People have opined that Iraq cannot continue with the 1310 IQD to $1USD but that simply isn't true.
Here is a recent list of new projects to make my point. Iraq Signs Strategic Agreement with BP for Kirkuk Oil Fields...Chinese Firm Wins Iraqi Seawater Pipeline Contract...
Iraq Implements Global Transit System TIR from April. Iraq Approves New Renewable Energy Schemes. Industry Minister Reviews Fertilizer Production in Basra.
New Iraq-China Contracts for Sponge Iron Plant and $2bn Industrial City. $374m Chinese Investment in Iraqi Medical City. Iraq to Restart Nitrogen Fertilizer Production after 40 Yrs. Work Begins at Baghdad's new Waste-to-Energy Power Plant. £1.1m Contract for AI Video Analytics in Iraq.
Construction Starts on Iraq's Tallest Bridge. New Sustainable Residential Development in Najaf. Iraq's $17bn Trade Corridor to Bypass the Suez Canal. This is a short list for the current period. Understand, the 1310 value to the USD is no barrier to trade or anything else.
100% Iraqi-Owned Company to manage Development Road Project,
By John Lee.
The Prime Minister's Advisor for Transportation Affairs has announced that the Development Road Project will be managed by a new 100% Iraqi-owned company, reporting directly to the Prime Minister.
Speaking to the state-run Iraqi News Agency (INA), Nasser Al-Asadi explained that during a recent meeting of the Higher Committee for the Development Road, a comprehensive study was conducted on the most appropriate legal structure to manage the project. Various options were considered, including establishing a company, authority, or other legal entity.
The final decision is to form an independent private company under the Companies Law, which will:
Oversee all financial, engineering, economic, and investment aspects of the project;
Operate independently of the Ministry of Transport;
Have its own laws and regulations;
Handle any investment shares related to the project.
Al-Asadi underlined the strategic nature of the Development Road, describing it as a global project requiring a dedicated entity to ensure effective and transparent management.
Prime Minister Muhammad Shia al-Sudini emphasized the various challenges faced by Iraq’s financial and banking sectors during a recent conference. He highlighted the government’s initiative to implement necessary reforms to establish stability and foster economic growth amidst complex economic circumstances.
The Prime Minister acknowledged the efforts of participating central banks, international consultants, and local firms committed to enhancing Iraq’s banking sector.
A significant aspect of the Prime Minister’s address involved discussing the government’s three-year budget plan, which aims to allocate resources across crucial sectors such as health, education, and infrastructure.
This budget is designed to facilitate a long-term financial strategy that aligns with the state’s developmental goals. Notably, there has been a focus on maximizing revenues through improved tax systems and increased non-oil revenues. The Prime Minister reported an impressive increase in customs and tax revenue streams, with customs seeing a 128% rise and tax revenues climbing by 22% compared to previous years.
Another crucial point raised at the conference was the government’s ambitious projects aimed at reforming the banking system. This includes significant restructuring of key banking institutions, such as Rafidain and Rasheed banks, in collaboration with reputable international consulting firms. The expansion of electronic payment systems has been a priority, leading to substantial enhancements in the financial system’s efficiency. The government is also promoting financial inclusion, which has risen from less than 10% to over 40% in two years—an achievement recognized by the World Bank and the International Monetary Fund.
Advancements in the regulatory framework surrounding e-commerce and payments are underway, complemented by awareness campaigns to encourage digital payment adoption. Additionally, small and medium-sized enterprises are receiving government support through financing initiatives, stimulating job creation and economic activity. Ultimately, the Prime Minister underscored the government’s commitment to international banking standards through comprehensive reforms, poised to make Iraq’s financial landscape more competitive and integrated with global markets.
Highlights
📈 Government Challenges: The Iraqi government has recognized the pressing challenges in its financial and banking sectors.
💼 Three-Year Budget Plan: A structured three-year budget aims to distribute resources effectively across essential sectors.
📊 Revenue Maximization: Significant improvements in both customs and tax revenues due to enhanced tax systems and non-oil revenue streams.
🔄 Banking System Reforms: Major restructuring of state-owned banks to improve financial service delivery.
🌐 Electronic Payment Infrastructure: Implementation of robust electronic payment systems to enhance transaction efficiency.
🙌 Financial Inclusion Growth: Financial inclusion in Iraq has soared from less than 10% to over 40% within two years.
