Friday, July 13, 2007
World Bank opens a branch in Iraq
Finance
(Al Sumaria) - The World Bank opened a branch in Baghdad. This step was backed by the International Monetary Fund, USA and Britain. The World Bank Officials in Iraq will exert efforts in order to organize economic workshops in collaboration with the government. These workshops will be aiming to help the government to use its resources in the profit of the people.
Labels: IMF, Iraq, World Bank
Monday, July 02, 2007
Petrol prices hiked for IMF targets
Oil
(Khaleej Times) - Iraq has increased official petrol prices by around 15 percent, an Iraqi official said on Monday, delivering the second hike this year to keep promises made to the International Monetary Fund. Karem Hattab, chairman of Iraq’s oil products distribution company, told Reuters that the price had been lifted to 450 Iraqi dinars, or about 36 U.S cents, per litre, from 400 dinars.
‘The price hike is in response to ongoing pressure by the IMF to cut subsidies on oil products, to be the same as neighbouring countries’ he said. Iraq has already raised prices from 20 Iraqi dinars in 2005, although prices still remain low compared with world standards. The government is committed to phasing out fuel subsidies under a $715 million economic programme agreed with the Washington-based IMF.
The aim is to limit a thriving Iraqi black market in fuel, which is believed to channel funds to anti-US insurgents, and encourage the money currently used by the government for subsidies to be better spent.
Iraq sits on the world’s third-largest oil reserves. But decades of war, sanctions, under investment and now widespread violence and sabotage have left it critically short of fuel. As a result, the government imports much of Iraq’s fuel. It paid heavy subsidies of $6 billion in 2005 and $2.5 billion last year to keep prices low, a second oil ministry official said. Diesel prices will be also hiked by 15 percent soon, said the official, who declined to be named.
‘The price hike is in response to ongoing pressure by the IMF to cut subsidies on oil products, to be the same as neighbouring countries’ he said. Iraq has already raised prices from 20 Iraqi dinars in 2005, although prices still remain low compared with world standards. The government is committed to phasing out fuel subsidies under a $715 million economic programme agreed with the Washington-based IMF.
The aim is to limit a thriving Iraqi black market in fuel, which is believed to channel funds to anti-US insurgents, and encourage the money currently used by the government for subsidies to be better spent.
Iraq sits on the world’s third-largest oil reserves. But decades of war, sanctions, under investment and now widespread violence and sabotage have left it critically short of fuel. As a result, the government imports much of Iraq’s fuel. It paid heavy subsidies of $6 billion in 2005 and $2.5 billion last year to keep prices low, a second oil ministry official said. Diesel prices will be also hiked by 15 percent soon, said the official, who declined to be named.
Labels: IMF, Karem Hattab, petrol prices
Tuesday, March 13, 2007
IMF extends $714 million loan
Finance
(Reuters) The International Monetary Fund on Tuesday extended Iraq's $714.7 million loan accord to Sept. 28 at the government's request and said the country faced an important juncture in its economic recovery amid increased violence. Iraq has treated the loan as precautionary finance and has not drawn down on it since its approval in December 2005.
"Despite very difficult political and security circumstances, the Iraqi authorities have taken important measures to keep their economic program on track," IMF Deputy managing Director Takatoshi Kato said in a statement. He commended the authorities for their management of the economy, including maintaining fiscal discipline, tightening monetary policy and raising domestic fuel prices.
But the IMF said inflation was high and the central bank may need to act to prevent it from becoming entrenched, while fiscal policy should keep current spending in check, including wages and pensions. Kato urged the government to increase its investment, especially in the oil sector, and to reduce supply constraints of fuel products. "To that end, actions are needed to facilitate the importing of fuel products by the private sector," Kato said. He said reforms needed to be broadened, including in the budget and financial management system. The fund praised restructuring efforts of Iraq's two largest banks but said more efforts were needed to overhaul the four other state-owned banks.
"Despite very difficult political and security circumstances, the Iraqi authorities have taken important measures to keep their economic program on track," IMF Deputy managing Director Takatoshi Kato said in a statement. He commended the authorities for their management of the economy, including maintaining fiscal discipline, tightening monetary policy and raising domestic fuel prices.
But the IMF said inflation was high and the central bank may need to act to prevent it from becoming entrenched, while fiscal policy should keep current spending in check, including wages and pensions. Kato urged the government to increase its investment, especially in the oil sector, and to reduce supply constraints of fuel products. "To that end, actions are needed to facilitate the importing of fuel products by the private sector," Kato said. He said reforms needed to be broadened, including in the budget and financial management system. The fund praised restructuring efforts of Iraq's two largest banks but said more efforts were needed to overhaul the four other state-owned banks.
Friday, March 09, 2007
Oil Ministry to raise price of fuel products
Fuel
(Azzaman) The Oil Ministry will have to hike prices of fuel products which are currently sold at highly subsidized rates, according to the minister Hussein Shahristani. The minister made the remarks ahead of a meeting with the International Monetary Fund which is coordinating the writing off of Iraqi debts. Shahristani said Iraq is obliged to honor the pledges it has made to the fund in return for financial assistance.
He did not say when the ministry will introduce the new rates but added the country will eventually have to reduce its huge fuel subsidies. Despite the subsidies, which are reported to cost hundreds of millions of dollars each month, Iraq still suffers from chronic fuel shortages. Subsidized fuel is hard to obtain and most Iraqis are forced to buy on the spot market at exorbitant rates.
Iraq currently imports huge volumes of fuel despite its massive oil wealth. But the selling and distribution of fuel is the type of economic activity where corrupt officials and profiteers are cashing in. Shahristani said the IMF has asked Iraq to raise fuel prices to levels comparable to those in neighboring countries.
He did not say when the ministry will introduce the new rates but added the country will eventually have to reduce its huge fuel subsidies. Despite the subsidies, which are reported to cost hundreds of millions of dollars each month, Iraq still suffers from chronic fuel shortages. Subsidized fuel is hard to obtain and most Iraqis are forced to buy on the spot market at exorbitant rates.
Iraq currently imports huge volumes of fuel despite its massive oil wealth. But the selling and distribution of fuel is the type of economic activity where corrupt officials and profiteers are cashing in. Shahristani said the IMF has asked Iraq to raise fuel prices to levels comparable to those in neighboring countries.
Labels: Hussain al-Shahristani, IMF, Oil Ministry
