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[size=30]The dollar and the budget on top.. The government spokesman answers questions about current developments
[ltr]2023.02.23 - 20:39[/ltr]
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[ltr]2023.02.23 - 20:39[/ltr]
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Baghdad - Nas
On Thursday, a spokesman for the Iraqi government, Basem Al-Awadi, confirmed that the government has projects and packages ready to be put forward in the event of an escalation of the dollar crisis, considering that the crisis is complex and thorny and is not related to the exchange rate only.
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Basem Al-Awadi said in an interview with colleague "Horaz Colby", followed by "NAS" (February 23, 2023), that "the Iraqi government is serious and determined to take a new approach and system that distances Iraq and the Iraqi economy and trade from external pressures and protects the Iraqi currency."
Regarding the budget, he pointed out that its preparation has been completed, "but recent events, specifically the intersections between the government's price and the budget market, are what delayed the process," noting that the government returned the budget to the Ministry of Finance, in order to "adapt" it to the new exchange rate.
Below is the transcript of the interview:
Has the draft federal budget law been prepared and when will it be sent to Parliament?
Bassem Al-Awadi: In fact, the preparation of the draft budget has been completed, but recent events, specifically the intersections between the government price and the budget market, are what delayed the process. As you know, the budget is numbers that must be adjusted in terms of the state's financial income, as well as in terms of the dollar exchange rate. The third issue is the approach adopted by the Prime Minister or the current government, provided that the budget reflects the governmental approach, which is happening for the first time in Iraq, meaning that the priorities emphasized by the Prime Minister through the governmental platform that Parliament voted on must be It turns into a budget, in order for the government to be true to its promises to the Iraqi people and Iraqi public opinion.
Will it be completed within the next two weeks?
Basem Al-Awady: No. If I say 14 or 15 days as a spokesperson for the government, it means that I am committing myself and the government. Let me be more flexible and say: In the sixth session, the budget was transferred to the Ministry of Finance in order for it to be re-adjusted to the new exchange rate, and this issue does not take much time and it has been two weeks, and we are waiting, within a short period, for the Ministry of Finance to present it in the new image to the Council of Ministers .
How was the formulation of the share of the Kurdistan region?
Basem Al-Awadi: We will wait for the budget to be approved in the beginning, and when it is transferred to the Iraqi parliament, there will be a first and second reading, and the law will be presented to the media and the public. All in all, the Kurdistan Region is an integral part of Iraq and there is an agreement for the State Administration Coalition, and the Kurdistan Region with all its parties is present within this coalition that formed the Iraqi government, and it also participated in formulating the governmental curriculum, and it is also part of the Iraqi government, and therefore it is present in all aspects of the Iraqi state And all the rights of the region will certainly be approved, and ready to be approved within the general budget for 2023.
On what basis was the share of the Kurdistan region estimated?
Basem Al-Awadi: As I told you, the budget has been transferred to the Ministry of Finance and it will return to the Council of Ministers so that we can see that and answer this question. At the moment, I haven't seen how to determine that.
Is there a share for the Peshmerga within the federal defense budget?
Basem Al-Awadi: I think yes.
Why was the delay in sending the draft federal budget law to Parliament? Was it because of the share of the Kurdistan region?
Basem Al-Awady: I don't think so. The budget was proposed and submitted to the Council of Ministers and discussed in the sessions that preceded the sixth session, as I said, but the difference in the exchange rate is what delayed reading it until this moment, and it was returned to the Ministry of Finance in order to adapt it to fix the numbers on the new exchange rate. This is the reason, and there is no disagreement about the share of the Kurdistan Region or the rights of the Kurdistan Region, which is an integral part of Iraq.
Will any funds be sent to the KRG before the budget is approved in Parliament?
Basem Al-Awadi: This question is entrusted to the Ministry of Finance, and I do not know what rights you are asking about. Is it the monthly resources or the monthly salaries? It is possible that the Ministry of Finance will have an exact answer on this subject.
The Kurdistan Regional Government announced this week that a draft oil and gas law will be prepared with the participation of the Ministry of Natural Resources in the Kurdistan Region and the Federal Ministry of Oil. Was this method agreed upon?
