilding Iraq in the Kuwait donor conference earlier this year. KRG officials hope some of this sum can be spent on strategic projects in the Kurdistan Region. "The projects in the Kurdistan Region, whether public or private, were showcased to them and the opportunities that there are. They would like to work here. We hope at the end of these talks that our Saudi friends work on some projects in the Kurdistan Region," Dara Jalil Khayat, head of the Trade and Industry Chamber of the Kurdistan Region, told journalists. Saudi Ambassador Shammari said they were impressed with the presentation. "The investment law in the Kurdistan Region is a unique and attractive law for investment,” he told Rudaw, adding that many of the visiting Saudi businessmen “showed interest in building a complete industrial city in the Kurdistan Region.” The Saudi delegation arrived in Erbil on Monday and met with KRG Prime Minister Nechirvan Barzani. They discussed investment and trade, “specifically focusing on fields of shared interest, such as industry, agriculture, and tourism,” read a statement from Barzani’s office. “They agreed that the Kurdistan Region could be a first step and a centre for the initiation of economic, trade, work, and investment activities in all of Iraq,” the readout added. Among the connections discussed were direct flights between them and opening Saudi banks in the Kurdistan Region and Iraq. Barzani “showed all readiness for supporting and facilitating Saudi Arabian investment in the Kurdistan Region… He hopes in the near future practical steps are taken for strengthening bilateral ties,” the KRG statement read. Saudi Arabia’s regional influence makes it an important ally. "In the Middle East, Saudi Arabia has a very strong position. It is very, very important for us,” Majid Sidiq, member of Erbil's Chamber of Commerce, told Rudaw. His organization would like to establish a joint chamber of commerce with Saudi traders. While Erbil and Riyadh cozied up, an official from Iraq’s Shiite Fatih coalition that has ties with Iran, denounced the Saudi visit. “Saudi Arabia has dirty hidden intentions by opening ties with Kurdistan. It wants to split Iraq and weaken it from within Iraqi soil,” Askandar Watwut told Baghdad Today. He urged the federal government to take a firm stance against Saudi-Kurdish cooperation. Baghdad is restoring relations with Riyadh, nearly three decades after ties were cut when Saddam Hussein invaded Kuwait. Iraqi Prime Minister Haider al-Abadi has said regional rivals must not fight their battles on Iraqi soil.
  10. Baghdad pulls $15bn out of emergency fund for Basra, Muthana By Rudaw 25 minutes ago Iraqi Prime Minister Haider al-Abadi speaks during a press conference in Baghdad on Tuesday. Photo: PM office ERBIL, Kurdistan Region – The Iraqi government is pulling 18 billion dinars ($15 million) out of its emergency budget to fund projects in Basra and Muthana provinces. The Council of Ministers decided to dedicate 3 billion dinars ($2.5 million) each to Basra’s operating costs, the Umm Qasr water project in Basra, and the Shatt al-Rumaitha water project in Muthana. Another 9 billion dinars ($7.5 million) will go to completing 52 schools in Basra within three months. The Council of Ministers met on Tuesday, chaired by Prime Minister Haider al-Abadi. In addition to dipping into the emergency fund, the council “decided to assess and hold accountable those responsible for poor performance and service delivery in ministries." Iraq has been rocked by over two weeks of protests by a population angry about endemic corruption, lack of transparency, high unemployment, and poor services. "The Council also decided to form the provincial reconstruction and services committees, chaired by the prime minister, to assess provincial reconstruction and services and to follow up on citizens' needs and demands to improve services, accelerate service delivery, and empower the council of ministers to ensure speedy implementation of mentioned duties,” read a statement from Abadi’s office after the meeting. Speaking in his weekly press conference on Tuesday, Abadi said his government wants to take advantage of the protests to do things that wouldn't have been done before. "We won't go easy on any official proven to be negligent in their duties. Negligence in many cases is the same as corruption. Corruption is not necessarily extending your hands into public funds. If you don't carry out your responsibility correctly, this is part of corruption,” he said. He labeled wastage of money and delays or failure to finish projects as another type of corruption. "The biggest corruption we are faced with is mismanagement. The biggest corruption is wasting the state's resources, not necessarily stealing them,” Abadi said. His governmental program includes the “strategic" decision of administrative decentralization, he explained, saying that provinces should be responsible for providing services and not all blame for Iraq’s problems can be laid on the federal government. The Council of Ministers decided to form a Supreme Committee to "evaluate and hold accountable" officials responsible for services failures and poor performance both at the ministerial level and in in the provincial administrations, Abadi explained. The latest reports are that 14 people have died in over two weeks of protests.
