American Contractor

Turkey just announced that all foreign investors or nonresidents are exempt from the withholding tax in the shares and bonds. Read the excerpt from the article below.

The changes, which include the abolition of a 15% withholding tax for nonresidents investing in shares and bonds, triggered a sharp recovery in Turkish asset prices and the lira currency.

I am sure Dr. Shabibi is aware of this tax break, and what a way to invest in Turkey, while living in Iraq and all the profit is tax free. What a concept. This is what we all need in Iraq Stock Exchange.

On another note.

The word on haffa street is the Iraqi government is looking forward to next years new budget, which is just a little over 90 days on 1 October. The rumor is that an influx of cash is on the horizon.

Could this be the new business foreign investment law that will be enacted then…we shall wait and see. It seems the Kurds in the north are not worried about the investment laws the way they have signed up several oil companies not as big as my favorite, ExxonMobil but it’s a start.

How long do you think it will take for the new amendments to take place on the Iraq constitution concerning the oil? If 90% of Iraq revenue is from the sales of discounted oil on the world market, I would be working on the new amendments to the Constitution quickly. I see no new developments on this at all it doesn’t mean that something is not going on behind closed doors, but I just wish they would hurry up and get the agreements made about the oil assets and revenue.

Do you still think we are close to an rv?

Posted by American Contractor at 10:30 PM | Permalink | Comments (2) | TrackBacks (0)

It has been reported that Iraq’s inflation rate is well over 100% and there is a strong desire from the Iraq Central bank to lower the inflation to a manageable level like the 10-15% very soon. Iraq could take the same step this country has just announced who will be introducing a new currency and lopping a few zeros.

I wonder if Dr. Shabibi reads the Financial Times.

The National Assembly Finance Committee, some directors of the Central Bank of Venezuela (BCV) and the Finance vice-minister believe those days when people deposited VEB 500,000 (USD 233) in their accounts and spent it all in an afternoon to purchase two pairs of shoes should be over.

After reading the above quote from this article I bet the Iraqi's feel the same way.

You can read it here.

Posted by American Contractor at 9:53 AM | Permalink | Comments (5) | TrackBacks (0)

A good article about oil and petro dollars.

Posted by American Contractor at 6:18 PM | Permalink | TrackBacks (0)

This is going to be a major problem for the Iraqi government.

Posted by American Contractor at 6:16 PM | Permalink | TrackBacks (0)

Question

I apologize for not posting regularly this week just been busy. Last week I had a question and I asked for people to write and answer it and I must say I received several replies that were close and some not so close. It was a good try and I appreciate everyone that wrote in.

Here is the question written below:

In early 2005 the Iraqi government and the Central Bank of Iraq (CBI) had deposited usd 5 billion in the Federal Reserve Bank in New York. The question is how did the CBI and the Iraqi government deposit the money in the Federal Reserve bank in New York. How did Iraq get the 5 billion usd to New York in an interest bearing account?

Now let me answer this question for all you in Iraq enthusiast. Back in 2005 the US government has you all know was sending plane loads of US dollars from the United States and delivering the US dollars in nice fresh printed money to Baghdad airport and then were moved throughout the country in Iraq.

Now to think that Iraq was sending the 5 billion usd back to the states after it had arrived in Baghdad is just not cost effective. So, the US government just opened an account with the Federal Bank of Reserve in New York and opened the account in Iraq government name and accredited the account 5 billion usd. No security to set up no plane loads of US currency very simple transaction thanks to the US government and making 100 million annually so it has been reported.

Posted by American Contractor at 7:29 AM | Permalink | TrackBacks (0)

This a very interesting article coming from the United States State Department talking about Iraq. If you notice we are in 2006 and they sure mention CPA laws all over this article. I thought the CPA Laws were no longer in effect??!!

I sure like that sentence “are not allowed to engage in forward transactions in Iraqi Dinar for speculative purposes.”

The Iraqi Dinar currency is worthless outside of the country of Iraq. Your right it is convertible but only inside Iraq and that’s all. And what is the currency of choice for all those Iraqi private and state banks, do I need to say it again.

From the DOS Web site:

The exchange rate is generally determined on the basis of supply and demand conditions in the foreign exchange market. Banks may engage in spot transactions in any currency, but are not allowed to engage in forward transactions in Iraqi Dinar for speculative purposes.

You still think we are close to an rv?

Posted by American Contractor at 7:13 AM | Permalink | Comments (5) | TrackBacks (0)

I guess no matter how many times I say this on my blog there are people out there like the Dinar Forums that are still going to believe what they believe and that's okay. Let's look at one quote shall we.

For an example Good_Karma on the dinar forum stated this.

"Why would they even go to the pain of sending USD abroad in increments, after every IQD auction, to pay for debts. They have more than enough foreign currency reserves to take care of that. I think these are IQD being sent abroad. They need to sell IQD for USD, before they send the IQD abroad to ensure that the IQD has an equivalent USD reserves (from the sale)."