Basem Al-Awadi: In general, the oil and gas law is one of the important points that were mentioned in the document on the basis of which the State Administration Alliance was formed, as stated in Paragraph 23 of the government curriculum, I think, and there is a special agreement and consensus between the Kurdistan Regional Government and the central government in Baghdad on a set of Points, including, the understanding and the formation of joint committees between the Kurdistan Regional Government and the Baghdad government, and on a group of facilities, even before the adoption of the oil and gas law, and the nature of the periods that preceded this law.Very important points were raised in the discussions of forming the State Administration Coalition, and I believe that the Prime Minister was very clear, more than once, and in media interviews, that his ninth government is committed to implementing the paragraphs and items contained in the State Administration Coalition paper, and the points contained in the government curriculum, In the papers of the State Administration Coalition and the Governmental Curriculum, there is a binding agreement for all parties to legislate the oil and gas law, and I believe that there is positivity on both sides, and they are convinced that the time has really come to legislate this law, so that we can take a step forward instead of going back to the previous intersections on this issue.
How long will it take to enact the law?
Basem Al-Awadi: Once again, the timing is not correct or binding, but overall we have completed three and a half months of the government's life, which is a short issue period. Let me say that there will be complete clarity before the end of the six months. There is agreement that there will be serious clarity on this issue after the completion of six months of the life of the Iraqi government.
Is the Kurdistan Regional Government cooperative in this respect?
Bassem El-Awadi: Absolutely, and I think we now have the best chances. Compass Erbil Sulaymaniyah towards Baghdad, and Baghdad also compass towards the Kurdistan Region. The visit of the delegations from the Kurdistan region expresses very positive proposals, and in Baghdad there is acceptance and willingness, and the two parties in the Kurdistan region and Baghdad are professionals in these issues, and they have a government that has more than twenty years of experience in these issues, and the two parties believe that the time has really come to legislate the oil law And gas, in order for us to move to a later stage in which many intersections will disappear with regard to the issue of energy and gas and the like. Therefore, yes, there is conviction on both sides, and an agreement and understanding, and they are obligated to reach a law according to the Iraqi constitution, that satisfies the two peoples, the people of the Kurdistan region, as well as the people Iraq in general.
The Iraqi government has contracted with two Chinese and Emirati companies to extract oil from the Naft Khana area in Khanaqin, and this area, as you know, is among the disputed areas. Has coordination been made with the Kurdistan Regional Government regarding this?
But the most important thing at this stage, as you know, is that the associated gas has been burned since the discovery of oil in Iraq, that is, from 1925 to today, and there is a wealth wasted that belongs to the Iraqi people now and the coming Iraqi generations. Some of the numbers that the Prime Minister spoke about indicate that we burn annually. Of the gas, it ranges between 8-10 billion dollars, and these billions will return to the budget when we start extracting gas, and when it returns to the Iraqi budget, it will be a share for the center and a share for the Kurdistan region, and the abundance of gas will enable all Iraqi citizens in the Kurdistan region and Baghdad to obtain it in better ways This also gives Iraq a geopolitical role, as it will transform from an oil-exporting country into an oil and gas extractor and exporter in the future. And as you know, there are new global climate commitments.
The implementation of Article 140 is one of the points in the written agreement between the parties of the State Administration coalition, and no step has been initiated in this direction. Why?
Basem Al-Awadi: The brothers in the Kurdistan Regional Government know that there are some important commitments in the government program, and perhaps what is happening is an order of priorities. But all in all, the brothers in the Kurdistan Regional Government know very well the good and sincerity of the Iraqi government's intention to respond to all the terms of the agreement signed in the Iraqi State Administration Coalition and the implementation of the government curriculum, and therefore the delay of fifteen days or months in order to present some other important and urgent issues does not mean renunciation. We have a long period ahead of us, and three and a half months have passed since the government's life, which is a short period, as you know in Iraq. We are not in the Scandinavian countries, nor in any of the developed European countries, until we say that three months or 100 days is enough to accomplish all plans and projects. We have a different reality and difficulties in Iraq, and you know that the government was not formed in an easy way, and it came after a difficult labor, and was delayed for a whole year from October 2021 to October 2022, and therefore it is possible that there will be progress and delay in some priorities. But the important thing is that there will be an implementation of all the paragraphs that were agreed upon.
Kurdish is the official language along with Arabic. Why was the teaching of the Kurdish language neglected in Baghdad and other provinces, according to the statements of the Directorate of Kurdish Studies in the Iraqi Ministry of Education?
Basem Al-Awadi: It is possible for me to answer this question if this negligence was on the part of the current government. I do not think that the current ninth government headed by Muhammad Shia’ al-Sudani has taken such a decision. Perhaps the decision exists, or it was taken by previous governments and is in force to this day. So it is not a default on the part of the current government, and if this issue is important or urgent according to what the brothers see. In the Kurdistan region, it may be opened through the central government, or through dialogue within the Iraqi parliament, and a decision is taken and transferred to the Ministry of Education to re-teach the Kurdish language subject in the school curricula.
