Welcoming the proposal to establish a sovereign fund for the development of the youth and the unemployed

[yota691]

The Sovereign Fund.. Managing National Wealth and Securing the Future of Generations

Wednesday 13 October 2021 94

 

 Faris Al Salman

 

 

The decision to establish the first sovereign fund to manage the national wealth in the country is the most important and bold decision since the stage of change, but it will face major challenges, as the importance of this decision lies in that it will lay the foundation for the establishment of the Generations Fund, which aims to secure the future of future generations, and the government can adopt it within economic reform policy. The oil wealth is permeable in addition to being threatened with being dispensed with, and many countries have begun to adopt alternative and clean energies.

 The government is considering establishing a sovereign wealth fund, in which it will deposit funds equal to the ongoing compensation for the Kuwait war (deduction of 3% of the proceeds of each barrel of Iraqi crude oil that is exported).

The establishment of the Sovereign Fund should not be under the supervision of a narrow range of government advisors (with our respect for their capabilities), but through openness to the people’s forces and segments, because it is the owner of wealth, especially that Iraqi universities are full of professors specialized in this field, as well as civil society organizations specialized in the economy And economic development has already dealt with the subject and organized mature and advanced workshops, including the Baghdad Economic Forum, in which international organizations such as the United Nations and the World Bank participated and came out with solid recommendations. 

 The biggest challenge to the project is corruption and partisan and sectarian quotas and their impact on the process of forming the fund and its future method of work, especially in choosing the chairman and members of the fund's board of directors. Because if corruption and quotas infiltrate it, these assets and resources will be squandered and will be lost forever. Especially since we have before us the pension fund model (the size of 50 billion dollars), which, due to corruption and mismanagement, is on the verge of bankruptcy.

We need to be careful in drawing up the fund's structure, its legal framework, methods of governance, management, financing, implementation of its tasks and control, choosing consultants in international investment specializations and investment portfolios.  

In addition to being careful to draw up the fund’s policy, because we want it to be a good source of revenue (if it were scientifically managed and prosecuted) to compensate for the missed opportunities that Iraq missed, including the rise in oil prices to more than 130 dollars / barrel in 2008, which Norway and the Gulf countries exploited to create a surplus wealth Kabir went to the sovereign funds, while Iraq squandered these revenues as a result of mismanagement and corruption, and they are added to the lost opportunities in the life of the Iraqi state.

 The other worrying dilemma is where the fund’s money will be invested? Is it by investing in profitable international stocks or bonds, similar to the Gulf funds and the Norwegian sovereign fund, or going to risky emerging markets? Or in the international real estate market, hedge funds, investment funds in the financial markets and bonds Stocks, futures and raw materials?

In addition to the foregoing, a logical question is added: Will the fund meet the aspirations and ambitions of the Iraqi people and the current Iraqi government in reorganizing the national economy in a way that ensures that the Iraqi national security is met?

I do not think so....because this fund cannot meet several requirements at the same time. If we say that to guarantee the future of future generations, the controversial and legitimate question will be: What about the current generations who suffer from poverty, illiteracy, etc.?, and if we consider that this fund can It should be a buffer against the normals of time and the government can borrow from it in economic crises, then the fund will be forced to forfeit its investments in investment portfolios and assets to provide liquidity to the government at a time when the market is suffering from a financial crisis. Therefore, Iraq needs a set of bumpers, not a single one, that is, a package of sovereign funds by benefiting from the experiences of other countries that preceded us in this field, while putting the national touch in line with the requirements of the Iraqi economy.

 Iraq is characterized by the abundance of its natural, financial and human resources and wealth, as well as the importance of its geopolitical position in the region, which urgently requires a rational management of its resources and its economy. A package of sovereign funds managed with good governance and transparency, as well as the development and support of the Iraqi Fund for Foreign Development as one of the tools of the Iraqi state's influence to secure the vital space within the theory of Iraqi national security.

It is noteworthy that the Baghdad Economic Forum had previously organized, in partnership with the General Secretariat of the Council of Ministers, a workshop entitled “Sovereign Funds and their Role in the Development of the Iraqi Economy” on 25/10/2017 at Al-Mansour Hotel, in the presence of a group of concerned officials, parliamentarians, local and foreign economic figures, academics, international organizations and the Bank International and the United Nations.

