Highlights/Thoughts
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1. Iraq plans to increase customs duties in March, which will lead to increased prices of imported materials and reduce the purchasing power of Iraqis
2. This comes at a time when Arab countries are trying to control prices to avoid the wrath of their people
3. The GOI says the goal is to protect local products and an economy that has suffered so much because of the embargo and the violence following the invasion
4. After removal of the customs duties by the coalition countries, there was a large influx of goods
5. Many local industries disappeared because they could not compete with cheap products that filled the market after the lifting of the customs duties
6. The new tariff will be as high as 80% for some goods, including fruit and vegetables, home appliances, and other items
7. Inflation will go up while Iraq faces the problem of rising world prices of raw materials
8. The law is scheduled to go into effect on March 6th. The law has been published for 3 months in the Gazette
9. The law will protect local agriculture
10. An economist said it is clear the GOI wants to reduce dependence on oil through increased support for local production
11. Oil accounts 65% of GDP, but only represents 1% of the sector
12. Agriculture accounts for 3% of GDP. It was 8% in 1975
13. Inflation reached 3.3% during 2010, but it is up to 5.5% without including the new tariffs
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