Automation in Iraq: A “Shy and Worrying” Development in the World of Technology

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[size=52]Automation in Iraq: A “Shy and Worrying” Development in the World of Technology[/size]

[size=45]Prime Minister Mohammed Shia Al-Sudani stressed the importance of proceeding with the automation process, as it lies at the heart of the government’s approach to financial and administrative reform, as well as its efforts to combat corruption. He also stressed the importance of diligent follow-up of the automation process and data accuracy, in order to provide a service that is characterized by modernity and overcomes all obstacles and routine complexities.[/size]
[size=45]The Iraqi government seeks to activate the electronic payment service, adopt modern automation systems, and end cash transactions. However, Iraq’s transition to this globally implemented system is not without fraud, whether by merchants when citizens shop, or by collecting additional amounts under the pretext of the current deduction fees, especially since the community’s culture of electronic payment is weak.[/size]
[size=45]Modern work environment[/size]
[size=45]Iraq is moving towards changing its payment system from direct cash to electronic mode for several reasons, including controlling the money supply, combating corruption, and reducing the cost of printing currency.[/size]
[size=45]The government supported the transformation environment by directing government transactions and collection systems to the new form, in conjunction with the decision of the Central Bank of Iraq to establish a company affiliated with it that is responsible for developing and managing national payment systems, to ensure a rapid transformation to the modern work environment.[/size]
[size=45]The change decision created a new working space for the private sector to participate as a service provider thanks to the rapid shift to electronic payment after the rate of issuing electronic cards reached nearly 19 million cards until the beginning of the first quarter of this year after increasing the localization of public sector employees’ salaries and the rise in the rate of financial inclusion linked to the financial culture of customers.[/size]
[size=45]Government sector data indicated a significant increase in the new system, as the number of institutions using electronic payment increased from 13 in 2019 to 558 last year, and with it collection rates increased from 3 billion Iraqi dinars in 2021 to 108 billion dinars last year, which indicates the rapid acceptance and integration of citizens.[/size]
[size=45]Government decisions to cancel customer payment commissions contributed to the widespread use of electronic cards through the issuance of two million new cards last year. The private sector’s reduction initiatives also stimulated the new transformation, raising electronic financial transactions from 298 billion in 2019 to 9 trillion and 66 billion transactions last year, but they certainly need more support, marketing and development to ensure better performance.[/size]
[size=45]In June 2023, the Central Bank of Iraq announced the entry into force of Iraqi Cabinet Resolution No. (23044) of 2023, which aims to increase the number of electronic payment devices in government institutions and the private sector to enhance the culture of electronic payment and collection, and reduce the use of paper money in collection and commercial transactions.[/size]
[size=45]Education sector[/size]
[size=45]In February 2020, eleven million Iraqi students were no longer able to go to school. The Covid-19 pandemic, with its measures to prevent and contain the virus, such as the closure of all educational institutions, posed a threat to the educational process for a developing country like Iraq, as the partial closure lasted for 55 school days, while the total closure of schools lasted for 255 school days, according to statistics from UNICEF and UNESCO.[/size]
[size=45]E-learning in Iraq is an initial experiment that is generally applied, but after the widespread spread of Corona, circumstances imposed the use of this type of education in Iraq, but the experiment was not successful as required, and it did not have the strong capabilities that would lead to the continuous success of this experiment.[/size]
[size=45]While the deterioration of the economic and security situation in Iraq coincided with the Corona pandemic, the country faced two double crises that forced many students to drop out of school.[/size]
[size=45]E-learning platforms are part of the project to support and develop the adoption of e-learning implemented by the Iraqi Public Sector Modernization Program of the United Nations Development Program, but it failed in a country plagued by corruption and crises. The matter does not stop there, because the education sector in the country already suffers from great chaos due to corruption, lack of basic scientific principles in teaching, weak spending on infrastructure, lack of services, and other matters that contributed to the decline of this sector.[/size]
[size=45]Fuel and energy[/size]
[size=45]While the government is trying to adapt to the electronic payment system, despite the fragility of the country's economic and banking environment, fuel stations in Baghdad and the governorates have returned to relying on cash payment instead of electronic payment due to the poor internet service, which led to the failure of attempts to pay for fuel via financial cards, raising questions about how to generalize this system in all areas?[/size]