[yota691]

Sovereign funds are the most prominent trends of multi-revenue

Tuesday 26 October 2021 160

  Baghdad: Shukran Al-Fatlawi

 The country has lost many opportunities to diversify the Iraqi economy over the past years, and we still have many solutions, foremost of which are sovereign wealth funds. The specialist in economic affairs, Dr. Bassem Al-Ibrahimi, explained that “many countries have established this type of fund for motives that differ from one country to another, and sometimes the goal of establishing it varies.

It may be achieving economic stability, or it may be achieving future savings, and sometimes it is combined 

The two goals. 

He pointed out that {the presence of a sovereign wealth fund in Iraq contributes to strengthening the general budget to face failures in annual revenues, and to confront unexpected deviations between revenues and public expenditures, i.e. a certain percentage of revenues is deducted annually to be placed in this fund and is managed according to a special law. With it, it includes transparency that guarantees success 

Currency. 

And he had indicated that {the main role that the sovereign fund can play in Iraq is to isolate the general budget and the macro economy from the external shocks that occur from time to time in international oil prices, thus leading to a state of stability, as well as working to preserve the rights of generations. In addition, he considered it an important basis for initiating projects of economic and social priority on the path to achieving success in the process of economic development. 

He pointed to the importance of establishing a sovereign fund in Iraq, pointing to the need not to think about this approach when a financial crisis occurs, as it is sometimes difficult to deduct some revenues and transfer them to this fund, indicating that many countries have sovereign funds that withdraw from them in times of crisis to reduce the effects of the crisis. 

 

[yota691]

Basra: Baghdad deprived us of 3 trillion dinars due to the failure to establish the Generations Fund

 

An oil field in Basra. "Reuters"

Reconstruction and building Economy News - Baghdad The local government in Basra revealed, on Monday, that the province was deprived of sums of money amounting to more than 3 trillion dinars, due to the Ministry of Oil . The first deputy governor, Muhammad Taher Al-Tamimi, said in a press interview, "The governorate has 2.5 trillion owed by the central government since the beginning of this year until last August, as a difference in the selling price of a barrel of oil calculated at forty-five dollars and sold at five and eight dollars ." He added, "The House of Representatives voted to exchange the difference in the price of a barrel of oil and put it in a fund called the Generations Fund for the governorate. The money it contains is disbursed at any time the governorate needs," noting that "the Ministry of Oil challenged this decision and refused to establish this fund, which deprived the governorate of more than 3 trillions by the end of this year .

Views 147   Date Added 08/11/2021

[ronscarpa]

"The House of Representatives voted to exchange the difference in the price of a barrel of oil and put it in a fund called the Generations Fund for the governorate. The money it contains is disbursed at any time the governorate needs," noting that "the Ministry of Oil challenged this decision and refused to establish this fund, which deprived the governorate of more than 3 trillions by the end of this year .

 

More government over-reach into the rights of the Iraqi people...Ron

[yota691]

Basra calls on the government to spend 3 trillion dinars on oil price differences

 

- 08-11-2021 09:49 AM - Read: 15098

 

The local government in Basra revealed, on Monday, that the province was deprived of sums of money amounting to more than 3 trillion dinars, due to the Ministry of Oil.
The first deputy governor, Muhammad Taher Al-Tamimi, said in a press interview, "The governorate has 2.5 trillion owed by the central government since the beginning of this year until last August, as a difference in the selling price of a barrel of oil calculated at forty-five dollars and sold at five and eight dollars."
He added, "The House of Representatives voted to exchange the difference in the price of a barrel of oil and put it in a fund called the Generation Fund for the governorate. The money it contains is disbursed at any time the governorate needs," noting that "the Ministry of Oil challenged this decision and refused to establish this fund, which deprived the governorate of more than 3 trillion by the end of this year.