Post #314

-- Good_Karma

If you go back and read the thread you see that they are talking about the CBI auctions of the US dollar as reported by the CBI. It is true they are having US dollar auctions and transferring the US Dollar each and everyday directly from the Central Bank of Iraq.

However, here is the facts, the CBI is transferring US dollars to all the State and private banks through out Iraq, because that is what they (State and private banks) are using to transfer abroad to either make deposit or pay debt or anything else they would like to do with that US currency.

The reason the private and state banks are wanting the US currency is because as you well know it is a fully convertible currency in just about any country in the world, unlike the Iraqi Dinar which is worthless outside the country of Iraq.

Believe it or not!

I want to be clear I have no problems with the people in Dinar Forum World (DFW) it's just that several of them are
well just looking in the wrong direction. I hope that they take my comments and really look into the CBI auctions.

So, that you will know just like my Colleagues and I have known going on 3 years now.

Posted by American Contractor at 12:10 AM | Permalink | TrackBacks (0)

The Iraq Stock Exchange (ISX) closed at 1% higher today and things are looking good the market will increase in value on Wednesdays trading. That is if nothing major happens in downtown Baghdad or one of the surrounding cities to cause the investors or employees’ to not come to the trading floor due to security reasons or just from plain fear.

I have a few pictures here of the Iraq Stock Exchange and never before published until now.

The first picture is the wording Iraq Stock Exchange on the powerline. And the rest just show how the market is when it is operating and when it is just about to open.

This is how the market looks just about when it's about to open.

A broker taking orders for stocks.

Some of the Investors taking breaks and relaxing thinking how much money they either made or lost.

Posted by American Contractor at 12:05 AM | Permalink | TrackBacks (0)

The new PM is going to start a curfew on 14 June. Hopefully, this will give the Iraqi Security forces an edge by keeping criminals off the streets at night and while the security forces conduct raids arresting the criminals and don’t forget the insurgents.

And hopefully the IED's that are planted and mostly done at night, the curfew will curtail that type of activity.

Posted by American Contractor at 2:58 PM | Permalink | Comments (1) | TrackBacks (0)

The CBI is not transferring Iraqi Dinar to other countries. The only currency the CBI would be transferring is US Dollars or the currency of that host country. The reason is the other country can not exchange the Iraqi Dinar and convert it to their own host country currency.

The Iraqi Dinar is a non-convertible currency and only valid inside of Iraq only. The CBI conducts daily auctions to the Private and State banks in Iraq in both US Dollars and the Iraqi Dinar. The auctions to the private and State banks yield the CBI approximately usd 500 million a month. The auctions by the CBI is how they make a profit to the bottom line of the CBI account to pay for employees, equipment etc., so that the CBI can sustain itself with out having to go the Iraqi government for additional funding to help pay for expenses for the equipment and employees.

When the Iraqi government is buying wheat from Australia the Iraqi government does not send the Australian government Iraqi Dinar for payment of the wheat. The Iraqi Dinar is a nonconvertible currency. When the Iraqi government sends the payment for the Australian wheat it tasks the CBI to send the payment. The CBI then sends the funds in US Currency to a Private Import and Export Bank in Iraq and then the Private Import and Export Bank send the funds electronically to the Australian government in Australia own currency. The Private Import and Export bank is converting the payment to Australia currency to pay for the Australian wheat.

All the data that some people are reading that the CBI is transferring Iraqi Dinar to other countries is false. The private and State banks in Iraq are buying US Dollars and sending them to other countries to deposit in accounts or make payments or buy goods for their clients. The private and state banks are not sending the Iraqi Dinar out of the country, which would be a violation of the CBI Banking laws and CPA Laws.

Posted by American Contractor at 2:36 PM | Permalink | Comments (4) | TrackBacks (0)

The International Advisory and Monitoring Board (IAMB) met in Washington D.C. in May in reference to the Development of Iraq Fund (DFI). The purpose of the meeting was to update their findings and information about the DFI funds.

The IAMB is responsible to ensure the Iraqi government is using the DFI fund in a transparent manner and all benefits from the fund are going to the Iraqi people. And to be sure all export sales of petroleum and products to include gas are made within the world market limits.

The IAMB is using accountants from Ernst & Young the appointed DFI auditors to write accurate financial reports concerning the DFI funds. The Iraqi government is slow to providing the information to IAMB to complete their reports on 30 June 2006

The IAMB wants to complete the reports in a timely manner to complete a 12 month reporting period. This would give Iraq a snapshot of their financial standing to give the world’s private corporations and companies a look at them. This is all inline with the direct foreign investment that large corporations want to know. If the large corporations don’t know the financial health of Iraq then the large corporations are most likely wont be investing funds in a country that can not provide the information they are seeking.

It would be difficult for foreign investments to start investing funds in Iraq when you have no independent study of the DFI funds on how Iraq has been managing the funds given them.

If you were a large corporation with billions in cash looking to invest in a emerging market, you would want to know if your money was going to benefit the Iraqi people such as construction projects etc. or is your corporate money just going to be used to build a mansion for the local militia commander.