  11. POLICY ANALYSIS POLICYWATCH 2992 Putting Iraq-KRG Oil Relations on Solid Legal Ground James F. Jeffrey and Bilal Wahab July 19, 2018 Notwithstanding their decades of contention, the two governments must resolve their differences legally to make way for economic development and stave off public unrest. Despite their country producing 4.3 million barrels of oil per day, Iraq’s population remains poor. Gathering in the streets of southern towns, masses are protesting government corruption, power shortages, and high unemployment rates. Consequently, the government must refocus its attention on economic prosperity and the daunting financial demands of reconstruction following years of war against the Islamic State. To that end, it should resolve its dispute with the Kurdistan Regional Government (KRG) over management of the oil and gas sector. Doing so would be the first of many crucial steps toward injecting rule of law back into the energy industry. Currently, a messy but promising case to adjudicate management rights over these disputed resources sits before Iraq's Supreme Court. Should the case progress constructively, it will pressure the newly elected parliament to prioritize passage of a national hydrocarbons law. This in turn would infuse much-needed confidence into Iraq’s risk-laden energy sector and invite greater foreign investment to boost production and revenues. Moreover, Kurdish recognition of the federal court foreshadows a more realistic approach to energy—one that aims to salvage and de-risk the KRG oil industry through better coordination, if not integration, with the federal industry. REENERGIZED AMBIGUITIES In 2005, Iraq’s new constitution enshrined federalism and the equitable sharing of oil and gas revenues. As the basis for its case that the KRG is supposed to take part in this arrangement, Baghdad cites three articles of the Iraqi constitution. Article 110 stipulates that the federal government shall have “exclusive authorities” in formulating “foreign sovereign economic and trade policy,” presumably including the trade in hydrocarbons, which account for over 95 percent of Iraq’s exports. Article 111 establishes that oil and gas are owned by all the people of Iraq. And the first paragraph of Article 112 stipulates that “present” oil and gas fields shall be managed by the central government alongside “the producing governorates and regional governments,” essentially continuing Saddam Hussein's arrangements at the time of the constitution’s enactment. Yet the second paragraph of Article 112 implies a distinction between old and new oil, with 2005 as the dividing line. It asserts that “the federal government, with the producing regional and governorate governments, shall together formulate the necessary strategic policies to develop the oil and gas wealth.” The KRG therefore premises all hydrocarbon production, excluding its claims to Kirkuk, on “new oil” provisions covered by the “together” phrase, which is not found in the article’s first paragraph. In its view, this phrasing also supersedes the “exclusive authorities” granted to Baghdad in Article 110. However these differing interpretations are ultimately reconciled, Article 112 clearly gives the government a mandate to pass legislation regulating the shared management of production, sale of crude oil, and the distribution of revenues. Due to constant power wrangling, though, these constitutional provisions have not yet been translated into regulations, let alone clear laws. In a major push during 2007-8, the United States offered to mediate a new hydrocarbons law, but both Baghdad and the KRG decided to stick with their self-serving interpretations of the constitution. The Kurds, eyeing the exit door from Iraq, sought to build an independent petroleum industry, inviting international oil companies (IOCs) to look for hydrocarbons in their territory. They also began independently exporting oil in January 2014 and contracted with Turkey to export gas, in clear violation of Article 110. Today, the KRG independently exports almost 300,000 barrels of oil per day via Turkey. For its part, Baghdad seeks to remain the locus of such decisionmaking; accordingly, it claims ownership of the KRG’s oil exports and refuses to recognize Kurdish deals with IOCs. In effect, Baghdad acts as if Article 112 regulates all oil, including “new” oil—a stance that seems to violate the constitution just as surely as Erbil’s unilateral exports do. COURT BATTLE In 2012, the federal government took the KRG to the Supreme Court over the legality of its oil contracts and independent exports. But the KRG deliberately neglected to appear before the court until April of this year. So far, the court has not made any rulings, requesting more information on the petroleum value chain instead. While the next and, perhaps, final hearing