[yota691]

Al-Kazemi’s advisor clarifies the details of the proposed sovereign wealth fund

 

•  Yesterday, 13:12

 

Baghdad - INA - Nassar Al-Hajj
, the financial advisor to the Prime Minister, Mazhar Muhammad Salih, explained, today, Saturday, the details of the proposed sovereign wealth fund to be established in Iraq, while specifying the entity responsible for its management.
Saleh told the Iraqi News Agency (INA): "The world's sovereign wealth funds were established at least 6 decades ago and were built on the fact that the returns from the resources of the producing and exporting countries of raw materials as financial surpluses have become an important part of capital wealth that can be invested, maximized and continuously increasing instead of consuming it with budgets. Large operational budgets in general annual budgets are mostly unproductive.
He added that "the philosophy of defining those returns from raw resources such as oil and other depleted natural wealth is not necessarily for consumer spending, but rather they are capital assets in themselves, which requires their sustainability and maximizing their growth by investing for the benefit of the nation in a profound cumulative way for wealth itself and across generations, and based on that and in order to serve capital assets." The current resulting from the revenues of raw materials, including oil wealth, the majority of the oil-producing countries in particular have established sovereign investment funds from their surpluses from oil revenues and employed them as capital in various investment assets, whether financial or real and generating income to increase the capital in them as a growing wealth for the benefit of the people ".
He continued: "Therefore, double returns in the form of income will accumulate within the investment of the resources of these sovereign funds in the form of an expanding capital wealth, realizing at the same time that the sovereign fund is an investment fund in nature, and thus the sovereign fund goes to a lofty goal, which is to maximize the nation's depleted resources for the benefit of sustainable development goals from during the intergenerational economic boom.
He stressed that "the current generation should provide supplies for sustainable welfare for the next generation and in accordance with the best investment practices for the assets that will be included in the sovereign investment portfolio and within the framework of the sovereign wealth fund itself," explaining that "the sovereign wealth fund is often managed by the executive authority as a direct sovereign entity. And in cooperation between the country’s financial and monetary authorities, and the performance of the sovereign fund is monitored by legislators in the House of Representatives within the country’s legislative assets and control rules.”
He pointed out that "one of the most important themes that were discussed on the subject of the Iraqi sovereign fund in a symposium he held at the House of Wisdom last September focused on the dilemma (How can a deficit economy over the past 40 years establish a sovereign wealth fund?... And sovereign funds". phenomenon that arose in surplus economies in general).
And he added: "The answer to this question is the adoption of a sovereign wealth fund directed to real investment inward within the framework of exceptional strategic economic and social development and in a different administrative style, which requires the presence of the state's economic sovereignty again in the management of the economic project by moving the idle projects and idle wealth of the public and private sectors, That is, in partnership with the market and foreign investment, and this will lead to the development and development of the national economy and its transformation into an economy of sustainable surplus on investment activities that lead to diversification of the sectors of the economy.
He noted that "the proposed inward-facing sovereign fund is managed through a system similar to holding companies, as it was noted that the existing 80 sovereign funds around the world differ from state to state and from fund to fund."
He concluded his speech by saying: "In order to avoid legislative difficulties, it was proposed that the Iraqi Fund for Foreign Development in the Iraqi Ministry of Finance be the legal basis for managing the next sovereign wealth fund for Iraq after agreeing on the style, model and nature of the fund, whose money will necessarily be from the state's wealth outside the general budget mostly and in partnership financial and administrative resources with the natural and intangible wealth of persons.

[horsesoldier]

Cut the crap, enough with the excuses, no more pointing greasy stubby little fingers...implement the “ proposed sovereign wealth fund “ ( you greedy, slippery, shifty bureaucrats).

[yota691]

After repaying Kuwait's debts, Al-Samarrai calls for the establishment of the "generational fund" with the same value as the deduction for compensation

 

 

- 22-12-2021 04:19 PM - Number of readings: 2028

 

 

 

[yota691]

 

Al-Samarrai calls on the Ministry of Finance to establish a sovereign fund

Policy

2021-12-22 | 09:15

 

 

 

561 views

 

The winning candidate, Muthanna Abdul Samad al-Samarrai, called on the Iraqi government, today, Wednesday, to establish a sovereign fund under the name of the Generations Fund with the same value as the deduction amount for previous compensation for Kuwait.

Al-Samarrai said in a tweet on "Twitter", which was followed by Alsumaria News, that "it is time to work to protect the future of generations, after we got rid of debt by completing the last batch of compensation to the State of Kuwait."