The IAMB is not the only organization to pressure Iraq government to provide accurate documents to the information that they are seeking. Another organization is the IMF. On 30 June 2006 the IMF is expecting Iraq to provide information about the progress of the SBA loan that was given to them in quarterly installments starting last December 2005. If Iraq doesn’t provide the report it is possible the IMF could with hold funds that are scheduled to be released on 30 June 2006, the third installment of the SBA loan.

Iraq can’t afford to continue to delay or stall the IAMB, and possibly the IMF (after 30 June) any longer because the large corporations will lose interest and go to another country to invest. If the report doesn’t come out soon by the IAMB then the corporate investments most likely will be delayed also.

Posted by American Contractor at 2:30 PM | Permalink | TrackBacks (0)

No wonder Iraq is not producing oil in the North they are in Russia.

Posted by American Contractor at 5:50 PM | Permalink | TrackBacks (0)

I have a question for all you in DFW land (that’s dinar forum world) and I am curious to see who is paying attention. I am going to ask this question and I will post some of your answers on The American Contractor blog at a later date.

I am not trying to make fun or belittle anyone just seeing if people are paying attention in this crazy ride as they say in DFW land and to promote good will between my world and DFW as I am a humanitarian.

The question?

In early 2005 the Iraqi government and the Central Bank of Iraq (CBI) had deposited usd 5 billion in the Federal Reserve Bank in New York. The question is how did the CBI and the Iraqi government deposit the money in the Federal Reserve bank in New York. How did Iraq get the 5 billion usd to New York in a interest bearing account?

This is not a trick question and I like to see what you think of how it happened. I’ m sure you smart people in DFW land can answer this. Any takers?

You can send your answer here to American Contractor.

Posted by American Contractor at 6:14 AM | Permalink | Comments (1) | TrackBacks (0)

Dinar Forum World is saying this:

With all the security features on the new Iraqi Dinar I don’t believe it…this has to be some left wing nut who hates Iraq to print a story like that.

They will swear that it is not true and go on with their normal selves and go on believing an rv is just around the corner.

Well, I know when the rv is going to happen.

Well, let me bring it home for you DFW it is true (the counterfeiting part) and the question is what is the Iraq Central Bank and the Iraqi government going to do about it.

Update:

I know the article is not specifically talking about bogus Dinar, I am just bringing it to light because it is happening.

Posted by American Contractor at 5:54 AM | Permalink | Comments (2) | TrackBacks (0)

Now, do you see how fast this grant of $8 million came into Iraq Ministry of Labor and Social Affairs to help the poor Iraqi people. Now if you can get this done just right after you can get a full government together lets get to work on that constitution and make some changes. Because

BIG OIL is waiting.

Posted by American Contractor at 10:44 PM | Permalink | TrackBacks (0)

I guess since the Shiites are the only ones in southern Iraq, that are producing any oil for the entire country, they are looking for new opportunities. Heading north to visit and look at conducting business in the Kurdistan area of Iraq and in search of other business or maybe get on in some of those oil deals.

These are the companies that have been reported and talked about that have signed oil contracts with the Kurds. The oil contracts are in opposition with the oil ministry in Baghdad as you all know. The Kurds have stated that they are not going to give up their oil rights. I guess their rather stick with the smaller oil companies then have Dutch Shell or ExxonMobil in there area with the best possible technology and know how.

I think if I had my choice of ExxonMobile or one of the smaller oil companies that have already signed oil contracts with the Kurds, I think you know who I would go with. When you make 10 billion in one quarter it’s a no brainer.

1. DNO of Norway

2. Petoil of Turkey

3. Ganel Energi of Turkey

4. Western Oil Sands of Canada

5. Heritage Oil of Canada

6. Woodside of Australia

7. Addax Petroleum of Switzerland

Japan Oil pending

Posted by American Contractor at 10:19 PM | Permalink | TrackBacks (0)

This article in the AME news reminds me of what I had written a few days ago about the reporting of oil production figures. The Iraqi government is still absorbing the oil subsidies and also the black market is getting their illegal share.

Remember a few days ago they reported a 15% increase in oil production I hope the figures are correct.

Do you still think we are close to an RV?

Posted by American Contractor at 4:39 PM | Permalink | TrackBacks (0)

Last December 2005, the IMF granted Iraq a Stand by Arrangement (SBA) for 15 months, starting in December 2005-March 2007 in the amount of usd 685 million. Behind the SBA agreement were stipulations for the new Iraqi government. The Iraqi government agreed to end the petroleum products subsidies in a piece meal fashion over the course of the year.

Upon the completion of the SBA in December Fuel prices were raised over night 5 and 9 fold gasoline, diesel, and kerosene and according to the SBA agreement the Iraqi government were to raise the cost of the petroleum products each quarter in 2006, so that by the end of the year Iraqi fuel cost to the average Iraqi would be inline with other gulf Arab countries.

