CAN THE POPULATION CENSUS SUCCEED IN DRAWING A NEW ECONOMIC POLICY IN IRAQ? WITH MNT GOAT COMMENTS, 21 NOV

 CAN THE POPULATION CENSUS SUCCEED IN DRAWING A NEW ECONOMIC POLICY IN IRAQ?

The Iraqi government is preparing to conduct a general population census on November 20, the first census to include all regions of Iraq in nearly 4 decades.

Iraq witnessed the last general population census that included all its governorates in 1987, and although the country conducted another population census in 1997, the latter did not include the governorates of the Kurdistan Region, because they were semi-independent from Iraq during the era of the former regime.

The population census represents a vital tool for formulating economic policies based on updated facts and data that enhance the government’s ability to achieve comprehensive and balanced economic growth, while addressing economic and social challenges.

On the subject, the financial and banking specialist, Mustafa Hantoush, said in an interview with / Al-Maalouma / Agency that the Iraqi state’s funds are scattered and it does not know where to direct them or where to start the development process, indicating that “The general population census is full of positives and has no negatives.”

He comes added, “There are no higher policies or clear lines to work on, and every country that puts forward its ideas far from the needs of society, and the population census will end this chaos by clarifying a number of important matters.”

He pointed out that “Iraq has clear economic problems in work, housing and diversifying the economy, and the state cannot solve them except by conducting a general population census.”

For his part, economic expert Dhurgham Muhammad confirmed that the results of the general population census will help the government reach a realistic formula and vision during the preparation and amendment of next year’s budget schedules, while he pointed out the necessity of having a real reading of the future of oil prices for next year in order to determine a reasonable price for a barrel of oil that will be adopted by the 2025 budget.

Mohamed Ali said in a statement to Al-Maalouma Agency, “The amendments to the 2025 budget schedules will depend scientifically and realistically on the results of the general population census that will be conducted at the end of this month,” indicating that “the census Results will give the government clarity when conducting transfers and drawing up realistic development plans.” 

He added that “the authorities responsible for preparing the budget must re-read it for the future of oil prices and adopt an appropriate and realistic price that is consistent with the expectations of global oil market experts, when preparing the schedules for next year, as Most indicators confirm a decrease in oil prices for security and economic reasons.”

Recently, rumors have spread on social media that the general population census will lead to the cutting of welfare salaries or the imposition of new taxes on citizens.

In this context, MP Aref Al-Hamami said in an interview with Al-Maalouma, “What is being said is inaccurate and we deny it completely and in detail through our close knowledge of the census’s progress and its great benefits in preparing the country’s strategic Plans for decades in terms of economy and development.”

He pointed out that “effective participation with the provision of accurate information will ensure the existence of comprehensive data that gives the government a vision in drawing the foundations of its future plans directly.”

The general population census will be launched on the 20th and 21st of this month in all Iraqi governorates, which will include a curfew. About 120,000 enumerators will participate in the census, while the Ministry of Planning confirmed that this census will contribute to knowing the real numbers of the population and the living conditions that will be invested for development purposes. 

(The key wording in this VERY IMPORTANT census is “in all governorates”. This will be an all inclusive census to develop Iraq as an all-inclusive country and not sectarian as past federal governments did.)

TIDBIT FROM MNT GOAT, 21 NOV

 Mnt Goat 

  ...the IMF fully intends to repeg the IQD to a basket of currencies once they revalue it and turn it back on FOREX (...this is called a reinstatement...).  

 It will initially be a FREE FLOAT driven by market fluctuations however it will be monitored and my CBI contact has told me they will cap it at a level to control the initial massive swings, if needed. 

Then over a period, the rate is expected to settle down to its nominal rate. I am told this could be about $3.85ish.

 The then CBI director in 2011 Dr. Shabibi told his audience in a news media conference on the Iraqi economy that the dinar could sustain a fluctuation as high as $16 USD...

I am told that the IMF will use the cap at about $9 - $11 to prevent wild swings out of control that could potentially hurt the basket.

FIREFLY: FINISH THE CENSUS NEEDS BE DONE BEFORE THE CHANGE OF EXCHANGE RATE @DINARREVALUATION

 

WILL IRAQ BE THE SAVIOR OF THE COUNTRIES OF THE REGION IF OIL PRICES FALL? WITH MNT GOAT COMMENTARY, 21 NOV

WILL IRAQ BE THE SAVIOR OF THE COUNTRIES OF THE REGION IF OIL PRICES FALL?

(Can’t possibly happen unless Iraq is globally traded on their new basket of currencies. Think about it. How can they under the current monetary conditions?)

Economic expert Safwan Qusay spoke about Iraq’s ability to confront the decline in global oil prices, pointing out that leaving the single economy and focusing on non-oil imports has become a necessity to restore the Iraqi economy. 

Qusay said, “If oil prices rise by a hundred dollars, it is possible that the quantities that were voluntarily reduced by OPEC will be re-pumped, noting that “there are no less than two million two hundred thousand barrels that have been voluntarily reduced.” 

He added, “It is not in the interest of oil producers to raise oil prices above $100 because that will support investments in shale oil, indicating that the producing countries are trying to control the price between $70 and $100.” 

Qusay pointed out that “Iraq will be the greatest savior for the countries of the region because it has dollar reserves and has a strategic reserve in terms of oil production,”indicating that “if the government succeeds in containing the conflict and not being dragged directly into the region’s unrest, the Iraqi economy will be pulled from the war zone to the development zone.”

Qusay explained that “Iraq is able to confront the decline in oil prices, knowing that there is no decline in prices below seventy dollars because OPEC is the one that determines the quantities of production and is determined to remain within the region of 70-100 dollars per barrel.” 

