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Oil prices at $60 gain currency
Financial Times
Published: February 07, 2008, 00:15
Hidden amid grotty fourth-quarter figures from BP on Tuesday was the disclosure that it now believes oil prices will stay stronger for longer.
BP will test projects' net present value on the basis of a Brent crude price of $60 per barrel for at least five years, up from $40. For chief executive Tony Hayward this marks a shift from his predecessor, Lord Browne, who expressed greater confidence that the oil price would revert rapidly to its mean.
That $60 figure is gaining currency across the industry. Suncor Energy used it in approving a huge C$21 billion investment to upgrade its Canadian oil sands operation.
Anything lower would have threatened a modest 15 per cent hurdle for return on capital - only fractionally above the average return on exploration for conventional oils in the past three years, according to Wood Mackenzie.
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The uplifts represent the industry catching up with reality. Natural conservatism - many executives will remember the 1970s price spikes and the 1980s crash - means planning assumptions have tended to lag spot prices by a significant margin.
However, a survey of almost 250 oil companies by Citigroup in December found that the gap between the oil price used for planning compared with the market prices implied by futures had increased to more than $20 a barrel - the widest on record.
It is easy to understand the concerns of oil executives - after all, crude prices are volatile and the industry has a history of capital indiscipline. Still, raising price assumptions does look sensible. For one thing, the oil companies are struggling to replace their reserves in an environment of aggressive resource nationalism and rampant cost inflation.
And there is still a decent buffer between new planning assumptions and a Brent spot price of $90. Admittedly an easing of tensions could cut the estimated $15 to $30 geopolitical risk premium inherent in the oil price.
But the chances of problems from Latin America to the Middle East evaporating any time soon look as remote as ever.
Carmakers in China
Faced with sluggish markets across much of the globe, carmakers are seeking solace in China. Take Japan's Toyota Motors, which yesterday reported a 7.5 per cent year-on-year rise in third quarter net income on the back of robust growth in China and other emerging markets.
The world's second-biggest car market grew 22 per cent last year, and is forecast to expand up to 20 per cent this year. Much of the received wisdom about the market, however, is starting to look rather dated.
Just a few years ago, carmakers' biggest fear was over-capacity as operators ploughed billions of dollars into plants - and were subsequently obliged to mark down prices on a regular basis.
Today, they are fretting about insufficient capacity. So when a domestic acquisition in effect dissolved a joint venture between Nanjing Auto and Italy's Fiat, Nanjing's new owner was quick to utilise the JV's idle plant.
Multinationals are tentatively eyeing opportunities in cheaper parts of the country, where the government is offering tax incentives to woo investment inland. Those without money to spend are mulling over more flexible options.
Carmakers are rethinking strategies on models too. The smallest cars command a slim - and shrinking - seven per cent market share. China's preference for mid-sized cars makes it more akin to Europe than emerging markets.
Equally, hybrids have been less popular than expected, perhaps because they are relatively expensive but only shave about 10-15 per cent off fuel bills.
The prospects on pricing look a little cheerier. Prices are expected to nudge lower this year but the narrowing gap between similar models in China should create a floor of sorts.
Against that, rising input costs suggest margins will be squeezed further. Of course, not all carmakers are created equal. Some barely scratch a living while others, notably Japan's Honda, cream off operating margins well above the average. Some things, at least, are reassuringly consistent.
A survey found that the gap between the oil price used for planning compared with the market prices implied by futures had increased to more than $20 a barrel.
Saudi Aramco will sell crude cheaper to US
Bloomberg
Published: February 07, 2008, 00:15
Riyadh: Saudi Aramco, the world's largest state oil company, will cut official selling prices for crude shipments to the US in March as refiners lower operating rates. The producer raised prices to Europe.
The discount of Arab Light, the most common variety exported by Saudi Arabia, to Aramco's benchmark price was widened to minus $5.40 a barrel from $4.15 a barrel in February, the company said.
Discounts for Extra Light, Arab Medium and Arab Heavy were also increased. Aramco raised prices of all grades it exports to European refiners.
For US customers, prices for all grades were cut by between 60 cents and $1.50 a barrel. Arab Extra Light's discount widened to minus $2.60 a barrel from minus $1.10 a barrel, Arab Medium to minus $8.35 from $7.45 and Arab Heavy grade to minus $11.35 from minus $10.75, Aramco said.
