In Light Of The Indicators Of Deflation And Increasing Unemployment Rates ... "The Specter Of Poverty" Is Chasing Iraqis And Economic Measures To Overcome The Crisis !

[DinarThug]

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His predecessor wasted $ 15 billion ... Al-Kazimi's government is passing its first difficult test

 
 

22nd May, 2020

 

The government of the Iraqi Prime Minister, Mustafa Al-Kazemi, accepts the first tactical test by announcing that three million employees are paid the salaries for the current month, with about 300 million dollars being urgently disbursed to four million poor, unemployed, and disabled people, with the aim of overcoming the scarcity of liquidity resulting from the semi-general closure due to Conditions facing the Corona outbreak

The government announced that it would pay the end of this month's salaries and allowances, without deduction, which caused general public satisfaction

And there were reports that the Al-Kazemi government would not be able to secure the salaries of the employees, after the previous government headed by Adel Abdul-Mahdi deliberately emptied the public treasury

Sources linked to the government financial sector say that the Abdul-Mahdi government wasted nearly $ 15 billion in its last four months, under the pretext of meeting the demands of the demonstrators who went out against it last October and caused it to resign

The Abdul-Mahdi government appointed nearly half a million Iraqis to mainly state departments that suffer from the problem of slack

Sources revealed that Abdul-Mahdi's ministers distributed the new job ranks among the major parties, according to loyalty

The Minister of Electricity Louay al-Khatib employed nearly ninety thousand people in institutions affiliated with his ministry, accused of chronic failure in the performance of its tasks

Sources in the Ministry of Finance said that half of these new recruits have not received their salaries yet, due to the lack of sufficient liquidity, despite the passage of about two months after the issuance of their appointment orders

When Al-Khatib was asked about how to secure the salaries of these people, during the last days of his term, he presented a television answer described as "slapping", as he said that "the task now rests with Parliament, as it is concerned with legislating the budget and providing the necessary funds for workers in state departments

Khaled al-Najim, Minister of Planning in the Al-Kazemi government, said that the new employees added by the Abdul-Mahdi government may not receive financial dues by next month, especially if Parliament takes into account that they were added to the owners of the state without consulting with him

And the star acknowledged that the salaries of employees in the next month, may not fully secure, which will push the government to work in the savings system, indicating that the government will start deducting from the rule not to prejudice the salaries of employees, which revolve in an atmosphere of 400 dollars per month

The sources say that the Iraqi parliament supports the government's measures to save part of the salaries of the highest-ranking employees in the country and distribute a direct financial grant to the unemployed and the poor, provided that the salaries saved will be returned to their owners with sufficient liquidity

Iraq relies on selling crude oil to finance nearly 98 percent of its annual budget. Iraq has lost about two-thirds of its financial returns during the past few months due to the drop in oil prices to unprecedented levels

Despite the bleak outlook, the Al-Kazemi government appears to have many tools to overcome the financial crisis, both internally and externally

Finance Minister Ali Allawi pledged that the government would not give up those with limited income, hinting that there are many options available to the state that can boost public budget imports

Allawi went to Saudi Arabia as an envoy of the Prime Minister to discuss bilateral relations and economic conditions in the region and encourage investment

Informed sources say that Al-Kazemi will turn to harsh measures within the administrative structure of the state, saving millions of dollars annually; For example, the Ministry of Oil controls the proceeds from the sale of about 750,000 barrels per day, intended for internal consumption

The large returns from this huge amount are converted daily into bonuses and benefits paid to employees who perform only classic office work

The new government also intends, according to the sources, to change the administration overseeing the border crossings, which control the entry of goods at the commercial level

Most of Iraq's border outlets are now controlled by parties and militias that monopolize their returns, and prevent them from being directed to the public treasury, in tortuous ways

On the external level, the sources say that Al-Kazemi received pledges to provide soft loans without interest, inexchange for investment projects granted to foreign companies

Observers say that the deep state established by former Prime Minister Nuri al-Maliki, and whose influence has increased during the era of the Adel Abdul Mahdi government, will constitute a major impediment to Al-Kazemi’s plans, which may push the Prime Minister towards harsh confrontations, toppling some senior officials