will take place on August 14, both parties are encouraged by the proceedings thus far. Federal officials feel they have a strong case against the KRG, while Kurdish officials are pleased to see the court question the two constitutional articles cited by Baghdad as grounds for indictment. The court has also put the onus of formulating a national oil law on Baghdad, since the KRG passed its own natural resources law in 2007. Moreover, past budget laws passed by the national parliament required the KRG to contribute certain oil export earnings to the country’s overall exports—a practice that Erbil cites as clear recognition that its independent exports are legitimate. One deal in 2015 had the KRG and federal government equitably split the proceeds of 150,000 barrels per day produced in the Kirkuk fields, whose oil can only be exported via the Kurdish pipeline to Turkey. Today, however, federal authorities refuse to export that oil, avoiding KRG infrastructure at all costs. By so doing, they limit Iraq’s northern export outlet—a self-defeating approach at a time when protests could threaten the flow of crude from the south. ONE COUNTRY, TWO INDUSTRIES The ongoing legal vacuum has essentially bifurcated Iraq’s energy industry. Although building an energy industry from naught was quite a feat for the KRG, its main goals—staving off the central government and building the economic foundation for a independence—led it to overreach at times, such as when it commandeered Kirkuk oil fields and revenues during the war against the Islamic State. The Kurdish energy industry also became increasingly less transparent as KRG officials sought to evade Baghdad. Yet federal authorities refused to give the KRG a break from day one. They declared Erbil’s production-sharing contracts illegal, blacklisted any interested IOCs, and sued buyers. Short-term and short-lived deals replaced law-based policy and strategy. Between 2013 and 2016, Erbil intermittently recognized Baghdad’s determinant role by turning its oil over to the central government for export. In return, Baghdad’s acceptance of this arrangement indirectly recognized the legality of the KRG’s contracts. The Kurds also received their share of country-wide oil export earnings: around 17% in most budgets up until recently. But various technical disputes and instances of overreach by both sides scotched several of these initiatives. The disputes have also opened a door for more Iranian influence. Last month, Baghdad and Tehran agreed to swap 30,000 barrels of Kirkuk oil, with Iraqi oil feeding Iranian refineries and Iran delivering equal amounts of its own oil to Iraq’s Persian Gulf ports. Warming oil relations could potentially enable Iran to evade U.S. energy sanctions, reminiscent of Baghdad’s own evasion methods in the 1990s, when Iraqi oil tankers flew Iranian flags. Going forward, the balance of power has clearly tipped in Baghdad’s favor given Erbil’s costly independence referendum, its loss of control over Kirkuk’s oil fields, and its dire need for cash flow from Iraqi coffers. Yet Baghdad also realizes that the KRG energy industry is here to stay. And continuing to substitute gentleman’s handshakes for regulated production handovers and revenue sharing is unsustainable. Mutually destructive approaches hamper the progress of the Iraqi oil sector, which seeks to reintegrate and recover in a competitive market. In standing before the Supreme Court, the KRG has an opportunity to cash out on the constitution, the forging of which was one of its main institutional and legal achievements in the post-Saddam era. And Baghdad cannot simply play the bully now that it is dealing with the KRG’s international energy partners, which include Russia’s Rosneft and Turkey’s BOTAS. TOWARD RULE OF LAW Allowing courts to settle Iraq’s oil disputes is a principle worth supporting, since a transparent, rule-based energy industry is in the interest of all parties. Among other benefits, resolving the oil issue would help untangle Baghdad and the KRG’s disputes over territory. It would also undercut Iran’s influence, limit its opportunities for oil smuggling, and aid efforts to spot its sanctions-busting efforts. To that end, the priority of the next Iraqi government should be passing a national hydrocarbons law and constructing inclusive state institutions that reflect the constitution. Rationalizing Iraq’s petroleum sector is necessary to maximize revenue and formulate economic policies needed to cope with recent public protests. The United States should resume the assistance it extended in 2007-8 toward passing an oil and gas law. It should also support the court proceedings as a positive precedent for conflict resolution, while offering the technical advice the court needs to pass a fair judgment. Baghdad and the KRG are both receptive to such assistance.