In March 2006, the Iraqi government delayed the raising of fuel and diesel prices until June 2006. Currently Iraqi’s pay $.26 per gallon of regular gasoline compared to $.91 per gallon in other Gulf Arab countries. It remains to be seen if the Iraqi government will be raising fuel prices in June.

The cost of the oil fuel subsidies to the Iraqi people is estimated anywhere from 2 to 5 billion usd. Complying with the SBA loan, Iraq would be able to place the cost of the subsidies billions of usd into the main general fund of the Iraqi government starting in 2007.

Iraq would be able to use the extra liquid cash to pay for medial care and the welfare for the poorest of Iraqi’s. The IMF continues through out the year to monitor Iraq and measure the progress in the SBA loan. The money is granted to Iraq in quarterly installments when the IMF agrees the Iraqi government is making progress in accordance with the SBA loan.

There are a few tasks at the end of June that the Iraqi government must be in the process or close to completion. According to the SBA there are several ongoing operations and completion dates for each item. I am going to list what I think is important. There are few that I am going to list.

1. Implementation of Payment System Regulations

2. Commencement of operations of real time Gross Settlement system (RTGS) linking headquarters of commercial banks to the CBI.

Both of these are to be completed by June 30. Now let’s look at another benchmark for the Iraqi government to complete.

3. Commencements of payments clearing system between the headquarters of commercial banks and the CBI through the Automatic Clearing House (ACH),

This is supposed to be completed by 30 November 2006. If you don’t know what ACH is in the banking world, it allows banks to be connected electronically and a very cheap way of sending money and clearing checks worldwide as long as the bank is connected to the ACH network.

And finally by the end of the year 2006, fully capitalization of CBI to the stipulated ID 100 billion, based on the 2005 audited financial statements and taking into account the restructuring of outstanding claims on the central government that are on the 31 December 2005 balance sheet of the CBI.

Also in June the IMF will be meeting to evaluate what the Iraqi government has been doing in regards to completing the SBA agreement. Also a payment from the IMF to the Iraqi government is also made if everything goes accordingly and no issues. The next review from the IMF will be September 2006.

I am unsure if the Iraq government will complete all agreements in the SBA especially with all the continue delays and the recent delay of the fuel price hike in March. I am unsure if the Iraqi government will raise the fuel prices in June, we will just have to play a wait and see.

I will quote the recent appointed Planning and development cooperation minister Ali Baban, when he said recently in a Financial Times report that Iraq might not be able to enact economic reform soon, or reduce subsidies as envisioned by the IMF. Baban went on to say “I hope the IMF will take into consideration the situation in Iraq and not pressure us to do what will be hard for our people, especially cancelling subsidies.”

More to follow.

Posted by American Contractor at 8:06 PM | Permalink | TrackBacks (0)

When the Coalition Provisional Authority came to Baghdad it had passed a set of laws in May 2003 known as the CPA laws. The CPA was the temporary government of Iraq and the existing laws in Iraq were still in force unless it was superseded by the CPA laws.

When the New Iraqi Interim government was appointed in June 2004, a new set of laws were in place known as the Transitional Administrative Laws (TAL) which were to govern the affairs of Iraq during the transitional period until a duly elected government, operating under a permanent and legitimate constitution.

The new transitional government embraced the CPA laws because they did not make any new laws. The TAL did not supersede any existing laws to include the CPA Laws.

Article 62 This law shall remain in effect until the permanent constitution is issued and the new Iraqi government is formed in accordance with it.

Iraq abides by the rule of law; the new Iraqi parliament has to enact new legislation to supersede laws (like CPA Laws and the TAL) and any Iraqi laws currently in place.

Although the Iraqi constitution was approved by the voting population it still needs to be ratified by the legislative body.

Today, the new government just completed, no new laws enacted, but Iraq is still trying saddam in a Iraqi Court, how??

The old CPA laws, TAL laws along with Iraqi laws are still in effect until changes are made by the new Iraqi government.

Posted by American Contractor at 8:01 PM | Permalink | TrackBacks (0)

The large oil companies are waiting to get the green light. Let's not stumble and be held hostage to the Oil Mafia. Change the Iraqi Constitution and lets get rolling.

Posted by American Contractor at 11:46 AM | Permalink | TrackBacks (0)

With all the attacks and the recent kidnapping of the oil workers in Kirkuk. Oil will not flow out of the largest oil field in the North until January 2007 or early next year. All the attacks have taken a toll on the oil infrastructure, and I am sure they are in need of badly needed parts and the technical expertise especially from the large oil company’s that are badly needed in Iraq but won’t go at this time.

The Oil Mafia in the south looks like they are going to reap the rewards or take up the slack in the southern oil fields and producing oil for the whole country.

Look at the figures for the oil production I thought Iraq just reported a 15% increase.

Posted by American Contractor at 9:52 AM | Permalink | TrackBacks (0)

After reading a few Iraq Dinar forums on the net, there is a perception that the CBI is transferring Iraqi Dinar currency to other countries to pay off debts or possibly depositing the Iraqi Dinar in interest bearing accounts in other countries.

