World Bank MENA Quarterly Economic Brief, January 2015: Plunging Oil Prices

[Maggie123]

 

 Exchange rate: Iraq pursues a policy of a de facto peg to the U.S. Dollar, and therefore monetary policy is constrained in tackling the current shock. The Central Bank of Iraq (CBI) had kept the Dinar steady through January 2009. In 2014, the nominal exchange rate in the official market remained stable against the U.S. Dollar at 1,166 IQD/1 USD, but the rate in the parallel market increased. The CBI has recently taken steps to simplify foreign exchange market regulations, but has not eliminated all existing exchange restrictions and the multiple currency practice. With the peg, fiscal policy carries the burden of macroeconomic stabilization, but in this case does not have the space to do so.

 

 

 

This Is Why I was Thinking Market Rate vs Street Rate.

[MyLadiesDaddy]

O.K. DL assessments, would be a more accurate description.

However, if you're wanting to borrow money from your banker and he reviews

your financial situation then gives you his, "ASSESSMENT", what do you think would

happen when you ignore him.

Iraq just borrowed , (or is in the process of), money from the WB.

Might wanna keep da banker happy.

[DNAR]

Middle East Understands they Must Let the Pegs Go to the Dollar

Gulf Arab oil states may need to rethink longstanding economic policies, including their fixed exchange rates, over the next couple of years as economic cycles in the region and the United States diverge. The deflationary trend will impact the region as hard-times emerge and the economies decline into 2020.

The six nations in the Gulf Cooperation Council (GCC) have pegged their currencies to the dollar. What was once viewed as a stabilization mechanism will turn against them and import deflation as oil prices collapse. True, in recent years the GCC economies have moved more out of sync with the United States. However, the pegs are now pressing the GCC policymakers to mirror the U.S. central bank’s decisions even though this is contrary to domestic policy objectives.

As long as they have currency pegs to the dollar, the Gulf States could face destabilizing capital outflows/inflows if they allow large interest rate gaps to open up with the United States. There remains a risk that the US will be forced to raise rates to fight a rise in the stock market as capital inflows pour in from many regions. We are likely to witness extreme currency destabilization in the years ahead.

 

http://armstrongeconomics.com/2015/01/30/middle-east-understands-they-must-let-the-pegs-go-to-the-dollar/

[dontlop]

Iraq is borrowing money because it has no choice

If they had a choice to just rv don't cha think they would do it

so " Sunday " don't expect anything

[TrinityeXchange]

DNAR +1 

This article was right on time.  wow!

[DzUP]

Here's my take on the situation.. the 2010 imf reforms was an agreement with many countries to get back to the gold standard but the public is only told .0001 % of what the world "architects" orchestrate behind closed doors. the fed never agreed to put the last signature and the deadline was Dec 31 2014..now U.S. no longer has veto power in the world.if the ptb (not limited just to the fed) had signed that agreement last year then this would have happened last year jan. Now plan b is in motion and happening very quickly. For those of us who don't just go off of what the news says as "TRUE", we can analyse the situation and come up with a LOGICAL speculation based off of multiple signs, and at a prophetic level that takes years of learning and seeking truth to aquire. After 6 years I've made 2 recent predictions of a date. Does that make me a guru? I don't know and I honestly don't care.Once was around thanksgiving last year and once early this month. doesn't mean I'm wrong for believing it.Does that mean i should just hang out in the rumor section?.., i prefer to make my own decisions Tyvm, it's not as if Im spreading rumors. To me it means I know when somethings close..I've waited and spread word about it. How many people has God led you to tell? Have you insisted and explained so they too can understand and take part in? Or did you keep to yourself and not tell anyone. Everyone made their choices up to now. As for me, I told all my family and friends.. I'm raising up an army Of powerful Christian Brothers and Sisters who will help contribute to making this world a better environment..and the best part is THIS IS ONLY THE BEGINNING OF THE 7 fat years.

[TrinityeXchange]

This excerpt from the 2013 Statement really highlights why we need Abadi's regime to clean up the legal and regulatory structure.  The longer I study Iraq the more I realize that we were never going to see monetary reform and our hoped for wealth under Maliki.