  12. World Bank partner pledges $269 million to develop Iraq telecom Zain John J. Catherine | 2 hours ago Share share The International Finance Corporation (IFC) is hoping the project will develop Iraq's telecommunications infrastructure. (Photo: Archive) Iraq WorldBank Telecom Mobile ERBIL (Kurdistan 24) – An international financial institution announced on Tuesday that it was providing a financial package of $269 million to a leading Iraqi mobile network operator to help reconstruct the country’s telecom operations and spur economic growth. The International Finance Corporation (IFC), a Washington-based member of the World Bank, is the largest global development institution focused on the private sector in so-called "emerging markets." "IFC arranged a $269 million debt package including $100 million from IFC’s own account, and $169 million in mobilization," plus loans from other institutions as well, according to a statement released on the website for the United Nation's in Iraq. "The financing will help Zain Iraq enhance the capacity and quality of its 3G network and expand coverage to unserved areas, as well as helping the company modernize its networks and customer service in northern Iraq." The other two major telecom competitors in Iraq are Korek Telecom and Asiacell. By arranging and mobilizing a seven-year loan in a country where long-term financing options remain extremely limited, IFC is hoping its investment "will support the company’s growth plans, while sending a positive signal to domestic and international players at a critical point in the country’s recovery." Iraq is one of the least-developed telecom markets in the Middle East, due in part to the fragile security situation. Mobile network operators have often struggled to maintain their networks and have refrained from investing heavily in infrastructure.
  13. STATEMENTS & RELEASES Notice Regarding the Continuation of the National Emergency with Respect to the Stabilization of Iraq FOREIGN POLICY Issued on: May 18, 2018 ALL NEWS On May 22, 2003, by Executive Order 13303, the President declared a national emergency pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701-1706) to deal with the unusual and extraordinary threat to the national security and foreign policy of the United States posed by obstacles to the orderly reconstruction of Iraq, the restoration and maintenance of peace and security in the country, and the development of political, administrative, and economic institutions in Iraq. The obstacles to the orderly reconstruction of Iraq, the restoration and maintenance of peace and security in the country, and the development of political, administrative, and economic institutions in Iraq continue to pose an unusual and extraordinary threat to the national security and foreign policy of the United States. For this reason, the national emergency declared in Executive Order 13303, as modified in scope and relied upon for additional steps taken in Executive Order 13315 of August 28, 2003, Executive Order 13350 of July 29, 2004, Executive Order 13364 of November 29, 2004, Executive Order 13438 of July 17, 2007, and Executive Order 13668 of May 27, 2014, must continue in effect beyond May 22, 2018. Therefore, in accordance with section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)), I am continuing for 1 year the national emergency with respect to the stabilization of Iraq declared in Executive Order 13303. This notice shall be published in the Federal Register and transmitted to the Congress. DONALD J. TRUMP
  14. The Englishman

    Announcement of the largest bloc

