Friday, September 29, 2023
Turkey and Iraq need to work together on oil policy, 29 SEPT
Turkey and Iraq need to work together on oil policy, 29 SEPT
The relationship between Turkey and Iraq is in need of a major reset. A recent arbitral award relating to the use of a pipeline that runs from Iraq to Turkey illustrates how relations between both countries have been beset by what appear to be uncoordinated policies and a failure to capitalise on mutual interests. Conversely, recent developments also demonstrate how much work would be required to achieve a reset, which is why it is so important for both sides to reflect internally on how to engage with each other.
Commentators have long argued that there are obvious synergies between Turkey and Iraq that should be capitalised upon. Turkey is a major importer of oil and gas, both of which are plentiful in Iraq. Conversely, Iraq is famously vulnerable to climate change. Its main sources of water originate in Turkey, which has constructed a large number of upstream dams. Much of its farmland is being damaged and abandoned as a result. In addition, much of Iraq’s water infrastructure is antiquated, while Turkey has significant expertise that it can share.
Instead of capitalising on these synergies, Iraq has been unable to build its own joint strategy towards Turkey, while Turkey has sought to benefit from Iraq’s weakness since 1991. As a result of these dynamics, in 2013, Turkey negotiated an agreement with the Kurdistan Regional Government (KRG), which controls the autonomous Kurdistan region of Iraq, to allow the KRG to pump oil into the (pre-existing) Iraq-Turkey Pipeline and then load it onto vessels in the Turkish port of Ceyhan for export without involving the Ministry of Oil in Baghdad.
Baghdad protested that use of the pipeline was governed by an agreement between Iraq and Turkey which stipulated that the export of all oil that flowed through the pipeline should be controlled by the Ministry. It brought two separate claims before the International Chamber of Commerce. The first related to oil that was exported through the pipeline in 2014-2018 and the second relating to 2018-2022.
In March 2023, an arbitral tribunal finally issued an award in the first dispute in Iraq’s favour. The tribunal also ordered Turkey to pay Iraq approximately $2 billion in damages, and also ordered Iraq to pay around $500 million in damages to Turkey for a variety of costs and expenses. The second dispute for the period 2018-2022 is expected to lead to a similar financial award in Iraq’s favour, without any corresponding amount in Turkey’s favour.
The arbitral award was an opportunity for both parties to re-engage with each other constructively. The award should have encouraged both parties to turn the page, to re-evaluate what they had achieved through their respective strategies and build on the synergies set out above.
However, instead of reengaging with each other positively, both parties adopted unconstructive positions that complicated matters further. Surprisingly, the parties’ actions were also incoherent, which suggests internal incoherence in both Turkey and Iraq. Elements in both countries have also taken actions that undermine their own respective positions.
As soon as the award was issued, Turkey immediately moved to close the pipeline, something that was not required by the tribunal. When Iraq asked for Turkey to allow for the flow of exports to resume, Turkey responded that the closure was to ensure the pipeline’s structural integrity following the February 2023 earthquake, a concern that it had not raised before.
As if that wasn’t peculiar enough, Turkey also stated behind the scenes that it would not reopen the pipeline until a number of conditions were met, including that Iraq abandon its second claim for 2018-2022. The closure means that Iraq has lost approximately $6bn in lost profit, an amount that it is probably entitled to recover from Turkey under the ITP Agreement. At the time of writing, the pipeline remains closed.
More recently, Turkey has argued that due to interest calculations, on balance Iraq owed it a payment of $950m and not the other way around. However, Turkey has also argued in the French courts that the award should be set aside, which strongly suggests that Turkey may not be so convinced by its interest calculations after all.
For its part, Iraq publicly stated that it was keen to reach an agreement with Turkey on this matter. At the same time, however, immediately after the award was issued, in a needlessly aggressive move that possibly motivated by overeager legal counsel, Iraq moved with lightning speed to have it enforced in the US courts without reaching out to Turkey first. Turkish officials have since stated that they felt slighted by Baghdad’s action.
This history of counterproductive actions and never-ending escalations should give officials in both countries pause. Both countries should engage in some serious introspection on how they have managed their bilateral ties and how to do better in the future. For states such as Turkey and Iraq to resolve their differences through the courts and threats of further action is a travesty – particularly given the synergies mentioned above.