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Refiners in Europe and the Mediterranean would pay more for crude oil shipments in March.
For its Northwest European customers, Aramco narrowed Arab Light's discount to the benchmark by 80 cents to minus $1.75, Arab Medium was narrowed to minus $4.20 and Arab Heavy increased to minus $6.35, while Extra Light was raised by 80 cents to a premium of $2.
I think it's a promising development...
Baghdad--CBI announces 3 zero lop
That's for you doubters.....he he he
BAGHDAD – A compromise on the main sticking point holding up Iraq's 2008 budget appears possible but it and several other key reconciliation laws face potentially long delays, lawmakers and ministers said on Wednesday.
Iraqi lawmakers are set to vote on Thursday on the budget as well as laws governing the distribution of power between Baghdad and Iraq's 18 provinces and another that would free thousands of mainly Sunni Arab detainees from Iraqi jails.
Advertisement Lawmakers have so far refused to ratify the $48 billion budget because of arguments over allocations between the provinces, particularly the largely autonomous northern region of Kurdistan.
The current draft of the law has allocated 17 percent of budget funds to Kurdistan, based on population estimates.
Shi'ite and Sunni Arab lawmakers say Kurdistan should receive about 13 percent because that is a more accurate reflection of the Kurdish population in the absence of any recent census.
Planning Minister Ali Baban, a Kurdish independent, said he would deliver on Thursday a report from his department with a compromise figure that showed Kurds made up about 14.5 percent of Iraq's estimated population of 27.5 million.
He said the figure was based on statistics available to his department, including the most recent national census in 1987.
Despite that estimate, Baban said he expected the budget to pass with an allocation for Kurdistan of 17 percent.
'I expect the budget for the region will be 17 percent because normally we give more than the percentage of the population to secure provinces to encourage these provinces to implements projects,' Baban told Reuters.
JUMPSTART ECONOMY
Iraqi officials have said that failure to pass the budget would hold up vital spending at a time when Washington is urging the government to jumpstart the economy.
U.S. officials have praised the 2008 budget as well as this month's passage of a law allowing former members of Saddam Hussein's Baath party to rejoin the government. Washington introduced 'de-Baathification' under U.S. administrators in Iraq after the 2003 invasion but acknowledged it went too far.
A U.S. embassy official said that matters of 'political will' were holding up the budget. He said the fact that lawmakers would not be able to take their winter recess before the budget was passed might hasten the process.
'The parliamentarians are desperate to go on holidays ... that's adding to the dynamic and increasing their willingness to compromise,' the embassy official told Reuters.
Lawmakers on both sides appeared unwilling to give ground.
'We consider the demands to lower our share of the budget below 17 percent are a political conspiracy against the Kurds and our rights,' Kurdish lawmaker Mahama Khalil told Reuters.
Usama al-Nujaifi of the secular Shi'ite Iraqi National List said 14.5 percent was the most likely point for compromise.
'If the Kurds insist on 17 percent then many blocs will reject the budget in its current form,' he said.
'It will be very difficult to pass the budget on Thursday.'
Freeing prisoners has been one of the preconditions for the Accordance Front, the main Sunni Arab bloc, to return to cabinet after it quit last August over a number of differences with Prime Minister Nuri al-Maliki's Shi'ite-led government.
The amnesty law to be voted on would exclude those sentenced to death or convicted of killings, terrorism, kidnapping, drugs offences or corruption and would cover more than 23,000 prisoners held by Iraq but not detainees in U.S. custody.
(Additional reporting by Waleed Ibrahim and Paul Tait in Baghdad; Writing by Paul Tait; Editing by Elizabeth
Gulf economies are becoming asset-driven
By Babu Das Augustine, Banking Editor
Published: February 05, 2008, 23:41
Dubai: The strong economic growth experienced by the Gulf region during the past five years combined with the prudent investment strategies of the governments are fast transforming Gulf economies to asset-driven rather than oil-driven, said Dr. Nasser H. Saidi, chief economist at the Dubai International Financial Centre (DIFC).