[size=45]Since the adoption of the electronic payment system in all fuel stations, many citizens have been concerned for many reasons, most notably the lack of trust in the banking system, the absence of electronic culture, and the government’s inability to deal with the problems associated with this decision.[/size]
[size=45]A number of vehicle owners in many governorates recorded, at the beginning of this month, “failed” attempts to pay via electronic card while trying to fill up with fuel from stations, coinciding with the government of Mohammed Shia al-Sudani forcing citizens to use the electronic system instead of cash payment.[/size]
[size=45]In turn, the Ministry of Electricity revealed last May a plan to implement the smart energy distribution project in Iraq, while indicating the completion of the electronic collection project throughout Iraq this year, and confirmed the success of the smart energy transformation experiment in some areas of Baghdad.[/size]
[size=45]The head of the ministerial committee supervising the electronic payment and smart transformation project at the Ministry of Electricity, Ahmed Murtada, said, “The ministry is working to implement the government’s direction and the direction of Prime Minister Mohammed Shia al-Sudani to achieve a complete smart transformation of the electrical system by adopting smart electronic meters,” noting that “certain areas in Baghdad and the governorates have been elected in order to transform them into a smart transformation in the field of electrical energy distribution, and in the coming weeks the results of this experiment will become clear.”[/size]
[size=45]He pointed out that “so far, the smart energy transformation experiment in Baghdad has achieved great success, and the experiment will be generalized within a month and a half to two months in all areas of Baghdad, after which it will move to one or two governorates until reaching all governorates,” explaining that “the ministry will divide Iraq into regions with five distribution companies, and each company will be responsible for a group of governorates.”[/size]
[size=45]Ration card[/size]
[size=45]Within the project of transformation to electronic automation in government transactions, which was adopted by Iraqi Prime Minister Mohammed Shia al-Sudani as part of his government program, the Ministry of Commerce announced earlier the start of converting the paper ration card to an electronic one.[/size]
[size=45]The ministry revealed that the project will start in Najaf Governorate (south) as a first step and as a model that will later be generalized to all governorates, according to what was confirmed by the Minister of Trade, Athir Dawood Al-Ghariri, in a previous interview.[/size]
[size=45]Al-Ghariri hopes that the project will help citizens obtain their ration card quotas of food items accurately, while reducing manipulation and avoiding routine procedures, through a smart application.[/size]
[size=45]The ministry’s move to an electronic system raises many questions about the advantages of the new system and the risks that may result if Iraqis’ personal data is leaked.[/size]
[size=45]The Ministry of Commerce faces major challenges in implementing the electronic food ration card system, according to Soran Omar, a member of the Iraqi Parliament’s Economy, Industry and Trade Committee.[/size]
[size=45]Omar added that the automation project requires huge sums of money and a period of no less than 5 years to complete.[/size]
[size=45]Regarding the availability of capabilities for electronic transformation in this project, Omar indicated that Iraq was able to automate the system for receiving salaries for government employees, while other areas - such as the Electoral Commission card - are still suffering, noting that the security of citizens’ data and their privacy will depend on the company to which the project implementation will be referred, according to his expression.[/size]
[size=45]Smuggling treatment[/size]
[size=45]The General Authority of Customs announced last June the completion of the first phase of the automation project in 8 centers, and while it set a date for its completion in all its centers in Iraq, it revealed its revenues within 5 months.[/size]
[size=45]The head of the authority, Hassan Al-Akeili, said, “The authority began implementing the Skoda system in some border crossings since last October,” indicating that “the first phase of automation has been completed in 8 customs centers out of a total of 25 centers.”[/size]
[size=45]He added, "The importance of the ports is measured by the ports that generate the most revenues and through which many goods enter," noting that "the second phase will witness the automation of the remaining centers within a time frame extending to the first half of next year," noting that "automation has contributed to increasing revenues."[/size]
[size=45]It is noteworthy that the Board of Directors of the Central Bank of Iraq decided on December 13 to establish the “National Company for Electronic Payment Systems” throughout the country, indicating that the company represents a qualitative development in the structure of the country’s financial infrastructure.[/size]
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