<b>Highlights/Thoughts</b>
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1. Kap talked about the tariff law back in December, and then we saw food prices jump in the first week of January. However, the jump was just a reaction and not the actual implementation
2. The law taking effect (March 6th) is good and bad
3. Good = requirement for the WTO; needed for them to become a full member and we're seeing them implement these requirements
4. Bad = tariff will reach up to 80% for some goods (fruit, vegetables, home appliances and others)
5. This will make Iraq face the problem of rising world prices of raw materials
6. Kap doesn't think there is a chance of delaying this
7. Kap referenced someone who said he was 100% sure the law would take effect
8. Besides the issues with the tariff, there are protests
9. Read Kap's thoughts #12, which explains why these next few weeks are so critical in Iraq
10. Kap is concerned the economists are starting to challenge the GOI
11. They are writing about promises and procedures that were made that have yet to be implemented
12. He cited an article discussing a study that said industrial projects produced in Iraq dropped by 66% for the years before 2003, and it dropped because of the flow of goods
13. The article said the decline in the factories caused a loss of more than 13 thousand jobs
14. It also stated there is a complex housing crisis and said the need for more than 2 million housing unites, which will require foreign companies to invest. But, the investment Law No. 13 of 2006 needs to be activated and the state institutions need to provide the appropriate climate for investment in a timely manner
15. The article then states the commercial sector is suffering from a complex problem of the migration of capital out of the country to start the stage of new investments
16. The article states Iraq desperately needs foreign investment money
17. Kap thinks that article is good stuff
18. He says that these articles are now challenging the GOI and this concerns him
19. He says it is critical for the GOI to implement the RV and move forward or see additional protests and potential violence
20. Kap says it would be a mistake for them to host the summit without a tradeable currency--especially since this is an "economic summit", and Iraq expects private investment to triple to $30 bil
21. There are economists with a positive outlook stating that Iraq is activating all economic sectors
22. All of this ties to the WTO, is significant for Iraq joining soon, and ties to the RV
23. Kap quotes an economist, who is saying that there are pros and cons for Iraq joining the WTO
24. The economist says the effects of the accession to the WTO are varied and depend on the nature of economic activities and the the stage of economic development. He said that developing countries are negatively impacted , especially when importing food more than other items. This caused the economist to question what Iraq would get from the accession
25. According to the economists, the benefits of joining are more long-term benefits
26. Kap says now we know Iraq is serious and he shares a couple of quotes
27. Kap says what we are seeing is the simultaneous implementation of the procedures and the completion of the GOI
28. Kap feels these two will meet and could be at the end of this month, and Shabibi will RV
29. Kap says it could take longer
30. Kap is waiting for these events to take place
doesn't it make sense for the GOI to increase tariff when all Iraqi's purchasing power increases when the reval happens? I see this as further proof that the GOI is about to reval.
ReplyDeleteonce the Iraqis have all of that buying power, there will be a huge inflow of imported goods into the country since there is currently no manufacturing sector in Iraq.