He added, "Under the Financial Management Law, I call on the Ministry of Finance and the Iraqi government to establish a sovereign fund with the same value as the deduction amount for previous compensation annually, with the same mechanism followed, under the name "Generation Fund."

 

 

 

[ronscarpa]

 A positive step for the Iraqi people..!

[horsesoldier]

Hoping for the sake of the Iraqi folks the Sovereign Fund isn’t code used by criminal bureaucrats for a new Slush Fund.

[yota691]

Sovereign funds are a requirement for the next stage

Tuesday 11 January 2022 158

 

  Baghdad: Hussein Thaghb 

 

The voices calling for the establishment of sovereign funds have returned, and to be among the priorities of the next government that everyone is waiting for, as the economic and business community hopes that it will correct many performance paths through the next government formation and move the labor market, and its activity will have a positive impact on the life of the Iraqi citizen. 

Economist Basem Jamil Antoine stressed that {sovereign funds represent an important hub in the economic life of the countries of the world, as they play dual roles that serve the national economy, through their role in financing discreet and developmental projects. 

in the country, and preserving the rights of the future generations. 

He added that the trend in this important path should receive the attention of the concerned authorities, in addition to benefiting from the experiences of the real private sector in forming such funds, especially since global experiences in this field have brought positive results, and when we review the matter, we find sovereign funds spread in most The countries of the world have a positive impact in support of major economies, and we have in the region a number of important sovereign funds, which necessitates us to turn to the adoption of such 

ideas}.

It is noteworthy that the head of the Department of Economics at the College of Administration and Economics, Al-Mustansiriya University, Dr. Falah Hassan Thuwaini said: The experience of establishing the Development Fund for Iraq (DFI) was aimed at ensuring the use of the Fund's resources in a transparent manner for the reconstruction of Iraq and to meet humanitarian needs. 

From the date of its establishment under Security Council Resolution 1483 in 2003 until the end of 2013, it was found that despite the Fund’s role in financing various economic sectors aimed at achieving economic development, it did not achieve the desired development despite the funds spent by the Fund for this purpose and for several reasons, including the lack of The fund adopts a development strategy 

clear.

financial revenue

The economic affairs specialist Haider Kazem Al-Baghdadi said: “The tendency to adopt the idea of establishing sovereign funds represents an important axis during the next stage, especially since expectations indicate an abundance of financial revenues after the rise in crude oil prices, and here we must have a financial formation that improves behavior.” With these funds, instantaneously and in the future, and developing them through major projects that benefit the national economy and address the problems of the economy at the same time.”

 

Specialized Institutions

He added, “We can have an administrative body within a ministry and in cooperation with specialized institutions in the public and private sectors, to supervise this important issue, prepare all requirements for the establishment of such a fund and work on the actual start, and here the next government must believe in this direction and work to support it, in order to start A positive step in the first year of her life. 

Al-Baghdadi pointed out that “the working mechanisms of such a fund must be transparent to a large extent, and there should be clarity in the funding paths, and that there should be evaluation oversight for the performance of such an important economic formation in order to make it influential in the process of economic development that it seeks.”

country}. 

 

The right of generations

It was between academic d. Sattar al-Bayati: {The sovereign fund that is fully compatible with the concept of sustainable human development that takes into account the right of future generations to depleted resources, then is it unreasonable that the country tends to borrow from abroad and that future generations have to bear part of the burden of these loans and their increasing benefits? To the extent that the right of generations to depleted resources is proven, it represents a realization of justice between the two generations}.

[yota691]

POSTED ON2022-01-25 BY SOTALIRAQ

Economists are optimistic about the rise in oil prices and call for the activation of the sovereign fund in Iraq

Economists expressed their optimism about the rise in oil prices, and while they called for structuring the oil policy in Iraq to absorb the unemployment crisis, they offered solutions that would revive the Iraqi economy.

The economic expert, Salam Sumaisem, says that “the increase in oil prices is supposed to be directed to areas where the Iraqi economy suffers from a lack of funding, the most important of which is bridging the deficit gap in the public budget, and that it is directed to development purposes and improving the situation of the citizen, especially the health file, especially with the outbreak of the pandemic and the presence of Hospitals suffocate phenomena as well as saving expenses to meet the needs of the ration card and improve its quality.”