In the event that Al-Kazemi’s plans are realized, his government will have bypassed, in the interim, the most important internal financial challenges, enabling him to devote sensitive files, including controlling the escaped militia weapon, organizing the relationship between Baghdad and the semi-autonomous Kurdish region, and reactivating Iraq’s external relations with a number of countries

And about two weeks after its formation, the Al-Kazemi government began to create an optimistic atmosphere about the economy and plans to deal with the repercussions of the Coruna epidemic and the file of foreign relations

But the patience of the Iraqis for the new government will not be long, especially if the electricity file enters the equation of the angry street, during the summer

The lack of electricity supplied to the population, during the flaming summer of Iraq, is one of the largest protest engines in the country in previous years, and may be an influential player this summer, due to the initial discouraging indications of energy supply rates

 

Edited May 22, 2020 by DinarThug

[Mary B]

Good afternoon DT, your the only member that gets about the same amount of sleep as me

[DinarThug]

17 minutes ago, Mary B said:

Good afternoon DT, your the only member that gets about the same amount of sleep as me

Lol - Luckily I Multitask By Drinking And Sleeping On The Job At The ‘News Desk’ !  

 

 

But U’ve Really Been Kicking Tail Lately Young Lady - Keep Up The Great Work !  
 

 

And Maybe Try To Get In At Least A Little Siesta Like Our World Class Relaxation Expert - Hammock Boy ...

     
 

Edited May 22, 2020 by DinarThug

[DinarThug]

Dr.. Ola Al-Din Jaafar *: The zero interest rate option in the face of the current deflationary crisis

05/19/2020

Many central banks, including the US Federal Reserve, went to the option of reducing interest rates to close to zero degrees to address economic and financial crises in order to maintain investment activities and exit from the state of deflation and stagnation caused by the Corona virus and the decline in oil prices in a double crisis the world has never seen before . Despite our prior knowledge that adopting the zero interest rate option is an unconventional monetary policy and is resorted to when all other measures are not feasible to avoid economic downturn or are costly to the citizen, then this option is on the cards to face deteriorating economic conditions and avoid slipping towards deflation and stagnation. .

In normal times, central banks applied a positive nominal interest rate when lending money to organize the economic cycle, but in recent years that have seen frequent crises, these banks have resorted to adopting a low base rate of interest to encourage banks to lend money instead of keeping them in their coffers. As for the current financial crisis, some central banks have cut interest rates to zero and perhaps even lower in order to stimulate economic activity and give an incentive to all consumers and companies to spend and invest money instead of leaving it in their bank accounts and hoarding them.

The applications of this policy in Japan and in some European countries have proven that their practical risks are much less than the risks of other frustrating growth policies, especially as they contribute to the recovery of credit movement and the restoration of life to the faltering economy and prevent banks from enriching and achieving an abnormal profit at the expense of the citizen who is tempted to borrow and finds himself bound With debts, installments and interest that he has no energy to bear, and as was recently disclosed information of one of the main banks in Iraq about the interest rate exceeding 50% in a procedure that has no economic or financial basis for it, at a time when the interest rate of the monetary policy of the Central Bank of Iraq is Just 4% .

The basic interest rate set by the central bank provides a key reference to enable borrowing in response to changes in the economic cycle and consistent with prevailing inflation rates, and low basic interest rates are often resorted to to stimulate consumption and reduce the cost of investment, which is what commercial banks must not move away from This price is very much.

Therefore, this paper came to clarify the effect of the zero option for the interest rate, especially since the Holy Qur’an was the first to adopt this concept to show us the dimensions of this option and its effect on the movement of other economic variables and the restoration of economic activity through it.