🏦 Support for SMEs: Targeted government support for small and medium enterprises spurring job creation and economic growth.
Key Insights
🌍 Economics Amidst Complexity: The Prime Minister’s acknowledgment of Iraq’s economic challenges highlights a critical awareness within the government. Addressing these challenges is essential for stabilizing the economy and, by extension, fostering a climate suitable for investment and growth. The interplay between global economic conditions and Iraq’s financial situation underscores the need for swift adaptation and reform measures.
📅 Long-term Financial Planning: The establishment of a three-year budget represents a significant shift towards a structured financial planning approach in Iraq. By focusing on distributing resources to key sectors, the government is laying the groundwork for sustainable development, recognizing the importance of long-term strategies in navigating economic challenges.
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Enhancing Revenue Streams: The reported increases in customs and tax revenues signify a successful implementation of reforms that have diversified Iraq’s economic foundation. This transition away from heavy reliance on oil revenues not only stabilizes public finances but also strengthens the economy against oil price volatility, thereby ensuring more robust fiscal health.
🏦 Strategic Banking Reforms: The reforms in major banks illustrate the government’s commitment to modernizing the banking sector. By engaging with reputable international consulting firms, Iraq aims to raise its banking standards to meet international norms, which is crucial for fostering investor confidence and improving financial services for the public.
⚙️ Digital Payment Revolution: The emphasis on electronic payments and improving infrastructure reflects a significant modernization effort within the financial sector. These developments not only facilitate smoother transactions but also promote a shift towards a cashless economy, encouraging citizens to engage with digital financial products that can bolster economic participation and efficiency.
📈 Financial Inclusion as a Goal: The considerable increase in financial inclusion signifies that more Iraqis have better access to financial services, which is vital for economic empowerment. This improvement is linked to broader socio-economic benefits, such as increased consumption and investment in personal and business ventures.
🌱 SME Support Schemes: The targeted initiatives for small and medium-sized enterprises underline the importance of these entities in driving economic growth and job creation. Supporting SMEs through access to capital and resources can lead to a more vibrant and resilient economy, capable of withstanding external shocks and fostering innovation.
In conclusion, the Prime Minister’s address signals a strategic commitment from the Iraqi government to address pressing economic challenges while fostering an environment conducive to growth and stability. By focusing on essential reform areas, including banking, revenue generation, and digital transformations, Iraq is poised to enhance its economic standing both regionally and internationally.
IRAQ-CBIThe Central Bank of Iraq determines the controls for using bank cards INTERNATIONALLY
*Activation Delay: New cards for international use will be activated 30 days after issuance
*Implementation Date: The rules take effect on April 8, 2025 with periodic reviews planned.
Transaction Limits:*Retirees: $10,000/month.
*Travel: $20,000/month (covers airfare, hotels, car rentals.
*Medical Treatment Abroad: $50,000/m.
*General Use: $5,000/m.
*Maximum limit for merchant bank cards: $20,000/m.
*Prepaid cards: Current limits remain unchanged.
*Foreign Currency for Travelers: Available at the official Central Bank rate via the e-governance system.
*MCC Codes: Merchant category codes will be shared with relevant authorities later
*Suspended Rules: Rules from April 20, 2020 are currently suspended but subject to review.
The Central Bank of Iraq directed its circular to a range of key financial entities to ensure broad compliance with the new regulations on bank card usage for INTERNATIONAL transactions. These entities include:*Banking Supervision Department: Oversees the operations and compliance of bank of Iraq.
*Directorate of Supervision of Non-Banking Financial Institutions: Regulates non-bank financial entities like money exchangers or investment firms.
*Government & Private Banks: Covers all domestic banking institutions ensuring uniform application across the sector.
*Branches of Foreign Banks Operating in Iraq: Ensures the international banks active in the country align with these controls.
*Electronic Payment Services Companies: Includes firms handling digital transactions such as prepaid card issuers or mobile payment providers.
By addressing these groupsthe Central Bank is signaling a comprehensive effort to enforce the new rules—effective April 8 2025 across Iraq’s financial ecosystem.
The CBI has outlined that it will supply the relevant authorities with Merchant Category Codes (MCC codes) at a later date specify which type of merchants align with the new bank card regulations for INTERNATIONAL transactions!!! LFG..
