Iraq seeks $100bn to reconstruct transport, agriculture and oil sectors

Local residents remove bodies from the rubble in the Old City of Mosul. Cities across Iraq have been destroyed by years of war with as much as $100 billion needed for the reconstruction effort. (Reuters)
Updated 09 February 2018
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Iraq seeks $100bn to reconstruct transport, agriculture and oil sectors

BAGHDAD: Iraq is seeksing around $100 billion in foreign investment in transport, energy and agriculture as part of a plan to rebuild parts of the country and revive the economy after a three-year war on Daesh.
The government’s National Investment Commission published a list of 157 projects it will seek investment for at an International Conference for Reconstruction of Iraq to be hosted by Kuwait Feb. 12 to 14.
Some of these projects are about rebuilding destroyed facilities like Mosul’s airport, while others are new investments to strengthen and diversify the economy away from oil, said an economic adviser to Prime Minister Haider Al-Abadi.
“All together, they cost about $100 billion,” the adviser, Mudhar Saleh, told Reuters. Sixteen projects carry a price tag of $500 million or more, according to the list.
Rebuilding homes, hospitals, schools, roads, businesses and telecommunications is key to providing jobs to the young, to end the displacement of hundreds of thousands of people and put an end to several decades of political and sectarian violence.
Iraq declared victory over Daesh in December, having taken back all the territory captured by the militants in 2014 and 2015. A US-led coalition supported the Iraqi forces, especially in the battle to dislodge them from Mosul, their de facto capital in northern Iraq, in July.
The US government will not contribute funds at the conference but will instead encourage investment from the private sector and Gulf Arab allies, US and Western officials said.
A US official in Baghdad said 100 US companies were participating in the conference.
Three rail projects top the list: A 500-kilometer (311 mile) line from Baghdad to Basra in the south estimated to cost $13.7 billion, a line from Baghdad to Mosul in the north estimated at $8.65 billion and an $8 billion metro for the capital.
Iraq reopened to foreign investment in 2003 after the US-led invasion that toppled Saddam Hussein, but the vast majority of the billions invested went to increasing its oil and gas production.
It has become the second-largest crude exporter of OPEC, after Saudi Arabia, with a daily output of 4.4 million barrels.
At the conference, Iraq will seek investment in the downstream oil industry including in storage tanks, refineries and petrochemical plants to process its crude into plastics and fertilizers.
Saleh said investments in the oil industry and agriculture will probably be easier to attract than other sectors given the country’s vast crude reserves, available land and water wealth.
Total land offered for investments to grow “strategic crops” is nearly 1,500 square kilometers (580 square miles). Iraq, one of the world’s largest wheat importers, aims to achieve self-sufficiency and possibly become a net exporter of the grain.
“We feel there will be support for Iraq, from the Americans, the Europeans, the Arab countries, the United Nations, and humanitarian organizations,” said Saleh.


Iran rial plunges to new lows as US sanctions loom

Updated 24 June 2018
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Iran rial plunges to new lows as US sanctions loom

  • The dollar was being offered for as much as 87,000 rials, compared to around 75,500 on Thursday
  • The currency has been sliding for months because of a weak economy

DUBAI: The Iranian rial plunged to a record low against the US dollar on the unofficial market on Sunday, continuing its slide amid fears of returning US sanctions after President Donald Trump in May withdrew from a deal on Tehran’s nuclear program.
The dollar was being offered for as much as 87,000 rials, compared to around 75,500 on Thursday, the last trading day before Iran’s weekend, according to foreign exchange website Bonbast.com, which tracks the unofficial market.
Iran’s semi-official news agency ISNA said the dollar had climbed to 87,000 rials on Sunday from about 74,000 before the weekend on the black market, and several Iranian websites carried similar reports.
The currency has been sliding for months because of a weak economy, financial difficulties at local banks and heavy demand for dollars among Iranians who fear the pullout by Washington from the nuclear deal and renewed US sanctions against Tehran could shrink the country’s exports of oil and other goods.
The fall of the national currency has provoked a public outcry over the quick rise of prices of imported consumer goods.
Merchants at the mobile phone shopping centers Aladdin and Charsou in central Tehran protested against the rapid depreciation of the rial by shutting down their shops on Sunday, the semi-official news agency Fars reported.
A video posted on social media showed protesters marching and chanting “strike, strike!” The footage could not be authenticated independently by Reuters.
Hours later, Information and Communications Technology Minister Mohammad Javad Azari-Jahromi said on Twitter that he visited the protesting merchants.
“I will try to help provide hard currency for (mobile) equipment (imports),” Azari-Jahromi wrote, adding: “The merchants’ activity has now gone back to normal.”
Some of the US sanctions against Iran take effect after a 90-day “wind-down” period ending on Aug. 6, and the rest, most notably on the petroleum sector, after a 180-day “wind-down” period ending on Nov. 4.
The rial has weakened from around 65,000 rials just before Trump’s announcement of the US withdrawal in early May, and from 42,890 at the end of last year — a freefall that threatens to boost inflation, hurt living standards and reduce the ability of Iranians to travel abroad.
In an effort to halt the slide, Iranian authorities announced in April they were unifying the dollar’s official and black market exchange rates at a single level of 42,000, and banning any trade at other rates under the threat of arrest.
But this step has failed to stamp out the unofficial market because authorities have been supplying much less hard currency through official channels than consumers are demanding. Free market trade simply went underground, dealers said.