Many economic theories pointed to the pivotal role that the interest rate plays in achieving the general economic balance, especially the low interest rate that would stimulate investment and consumer spending, which helps to enhance the value of assets and assets, due to the tendency of stock and bond prices to rise and increase the movement of consumer and durable goods. Rather, the matter also extends to the value of the exchange rate, which decreases with a certain degree as a result of the low interest rate, which helps to increase the level of net exports and increase spending in many economic fields, as other studies have indicated important results of the policy of low interest rates, including redistribution of income between Creditors and debtors, the second category has a higher marginal tendency to spend more than the first category and therefore a low interest rate will provide additional amounts for investment and consumption at the same time and an increase in the value of assets, which gives a high sense of wealth, which is called the effect Wealth effect.

There is no need to say that high interest rates will lead to adverse results, including declining investment, a decline in economic activity, and a state of uncertainty. Uncertainty, and it is true that high interest rates will stimulate the flow of capital from abroad to inside, which means high credit supply and then the amounts available To invest, but this matter or this effect will be limited in the short term. When the central bank resorted to raising the interest rate, this will attract short-term speculative capital, which is often used in the field of consumption and real estate trading, and to a greater degree of use in productive long-term investments.

The flow of capital will lead to an increase in the value of the local currency exchange against foreign currencies Appreciation, which weakens the national economy in the medium and long term, given that exports and local industries will lose their competitiveness in the markets, which frustrates growth in the long term.

It seems that the position associated with the prohibition of hoarding and lowering the interest rate (making it zero according to the Qur’anic concept) is more advanced than the theory of effective aggregate demand brought by the well-known British economist John Maynard Keynes as he stressed the importance of moving aggregate demand by all possible means including monetary issuance in order to stimulate the economy And raise the level of employment and create new jobs. The man may be right in that his theory came against the backdrop of the great recession that prevailed in the major capitalist economies at the end of the twenties of the last century, but the dilemma in which his theory occurred later was clear, which paved the way for other more advanced theories to address the new economic problems that the countries ’economies suffered Advanced. As for the Qur’an, and in its basic premises, we found it keen to maintain the stability of the value of the currency, and that it would not accept any transactions leading to a decline in the value of money, including the wide monetary issuance, one of whose proven results is inflation, the macroeconomic instability it leaves, the disruption of the income distribution mechanism, and the widening inequality Among the segments of the same society. It seems that investing in this framework is not just a financial or monetary transaction through which we achieve profit by trading the currency as the money itself is not considered capital and it cannot achieve a return without using it in real activity.

Accordingly, the monetary policy according to these premises must be based on real assets. The banking system is not permitted to create money from nothing or finance government budget deficits without the availability of sufficient assets for the government apparatus to be able to generate income, hence the wisdom in making the interest rate Equal to zero as the banks ’ability to create real money depends largely on the level of bank credit or bank loan demand, and that this matter will only be available at very low levels of the interest rate, the inverse relationship between the interest rate and demand for credit by individuals and projects.

This position is very close to the concept of (liquidity trap) where the public desires to carry any amount of money offered when the interest rate is very close to zero and thus the increase in the money supply will not affect the real sector, then monetary policy will be ineffective.

The Qur’an, with its stance on the interest rate, has set a wall between the monetary sector and the real sector. Therefore, any fluctuations in the money and money sector (which is known as the speed of movement of changes in it) will not affect the same degree or speed on the real sector and thus isolate the real economy from repeated financial crises. Or at least provide sufficient time to take the necessary measures to deal with the situation when crises happen, and then the low interest rate is no longer a liquidity trap as described by economist Keynes on the understanding that speculators will expect an increase in the interest rate at any time soon in the future, rather that this expectation and with the cancellation The interest rate will be absent in the first place and there is no room for profit taking through it. Therefore, the available liquidity is real liquidity and cannot be speculated for the sake of achieving profits, as investment in real activities becomes the only way to obtain profits, and then the economy will operate within the limits of its real potential and in a balance language EconomicThe monetary growth rates will be parallel to the real flows of goods and services and achieving a balance between the goods and services market and the money market, which is one of the requirements for achieving macroeconomic stability.