The Gulf countries' international reserves have quadrupled from $90.5 billion in 2003 to $365 billion in 2007 and are forecast to touch $455 billion by 2008, according to Saidi.
"The future of these economies lies in managing their assets rather than producing more oil and gas. Efforts will be focused on how to generate high returns on the existing wealth," he said.
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The cumulative current account surpluses for the GCC countries are expected to grow to $954.6 billion by 2008. Currently, Gulf countries are recycling surpluses back into the region, leading to greater diversification of local econ-omies and regional econ-omic integration.
The GCC is forecast to grow close to six per cent in 2008. Allaying fears of a potential US recession impacting the regional econ-omies, Saidi said: "Our region is proving resilient to uncertainty and volatility in the US and European financial markets.
"The GCC countries are projected to grow at 5.8 to six per cent, with the UAE expected to grow at 7.8 to eight per cent".
The current period of the above-trend growth is partly a reflection of the persisting strength in oil and gas prices and large capital inflows and pegged exchange rates.
Gulf states 'will revise peg this year'
Bloomberg
Published: February 05, 2008, 23:41
Dubai: Gulf states including Saudi Arabia and the United Arab Emirates will be forced to revalue their currency pegs this year following the dollar's declines and the Federal Reserve's interest-rate cuts, said Bear Stearns.
Five Gulf nations lowered interest rates last week in step with the US to keep their links to the dollar even as inflation accelerated. When Saudi Arabia left rates unchanged after the Fed's September 18 reduction, the riyal rose to a 20-year high.
"It's going to be very difficult for central banks in the region to have adequate control of monetary policy, and hence inflation, when the Fed is slashing rates left, right and centre and the dollar is slumping,'' Steven Barrow, chief currency strategist in London at Bears Stearns, wrote in a client note.
Inflation
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Inflation accelerated to records in all six Gulf Cooperation Council, or GCC, states last year as the oil-rich nations sought to preserve their dollar links. The regional average was 6.3 per cent in 2007, compared with 0.3 per cent in 2001, according to Merrill Lynch & Co.
The Fed cut its target rate for overnight bank lending by 1.25 percentage points in January to prevent the housing slump from pushing the world's biggest economy into a recession.
The US Dollar Index traded on ICE Futures in New York, which tracks the currency against six major counterparts, dropped 0.7 per cent last week to 75.45. It was at 74.48 on November 23, the weakest level since the gauge started in 1973.
"The only way out, unless the Fed reverses course soon or the dollar soars, is to adjust the currency regime with either a free float, revaluation or the adoption of a currency basket,'' Barrow wrote.
Iraqi economy data in World Bank bulletin
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Baghdad, 05 February 2008 (Voices of Iraq)
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For the first time in 30 years Iraqi economy statistics and data will be published in a periodic bulletin released by the World Bank, an Iraqi central bank statement said on Tuesday.
Statistics on Iraqi economy will be published in a periodic bulletin issued by the International Monetary Fund (IMF) as of early March 2008, according to the statement that was received by Aswat al-Iraq, Voices of Iraq, (VOI).
"For the first time since 1977 Iraq has reached an advanced level of progress with regards to the proliferation of macroeconomics information, after it had blocked the international community's access to useful data for over 30 years," read the statement.
"The publication of these data opens the door to a new era of integration into the international community and ranks Iraq high on international development assessment and transparency…," it added.
Leadership in the coalition: the Emergency Law gives Maliki authority to dissolve the Council Anbar province
Baghdad - Iraq votes
A leading figure in the United Iraqi Alliance Sami military, Wednesday, the Emergency Law granted to the Prime Minister gives it the power to dissolve the province of Anbar, noting that new reality witnessed by maintaining imposed on al-Maliki must act to preserve a way to avoid "more political tension."
He said the military, the Independent News Agency (Voices of Iraq) to the right of the Prime Minister "dissolution of the province of Anbar, according to the emergency law." Noting that "there is a new reality has witnessed during the last period of Anbar, which constitute the awakening and rescue boards in Anbar, which took it upon themselves to hunt Al Qaeda, and these elements Council rejects this because it believes that the members of the provincial council does not represent."