If the CBI was indeed transferring currency to other countries to pay off debts or place in a deposit interest bearing account, it would do so only in US dollars and not in Iraqi Dinars. Doing so in Iraqi Dinars would violate the laws that are in place at this time.

In early 2005 the CBI made an announcement that it had deposited 5 billion US dollars inside the Federal Reserve in New York. This transaction was done in US dollars and not Iraqi Dinars. Keeping in compliance with current Iraqi Laws and maybe if at all any agreements made with the IMF and the World Bank.

The paragraph below is the law in regards to the Iraqi currency and the CBI.

CPA Order 56, Section 7 , para 1.

1. The CBI shall have the exclusive right to issue banknotes and coins intended for circulation in Iraq. Banknotes issued under this Article shall be a first charge on the assets of the CBI. The CBI shall make appropriate arrangements for the issue of its banknotes and coins as required for circulation in Iraq. Banknotes and coins issued by the CBI and intended for circulation in Iraq are not promissory notes, bills of exchange, or any other type of commercial document under the applicable commercial law, and the CBI is obligated to honor them only as provided for in this Law.

Posted by American Contractor at 9:16 AM | Permalink | Comments (2) | TrackBacks (0)

This is from the Financial Times this morning.

This is what thier saying in Iraq, let's hope PM Mailik can turn it around and be the PM he was elected to be with out all the constraints

"He does not control the army, the police or his government," said one journalist for an Iraqi radio station, while watching a news conference this week given by the prime minister.

For all you IMF Fans what do you think they will be saying at the meeting this month about Iraq. A very important meeting because it involves money. Just because the IMF does not have an office in Baghdad doesn't mean they are not watching what is happening on the ground and in government and are committed to their meetings.

Feel free to write me here however, I will be posting about it soon.

Posted by American Contractor at 7:08 AM | Permalink | TrackBacks (0)

Just reported is the kidnapping of four Iraqi oil workers from the NOC in Kirkuk which is located on the North side. Nice compound in the middle of a gated community.

Oil has not been pumped in the north for several months now it makes you think how they are really pumping the oil and if so where is all the oil going? I hope the oil workers are set free and soon.

The oil crisis is just getting started and don’t forget about the ongoing fuel shortage.

Posted by American Contractor at 1:12 PM | Permalink | TrackBacks (0)

When I see reporting like this from the media and looking at what’s happening on the ground especially in Basrah, you have to step back and analyze the report. We already know the “Oil Mafia” control the oil in the south and are smuggling the oil and funneling the proceeds for their illegal activities.

How do we know the report is true especially coming from possible smugglers and corrupt officials and oil company employee’s who possibly could be involved in the smuggling operation.

If I knew in the future I was going to make concessions to the central bank of Baghdad in regards to the oil assets in the south inflating or deflating the production figures probably wouldn’t be a bad idea. How would central bank of Baghdad ever know what the true production level was?

I could be wrong will just have to wait and see.

Posted by American Contractor at 8:04 PM | Permalink | TrackBacks (0)

It has been reported in several media reports that Prime Minister Nouri Al-Maliki had three names for each of the three vacant cabinet posts, Interior, Defense, and National Security. PM Al-Maliki had announced last weekend the exact names he wanted for the posts and was unable to confirm those names.

If the deadlock didn’t occur the government would be on their way in getting Iraq back on track and getting on with business and managing the countries affairs. Let’s go back a few days to what happened in Basrah.

Last Wednesday, PM Al-Maliki went down to Basrah to put a stop to the militia, political parties and criminals that are controlling the oil reserves in Basrah. Things did not get any better in Basrah. The largest party in the Iraqi parliament is the United Iraqi Alliance, the largest Shiite group that dwells and lives in the southern region of Iraq.

The UIA along with Militia and criminals control the oil reserves and don’t want to give it up. Iran has purposely crippled Iraq due to funding the militia and other groups. I am wondering what the response is going to be to get the oil reserves back under the central government control. Since the Militia’s and the criminals answer to the Iraqi PM was a suicide bomber. Now the PM has declared martial law for 30 days.

There is a major problem when a PM of a country can not get his cabinet appointed of people who he thinks that can fill those positions. I think we are heading into another serious of delays in the new Iraqi government. I don’t see any appointments anytime soon. PM Maliki is handcuffed and can’t operate for the good of the Iraqi people no matter what party affiliation or religious aspect they fall under.

I think that PM Maliki is doing his best under the difficult circumstances it’s his party that is giving him the problems and setting the country back.

The good thing about this is that no matter what the Iraq government does people are still building things and still living their lives and attempting to provide for their families. Construction Projects are still being executed. The banking infrastructure and most definitely the Iraq Stock Exchange projects such as electronic trading are being worked on as the Iraq government continues with there delays after delays.

There is a good side to all of this besides the violence going on in Iraq. I can go on and on but I think you get the picture.

Posted by American Contractor at 7:44 PM | Permalink | Comments (1) | TrackBacks (0)

Despite all the violence in the Iraq and in the region Citigroup is obtaining a foothold in the Middle East.