In such a mechanism, we find that credit does not arise except to the extent that there are real possibilities for obtaining more wealth through real activities and that the abolition of interest will lead to a large extent to curbing the confusing speculation of financial transactions while the opposite occurs with the presence of the interest rate where the owners of money and business look to rates A very high profit outweighing the prevailing interest rate and the resultant trend towards higher product prices or lower real wages, and hence the level of aggregate demand. The system based on the abolition of the interest rate provides the appropriate opportunity to establish a real partnership relationship between the banking system and investors and traders and not the relationship of a lender and a borrower or a creditor and a debtor.

One of the most important arguments presented by supporters of the high interest rate is that it is considered the best way to face inflationary pressures and the expectations resulting from it that motivate speculation with funds and stay away from productive activities and therefore it is necessary to impose an interest rate that is at the minimum equal to the prevailing inflation rate in order to maintain a positive real interest rate His promise is the price of money, which serves the stability of demand for the currency to meet the Expectation of inflation, as well as maintaining a stable exchange rate. Thus, monetary policy turns into the art of managing expectations. It is clear that these arguments are valid only in the short term, as the interest rate signal, no matter how low, will turn into an important tool for building inflationary expectations by curtailing investment activity on the one hand and stimulating financial speculation on the other hand, as it will rise again.

The Qur'an with this legislation has severely fulfilled these expectations by making the interest rate equal to zero, which means stopping the work of one of the main sources of inflation. Thus it appears that this argument for facing inflation finds its place only in the short term only as the interest rate shifts from being considered part of the solution to part of the problem in the long term as governments often care to address the problems of inflation and income and others in the short term while in the long term If most of its attention is focused on achieving economic growth, this will only be achieved by raising the level of investment when the interest rate is low to the point that stimulates investment spending and the growth of productive capacities.

Canceling the interest rate and achieving synergy

Another important effect that the economic theory has linked to the rise in the interest rate is the so-called Crowding out effect. Increasing government spending for any reason will lead to higher total demand and a higher level of income and production and that this increase in income will lead to an increase in demand for money, which is what It is pushed by the monetary authority to raise the interest rate, which leads to a decrease in investment demand, and the consumption function to be turned down; In other words, the increase in the interest rate will lead to a decline in the balance point and reduce the effect of the multiplier effect caused by the increase in government spending as a result of the competition that the latter creates with the private sector, which is witnessing a decline in its investment spending as a result of the high interest rate, which leads to a reduction in the impact of expansion. On high government spending.

Thus we see that the use of the interest rate in this way has allowed a decline in economic activity and the negative effects of unemployment, lack of commodity supply, inflation and other problems.

Once again, the importance of the position regarding the abolition of the interest rate completely appears, as this abolition will not allow this scenario to operate and therefore the displacement of the private sector from economic activity will not occur as long as the interest rate is equal to zero where the door is open to all investment activities for work provided That the monetary authorities provide a parallel cash supply for the cash demand, and that what will happen under a system that works without the interest rate is the synergy between government and private investment, as the first rise will lead to the activation of all economic sectors, which opens the way for the private sector to invest higher. For example, increasing government spending on infrastructure will increase the return on private sector investment and stimulate higher investments in all economic sectors, especially in developing countries where the multiplier is very high, as the economy is far from a state of full use, and hence the impact of competition will not be inevitable .

Thus it seems to us that canceling the interest rate or building an economic system without the interest rate will limit the work of three basic variables (speculation, inflationary expectations, and the effect of crowding out) that work against the macroeconomic stability. It seems that this approach is the one that may provide the first solution to the problems resulting from the double global crisis resulting from the outbreak of the Corona virus and the decline in oil prices that led to stopping economic activity and then stopping and retreating economic growth, instead of going to difficult traditional solutions, including printing money and reducing the exchange rate or Resorting to (external) debt that is not currently available, we must return the interest rate to zero and make it zero so that we can find a solution to our economic problems that have become impossible to solve.