Sumaisem added, "The Ministry of Finance confirmed that the issue of raising the price of the dollar will continue for 5 years, and it is possible to address the effects of this, and thus reduce the internal debt represented by the state's borrowing from some institutions such as the Rafidain Bank, the Trade Bank of Iraq and other banks, in addition to the volume of bonds submitted, and this remains based on the size of the state's fiscal policy.

And she noted that "there is an important issue represented in the economic vision and benefiting from these funds and caution against their loss and loss of control and transparency, as there are no reports regarding the final accounts provided by the Financial Supervision Bureau, as well as waiting for Parliament to approve the 2022 budget." In turn, the economic expert, Tariq Al-Ansari, says, “The rise in oil prices can be called (the oil market uprising) due to three cases or problems that occurred in the oil market, which are the increased demand for fuel in Europe due to the decrease in European stocks by 11%, and the establishment of the United States The US has withdrawn the strategic oil stockpile, and decreased exports to Kazakhstan, which is a member of OPEC.”

Al-Ansari added, "These three factors led to a price increase to $85, and it is expected in the coming months to reach $90," noting that "this increase represents successful and good indicators for reviving the Iraqi economy if it is properly and properly utilized within the economic engineering." In Iraq’s oil policy, to absorb unemployment and reduce loans, which has become a burden on the Iraqi economy, the public budget, and the Iraqi citizen in particular.” He stressed, "This increase should follow the example of what countries such as Kuwait, Saudi Arabia, the UAE and Qatar did by placing them within the generational support strategy, as economists in oil policy tended to directly strengthen the sovereign fund of their countries," stressing "the need to take correct and sound measures in oil policy and achieve The increase in the economic system in Iraq is a fragile system that does not adopt standards on how to employ these increases so that they are reflected on the Iraqi economy and citizens.”

He pointed out “the importance of there being a return to all government performance of economic activities, restructuring the oil policy, achieving a balance between financial, monetary and investment policies, and working to activate the sovereign fund, as we call it the Generations Fund, and build it in a way that guarantees a solid and sober economy because opportunities in the economy do not always come.” In normal circumstances, it always comes in difficult circumstances.”

For his part, the economist, Nabil Jaafar, said, “There are upward trends in the tracks of crude oil, and Brent crude recording more than $87 is an indication of the recovery and recovery of the global oil market due to many factors, with strong demand accompanied by limited supply due to the inability of OPEC to implement monthly increases.” amounting to 400,000 barrels per day and only 250 thousand barrels, in addition to this, the inability of shale oil producers to distribute profits and invest in the industry, which is turbulent and requires large capital to shift towards clean energy.”

Jaafar continued: "Added to this are the tensions that the world is witnessing, especially in Kazakhstan, and the armed attacks against the UAE, which cast doubt on the safety of oil supplies, in addition to the cold weather experienced by the western hemisphere," noting that "all these factors pushed oil prices to These prices are high."

He added, "It is hoped that the price of a barrel of oil will break the $100 barrier, and this situation will reflect positively on the Iraqi situation, where the value of exports is expected to reach 145 trillion dinars, an increase of about $25 billion over what was achieved in 2021."

He stressed, "Oil is the focus of the Iraqi economy and the main source of income from foreign currency, as it is positively reflected on the level of all economic indicators, the balance of payments, external balances and the current account balance, and the deficit will also decrease as a result of the increase in oil prices and the high level of Iraqi oil revenues."

He pointed out that "today, there is a new wave of rising crude oil prices, and it is possible to invest this to break the financial constraint that prevents real economic development, and to invest large sums that can be allocated to activate the investment aspect and establish some strategic projects that generate goods and services and have an impact on achieving a qualitative leap." for the Iraqi economy.

He pointed out, "the importance of working to establish a sovereign fund and a financial and economic buffer, because the rise in oil prices will not continue, and we will face in the coming years factors of a decline in prices, so this fund is important to maintain the guarantee of the future for future generations." The financial advisor to the Prime Minister, Mazhar Muhammad Salih, had submitted earlier, a proposal to establish a fund or account concerned with the stability of the budget and fed annually with a percentage of the surplus oil revenues, to hedge against the risks of price fluctuations, while recommending the adoption of financial discipline after the rise in oil prices, pointing to This avoids resorting to debt and hedges against oil price shocks.