Posted by American Contractor at 6:05 PM | Permalink | TrackBacks (0)

This is a long read but well worth it.

Naomi Klein

Posted by American Contractor at 4:23 PM | Permalink | TrackBacks (0)

Last week 1500 US Soldiers that were stationed in Kuwait were re-deployed to Iraq and their final destination was the Al-Anbar province. I guess training the Iraqi Army at the same time fighting the bad guys was not working out as hoped.

The Iraqi Army had a lot of defections after the Iraqi soldiers were given their paychecks and did not return on their monthly ten day leave. The Iraqi Army trains for 20 days and off for 10 days. That is a lot of time off for 20 days worth of work or I should say training. I think I would have forgotten everything that I had learned in training when I returned. There are other provinces the Iraqi Army is performing poorly I will let you read the article here.

Posted by American Contractor at 7:57 PM | Permalink | TrackBacks (0)

Just published from the Middle East Economic Survey and written by Tariq Shafiq, who is the Founding Executive Director, Iraq National Oil Company (INOC), Dircetor, Petrolog & Associates, and Chair, Fertile Crescent Oil Development Co. Based in Baghdad, Iraq.

The constitution doesn’t do any favors for the large International Oil Companies that would like to come to Iraq. This is going to be a hot contested debate with the Governorates and the Iraq central government.

Mr. Shafiq, raises some very good points:

“Without a central unified policy there will be disharmony and competition between INOC (operating on production and marketing its export oil to provide the state’s income) and the Regions and Governorates (operating on exploration for unneeded additional reserves), and among the various Regions and Governorates, with disharmony and envy between the haves and have-nots. This would lead to an unhealthy oil industry, causing instability and damaging consequences contributing to the fragmentation of the country”

“Leaving the constitutional terms unchanged, the Regions and Governorates’ likely course would be to go down the route of indiscriminate PSAs and second rate oil companies and the damaging consequences enumerated above. This would also be regarded by critics as inviting privatization of the nation’s very livelihood through the back door; a policy known to be absolutely unacceptable by the nation”

This is a very good read if your interested in the future of the oil contracts in Iraq if there ever will be unless the government of Iraq and all the Governorates can agree on a unified policy. Sure you’re going to have explorations for oil like with the Kurds in the north with the recently signed contracts with Canada Western Oil Sands, Inc. and the Norwegian company Det Norsje Oljeselskap. However, they have not been approved by the central government of Iraq and signed into law.

From the State Department regarding the Kurdish Oil Contracts with Foreign Firms.

In March 2006, Robert Silverman, who directs the department's Office of Iraq Economic Affairs, said the contracts set a worrisome precedent for the country and that they could cause instability if Iraq's southern regions followed Kurdistan's lead.

Posted by American Contractor at 5:44 PM | Permalink | TrackBacks (0)

The experts and professionals working on the New Iraq Foreign Investment Laws are just about finished and soon will be bringing the long awaited documents to the Iraqi Parliament.

With this information and along with the Iraq Stock Exchange electronic trading platform contract finalized, you just have to agree that it is all coming together. Soon very soon.

Posted by American Contractor at 3:43 PM | Permalink | TrackBacks (0)

The Iraq daily Al-basa’er has reported that the militia’s have improved their financial situation by Iran giving them some green backs. The report goes on to say that the lowest ranking members of the militia’s are riding around in cars, living in nice houses, and have fat bank accounts. There are livings in the nicest and richest section of the city. I bet their all eating good too. If this is the lifestyle of the lower ranking members of the militia, I wonder how the higher ranking members of the militia are living. Beach front property maybe.

Given all this information I think it’s going to be tough for a militia member lower ranking or not to give up his allegiance to an institution or his gang to do a three year hitch with the New Iraqi Army. It’s going to be a tough sell. I have always said an Iraqi with an Ak-47 and a new set of sneakers is a hard one to catch and he can do a lot of damage. Let’s hope the militia members do what’s right for their country and give up their AK-47’s. They can keep the sneakers.

Posted by American Contractor at 11:53 AM | Permalink | TrackBacks (0)

Thanks to a reader named J. I appreciate the info.

From: J.
add this to your post, Taha Ahmed Abdul Salam, Iraq Stock Exchange Market's chief operating officer, said Monday that the Iraqi stock market has joined the Arab bourses union.
Taha, in a statement, said the Iraqi bourse received a cable, on Sunday, from the union approving its accession into the federation This step contributed to a revival of the Iraqi market today, adding that the volume of the traded stocks reached about 400 million stocks, at a value of more than 800 million Iraqi dinars.

things that make you go hmmmm!!

Posted by American Contractor at 9:12 AM | Permalink | TrackBacks (0)

If you read this news article by James Glanz and Robert F. Worth of the Press Democrat you will be given a new insight on the operation of the large network of the smugglers and criminals in Iraq stealing and pilfering Iraqi oil. Iraq uses the oil revenue to help fund the reconstruction efforts and billions of dollars are removed from the Iraqi economy due to oil smuggling.