The council Anbar tribal elders and awakening them Tnziman who will join leaders from most tribes province of Anbar, west of Iraq, and the form before the end of the year (2006) aimed at fighting organization (al-Qaeda), which had been strongly active in the province, in cooperation with Iraqi government forces.
The Alhais Hamid, a tribal leaders who fought for Al Qaeda pct in September 2006, has launched a sharp attack on the Islamic Party and wondered "Is it conceivable that the number of seats the Islamic Party's local council of Anbar governorate (36) seats out of seats (41)" .
The Iraqi Islamic Party is one of organizations (Sunni) for the three main constituent (Accord Front), which is the third parliamentary bloc in the House of Representatives current Iraqi, and the Islamic Party 22 seats from 35 seats to acquire the compatibility of the total members of Parliament and the (275) member.
He added the military, that the members of the provincial council "has been appointed by the American forces, have not been elected." He asked the Prime Minister to "act in a way that preserves the unity of the sons of Anbar, and maintain spare emerging from years of bloody conflict, more conflicts."
The military on the "need to reconsider the members of the provincial council and the selection of new personalities, and the need to be done this in coordination with the Presidency of the Republic and Parliament."
Sami military belongs to the United Iraqi Alliance (Shiite bloc of advocacy and Islamic Council and other organizations) of the 83 seats.
The head of the rescue Anbar Hamid Alhais threatened, Wednesday, lifting arms in the Iraqi Islamic Party, which is headed by Vice President Tariq Hashimi, because of what he viewed as the party control of government posts in the province, and his involvement with "the introduction of Al Qaeda in the province of the Sunni majority."
He explained that Alhais demands include abolition of the Office of the High Commission for Elections in Ramadi, the dissolution of the provincial council, the fact that the party controlling it.
For his part, refused deputy Accord Front and the Muslim leadership in the party Alkervolli Omar Abdel Sattar, responding to statements Alhais, told (Voices of Iraq) it is not I am not responding "to such statements outside the law" stating that there contexts parliamentary, constitutional and legal been Election of the provincial council, the Office of UNHCR, and objections must be constitutionally and legally. Dd (x) - m t
agree 10000000000000000 % too much already
lmao...thx man
Mahdi Al Hafiz criticizing the Iraqi budget figures
Mahdi Al Hafiz criticizing the Iraqi budget figures
Translated by IRAQdirectory.com - [1/31/2008]
Member of the parliament and former Iraqi planning minister, Mahdi Al-Hafiz, considered the omission of anything about foreign grants and aids in the new Iraqi budget "a significant gap."
Ministry of Finance was asked to submit a report on these aids, ways of exploiting them and how successful integrating them in projects on the local economy. He explained that the figures for the investment program projects, which were not attached to the budget of 2008, appeared to be "dumb" although they are $13 billion out of the $48 billion earmarked for the budget.
Al-Hafiz pointed out that the final accounts for the last four years were not submitted within the draft budget of the government, considering that a "serious issue" and that the Financial Control Office reserved the accounts of 2004 and placed at them at the disposal of the parliament and avoid the responsibility of approving them."
He thought it unlikely to acquittal the government and ministries unless the public is informed of the final accounts of the budget which did not contain any reference to fulfilling the obligations of the State about the remainder of the debts, both for the third and final part of reducing the debt of "Paris Club" or the debts owed to other countries (the Gulf states in particular). This gives the budget an incomplete picture of the foreign commitments through 2008, in addition to not solving the Kuwait war compensation with the United Nations to reduce or cancel them or even resort to international arbitration in the future.
He explained that the allocation of more than $ 3.3 billion to provinces for investment purposes and give the validity of their approval to governors, is a matter of concern for several reasons, mainly the lack of identification of the proposed projects and the absence of control and inspection of the federal government, in addition to the mistake of reducing allocations for the ration card which is of great importance for a large segment of society for this year.
Al-Hafiz said that the monetary policy of the State have caused great harm to the private sector because of reducing banking facilities and raise the level of interest rates to %20, which reflects the contradiction between the fiscal policy aimed at expansion and investment, and the one aimed at contraction.
BP positions itself for share of Iraqi oil
BP positions itself for share of Iraqi oil
Scenta - [2/5/2008]
BP has been holding meetings with Iraqi oil officials as it speeds up plans to re-enter one of the biggest but politically most controversial oil provinces in the world, five years after the toppling of Saddam Hussein by the British and US military.