He added, "Financial discipline means the optimal use of budget resources and raising the levels of good management without financial waste that ultimately arranges resorting to unjustified borrowing, and it also hedges against external price shocks generated by oil market surprises and price fluctuations and their sudden decline without knowing the reasons, which leaves direct adverse effects on the stability of the financial sustainability of the country.”

• About Agency (INA)

[yota691]

 

A government move to form a sovereign fund in Iraq that was supposed to work 18 years ago

 

 2022-01-26 04:12

 

Shafaq News/ The Prime Minister's advisor, Mazhar Muhammad Salih, considered today, Wednesday, that the sovereign funds are "not difficult", and he also said that they were supposed to work 18 years ago, that is, after the fall of the regime of former President Saddam Hussein.

Saleh said in an interview with Shafaq News Agency, "The sovereign funds that countries take are not difficult to establish, and they are part of the financial surpluses that come to protect the national economy in times of crisis or when prices drop, and they are called stability funds," describing "such an approach as positive, logical and correct." And the budget was supposed to have taken it 18 years ago.”

He added, "There is a tendency at the present time by the Iraqi government to establish a stability or sovereign fund to protect the public budget and the Iraqi economy."

Saleh also pointed out that “sovereign funds have many and varied names,” noting that “the Generation Fund is whenever there are large surpluses of funds, and when the desires of the current generation are not at the expense of the desires and aspirations of the next generation, then certain sums are provided to them from The money will therefore have current and future protection for future generations.”

A sovereign wealth fund or sovereign funds is a state-owned fund consisting of assets such as land, shares, bonds or other investment devices, and these funds can be described as entities that manage state surpluses for investment and promise billions of dollars invested by states in stocks and bonds.

[6ly410]

Utilizing oil revenues to establish sovereign funds

Sunday 06 February 2022

https://alsabaah.iq/60536/توظيف-عائدات-النفط-في-إنشاء-صناديق-سيادي-ة

 

 Baghdad: Imad of the emirate

To ensure the rights of the people and future generations, voices are calling for a serious approach to defining the paths of the surplus oil towards achieving prosperity for all segments of society, by employing the surplus oil revenues in paths that work to achieve sustainable development. Financial shocks to the global economy.

Oil prices rose by 2 percent; While the price of Brent crude exceeded the mark of $93 a barrel; For the first time, since October 6, 2014.

Member of the Businessmen Union, Yassin Al-Quraishi, stressed that “the rise in global crude oil prices represents an opportunity that must be invested in the right way, and here it is necessary to benefit from global experiences in this field, and to establish sovereign funds that work on developing the national economy and guaranteeing the rights of future generations, and at the same time expanding These funds contribute to a broader service to support the economy.” He pointed out that «Iraq is required to work on the establishment of sovereign funds that have a direct and positive impact on the national economy, meet the needs of the growing Iraqi society and address all the problems facing the country».  

 

financial returns

Academic Dr. Abdul Karim Al-Issawi said

To “Al-Sabah Al-Eqtisadiah”: “The fluctuations in oil prices and the impact of financial returns prompted the idea of establishing sovereign wealth funds dedicated to ensuring the stability of returns and protecting the interests of future generations in order to avoid the cycle of boom and bust, which is one of the confirmed repercussions of fluctuating oil prices.”

 

generational rights 

He added that "Iraq's acquisition of an abundance of foreign assets (hard currency) through the oil resource, it must be exploited in a way that guarantees the rights of future generations, and we see that this be done by establishing a sovereign fund in Iraq, and of course, the process of establishing a sovereign fund in the country stands behind a group of The rentier justifications for the Iraqi economy.

 

oil prices

Al-Issawi added, “One of the important justifications that makes it necessary to establish the sovereign fund is the fluctuations in oil prices in global markets, as the crude oil commodity is at the forefront of economic commodities that are subject to price fluctuations, at a time when Iraq has huge reserves estimated by experts at more than 250 billion barrels. In the event of the completion of oil explorations, and here we can imagine the importance of the country in global energy security with its reserves in exchange for the inability of other sources of energy to meet the actual need for crude oil.”