Up to 30% of the imported gasoline is stolen and then resold to the neighboring countries of Iraq at huge profits. If you want to make a lot of money in Iraq just get yourself an empty fuel tanker and you’re in business. You drive your empty tanker into Turkey and pick up a load of gasoline at full retail price and sell the gasoline on the black market at a higher price.

When the fuel truck is empty before you head back to Turkey to pick up another full tank of gasoline, you just pull up to a gas station and load up with the lower price Iraq subsidized gasoline and take the fuel into Turkey and sell it at a higher price. If the Iraq fuel station can only give you a half a tank then you would still gain a profit when you sell in one of the neighboring countries.

According to the article Iraq has spent anywhere from 4-5 Billion in 2005 to import gasoline from Iraq’s neighboring countries. Now you see why the IMF wants Iraq government to stop the subsidies on gasoline to the Iraqi people. I think I would rather spend 5 billion on reconstruction projects or Central bank and banking infrastructure then having it stolen by smugglers. It’s going to be difficult to remove the fuel subsidies all together especially to be inline with the IMF agreement at the end of 2006.

I believe all this ties into not having the cabinet posts of Interior, Defense, and National Security because remember what the New Finance minister Bayon Jabor, said after he was appointed to his new position.

"I shall work with all my passion and my commercial experience to preserve the money of Iraqis," the former interior minister told reporters when asked for his policy priorities.

"My priority is preserving Iraqi funds, as I preserved Iraqi lives when I was interior minister," he told Reuters. "I will also fight corruption in the administration of the Finance Ministry as I did at Interior. That will be a priority."

I hope the Iraqi funds he is speaking about is the common Iraqi that is trying to make a living and provide for his family and not the “oil Mafia.”

When you read the article the oil corruption is very much embedded in Iraqi society. Let’s hope the Iraq government can clean it up and soon. We can start by confirming the absent cabinet posts and work on cleaning house.

Posted by American Contractor at 10:08 PM | Permalink | TrackBacks (0)

The Director of the Iraq Stock Exchange has just announced an agreement with partners to provide support for electronic trading in the ISX. The company provided the support is The OMX Group

The OMX Group is also providing support in Dubai

I believe we are getting close to see the ISX transition to an electronic trading platform soon. Read the memo below.

Messrs. investors

M / resolution of the Board of Governors
Electronic systems in the securities market Iraq
Nhdikm best greetings ...

We are pleased to inform the Board of Governors adopted resolution firmly eighth meeting of the year 2006
19 / 5 / 2006 on the implementation of the draft regulations for electronic securities market of Iraq, which includes :
1-electronic trading system. Electronic trading
2-central depository. Depository System
3-clearing and financial settlements. Clearing and Settlement

Application of the regulations will be provided by the Company (OMX) The Swedish system is to be applied
Horizon System for the Trading System functions and HSBC System for Settlement and Depository functions.
These regulations are used to :

Bourses Cairo and Alexandria Stock Exchange Dubai, Abu Dubai Stock Exchange, the Stock Exchange Doha, Bahrain Stock Exchange and the Stock Exchange of Palestine. This is for the Arab States of the European system is applied in all countries of Northern Europe.

Approved by the Board of Governors firmly eighth year 2006, after extensive negotiations with the company director (OMX) Over on 18 / 5 and 19 / 5 / 2006 paragraphs of the Agreement on the Maintenance Contract for the continuation of the application and updating of regulations for a period of five years commencing from the date of application and operation of the regulations after the final test, with the exemption of this market cost for the first six months of the duration of maintenance.

To see if the Senelmkm later date began the process of training and application as implementation schedules that will be sustained after it is a process updates the initial and final paragraphs of the regulations and commensurate with the requirements of activity in the Iraqi market securities ... With appreciation.


Copy :
1 - Office of the Board of Governors.
2 - All sections of the market.
3 - Bulletin board.
4 - Iraq site market securities on the Internet.

Taha Ahmed Abdel-Salam
Executive Director

Posted by American Contractor at 7:41 PM | Permalink | Comments (1) | TrackBacks (0)

Some Govt workers in Iraq have a tough job at keeping an eye on anyone trying to rip off the U.S. taxpayers on contracts in Iraq. Read about this worker here.

Posted by American Contractor at 2:45 PM | Permalink | TrackBacks (0)

This is a snap shot of the Security and Economic conditions of Iraq as of 31 March 2006. Thanks to the U.S. Embassy/MNF-I. As of March they were only three provinces that were categorized as Stable conditions Dahuk, Erbil, Al-Sulaymaniyah. To be honest this doesn’t surprise me.

Northern Iraq is in the Serious Condition and as I have said only 3 are listed as Stable. The United States and the rest of the International community have a long way to go. Now you see why there looking and soon to be drilling for oil in the Dahuk area because it is a stable area. I wonder if the Canada company Western Sands as looked at the condition of where they are expected to start to exploring for oil in Iraq. I believe the area they were going would be listed as Critical Conditions. I hope they have a good security package.