Sources

1- Muhammad Ayoub, The Financial System in Islam, Beirut, 2009

2- Samuelson, Economics, Beirut, 2006

3- Dr. Sinan al-Shabibi, Monetary Policy Profiles in Iraq, Abu Dhabi, 2007

4- Dr. The appearance of Muhammad Salih, Monetary Policy in Iraq, an analytical view, Baghdad, 2009

5- David Begg, Stanley Fischer, Rudiger Dornbush, Economics, London, 1987

6- Shari Spiegel, 2007. “Macroeconomics and Growth Policies,” Policy Notes 1, United Nations, Department of Economics and Social Affairs

7- Paul Wachtel, Macroeconomics from theory to practice, USA, 1989

8- IMF, Finance & Development, March, 2020

(*) Director General of the Department of Economic Policy / Ministry of Planning

Copyright reserved for the Iraqi Economist Network. Republishing is permitted provided that the source is indicated. May 19, 2020

To download the search as a PDF, click on the following link

Aladdin Jaafar - the zero exchange rate option, written

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[siberian_shaddow]

Much Appreciated Thugs, well Al-Kazemi has his hands full. But it seems he has some great support, hopefully he can get it done. And possibly take out Maliki and his Goons, fingers crossed.

[DinarThug]

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Veteran American investor: The European Union may break apart because of Corona

 

 

18:40 - 05/22/2020
 

 

US billionaire George Soros stressed that the European Union could disintegrate in the aftermath of the Corona virus pandemic, unless it issues permanent bonds to help its weak members, such as Italy.

The 89-year-old Soros said the damage to the eurozone economy from the Coruna virus will continue "for a period longer than most people think," adding that the rapid development of the virus means that it will be difficult to develop a reliable vaccine.

The veteran hedge fund expert said the permanent bonds that the British used to finance their wars against Napoleon would allow the European Union to survive.

"If the European Union cannot think about issuing bonds now, it will probably not be able to escape the challenges it is currently facing," Soros said in an interview with reporters. "This is not a theoretical possibility. The truth may be tragic."

He added that the issuance of permanent bonds, issued without a due date and paid interest to the holder as long as it remained in possession, would ease a looming budget crisis across the European Union.

He said that the union would have to maintain its AAA credit rating to issue such debts, and therefore would have to have the authority to raise taxes to cover the cost of the bonds. 

[DinarThug]

A deputy reveals destinations that millions of dollars go to outlet money and confirms: Do not go to the state

 

 

Economie 05/22 2020 13:32 675 Editor: ht    

Baghdad today - special 

 

Member of the Parliamentary Finance Committee, Jamal Couger, affirmed on Friday (May 22, 2020) that imports of the country's border outlets do not enter the state treasury, pointing out that some armed parties and factions control the outlets.

Cougar said in an interview with (Baghdad Today), that "many political and armed parties control multiple financial resources for the country, including imports of border crossings, which amount to approximately $ 6 million in just two weeks."

He added, "Breaking that hegemony, cleaning the outlets and controlling the state over them need a brave and strong decision to purge them from the corrupt", stressing that "the government's control of these funds will be an important factor in the country's general budget bill." 

The member of the Parliamentary Finance Committee, MP Ahmad Mazhar al-Jubouri, confirmed, yesterday, Thursday, that Iraqi oil is sold at less than the global market price of 7 units, while revealing the net amount of the price of oil entering the treasury.

Al-Jubouri said in an interview with (Baghdad Today), "The fact that public opinion must be aware of Iraqi oil is that oil is sold at less than the global market price of 7 tigers, due to impurities." 

He added, "The foreign companies involved in the extraction take 9 dollars per barrel, so if the current prices are 33 dollars per barrel, then the net that enters the treasury is 15 dollars, and more or slightly less." 

He pointed out that "the financial crisis in Iraq is not easy, but there are doors through which it can be mitigated, especially attention to the file of customs, taxes and ports, which can be dealt with according to decisive measures by addressing all the negatives, that lead to providing financial liquidity that helps in pushing us To cross the crisis. " 

He pointed out that "Prime Minister Mustafa Al-Kazemi is approaching internal and external borrowing to bridge the large budget deficit", stressing that "the current crisis requires radical solutions to complex files related to the country's economy in general, and the revival of agriculture and industry and ending negatives in the outlets that can provide financial sums Big money. "

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[DinarThug]

The policy-making forum provides a study on the fate of the Iraqi economy and ways of reviving it in the manner of Nigeria and Botswana

2020-05-20

 

 

Yassin Iraq: Baghdad

 

The IFPMC Policy-making Forum prepared a report that compared the Iraqi economic situation and the possibility of advancing its capabilities and wealth, with the economic situation and the advancement presented by the countries of Botswana and Nigeria, while indicating that Iraq’s economic dilemma is not related to wealth but to the political option.