The move comes as BP is drawing fire for abandoning any pursuit of green credentials. Environmental groups accuse the new chief executive, Tony Hayward, of "recarbonising" a once enlightened oil group.
BP said it was "possible" some of its executives might meet the Iraqi oil minister, Hussain al-Shahristani, today at a Royal Institute of International Affairs conference in London, sponsored by BP, Shell and other western oil majors.
A spokesman for BP, which will report annual profits of about $18bn, confirmed managers met Iraqi oil officials last week in Jordan and talked about providing technical assistance.
Iraq has more than 115bn barrels of recoverable reserves, an attraction for oil groups at a time when easily recoverable reserves are becoming more difficult to secure.
BP was last night playing down any likelihood of an imminent move into Iraq. "It is a country of interest to us but we are waiting for political and security stability to return before we will take anything further," a spokesman said.
The group has already undertaken technical studies on the Rumeila oilfield for the new government of Iraq. It is gearing up for further involvement following the drafting of a new oil law in Iraq. The chief executive of Shell, Jeroen van der Veer, also admitted last week that his company was looking closely at re-entering Iraq.
When British and American forces invaded five years ago, Tony Blair and George Bush denied they were waging war to secure oil supplies.
The appearance of Shahristani with British energy minister Malcolm Wicks today will be met with campaigners from the charity War on Want and other groups that have formed a coalition called Hands Off Iraqi Oil. They claim the country will lose "billions of pounds in oil income" under the proposed new law which they say the British and US governments are pressing Baghdad to sign.
"It is a scandal that BP and Shell intend to raid Iraqis' oil wealth for themselves. Not content with record profits, they would deny millions of people the money needed to rebuild their shattered land," said Ruth Tanner, senior campaigns officer at War on Want.
Meanwhile the Platform campaign group accused Hayward of starting BP on a dangerous programme of "recarbonisation" since he took over last April from Lord Browne, who had vowed to take the company "beyond petroleum".
James Marriott, of Platform, said: "Moving into the tar sands of Canada and dropping a carbon capture and storage plan for Peterhead are part of a recarbonisation of BP. It might help the share price in the short term but longer-term Hayward is exposing the company to the dangers of a rising carbon price and falling oil price."
Thank you....This used to be positive Bob..tisk tisk
Posted by: B o b
In reply to: strongtower who wrote msg# 6297 Date:5/1/2007 11:27:51 AM
Post #of 7690
That no doubt for me clearly means reval and is from their own statements posted in the news. I'm packed and ready. Packin more than me.
Marshall Plan Was 10-1 Conversion After The 1st 60 At 1-1
posted in another room----------------------
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I HAVE BEEN DOING LOTS OF RESEARCH AND HAVE COME ACROSS THIS:-
implications of the arguments which were advanced for and against a Currency Reform
during the 1940s.
2. The Currency Reform: Terms and Conditions
The German Currency Reform involved both the substitution of one currency for another, and
the sterilisation of monetary assets. The process began on Friday 18.June 1948 with the
promulgation by the three western Military Governments of the first two laws, to come into
force on Sunday 20.June 1948. Article I of Law No. 61, the “First Law for Monetary Reform
(Currency Law)”, established the Deutsche Mark as the legal currency from Monday 21.June,
with Allied Military Marks of 1 and ½ Mark denominations, and Rentenbank notes of 1
Mark, being recognised until 31.August at one-tenth of their face value – resolving the
problem that no small coin for the new currency yet existed.
6 Where existing laws and
ordinances employed the Reichsmark, Rentenmark or Goldmark as a unit of account this
should in general be henceforth read in DM (Art. II). Monetary obligations arising from
application of these laws and ordinances were therefore to be written on 1:1 from the old to
the new currency. A deadline of midnight on 26.June (ie. the Saturday of the week following
the Reform) was set for all RM obligations (Art. IV). Article V provided for wages and
salaries due later than the end of June, and this concluded Part One of the Law, subtitled
“Conversion of Currency”. Note that it includes two conversion rates, 1:1 under Article II
and 10:1 under Article I.