    Iraqi election winner Al-Sadr hints at alliances to form government Sangar Ali | May 15-2018 11:28 AM Share share Supporters pour onto the streets of Baghdad following the victory of Iraqi Shia cleric Muqtada al-Sadr's electoral win. (Photo: AP) Iraq Elections Baghdad Sadr Iran ERBIL (Kurdistan 24) – Influential Shia cleric Muqtada al-Sadr on Monday revealed potential political allies needed to form a new government following Saturday’s as-of-yet inconclusive elections. Sadr, who is the winner with 53 seats out of a total of 329 in Baghdad's parliament, hinted at those with whom he intends to establish a new government comprised of "non-partisan technocrats." In a tweet on his official Twitter account, Sadr described the prospective cabinet and appeared to indirectly name 12 parties and alliances. Those thought to be referred to are al-Hikma, al-Wataniya, Irada, New Generation, Gorran (Change), al-Qarrar, Bayariq, al-Nasr (Victory), Baghdad Alliance, Hawiyatuna, Kurdistan Democratic Party (KDP), and Kawadir. View image on Twitter Sadr’s tweet excluded mention of Former Prime Minister Nouri al-Maliki’s State of Law Coalition, al-Fatih led by Shia militia leader Hadi al-Amiri, and the Patriotic Union of Kurdistan (PUK), all known for having close ties to Iran. Projecting himself as an Iraqi nationalist, Sadr has a zealous following among the young, poor, and dispossessed among Shia Iraqis, but had been sidelined by influential Iran-backed figures. Unlike current Iraqi Prime Minister Haider al-Abadi, a rare ally of both the United States and Iran, Sadr is an opponent of both countries, both wielding influence in Iraq since a US-led invasion toppled Sunni dictator Saddam Hussein in 2003 thrust the Shia majority into power. Sadr has led two uprisings against US forces in Iraq and is one of the few Shia leaders to distance himself from Iran. A source familiar with ongoing talks between Iraqi political parties told Kurdistan 24 on Tuesday that the head of the Quds Force of Iran's Islamic Revolutionary Guard Corps Qassem Soleimani is currently in Baghdad to meet with Shia parties in an attempt to prevent Sadr from choosing the new Premier. Sadr cannot become prime minister since he did not personally run in the election, but the fact that those within his party hold a large number of seats could put him in a position to pick someone for the job. Editing by John J. Catherine
  15. The Englishman

    Announcement of the largest bloc

    Sadr calls for brotherhood in phone call with Barzanis By Rudaw 35 minutes ago ERBIL, Kurdistan Region – Masoud and Nechirvan Barzani called Muqtada al-Sadr on Tuesday to extend their congratulations on his election win, Sadr’s office stated. They wished “his eminence success,” the statement said. Masoud Barzani is former president of the Kurdistan Region and current leader of the Kurdistan Democratic Party (KDP). Nechirvan Barzani, his nephew, is KRG prime minister and deputy leader of the KDP. Sadr thanked them for their wishes and expressed his hope that “the brotherhood of the Iraqi people be strengthened and for the love ties be solidified between the different sects, components and ethnicities.” A Shiite cleric, Sadr ran on a non-sectarian platform pledging to tackle corruption. His movement joined forces with the Communist Party on the Sayirun alliance. They have emerged as the surprise leader after the release of preliminary results. Fifteen days after final election results are released, the new parliament must hold its first session during which the speaker will be chosen. A new president will be elected within three days of the legislature convening and the president will then ask the largest parliamentary bloc to form a cabinet. Traditionally, the speaker of the parliament has been a Sunni Arab, the prime minister a Shiite, and the president a Kurd. Sadr and Erbil have frequently taken a similar stance with respect to Iraqi politics over the past decade, including opposition to Nouri al-Maliki during his tenure as prime minister.

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