Posted by American Contractor at 1:02 PM | Permalink | TrackBacks (0)

In an earlier post I had made the comment “Basrah Burning” you can read about another attack today in a market area in Basrah.

Posted by American Contractor at 8:39 AM | Permalink | TrackBacks (0)

I know my title above just doesn't sound right. How dare I say that Iraq has been reduced to a Sub-Saharan country. It's true at least that what the ambassador James Jeffrey stated when he addressed The Washington Institute of Special Policy Forum on 18 May 2006. Along with Maj. Gen. William McCoy.

They had some very good points in their speeches about Iraq. Ambassador Jeffrey had this to say such as; Iraq Oil production has been largely restored and production is over 2 million barrels a day, with exports at 1.6 mbpd,

Now granted this speech was given in the middle of May before anything occurred in the south. Now the city of Basrah is Burning and criminal gangs turned Oil entrepreneurs are learning the finer points of oil production, by using AK-47’s and a pair of sneakers.

Let’s hope that the exports in oil are still producing and Iraq has no loss of revenue. The Iraq Reconstruction Fund the 20.9 billion usd, well that money will be gone at the end of this fiscal year and I think that would be 1 October 2006. I could be wrong on this date however, the United States is not going to be funding this any more. At least that is what I am led to believe. So how is Iraq gong to finish or should I say continue with their reconstruction projects? I guess the Iraqi budget for 2006-2007 or just maybe the foreign investments will start by October 2006 just in time when the Iraq Reconstruction Fund money ends.

We will have to see I hear that soon a new Foreign Investment law is in the works and will be published in the near future. At least the Kurds in the north are working on a draft copy so I’ve heard.

You can read the rest of the finer points of Iraq in the ambassador speech here.

Posted by American Contractor at 11:11 PM | Permalink | TrackBacks (0)

Last month in May the previous Prime Minister Ibrahim Jaafari, said that when he started out as the PM he had usd 325 million and the amount went up to a whopping usd 14 billion.

I am sure the new PM Maliki really likes that he has plenty of us dollars (14 Billion) to work with in his new budget starting out in his newly PM duties. After his Interior and Defence cabinet posts are confirmed you can expect things will start to take shape in the new Iraq. Let's hope anyway.

Posted by American Contractor at 10:52 PM | Permalink | TrackBacks (0)

A possibility that these two posts might be confirmed on Sunday. Farouk al-Araji a former army officer for the position of Interior minister, a shiite.

General Abdel qader Mohammed Jassim, a former commander of Iraqi ground forces and a sunni, for defence minister.

I hope these positions are confirmed and the new complete Iraqi Government can proceed with governing Iraq and getting the country on a course of prosperity.

Posted by American Contractor at 7:40 PM | Permalink | TrackBacks (0)

Iraq is slowly but surely approaching the 21st century in the banking world. I remember travelling in Iraq and delivering cash to differant projects and most likely it is still done to this day. I think the north might be slightly ahead of the rest of the country but I could be wrong.

Just because the north has got it together with construction projects does not mean they got it all together as far as the banking tranactions. A lot of the iraqi's are very nervous about placing their currency inside a bank in Iraq. Back in the day Ahmed would place his money in a bank to be told by the person at the counter "what money" and their went the confidence in Iraqi banking. After an experience like that you can now see why Iraq is in the situation it finds itself. A lot of the Iraqi's are carrying around large amounts of cash. I know because I have seen it.

I am sure there are plenty of Iraqi's that deposit their money inside a private Iraqi Bank and I am sure most of them are investing inside the Iraq Stock Market (ISX).

Maybe in my next post I will talk about Capital flight.

Read about Northern Iraqi banking operations here.

Posted by American Contractor at 4:47 PM | Permalink | TrackBacks (0)

Check out this blog that writes about scams and talking about the Iraqi Dinar. Blogcritics blog make a reference about the Iraq Dinar ad on the folks at the Power Line blog.

http://blogcritics.org/archives/2006/05/16/124639.php

The Power line blog had a response and you can read it here.

http://powerlineblog.com/archives/014107.php

Posted by American Contractor at 2:33 PM | Permalink | TrackBacks (0)

Recently in Iraq the new Prime Minister Maliki has appointed Bayan Jabor, to head up the Ministry of Finance. Jabor was previously head of Iraq's Ministry of Interior and not a favorite of the United States. I hope that he will be able to do what he has been saying and stop the corruption in the Iraq government. I believe he has his work cut out for him.

"I shall work with all my passion and my commercial experience to preserve the money of Iraqis," the former interior minister told reporters when asked for his policy priorities.

"My priority is preserving Iraqi funds, as I preserved Iraqi lives when I was interior minister," he told Reuters. "I will also fight corruption in the administration of the Finance Ministry as I did at Interior. That will be a priority."

http://www.alertnet.org/thenews/newsdesk/MAC040592.htm

Posted by American Contractor at 1:34 PM | Permalink | Comments (2) | TrackBacks (0)