The text of the report states:

It is difficult to imagine a country rich in Iraq as it appends the lists of international indicators in such a shameful way. When the 2003 war erupted in Iraq, the Iraqis branded it as the beginning of a new development march that would turn Iraq into a pioneering model in political democracy. Likewise, Iraq would have all the international support required to be a distinguished economic model that would compensate for the years of the international blockade imposed on it due to the policies of the previous regime. Much in the details of the complex narrative that brought Iraq today to turn into an economically failing state. But what we find unreasonable is that successive Iraqi governments have made little effort in improving these indicators despite the fact that Iraq is not Botswana, the poor and impoverished country, but Iraq is ranked No. 172 Out of 191 countries in the Doing Business report (2020 http://www.doingbusiness.org) prepared by the World Bank, Botswana is ranked 87th, and Nigeria ranks 131. And when we chose these two countries, it is because they suffer from difficult and chronic challenges, whether civil wars, terrorism, poverty, external interference, the domination of neighboring countries, or great corruption. These countries (and other others) suffer as Iraq suffers, but rather that Iraq’s crises are considered a paradise compared to the hell of crises Those countries. However, these countries have made streak steps in the areas of development that we can learn about by reading the most important economic indicators.

Learn about Botswana

Botswana is a flat desert land located in sub-Saharan Africa and when independence in Botswana in 1966, it was one of the poorest countries in the world. It had only 12 km of paved roads, 22 citizens with college degrees, and 100 citizens who graduated from high school. Moreover, it was surrounded by hostile regimes 

- South Africa, Namibia, and Rhodesia (now Zimbabwe). However, in the following fifty years, Botswana became the only stable economy in Africa, maintaining one of the highest growth rates in the world and achieving the highest per capita GDP in sub-Saharan Africa, which is equivalent to that in Estonia, Hungary and Costa Rica.

If all possibilities are stacked against it, how did Botswana do it? One theory is that the country has accomplished this through sound economic and political institutions, also referred to as inclusive institutions. All-inclusive institutions create platforms to generate economic growth by doing the following:

- Implementing the "rule of law" (a clear and properly implemented legal system that defines and defends property rights) and property rights that are well implemented and provide protection against expropriation. This encourages investment in the country's capital assets.

- Allocate factors of production (land, labor, capital, and projects) more efficiently, and provide financing to startups. This allows companies to enter the market and develop the economy.

Maintaining a democracy characterized by the separation of legislative, judicial and executive powers. This ensures effective contracting through the rule of law.

So Botoswana has turned into an economic miracle in Africa by focusing on specific institutional reforms that may not have made Botswana an African Singapore, but not even Vietnam, but at least they have achieved developmental standards that conform to the standards of international economic organizations (IMF, World Bank ... etc). Botswana's achievement of these standards led it to become one of the international investment destinations, and was even called Africa's economic jewel.

Learn about Nigeria

Another model that attracts attention is Nigeria, which is the other today, one of the most important emerging markets, which are called MINT countries, which are all (from Mexico, Indonesia, Nigeria and Turkey). These countries according to the British economist (John O'Neill) will be profitable investment markets up to 2030.

Nigeria, the country whose name is associated with poverty, chronic corruption, and terrorist organizations (Boukouhram), ranks in the Business Performance Index 131 out of 191 countries (www.doingbusiness.org 2020), achieving a 17-point increase from last year 2019, which rose to 146 out of 191 Country. Nigeria was able to improve its economic position by making some reforms in the field of starting business, as it reduced the time of starting a business through the use of the online registration system. Nigeria made this step, reducing the number of days, the cost, and raising its points in the international economic indicators.