 

=============================

 

Transparency of the Regulatory System

The lack of clear and definitive implementing regulations for the National Investment Law and its amendment remains a source of delay and confusion in the approval of investment projects. Once fully implemented, the law would establish a legal framework for investment. Potential investors, however, would likely still face laws, regulations, and administrative procedures that continue to make Iraq’s overall regulatory environment relatively opaque. Over 950 firms—both foreign and domestic—have filed for investment licenses in Iraq to date, but fewer have moved to an execution phase. PICs have also been active in assisting regional investors. However, NIC and PIC Commissioners and their staff often lack training and expertise, and are still building their operations to serve as effective “One-Stop Shops” for investors to ease their entrance into the Iraqi market.

The absence of other laws in areas of interest to foreign investors also creates ambiguity. Iraq’s Legislative Action Plan for the Implementation of WTO Agreements – the legislative “road map” for Iraq’s eventual WTO accession – requires competition and consumer protection laws that are critical for leveling the business playing field. The Council of Representatives passed a Competition Law and a Consumer Protection Law in 2010; however, the Competition and Consumer Protection Commissions authorized by these laws have yet to be formed. Without these Commissions, investors do not have recourse against unfair business practices such as price-fixing by competitors, bid rigging, or abuse of dominant position in the market. In the IKR, the KRG implemented the Consumer Protection Law by passing Law 9 of 2010.

The way in which the Iraqi government promulgates regulations can be opaque and lend itself to arbitrary use. Regulations imposing duties on citizens or private businesses are required to be published in the official government gazette. However, there is no corresponding requirement for the publication of internal ministerial regulations. This loophole allows bureaucrats to create internal requirements, procedures, or other “turnstiles” with little or no oversight, which can result in additional burdens for investors and other businesspersons.

[Texstorm]

DL if they ramp up their oil quite possibly they could pay off most all of the debts in less than 10 years according to a financial analyst that I have talked with. I don't but there are a ton of in esters if they can make the market right, so far the CBI has maintained stability and the Calvary is already there.

[TrinityeXchange]

DL if they ramp up their oil quite possibly they could pay off most all of the debts in less than 10 years according to a financial analyst that I have talked with. I don't but there are a ton of in esters if they can make the market right, so far the CBI has maintained stability and the Calvary is already there.

I agree Texstorm.  Willing investors have never been the problem.  The lack of regulations, regulatory bodies and recourse has been.  Nobody wants to invest in a country steeped in corruption and who create rules as they wake up each morning.  Abadi has quite the task in front of him to clean up Iraq and he has a LOT of help from will neighbors namely the US through the Strategic Framework Agreement.  I do believe Iraq is finally on track to get construct a strong regulatory environment, finally.  We just have to patiently wait for these components to be put in place.  The job this man has done within 3 months time is shy of a miracle.  I am eager to see what else he can pull out of this hat!

[chinadawg]

Is Dontlop and Maggie the same negative Nellie logging in and out......or......... they Belly mate twins ?

 

I have a hard time believing than if anyone is as hell bent on something never ever happening, why be here,

 

7000 post and 12000 post , damn, just saying.

 

we are grown folks here, no one needs MOM and DAD coming on every post telling us kids not to get excited ......REALLY.........................stick your opinion up your ****!!!........... I don"t want or need it.

Edited January 31, 2015 by TexasGranny
removed cuss word

[MyLadiesDaddy]

Iraq is borrowing money because it has no choice

If they had a choice to just rv don't cha think they would do it

so " Sunday " don't expect anything

Well if you say so then I won't.

Feel better now?

Is Dontlop and Maggie the same negative Nellie logging in and out......or......... they Belly mate twins ?

 

I have a hard time believing than if anyone is as hell bent on something never ever happening, why be here,

 

7000 post and 12000 post , damn, just saying.

 

we are grown folks here, no one needs MOM and DAD coming on every post telling us kids not to get excited ......REALLY.........................stick your opinion up your **** !!!........... I don"t want or need it.

Funny, I was literally just wondering the same thing.

[mokie775]

Thank you thank you thank you thank you Chinadawg thank you thank you thank you thank you, did I say THANK YOU    LGD  Sunday sounds good to me!!!

[drj]

Is Dontlop and Maggie the same negative Nellie logging in and out......or......... they Belly mate twins ?