Two years ago, it was agreed that two joint brigades would start operating in the disputed areas. When does this happen?
Basem Al-Awadi: Once again, I say that this is a previous commitment, two years ago, away from our new, ninth government, and therefore I really do not know the details of this issue, and I cannot answer when it will be implemented. Once again, all the pressing issues that the brothers in the Kurdistan region believe should be implemented are supposed to be raised through continuous negotiations, or through the delegations of the Kurdistan region that visit Baghdad frequently.
Is there a plan for the reconstruction of Yazidi homes in Sinjar?
Basem Al-Awadi: There is a great deal of interest in the general issue of housing in Iraq. There is a platform and a special committee formed by the Prime Minister. A decision was issued to change the type of agricultural lands to ownership, which is a very important issue. I do not know the extent of its influence in the Kurdistan region, but there are many housing complexes that used agricultural land for construction, so the first decision was to convert the type of agricultural land, which formed a first response to solve the housing problem in all of Iraq, and at the heart of the housing problem is certainly the issue of the Yazidis, and what they have been subjected to He has had it since 2014 during the ISIS attack, and they are of interest and appreciation to the Iraqi government. The Iraqi government and ministries are ready to respond to everything that facilitates the life of the Yazidi brothers in Sinjar and elsewhere.
Will the Sinjar Agreement be implemented by this government?
Bassem El-Awady: We hope you are.
Is there an understanding between Erbil and Baghdad to postpone the implementation of the Sinjar Agreement?
Basem Al-Awadi: I have not heard of this.
When will the Prime Minister, Mr. Mohamed Shia Al-Sudani, visit the Kurdistan region?
Basem Al-Awadi: I think there is no difference between the Kurdistan region and Baghdad. The provinces of the Kurdistan region are part of Iraq, and I can say that the rest of the provinces are part of the Kurdistan region, and it is possible that when any circumstances are ripe, or at any moment the Prime Minister deems there is a need to visit his brothers in the Kurdistan Region, he will be there in a very short period. The separation between Erbil and Sulaymaniyah and between Baghdad is minutes. When conditions are ripe and when there is a need, the Prime Minister will definitely not be late to be in Erbil or Sulaymaniyah.
Will the dinar regain its value against the dollar after the visit of the Iraqi delegation to Washington headed by Fouad Hussein.?
Basem Al-Awady: Absolutely. Many measures were taken before the delegation's visit, and there are new decisions issued by the Central Bank, and there are other packages. The government has projects and packages ready, and it deals with these packages according to the arrangement and escalation of the crisis. And if the crisis escalates, these ready-made packages can be put forward, and if they stabilize and do not escalate, the government or the central bank may be satisfied with the previous packages and decisions that were put forward. But as you know, the issue is very complicated and thorny. It is not only an exchange rate crisis, but there is intention, serious work and agreements, even through the delegation that visited the United States and discussed many matters, and perhaps one of the most important issues discussed was the exchange rate and sending hard currency to Iraq, and there was an agreement that the two parties work Together in order to solve the exchange rate crisis, and work to stabilize its price, and therefore we need a period of time. In conclusion, we are not dealing with an exchange rate crisis only, as there is an agreement to change the nature of Iraqi trade and the system of dealing with the central bank. This process constitutes a shift. We had a system followed from 2003 until 2023. Now there are new laws, a platform for follow-up, new decisions, and a large international follow-up for hard currency and how it enters and exits Iraq, and the Iraqi government is serious and determined to take a new approach and system that keeps Iraq, the Iraqi economy and trade away from pressures Foreign affairs and protects the Iraqi currency, and new methods are applied that revive life again in accordance with the system, firmness and new decisions that were issued, whether from the Central Bank of Iraq or the Iraqi government.
Did the Iraqi delegation succeed in solving the dollar problem?
Basem Al-Awady: I say yes. The delegation succeeded, and as I said, the issue is not a push of a button, and it is a complex crisis and not only an exchange rate crisis. It is a process of organizing all trade and the Iraqi currency, and all investment, trade and transfer funds, and it is a process of changing what was happening during the past twenty years. The system that has been followed for the past twenty years is no longer useful. Political circumstances and scales have changed, and we must deal with these circumstances and changes in a very correct manner. We do not want to underestimate the value of the crisis, nor do we want to exaggerate its value. There are procedures and agreements, and the procedures included various aspects, commercial, investment and financial. There are even security measures and a negotiating delegation, diplomacy, decisions and linking this issue to politics, and all of that has been covered in the current stage.