 

Infrastructure

It is noteworthy that the financial advisor to the Prime Minister, Mazhar Muhammad Salih, had focused on the submerged sovereign fund and economic development guarantees, which represent a means by which governments and institutions can put money and accumulate it over time to address economic problems, noting that “in consultation with the International Monetary Fund, the possibility of Iraq establishing A submerged sovereign fund that deals with financing by supplementary borrowing from the international market through executive coherence with the global contracting market to advance the fixed capital formation ratio in relation to the gross domestic product. In turn, the academic at Al-Nahrain University d

[yota691]

Sovereign Generation Funds..a guarantee for the future awaiting implementation

Thursday 07 April 2022 208

 

 Baghdad: Nafeh Al-Naji

To arrive late is better than not to arrive. This argument is what led rentier countries that have wealth to enter the arena of sovereign funds or the Generation Fund with the growth of the oil boom, including Norway, the Emirates, Kuwait, Qatar 

and Saudi Arabia.

These countries were the first to establish and establish generation funds with the aim of preserving and developing the country’s wealth to face the risks of the future, especially for future generations. Will Iraq join these countries, especially as it lives (in oil wealth) after the price of a barrel of oil exceeded $100?

 

Facing future risks

Economist Dr. says. Muhammad Samir Dheereb told (Al-Sabah), that "the goal of the sovereign fund or generational funds is to confront any risks facing the future generation and to preserve and develop their wealth," and added, "The nature of this fund is similar to what exists today in the Gulf countries near Iraq, and its idea is focused By moving away and not relying on oil outputs and making them the main resource for financing the country’s treasury.”

 

Asset management specialization

Dheereb pointed out, "These funds are investment funds that manage assets for foreign currencies and assets by a company or department specialized in the issue of foreign asset management, with the aim of either achieving income growth or achieving stability when the economy fluctuates, or adding a reserve to the country away from the bank's legal reserve rules. 

Central".

For his part, economic analyst Ahmed Majid Abu Kell revealed that calls were made on many occasions to establish sovereign funds for Iraq, but the project was ignored or postponed for many reasons and circumstances that were not appropriate.

He explained, "The demand to establish a sovereign fund came late, of course, and here a question arises about the nature of the fund's financing. Is it an asset in the sense of deducting money from the state budget and allocating it to it as a fixed paragraph in the budget?" Finance and government banks, which weakens the financing of the Fund.

As a solution to this problem, Abu Kell suggests: “The financing of the fund should be based on the law founding this fund, and its customary financing by allocating a percentage of the general budget annually, in addition to adding a percentage to the founding capital, which may be deducted from the foreign reserves of the economy concerned with establishing the fund, as well as For surpluses and additional revenues outside the budget estimates, which are realized in each annual budget, to go to the Fund to preserve them from waste.

He stressed, "The financing of this fund when it is sovereign, this means that the assets are sovereign belonging to the state."

[yota691]

Welcoming the proposal to establish a sovereign fund for the development of the youth and the unemployed

Thursday 14 April 2022 115

 

 Baghdad: Haider Falih Al-Rubaie 

Specialists in economic affairs welcomed the initiative of the House of Representatives to establish a sovereign fund for the development of the youth and the unemployed, stressing the importance of the step in eliminating unemployment and moving the wheel of production and employment of labor, calling at the same time to the harm that this fund take into account, activating areas that can increase rates Gross domestic product, such as industrial, agricultural and tourism aspects.

 

The First Deputy Speaker of the House of Representatives, Hakim al-Zamili, revealed that there are parliamentary efforts to legislate a law that serves segments of Iraqis, while referring to work on establishing a sovereign fund for the development of youth and the unemployed.

 

development rates 

The parliamentary move was met with an economic welcome, expressed by the expert, Manaf Al-Sayegh, who confirmed to Al-Sabah the importance of this trend in moving the wheel of production, increasing development rates and eliminating unemployment, calling for the need to define the project’s goals more clearly, and if it seeks to employ unemployed youth Work or push them towards profitable, income-generating projects that add to the GDP and financial savings, pointing out that this step can effectively contribute to achieving a broader movement within the local market and provide job opportunities.

Al-Sayegh believes that, "In general, the trend towards establishing a fund for the development and employment of the unemployed, and pushing them to create new and useful productive works that serve the needs of society, is an important step towards increasing development rates and activating the vital productive sectors that can be targeted by that fund, which should be He leaves the "classical support" represented by some professions that cannot increase the movement of production nor is it capable of doubling the rates of development, and abstains from assigning consumer projects that do not add anything to the GDP.