 

I have a hard time believing than if anyone is as hell bent on something never ever happening, why be here,

 

7000 post and 12000 post , damn, just saying.

 

we are grown folks here, no one needs MOM and DAD coming on every post telling us kids not to get excited ......REALLY.........................stick your opinion up your **** !!!........... I don"t want or need it.

 

 

Spot-on, chinadawg, spot-on!!!

[Catluver67]

Spot-on, chinadawg, spot-on!!!

Agreed chinadawg and drj...try blocking them...then you don't have to see the crap all day everyday...makes for a much better viewing experience...

[davis411]

MMMMMMM i see everything now,

I am going to drink another beer,

MMMMMMM

and yes another

enjoy people you only live once

[Texstorm]

Damn Davis411 I can see that you are in deep thought ! 3 more beers and I bet you can solve all of the worlds problems, and I double dog dare you to bring an RV with a shot of tequila !

[DzUP]

DL..looks like the legacy of your username at dvets has left it at a shameful stage, at this point I humbly ask you, Humble yourself, allow Jesus Chris to work in your life, and stop working for the devil, even if he's paying yoU, or bribing you. You being 90% but the other 10% hogwash is enough of a stench. It's about time

Shut up and listen for once.

And that's just my opinion. Take it how you desire. I'm praying for you brother.

And that's just my opinion. Take it how you desire. I'm praying for you brother.

[yota691]

World Bank: losses GCC countries could reach $ 300 billion

 

31-01-2015 12:30 PM

 

Free -

The World Bank predicted that incurs the six Gulf Cooperation Council (GCC), the loss of oil revenues by about $ 215 billion over six months, if oil prices remain around $ 50 a barrel, or about 14 percent of GDP combined. 
and includes the Gulf Cooperation Council (GCC) both Saudi Arabia, Kuwait, Bahrain, Oman, Qatar and the UAE. The look estimates are acceptable, the light went oil prices to record a record wave of monthly losses since the start of data recording, where tumbled prices by more than 50 percent since last June, to reach near their lowest levels in six years on less than $ 50 a barrel. The International Monetary Fund predicted last week that up losses exporting GCC oil states to $ 300 billion, or 21 percent of GDP driven connects the decline in prices.The World Bank in a report issued yesterday, that oil revenues in the Gulf countries accounted for more than half of the GDP and 75 percent of the total export earnings in 2013, what makes these countries more vulnerable to the vagaries of the market, and the most affected by the consequences of falling oil prices. Analysts say that most of the Gulf Cooperation Council squandered an important opportunity to achieve a quantum quality, invest part of those proceeds to the development of their economies from outside the oil sector. He said economic analyst Jassem al-Saadoun, said that the GCC countries have not invested chance high energy revenues in recent years, to the development of economies outside the oil sector, pointing to a rise in public spending, but he did not draw to vital infrastructure projects. The World Bank report said, the revenue Gulf countries exceeded the average expenses, but rising government spending may lead the decline in oil prices to change course, it is possible that the surplus turns in the budget, the complex, which amounted to about 10 percent of GDP Local in 2013, to a deficit of 5 percent of the total. The World Bank estimated that recorded budgets GCC varying deficit ratios, when the average price of a barrel of oil to $ 65, and the Saudi budget deficit up to 1.9 percent of gross domestic product and Bahrain 5.3 percent and Qatar 7.4 percent and the UAE 3.7 percent, while the check Kuwait surplus of 3.1 percent, and the Sultanate of Oman to the highest rate of up to 11.6 percent. The Minister of Oil and Gas of Oman Mohammed bin Hamad Al Rumhy said this week that his country is losing $ 55 million a day due to the drop in oil prices to less than $ 50 a barrel. The World Bank said that the Gulf countries despite their large financial reserves to cover any shortfall, there are indications that the governments in the region began to reconsider their spending, and tend to diversify their sources of income. The International Energy Agency said this month that the recovery in oil prices, It may take some time, despite doubling signs of easing the pace of decline with lower shale production from North America and rising demand due to low prices.Experts say the Gulf OPEC member, and adhering to the roof of the current production, perhaps betting at this stage at low prices to take out the marginal of the global oil market, and curb US production of shale oil boom, to control the prices during the next phase and thus has become a substantial margin to compensate for losses during the period of falling prices.