Concern about capital flight from Iraq

Concern about capital flight from Iraq

Date: Saturday: 14-09-13 10: 02: 05 pm

Author: Mohamed Atef




A large number of Iraqi economists expressed concern about capital flight from Iraq following the deterioration of the security situation and the Iraqi Central Bank tightening procedures for trading in the financial market. The last announced earlier on low volume of non-Iraqis in the banking sector by 66% during the current year to 1.4 billion dinars (1.8 million dollars) from around 6.4 billion dinars ($ 5.4 million) in 2012.

She is a member of the Finance Committee of the Chamber of Deputies, Najib is smart, several reasons have led to the withdrawal of a large number of non-Iraqi dealers in the local market, including developments in the region, notably in Syria and economic sanctions on Iran that reflected negatively on Iraq, adding to the worsening security situation during the final period.

She said in an interview with Al-Jazeera that banking laws and strict Central Bank actions and through the restoration of the controls the sale of dollar auction, take action to increase the value of the Iraqi dinar against the dollar, as well as the difficulty of trading dinar because the local currency is not a preferred customer, all these factors contributed to the flight of foreign capital.

Najiba said the Government's actions in the financial sector, and the deterioration of security does not encourage foreign nationals to enter the Iraqi capital market and competition projects, arguing that the State has to attract foreigners to the country needs their expertise and expected the Iraqi economy many of the damage caused by the flight of foreign capital.

On the other hand, said an expert with the United Nations Industrial Development Organization (UNIDO) on the Sudanese authorities to the deteriorating security situation in Iraq during the last five months, leaving no doubt cast a dark shadow on the economic scene and the stock market in particular, has become a factor for the expulsion of an Iraqi trader.

He said that the new laws approved by the Parliament and allowed foreign investors to buy and sell stocks in absolute terms to the Iraqi stock exchange contributed to the revitalization of this emerging market, but that the legislation accompanying the set stock ownership percentage not exceed 49% of the shares of the company are alienating factor and not attract non-Iraqi trader.

The nature of the money market trades based on the banking sector is 75 percent of the daily trading volume, while the share of other sectors remains weak, except the communication raised a quarter of its shares trading under the instructions of the Government.

Iraqi economic noted that when a simple comparison of average daily trading volume in the Iraqi market, and 1.9 million dollars a day, the neighboring countries have traded very much comparable to the Iraqi market, for example, Egypt achieved $ 82.3 million and 100 million of Dubai and Abu Dhabi 141.7 million.

The Sudanese Government called for the establishment of a fund to protect investors in the special law, can contribute to attract Iraqi investors and others in the Iraqi market, through to reassure them and to protect them from the dangers of non-trading risk and appropriate adjustments and cover the risks arising from the activities of securities firms.

Meanwhile, a leading economic Hashimi told the Central number customers non-Iraqis was an indication of a very serious economic situation of Iraq. He said that foreigners deemed Iraq unsafe economic environment for investment and this is very normal for investment and security commensurate is directly proportional, the more security and stability has increased investment and vice versa. "

Al-Hashemi called the Iraqi Government and its financial institutions to hasten to take effective action to address the situation and provide financial protection and security to holders of capital non-Iraqis, with the need to secure financial plans that would help them and reassure them their money and attracting them again before they worsen the situation, and have grave effects on the Iraqi economy.

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