Iraq News Highlights and Points to Ponder Tuesday AM 12-31-24

Monetary Policy Collapses In Iraq.. Investment In Banks Is Almost Non-Existent And The Central Bank Is Going Against The Tide - Urgent

Economy |Today, Baghdad Today – Baghdad   Financial and economic expert Mustafa Akram Hantoush commented, today, Tuesday (December 31, 2024), on the performance of the Central Bank of Iraq for the current year.

Hantoush said in an interview with Baghdad Today, " The reality of monetary policies in Iraq is heading in the opposite direction to the process of building monetary policies, and there have been problems for years that have led to a clear collapse in Iraqi monetary policies."

He added, "The banking system has been subject to near-annihilation for years.  32 banks are subject to sanctions, and the rest are banned from the dollar only, in specific currencies, and the mechanism is still unclear."

He pointed out that "there are more than 70 Iraqi banks that do not lend, because the Central Bank has not set a clear lending policy in terms of loans, categories and guarantees."

He added that "the policy of attracting deposits of more than 80 to 85% of the currency issued by the Central Bank, and it does not appear in the monthly transactions in the monthly banking system, so this currency is supposed to be offered as marketing deposits, so the banking system does not enter into this process," indicating that "the Iraqi bank's investment policy is almost non-existent in its investments."

Hantoush explained that the investment banking operations policy is not defined in any direction, and the remittance policy also has a problem with the cancellation of the platform, "  therefore I see a clear collapse in Iraqi monetary policies."

Hantoush called on the Central Bank to reform its monetary policy, set new standards to develop the Islamic banking system and go beyond standards that keep pace with the requirements of the current and future economic stage.  LINK

Economist: Relying On Oil As A Source Of Revenue Will Have Serious Consequences

Today 10:29  Information/Baghdad...  Economic researcher Diaa Abdul Karim found that the primary reliance on oil exports as a main source of revenues and salaries will have serious consequences in the future.

Abdul Karim told Al-Maalouma, "The world's dependence on oil and its derivatives will gradually decline over time, especially with technological advancement and reliance on clean energy methods in many countries, in addition to the start of work on producing electric cars, as manufacturing countries have begun to resort to this option as an alternative to liquid fuel and its harm to the environment."

He added, "The dependence on oil and its derivatives will never stop, but it will decrease significantly over time. Therefore, the countries exporting oil need a strategy to save them from the decline in oil revenues."

He pointed out that "Iraq depends mainly on oil revenues to finance the budget and pay salaries, and this poses a threat to the country, especially with the rise and fall in oil prices, which requires governments to resort to other options to diversify the sources of the economy to avoid the global trend towards moving away from oil." End25  LINK

Customs: Our Revenues Increased By 128% During The Current Year

Faw Port   Money and business  Economy News – Baghdad  The General Authority of Customs revealed, on Monday, that its revenues increased by 128% during the current year compared to last year, while confirming that administrative reforms and the ASYCUDA system contributed to the increase.

Director of the General Authority of Customs, Ahmed Al-Akidi, said in a statement reported by the official news agency, and reviewed by "Al-Eqtisad News", that "the revenues of the General Authority of Customs for the period from 1/1/2024 to 30/11/2024 amounted to one trillion and nine hundred billion dinars, compared to 892 billion dinars in 2023, with an increase rate of 128%."

He added that "administrative reforms, the ASYCUDA system, and simplification and facilitation of customs procedures contributed to increasing revenues."

 Al-Akidi explained that "the General Authority of Customs is working according to plans represented in a number of axes, including developing the competencies and skills of employees, in addition to completing the installation of the ASYCUDA system in customs centers that have not been automated," noting that "by the end of 2025, all customs centers will be automated."

He continued that "automation consists of multiple stages, the first stage is done by automating the centers, then linking with government departments within the country is considered the second stage, and the third stage is linking with the customs programs of neighboring countries." Added 12/30/2024   https://economy-news.net/content.php?id=51450

Dinars Entering The Ministry Of Finance Are 20% Less Than The Amount It Needs.. Iraqis Start Their New Year With Salary Anxiety

Economy   2024-12-31 | 1,818 views  SumerianNews  More than 6 days have passed since the supposed date for the release of salariesStaffAs concerns grow over possible delay in pension paymentsIraqisAlso, their salaries will be due tomorrow.vacationNew Year's Eve

Iraqi employees usually receive their monthly salaries no later than the 25th to the 27th of the month, but the current month ended today, and there are still no indications of the possibility of disbursing salaries, as salaries were paid in “installments” for some categories, ministries and departments and not others, due to the lack of liquidity, i.e. the Ministry of Finance does not have the dinar.IraqiIn her closets.

This prompted the Ministry of Finance to issue a “denial” statement, but the denial, as it seems, is a denial of “the inability to release salaries,” not a denial of their delay, as the ministry said in a statement that “the information circulating on social media, which claims to apologize for the disbursement of salaries of employees,The StateThis month due to a lack of liquidity is completely incorrect and has no relation to reality.

She added: “We are fully committed to the process of financing employees’ salaries, as the Accounting Department has financed the salaries due to ministries, governorates and non-affiliated entities for the current month of December according to the schedules specified for each of them, and it is continuing its efforts to ensure the continuity of disbursing financial dues without any delay or interruption.”

It is clear that the ministry only denied “the inability to disburse salaries this month,” and did not deny the existence of a lack of liquidity or a delay in disbursing salaries.

Problems of delayed salary disbursement have begun to appear more than once during the past few months, with spending requirements increasing compared to the revenues entering the state. For example, current spending alone during the past ten months amounted to more than 91 trillion, excluding investment spending, i.e. an average of more than 9 trillion dinars per month that the Ministry of Finance needs to ensure current spending such as salaries and other mandatory requirements.

In contrast, Central Bank data shows that the Ministry of Finance sold the Central Bank only $4.4 billion last November, equivalent to 5.8 trillion dinars.

As for non-oil revenues, they average 1.4 trillion dinars Monthly according to the Ministry of Finance data, which means that the total non-oil and oil revenues resulting from selling the dollar to the Central Bank amount to 7.2 trillion dinars, while the required amount is more than 9 trillion dinars per month.

Accordingly, this means that there is a 20% deficit in the funds required for the mandatory monthly current expenditures, which makes the Ministry of Finance unable to collect all the funds at the same time in order to pay the salaries of all ministries at the same time as was the case previously, and it resorted to paying them in "installments", and whenever it has gradual liquidity.

Member of the Parliamentary Finance Committee Jamal Kojer says that the liquidity shortage crisis will continue in 2025, and if the price of a barrel of oil drops to $60, we will not be able to secure employees' salaries.   LINK

With More Than 30 Billion Dollars... A Leap In The Projects Market In Iraq

2024-12-31 00:32  Shafaq News/ The English magazine "Med Projects" revealed that the projects market in Iraq rose to 8.6% in November.

The magazine said in a report it published and reviewed by Shafaq News Agency that Iraq witnessed a significant increase of 8.6 percent or $31.7 billion in the value of its market projects in November, ranking fourth after the UAE, Saudi Arabia and Iran.

She added that the increase in the value of projects in Iraq reflects the view that Baghdad has shifted its focus to rebuilding and modernizing the country's deteriorating infrastructure. LINK