Why do not the privileges of multiple loans provided by the Iraqi government banks include employees of the Kurdistan region?
Basem Al-Awadi: You may know that the Kurdistan region has a semi-special situation with regard to banks, loans and financial allocations, and most of the affairs of Kurdish citizens are managed through the Kurdistan Region.
After contracting with Siemens, why did the Iraqi government contract with the US General Electric Company?
Basem Al-Awady: Absolutely. You need more than one major company to reform the electricity sector in Iraq, which is a large sector with billions of deals as you know, on an area of 15 governorates that are not organized into a region, if we exclude the Kurdistan Region, which enjoys comfort in the issue of electric power, or with good investments in the issue of electricity. We are talking about the remaining provinces, and this large sector cannot be granted to one company. It is in the interest of the state, and one of the conditions for independence is not linking the interest of the country to one state or one company. For example, when buying weapons, do not link your armament and army to one source, as it is usually said that the sources of weapons must be diversified. Energy sources are also in this way, as are investment sources. The sector is very large and there is a great deal of experience with Siemens and a global reputation as well, so Iraq granted a large percentage of these investments to Siemens, but the reputation of General Electric, which was awarded secondary contracts in this sector, should not be challenged.
After these two decades, when will Iraq be able to fully secure electricity?
Basem El-Awadi: I think the answer is both easy and difficult. I will speak as a spokesman for this government, I cannot answer for the subsequent periods. I say the government is serious. Two days ago, through the Supreme Coordinating Authority between the governorates, which is the body introduced by the Prime Minister in this government, and it is one of the most important bodies that will supervise the organization of the affairs of the governors and governorates, including energy affairs in the governorates. This body will hold monthly meetings, and it is linked to all The provinces and for all projects.. All I want to say in general is that the Iraqi government is now preparing for next summer, and there was a hosting of the Minister of Electricity at the meeting of the Coordinating Body. He spoke at length, and he also spoke with the conservative brothers about their needs of gas, liquid fuel, stations, their number, and the shortcomings they need. She suffers from it, and there are preparations for the upcoming summer to be special and different from previous years.
I would like to add one line, that one of the most important weaknesses in the electric power project in Iraq is the issue of supplying gas to the gas-powered electricity facilities. The gas is imported and costs a lot of money, and in the fifth round, whose contracts were signed under the supervision of Prime Minister Muhammad Shia’ al-Sudani to extract associated gas, the companies pledged that they would produce for Iraq during the first 15 months after signing the contract a quarter of the gas that Iraq imports, and therefore, when Iraq controls On the issue of gas and have a lot of gas that he extracts, I think it will be the first step after which we can say that electric energy will develop, and we may reach very large levels to provide the Iraqi citizen with energy.
Does the government have fears of new demonstrations this summer?
Bassem Al-Awadi: There are no such concerns so far, and I think that the political atmosphere is very clear and good in Baghdad, and there are no such risks.
Is the Sino-Iraqi agreement being implemented at the present time?
Bassem Al-Awadi: There is no such thing as the Sino-Iraqi agreement. The name of the agreement applies only to the agreements submitted to the Iraqi Parliament and approved by the Iraqi Parliament. If the parliament approves the decisions or agreements, it is called the agreement, and if the Iraqi parliament does not approve it, it is called partnership and investment contracts and any other name that can be called, but it is not an agreement.
In this regard, Iraq considers China a major country that has large investments in Iraq in the oil sector and other sectors, and Iraq wants to cooperate with China, and it is possible that these partnerships will continue for a period, just as the government pays attention not only to China, but also pays attention to cooperation with most Important countries that have investments in Iraq and that have a great desire to develop relations with Iraq.
Our last question. Has the implementation of the Iraqi-French agreement started?
Bassem El-Awadi: I think it needs some time. The agreements, when codified, need research, and we have some delays in investment projects, but in general the Prime Minister’s visit to France and his meeting with President Macron .. There are old agreements, which the current government is working on, also there is talk about new partnerships and projects, so the Iraqi government, as well I said, attach importance to most of the major countries, the United States, China, and the Russian Foreign Minister Lavrov was present in Iraq, Germany through Siemens, France also has contracts and connections. It is in the interest of Iraq to diversify its relations with these major countries, and for matters with these countries to proceed in the right direction in order to advance Iraq, and to strengthen our relations in the right direction with these countries.
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