On the other hand, Nigeria has suffered from the problem of implementing contracts, or what is known as enforcement contract, and because Nigeria suffers from the problem of chronic corruption, the judicial reform process becomes very complicated. At the same time, implementing and protecting contracts according to effective laws is one of the most important international standards for the efficiency of the economy in any country, and certainly weak and insignificant contract implementation laws will affect trade, look at investment, and hinder the general economy. On this basis, the Nigerian government has undertaken some reforms to enhance the implementation of contracts by issuing new rules for civil procedures. These procedures have reduced the time for filing legal suits between companies, whether local or international (2019 http://www.doingbusiness.org)

In addition, if the most important element of the law’s weakness in Nigeria and many emerging countries is the impact of corruption, Nigeria ranks 144 out of 180 in the global corruption index, which makes this country “one of the most corrupt and struggling countries against the effects of corruption on the economy.” . Knowing that since Muhammad Boukhari became President of the Republic of Nigeria in May 2015, he worked to improve the conditions of investment and development in Nigeria by chasing the heads of political corruption in the country and throwing them in prisons and dealing firmly with this file. It is considered one of the most corrupt countries.

The Iraqi economy crisis ... the decision-maker crisis 

When we read the indicators of Iraq according to the report on business performance http://www.doingbusiness.org 2020, we will be very disappointed. Iraq is not only the lowest ranked in the field of starting work or the Starting Business, but it is the country with the highest cost and the longest term and compared to the countries that append the list, because Iraq is not a poor country in resources such as Chad or Haiti or the Congo and not a country that suffers from war like Syria or Yemen. So the economic crisis in Iraq does not stem from the inability of wealth from development, but from the political and economic decision-maker's inability to manage wealth and improve production forces. I hope that we have not tampered with the words when we say (impotence) instead of saying (will).

Today, Iraq is already threatened by an economic catastrophe that may change its profile forever, especially after the collapse of the social and political contract in Iraq that resulted in massive protests and violence, as well as the collapse of oil prices and the epidemic of Covid-19, which threatens the largest economies in the world. In the face of this economic disaster, Iraq, sooner or later, will need international borrowing. The irony is that Iraq without these aforementioned crises borrowed from the International Monetary Fund in addition to the accumulations of its previous debts by virtue of international decisions, and Iraq is one of the worst countries in the payment file and commitment to international standards in terms of transparency and justice.

The governments in Iraq in the past were escaping their economic crises, arguing for combating terrorism and reconstruction campaigns ... etc. from the arguments that were bringing the Iraqi government billions of supportive and donor countries, but Iraq is not able to ask for aid anymore, especially since all countries of the world suffer from major economic crises as a result Closure policies to prevent the spread of the Corona epidemic and the economic effects of this closure, which confirm that the global economy is on the verge of the largest contraction that may change the shape of the global economy. Therefore, the decision-maker in Iraq will face its economic disaster this time without any guarantees to obtain international support and may even face the repercussions of the economic collapse Double, especially with the lack of preventive solutions and plans to cope with economic disasters.

One of the most important options available to political decision makers now is to improve the quality of economic indicators through:

Conducting in-depth studies on all means to improve the business environment and ways to raise its efficiency.

Cooperation from competent and reliable international consulting agencies in the field of developing the performance of local and international investment.

Use the expertise of international financial and economic organizations such as the World Bank and the International Monetary Fund and deal with these entities transparently in order to find the necessary solutions to raise the indicators of business and investment performance.

Providing support for local projects and developing and protecting local capital, as well as providing facilities, incentives and protection for international capital and investment to the fullest possible capacity, to ensure continuity of operation and give an impression of the vitality of the market.

Finally, political and legislative institutions in Iraq must take firm and immediate economic decisions that improve the economic situation of Iraq and give the impression that Iraq is a serious country in the field of economic reform - despite all challenges and obstacles - and that it deserves that the major economic and international economic organizations support efforts .

To see the report source, click here

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