In addition, both sides should examine the means through which they have been communicating with each other on these issues: currently, communication is often through ad hoc meetings, as well as uncoordinated statements and legal actions by a variety of different government departments. Instead, both countries should explore ways to centralise strategy and decision making, and to create a permanent forum of exchange and negotiation (for example, through the formation of a permanent strategic committee).
Turkey and Iraq are natural allies that have much to offer each other. But to improve their own positions, both sides will have to engage in significant introspection and offer concessions. Were they to do so, it is hard to overstate how much could be achieved.
The Emirates Chambers and the Iraqi Development Bank launch the “Together” initiative to enhance trade cooperation, 29 SEPT
The Emirates Chambers and the Iraqi Development Bank launch the “Together” initiative to enhance trade cooperation
The Federation of Emirates Chambers announced today, Thursday, the launch of the “Together” initiative under the slogan “Partnership for a Promising Economic Future” in cooperation with the International Development Bank of Iraq, UAE Branch.
This announcement came as a continuation of the memorandum of understanding signed in June 2023 between the two parties to support and empower the private sector in the United Arab Emirates and the Republic of Iraq in various commercial and industrial fields, according to the Emirates News Agency, WAM.
Cooperation between the two parties contributes to supporting the private sector in the two countries. It also facilitates the work of Emirati companies operating in Iraq and Iraqi companies operating in the Emirates, and opens the door to more opportunities in the two markets for companies from both countries, which contributes to raising the value of bilateral trade exchange, which, according to the bank, currently amounts to More than $27 billion; Thus, the UAE will be Iraq's first trading partner.
The Union announced the organization of a special pavilion for the “Together for Partnerships” initiative at the 47th session of the Baghdad International Fair, which will be held from November 1 to 10, 2023.
Hamid Mohammed bin Salem, Secretary-General of the Federation of Emirates Chambers, said that the Federation’s participation in the “Together for Partnerships” pavilion in the 47th session of the Baghdad International Fair will include exhibits from a number of Emirati companies from various sectors, and that extensive discussions will take place on the sidelines of the work of this session, to discuss ways to encourage... Emirati investment in Iraqi free zones.
He added that participation in the next session of the Baghdad International Fair comes within the framework of the UAE private sector's constant keenness to participate in all economic activities organized there, given the importance of Iraqi markets for Emirati products of all types.
He pointed to the great potential of the Iraqi economy and the promising opportunities for companies, calling on Emirati companies and Emirati investors to explore these opportunities.
For his part, Ziad Khalaf, Chairman of the Board of Directors of the International Development Bank, stressed that the Federation of Emirates Chambers plays a pivotal role in promoting the growth of business and investments between the UAE and the outside world, and that the “Together for Partnerships” initiative pavilion in the next session of the Baghdad International Fair will be a pioneering platform for communication between... Companies, business owners and investors from the Emirates and their counterparts in the Republic of Iraq at the business and individual levels, and it will represent an opportunity to improve trade and economic relations between the two countries.
He added: "During the coming period, we will organize many joint economic events that serve the business sector and investors in the two countries."
He hinted that signing the memorandum of understanding with the Federation of Emirates Chambers will contribute to facilitating the work of Iraqi companies present in the UAE and Emirati companies operating in Iraq, and will also support those companies’ efforts to expand in the two markets.
Khalaf stated that the UAE is Iraq's first trading partner with a trade volume of $27 billion annually, and a growth rate ranging between 5 and 6 percent, which means that trade exchange with the UAE represents about 10 percent of Iraq's total international trade.
He pointed out that, within less than a year of its presence in the Emirates, the bank has managed about 8 percent of the volume of trade exchange between the two countries.
He pointed out that there are more than 4,000 Iraqi companies registered in the UAE, and a number of Emirati companies that own investments in the Iraqi market, pointing out that the volume of UAE investments in Iraq exceeds 25 billion dirhams, or more than 7 billion dollars, distributed among many sectors and sectors. Mainly the energy, infrastructure and housing sectors.
He explained that the bank supports Emirati companies operating in Iraq in their various activities, whether financing or managing payments, collection and transfer.
This announcement came during the launch and activation ceremony of the “Together” initiative, which was organized by the International Development Bank at its headquarters in Dubai, in the presence of engineer Farida Al Awadhi, President of the Emirates Businesswomen Council, and a number of representatives of companies operating in the country.