 

industry and agriculture

Al-Sayegh urged the importance of the Fund to take into account the attribution of vital projects that can support the industry or provide the requirements of this production in this sector, or agricultural projects or supplements to this sector as well, as well as advanced electronic projects, calling for the need to determine the funds in a scientific manner based on The basis of the expected profit amount, the type of project and its ability to increase growth rates, move the wheel of production and employ manpower.

The speaker also stressed the need to determine reasonable profits from that sovereign fund or to zero them in order not to restrict young people aspiring to establish their productive projects in their first steps, indicating that with such a mechanism of action, the results of the fund will be positive and fruitful and have a vital and significant role in moving the wheel of the national economy. 

As well as the most prominent role in eliminating unemployment and employment and achieving development goals.

Al-Sayegh expressed his disagreement with “the project” if its goal was to distribute funds to the unemployed, noting that this could increase unemployment rates and contribute to the prosperity of young people looking for real job opportunities, pointing out that the sovereign fund could enter into large investments with the aim of doubling Its assets are from funds to support small and medium productive enterprises.

 

good rules 

For his part, the expert and economic advisor, Duraid Al-Shaker Al-Anzi, believes that "financial allocations are not the only ones that are sufficient for work, production and employment of young people, but there is an urgent need to pass laws that help in planning and work."

Al-Enezi urged, in a statement to "Al-Sabah", the need to "create decisions, laws and facilities that can make the project successful, otherwise this step could face many bumps, especially the issue of guarantees that are an obstacle in all the initiatives of the Central Bank."

Al-Enezi stressed the importance that the projects to be supported should be appropriate to the levels of experience enjoyed by the unemployed youth, calling for supporting "sectors of work" and not isolated projects, provided that the projects are productive and contribute to employing the largest possible number of manpower.

The economist also urged the need to move away from the mechanism of distributing amounts, as it is a process that can create inflation and consumer demand, suggesting that support be through the ration card.

 

development of the unemployed 

It is noteworthy that the First Deputy Speaker of the House of Representatives, Hakim al-Zamili, revealed earlier this week, parliamentary efforts to legislate a law that serves segments of Iraqis, while referring to work on establishing a sovereign fund for the development of youth and the unemployed.

Al-Zamili told the Iraqi News Agency (INA), that "Iraq has completed the compensation file for Kuwait, and the allocated funds are still in the Ministry of Finance, where at first it was paying a high percentage of debts of 5%, and then it decreased to 3%, and more than 52 billion dollars were paid to Kuwait." ".

And he stressed, "the need for the House of Representatives to invest the same percentage through a binding law legislation to deduct a portion of oil imports to be distributed among the poor and the unemployed," adding, "certainly, that the amount is large and depends on oil exports."

Al-Zamili added, "We are working to establish a sovereign fund, so that we can develop young people and many of the unemployed." The Central Bank had previously confirmed its support for the establishment of a sovereign fund for future generations.

[yota691]

Adviser to the Prime Minister reveals the conditions for depositing the financial surplus in a sovereign fund

 

- 05-01-2022 12:02 PM - Read: 954

 

Today, Sunday, the financial advisor to the Prime Minister, Mazhar Muhammad Salih, set a condition for depositing the financial surplus in a sovereign fund, while indicating that spending on social spending and addressing poverty will be the first priority.
Saleh said in a press statement, “Based on the text of Article 19/Second of the amended Federal Financial Management Law No. 6 of 2019, if the actual revenues exceed total expenses or expenditures, including financing the planned deficit in the annual budget, the surplus amount is deposited in ( Sovereign Fund) provided that a budget law is available, otherwise the said financial surpluses will be deposited in a reserve account and will undoubtedly be an opening balance in financing the federal general budget for the year 2023 in whole or in part and according to the exchange chapters and its future priorities.
He added, "Spending on social spending and addressing poverty will be the first priority, in addition to making it easier with the investment spending associated with the implementation of strategic projects that operate work and inevitably generate income."
And the Ministry of Oil announced, earlier, that the revenues last month amounted to more than 10 billion dollars.