Facts:
Rumors:
Of Interest (rumors that I find of particular interest either because of who said it or because of how I think it relates to what is happening right now):
The Rest (doesn’t mean these are not happening):
Where Are We At?
1. In government formation news today, it was reported that Parliament postponed its meeting today to Wednesday. They said the reason for postponing the meeting is because of the opposition to the vote on the issue of the VPs of the Republic. In other news, it appears that Maliki and Allawi have finally met. It was reported that the meeting was positive and that they discussed all the topics agreed upon in the Barzani agreement. Another article reported on their meeting and reported that Maliki confirmed the need to implement and abide by the agreement, and he noted that they need to apply the agreements through a national partnership to elect chairs, different positions, and by making decisions. Both parties were reported to agree on the need to complete the agreements as soon as possible. Finally, in a third article about the meeting between Allawi and Maliki, it was said that they discussed the formation of the ministries as well as the Council of the strategic policies. It also said that Allawi said only 6 of the 9 agreements have been complied with. Lastly, a mini-committee will be submitting a draf law of the National Council to Parliament for a vote. In a related article, it was stated that the vote in Parliament on the draft law will take place some time this week.
2. The CBI auciton results today remain high
3. In budget news, it was reported that all the issues have been resolved and that the budget should be approved soon. No date was given.
4. The Minister of Trade met with the US Department Treasury Secretary as well as other groupls to discuss a strategic partnership between the US and Iraq and a partnership that will build a vibrant Iraq econmy. They also discussed implementing modern economic policies to integrate Iraq’s economy with the international economy and markets. Finally, the discussed the requirements that should be in place for Iraq to join the WTO.
5. On tariff’s, Iraq has postponed the implementation of the tariffs indefinitely
6. In Kuwaiti news, Melkert met with a permanent representative of Iraq on 2/10. They discussed the upcomming meeting with Maliki and Kuwait, and Melkert expressed optimism that Maliki’s visit to Kuwait would result in important decisions and solutions to some outstanding issues, including waterways, land borders, and oil investments in common. He further stated that he felt both sides would reach a satisfactory agreement.
What’s left?
1. Reading of the budget for the third time
2. Closure on Security positions (3 in total) and the remaining unfilled positions (6)
3. Formal announcement of government
4. Agreement on outstanding Kuwait issues
5. Lifting of remaining Chapter 7 sanctions (Kuwait related)
6. RV/RI
7. HCL
Important Dates
1. February (on/after Tuesday, but sometime this week) – Parliament votes on the National Council of Supreme policies
2. February 15 – 3rd reading of the budget
3. February 16-17 – GCC Meeting
4. February 28 – Constitutional deadline to form government
5. February 25 -- Large demonstration online
6. March 6 – Tariff law goes into effect : Postponed indefinitely
7. March 29-30 – Arab Summit
8. May 1 – CBI must be ready to transfer DFI monies
9. May 22 – Presidential order 13303 expires
10. June 30 – DFI expires
What’s It All Mean?
1. The big news of today has to be the news of the US Department of Treasury meeting with Iraq. One of the primary outcomes of this working group will be trade between the US and Iraq. Further, they are actually discussing the requirements for Iraq to enter the WTO! Based on these two things, what can be infered is that they simply must increase the value of their currency, or RV/RI. Why? First of all, we know that the WTO stated in an article that Iraq can become a full member of the WTO, but they stated Iraq must first close the gap between their currency and the USD. Second, they discussed trade between the US and Iraq, among other things. Trade between the US and Iraq? Will Iraq want to trade with the US, or any other country for that matter, using a currency of so little value? Imagine Iraq never increasing the value of their dinar and spending trillions up on trillions to trade with other countries. They would get so little, but they would be spending a huge amount. That scenario is not sustainable from so many different economic perspectives. They have to increase the value of their currency if they are serious about trading with other countries. Today’s article noted that Iraq said they are serious about trade. There are many other reasons why their meetings all point to an RV, but I think those two reasons are enough.
2. Although I did not post entries about demonstrations, they have not stopped. In fact, the big demonstration on the 25th of this month seems to be scarrying the GOI more and more everyday. This is good because we are seeing the GOI take measures to appease the people of Iraq. They see the protests in Iraq, they see what’s happening around them, and they do not like their prospects. The tariffs were likely postoponed primarily because of the protests. The pace of the government formation is definitely being impacted by the protests. This is not just a perception as we see members of Parliament and politician state that they must form the government now. Although there was a hiccup today regarding the postponment of today’s Parliament meeting, it was stated they are working outside of Parliament to come to agreement on the VP issue, which caused the cancelation of today’s Parliament meeting. More importantly, we’re seeing news of Maliki and Allawi meeting, and there are reports that the meetings are positive! Last but not least, we continue to see progress with regard to Iraq addressing the outstanding issues with Kuwait. When you add it all up, things look good in terms of all the pressures being placed on them to complete the government and in terms of the progress Iraq is making on the things we think they need to do to RV. Let’s hope that Shabibi sticks to what he said and RVs/Ris “directly after the government is formed”.
3. On the rumor front, back in January, I remember Delta saying he thought the RI/RV would surface in the middle of this month. Well, here we are! Given the GCC meeting, the mounting pressures from Iraqi protestors and the situation in the ME, Delta’s prediction is looking good at least from the perspective of the GOI getting completed by the middle of this month. Given that Joe P didn’t divulge what the new bank news is yet, I can’t really comment on it. In regards to Cage’s rumor, if it is true, I would think it only adds additional pressure on the GOI to complete what they should have done almost a year ago.
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