The minister of finance undertook a visit to the United States of America, heading a group of visitors from the ministry of finance and the central bank of Iraq, which lasted from October 9-16, 2008, in attendance of the annual convention of the IMF, and to also meet with their partners among the Americans, to strengthen the economic ties between the friendly countries.
H.E. Baqir Jabr Alzubaidi, minister of finance, along with other Arab finance ministers, met with Mr. Robert Zoellick, head of the World Bank. Mr. Zoellick discussed the financial crisis that is currently hitting the financial markets of the European nations, the US, and Japan, and its negative impact on the economies of the countries of the world, especially the developing and Arab countries.
Among the topics discussed in the convention were the types of aid to be given to the Arab nations, to help in progressing and enhancing their capabilities in a variety of areas; in that the Arab nations are considered a large sector of the world market which plays a supportive role for the international economy.
Also, the minister signed a contract on Nov. 15th 2008 with the World Bank in the amount of $1.2 Billion in exchange for water projects in Iraq. The World Bank is to open a local office in Baghdad to oversee those activities.
The minister also met with Mr. James Bond – head of MIGA (Multilateral Investment Guarantee Agency) – which is a branch of the World Bank. Mr. Bond confirmed his readiness to attend the investment meetings which are held in Iraq, as well as those meetings with multinational corporations which desire to invest in Iraq. During that meeting, he also expounded on the rules and regulations governing MIGA’s involvement in Iraqi investment.
The minister also met in Washington with the Greek financial minister and the Greek ambassador in Washington. The two ministers reviewed the secondary relations between the two friendly nations to further their common interests and economic support. They also discussed (reviewing?) the debts upon Iraq due to Greece. The Iraqi minister also expressed the importance of Greek companies participating in the public and private sectors in re-building Iraq, especially the real estate.
The Iraqi minister also met with the Lebanese financial minister Mr. Muhammad Shatah, during which they discussed the economic ties between Iraq and Lebanon, and overviewed the issues that were brought up during Prime Minister Fouad Siniora’s visit to Iraq, among which included the completion of the agreement to avoid the double taxing, which was begun during the visit of Iraqi financial ministers to Lebanon in April 2008. It is hoped that this agreement will be ratified either in Baghdad or Beirut. They also discussed the draft agreement about securing the investment which is still pending further study.
The minister, in the company of Dr. Sinan al-Shibibi, head of the Central Bank of Iraq, and other Iraqi representatives, with Mr. Robert Kemet, vice-president of the American Treasury and other representatives and economic experts, during which meeting they discussed protection of Iraqi wealth and resources and the projects of the Iraqi central bank, and set up a contract of investment to take effect after December 13, 2008 – the date of the end of the UN Security Council’s and President Bush’s executive’s decision, which ends in May.
The financial minister also went over the factors of the implementation of the budget of 2008 and the required technical assistance to enhance the implementation projects in the governorates. He also went over the steps that were taken to draft the 2009 budget following the shaking world oil markets occurring lately, and how to deal with the observations of the International Monetary Fund especially those related to the current expenditure increases and increasing the deficit in the proposed budget, and getting out of the normal range of the gross national products (GNP).
Mr. Kamit stated that he would visit the Gulf countries to study the issue of clearing the debts upon Iraq, in a way that will ensure the stability in Iraq and aid its economy which is experiencing a boom, and also to help produce a fertile ground for attracting international investments.
The minister, along with Dr. Alshibibi, also met with Mr. Dominic Kahn, the president of the IMF, in attendance with the team responsible for Iraq in the IMF office. Mr. Kan suggested that Iraq is walking the right path, in completing the first phase which ended in Dec. 2007 with regard to the support agreement or the second which will be completed in Dec. 2008. Mr. Kahn also clarified that the first period of this agreement, which was completed in June 2008, was successful and passed thru the executive council with ease, because Iraq upheld all of its conditions. He further added that the second review – which will end in ‘Amman in the end of the last week of October 2008 – in which Iraq will obtain an agreement from the IMF concerning a lowering of its debt due to Paris Club by the last 20%, remaining from the 80% decrease of out of its total foreign debts after they lowered the 60%, which includes the remaining balance of 30 billion dollars.
Mr. Kahn further addressed some suggestions made concerning the bill of 2009, which concerns an increase of current spending, the amount of stipends, monetary transfers, and the deficit which has increased to represent a large portion of the GNP, calling for serious solutions by the experts of the IMF so that the second review can be successful.
The financial minister asked the IMF experts to diligently review the interest amounts calculated by the Central Bank, to curb inflation after its value had dropped, to entice the investors in the private sector. They also requested more financial security to help the investments, which was negatively affected in the past when the private sector in Iraq was not active in investing due to rising interest costs. This is due to the fact that Iraq is in need of increased investments and increased participation from the private sector, to rebuild it and reintroduce work opportunities for its citizens.
The minister also met, in a separate meeting, a group of experts from the World Bank, headed by Mr. Erick, who is responsible for the Iraqi folder in the World Bank. The meeting was about the relationships between Iraq and the World Bank, especially concerning the “bilateral review” for the second support agreement, which was signed with the Bank on December 2007, and which will end on 12/31/2008.
The minister met with the legal consultants to the Finance Ministry and the Central Iraqi Bank, in the accompaniment of Dr. Alshibibi and Dr. Fadel Jawad, who is the legal consultant to the prime minister. They discussed security for the Central Bank and the Iraqi government bank accounts registered in the Iraqi Development Account. They also discussed the effects of the common claims in the USA by some American citizens who were harmed by the previous Iraqi regime, and how to fix that legally, as well as the size of their requests and demands (given thru judicial order) of the Iraqi central bank, and its effects on Iraq’s property.
It can also be mentioned that the financial minister met in New York – on October 9th 2008 – with Mr. John Snow, the previous American minister of treasury, and during that meeting they discussed the double economic relationship between Iraq and the USA, and the financial state which is witnessing great improvement in all areas in Iraq, especially in the 2009 Iraqi budget.
The minister also gave a lecture about the Iraqi economy, and how to invest in Iraq, in the office of international relations in New York, which was attended by a number of investors and heads of international and American corporations and financial companies. He stressed that the new rules of investing in Iraq have prepared a fertile ground for investing in it, in addition to Iraq’s signing on to MIGA (which protects the rights of the foreign investor in Iraq).
The American trade council also invited the Iraqi minister, during which he met a number of corporations and representatives from the Department of Treasury and State Department, and they discussed the financial and political state of affairs, and the opportunities for investment in Iraq, especially in the areas of petrol and agriculture and industry.
And on October 16th 2008, the minister participated in the celebration of the opening of the project of protection of Iraqi historical artifacts, which was begun by the Iraqi ambassador in Washington under the oversight of the First Lady Laura Bush, and in the presence of a number of representatives in the State Department and White House. It should be mentioned that the American government gave 14 million dollars to this project.
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Sayed Alhakim received on Wednesday, December 28, 2011, Dr. Ahmad Chalabi, a member of the National Alliance Party and the head of the Iraqi National Congress. Sayed Alhakim stressed on the need to hold a meeting of Iraqi parties to overcome the crisis.