He added, “The surplus that accumulated during the previous period of this year, in which Iraq sold at no less than $80 per barrel, enables Iraq to confront price changes.”

He pointed out that “Iraq has begun to diversify its economy by investing in oil derivatives and stopping the burning of associated gas, in addition to stopping the import of materials that could be included in the ration card, noting that “the government has opportunities in the matter of sustainable financing through the reserves of the Central Bank or through the sale of oil shares if revenues fail to reach their goals.”

TIDBIT FROM MILITIAMAN, 21 NOV

 Militia Man 

 If in fact we have a revaluation of the Iraqi dinar a lot of things are going to change and a lot of people need to have at least a plausible deniability...

The central bank...they openly exposed the education system, they talked about the zeros forever, they're talking about the Islamic banking law, they're talking about the Securities Law and they're talking about that with some of the largest money institutions in the world. 

 Britain is on big one.  Same with the United States...It's exciting.  I think it's powerful that we're watching this unfold.

"there is a massive push in Iraq to go before Dec. 10th." BY MARKZ@DINAR...

THE OIL AND GAS LAW RETURNS TO THE FOREFRONT… WILL AL-SUDANI BE ABLE TO RESOLVE THE DISPUTES OVER IT? WITH COMMENTS BY MNT GOAT, 20 NOV

 THE OIL AND GAS LAW RETURNS TO THE FOREFRONT… WILL AL-SUDANI BE ABLE TO RESOLVE THE DISPUTES OVER IT?

(Iraqi is going to play it close on this one. Can the get this passed on time for the early 2025 target for the reinstatement? Will the let the reinstatement go anyhow?)

Talk returns about the oil and gas bill that has been absent for two decades due to political differences, despite the fact that it represents the only solution to all the problems of the center and the region.

MP Ali Al-Mashkoor, a member of the Parliamentary Oil and Gas Committee, attributed the delay in approving the Oil and Gas Law to points of contention behind which the Kurdistan Region of Iraq stands. It is noteworthy that the Oil and Gas Law has undergone 11 amendments and has never reached Parliament.

Al-Mashkoor said in a press statement, “The law has been in place since 2008 and was sent to the House of Representatives to regulate the financial and oil matters of the producing provinces,” explaining that “this law cannot be passed except with political approvals from the blocs within Parliament.”

He added, “The reason for the suspension of this law in the corridors of the House of Representatives is the failure to send its latest updates, as there are clear points of disagreement with the region,” indicating that “the dialogues with the region resulted in reducing these articles from 9 to 7 points.”

He explained that “dialogues are still ongoing between the federal government and the region in order to resolve these points,” noting that “until now we have not reached solutions that can be accepted by both parties.”

Yesterday, Wednesday, Prime Minister Mohammed Al-Sudani visited the Kurdistan Region of Iraq to discuss a number of important files, including the oil and gas law.

Iraq’s oil and gas law, which has been awaiting legislation since 2005, stipulates that responsibility for managing the country’s oil fields should be vested in a national oil company, overseen by a federal council specializing in this matter.

The Kurdistan Oil Law stipulates that the Ministry of Oil in the region or whoever it authorizes shall assume responsibility for organizing and supervising oil operations as well as all activities related to them, including marketing oil, as well as negotiating and concluding agreements and implementing all licenses, including oil contracts concluded by the regional government. The Iraqi government also has the right to participate in the management of fields discovered before 2005, but fields discovered after that are subject to the regional government.

On February 21, the Federal Supreme Court ruled that the federal government would be responsible for paying the salaries of Erbil government civil servants, with the amount paid at source in Baghdad deducted from the regional government’s share, and the KRG must submit monthly accounts detailing each salary paid. This is effectively a stricter reset of the original “budget payments for oil revenues” deal agreed between the KRG and the federal government in November 2014.

There are no government statistics on oil exported from the Kurdistan Region of Iraq, but the Iraqi Ministry of Oil published an analysis in May 2023, saying the regional government had committed “legal and procedural violations” in selling oil that caused significant losses.

The financial returns of the regional government constitute no more than 80 percent on average after deducting the production costs (the cost of producing a barrel of oil), while the financial returns of the first and second licensing rounds (held by Baghdad) constitute from 94.5 percent to 96.5 percent, and the cost of production is equivalent to (4) times the production costs in the licensing rounds of the federal Ministry of Oil, according to the Ministry of Oil.

Iraq exports an average of 3.3 million barrels of crude oil per day, and black gold constitutes more than 90 percent of the Iraqi treasury’s resources.

In August 2023, the government formed a committee to draft the oil and gas law and present it to the government for voting and try to pass it in the House of Representatives. The committee included the Minister of Oil, the Minister of Natural Resources in the Kurdistan Region of Iraq, the Director General of SOMO, and senior staff in the Federal Ministry of Oil, in addition to the producing governorates such as Basra, Dhi Qar, Maysan, and Kirkuk.

For years, the points of contention between Baghdad and Erbil have not been resolved, but Al-Sudani recently revealed that an agreement had been reached with Erbil on these points, in addition to including in his ministerial program the resolution of these items, most notably the enactment of the Oil and Gas Law and the implementation of Article 140 regarding the disputed areas.

In mid-February 2022, the Federal Court issued a decision declaring the oil and gas law in the Kurdistan Region of Iraq unconstitutional, and prevented it from exporting oil for its own benefit, with the export to be through Baghdad exclusively, based on a lawsuit filed by the Federal Ministry of Oil.

MNT GOAT COMMENT: 

(As I have said many times when they decide to settle Article 140 issues then also the Oil and Gas law will come into place too. The these two issues are connected. The census we also learn about today is all part of settling these issues. Remember the Iraqi constitution must be fully implemented in order to see the reinstatement of the dinar. These are the last and most important issues still remaining.)