The initiative's logo was designed after the saying of His Highness Sheikh Mohammed bin Zayed Al Nahyan, President of the State, may God protect him, about Iraq: “We are close to each other in distance and in heart. link
"RV UPDATE" BY MNT GOAT, SANDY INGRAM & HOLLY, 29 SEPT
Mnt Goat
Question: Will there be a cap limit on the dinar when exchanging?
Mnt Goat Answer: Yes, the IMF will place the dinar initially on a managed float and I was told around a $9 cap but that was years ago and things have changed...I wouldn’t be surprised if we witness up to $12 before they cut it off.
Dr Shabibi told us in 2011 that the dinar back then could sustain a rate of $16...They are now pumping 2/3 more oil and have agriculture exports now and also 132 tons of gold...They are filthy rich! I am seeing a constant rate of about USD $3.80 - $4.25 range on the back screens at the bank right now...
Sandy Ingram
Iraq is on the verge of satisfying the IMF (International Monetary Fund) recommendation that they have a solid income stream outside the oil industry.
The Development Road Project will not only provide 4 billion US dollars in revenue each year, it will also increase the GDP of Iraqi citizens.
Holly
Some very important things are going to happen:
1. The USA sanctions on auctions for Iraq are being lifted after 30 years! Signed off by treasury last week when Iraq was in USA! Boom
2. Iraq is being part of the WTO by October 4th! They have to have an international rate to be part of it! Boom
3. Iraq is having their first ever Independence Day on October 3rd!! Congratulations Iraq! This means they are independent and their war has ended! This by far is the biggest boom ever!
The Political Agreement Paper Is A Binding Document For The Government, And Limiting Black Market Transactions Is Firmly Underway, 29 SEPT
The Political Agreement Paper Is A Binding Document For The Government, And Limiting Black Market Transactions Is Firmly Underway
Baghdad/Al-Masala Al-Hadath: The political advisor to the Prime Minister, Fadi Al-Shammari, stressed that the government does not have a magic wand to limit black market transactions, but it is moving forward with confident steps to address it.
The political advisor said in a televised statement followed by Al-Masala: The Prime Minister sent to the world in New York multiple messages about the form of the new Iraq that we want. International relations, internal stability, the fight against corruption, the establishment of security, and the file of services, electricity, and health are among the Prime Minister’s priorities.
He added that the corruption file was present in the Prime Minister’s speech to the world and he called it the “corruption pandemic” and considered it one of the basic challenges that the government insists on confronting, while he issued important messages about human rights, addressing the displaced file, post-ISIS harbingers, compensating affected civilians, and providing the basic necessities of life for their return. And their stability.
He continued that the Prime Minister announced a very important file, which is the approval of the civilian protection policy, as Iraq is considered one of the first countries in the region that will adopt the policy of protecting civilians in wars, conflicts and disasters, pointing out that the Prime Minister’s meetings with the US Treasury and the Federal Reserve were successful, and the Prime Minister adopted the economic networking policy. To advance the country.
He pointed out that the political agreement paper is a binding document for the government, as it is the platform that the House of Representatives voted on, and these are understandings that serve the country.
He noted that the trade exchange between Iraqi and Iranian merchants amounts to approximately 20 million dollars per day, and this causes significant pressure on the currency file, stressing that the government does not have a magic wand to limit black market transactions, but it is moving forward with confident steps to address it.
He pointed out that the government calls on citizens to use the electronic card in financial transactions and that the Iraqi development path is the most feasible from a purely economic perspective and will build a new Iraq along the western side of the country.
He expressed that international companies will work to build city corridors along the development road, which will pass through 10 governorates, reaching the Iraqi-Turkish border, from where it will be connected to the highway network in Turkey.
He continued by saying: The development road will transform the areas located on either side of it, 7 km on either side of the road, along the line (16,660,000 km) into cities, factories, factories, warehouses, and investment projects that contribute to diversifying sources of income.
He concluded his speech by saying: Industrial cities will be established along the path of development.
Parliamentary Integrity opens the “Travelers’ Dollar” file and warns against imposing taxes on citizens, 29 SEPT
Parliamentary Integrity opens the “Travelers’ Dollar” file and warns against imposing taxes on citizens
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Frank26 [Bank story] This time we didn't go down, we just called [the bank]... We said we want to see if we can exchange some cu...
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Bank appointment for Currency EXCHANGE Instructions/Checklist Bank Name_________________________________________ Bank 800#____________...
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Walkingstick All these meetings that the CBI had with all these agencies that were helping them with their monetary reform are done. Al...