Part Two of the Law dealt with the allocation of new DM to individuals above and beyond
the conversion of their pending wages and salaries. Here commentary is often rather blurry,
and so it is worth quoting Article VI in its entirety:
Every inhabitant of the specified area shall receive in cash Deutsche Marks, in
exchange for old currency notes as defined in Article IX paragraph 1(i)7 of the
same nominal amount to a maximum of 60 Deutsche Marks (quota per capita),
of which not more than 40 Deutsche Marks shall be paid immediately and the
remainder within two months. Where the person entitled can claim amounts
in Deutsche Marks as a result of the subsequent conversion of old currency as
defined hereinafter (Altgeld), the quota per capita shall be charged against the
amount thus due.
The quota was to be issued to ration card holders, who in turn were required to surrender 60
RM in order to receive 40 DM immediately, and a further 20 DM at a later date. The 60 DM
was an exchange for a nominal equivalent amount of cash denominated in the old currency; it
6
Military Government Gazette No. 25 Law no. 61 pp. 848-9.
7
Reichsmark notes, Rentenbank notes greater than 1 RM, and Allied Military Marks with a value greater than 1
Mark –
Gazette No. 25 Law No. 61 Art. IX p. 850.
was a maximum, so that if you did not have 60 RM in cash
8 you did not get the full 60 DM
allocation. Furthermore, where individuals held accounts which were to be converted from
old to new money, the quota was to be charged against these accounts. As we shall see, this
meant that account holders could end up paying 600 RM for their 60 DM quota, instead of 60
RM, although they would not have become aware of this until the following October.
The old currency became invalid for new transactions from 21.June (Art. VIII), and all RM
credit balances held in specified financial institutions became defined as “old currency” along
with RM notes and Allied Military Marks (Art. IX). All old currency was, as we have
already seen, to be declared and surrendered by 26.June 1948, the obligation to do so being
laid upon juridical and natural persons, the latter taxable subject
9 then acting on behalf of any
dependants (wife and children). Currency was to be surrendered at specific institutions,
primarily banks and buildings societies of various kinds, but not the Postal Cheque Office
and the Postal Savings Institute (Art. XII). Large private and government places of
employment were also authorised for this purpose on behalf of the Land Central Banks. On
receipt of the form declaring monetary assets the identity cards of those included on the form
were punched in a defined manner to obviate future claims (Art. XII.5), and the balances
placed in a Reichsmark Liquidation Account (Art. XIV). Procedures were also outlined to
cover misreporting of various kinds. Part Five, the final substantive section of the First Law,
dealt with the issue of new currency to public authorities and businesses. The Land Central
Bank was made responsible for supplying agencies and offices with a sum of DM one-sixth
of Land receipts during the last quarter of 1947 and the first of 1948, to which was added
one-sixth of Zone receipts during the same period (Art. XV). For the ensuing half a year,
therefore, public authorities received an allocation about one third of former annual receipts,
introducing a further variation on the rate of exchange between DM and RM. Businesses
were entitled to claim 60 DM per employee payable against their balances of old money, a
requirement being that payment so made
8
60 DM was roughly a week’s pay for a working man; a skilled worker in Hamburg at this time would have
earned 10 RM per eight hour day, and a six-day week was the official norm (official statistic cited in
Buchheim, “Die Währungsreform in Westdeutschland”, p. 193). Mendershausen and Matchett in their
estimate of cash and deposit holdings in early 1946 estimated that 66.5% of the population in the US Zone
and Berlin Sector held less than RM 250 in cash, that 28% of the adult population had no bank accounts,
and that another quarter of the population had less than 2000 RM in bank and savings accounts: “Annex H:
Analysis of Size Distribution of Cash and Bank Deposits”, Colm-Dodge-Goldsmith Plan, reprinted in H.
Möller (ed.) Zur Vorgeschichte der deutschen Mark, J. C. B. Mohr (Paul Siebeck), Tübingen 1961, pp.
459, 457. It is reasonable to suppose that during 1947 redistribution from poorer to richer households, and
from urban dwellers to farmers, exacerbated this position. Burchardt and Martin drew attention to this
when they noted that “…it must not be forgotten that in contrast to a country such as Britain all goods, bar
the most essential ones, have become liquid assets and that the process of inflation continues to be fed by
turning household stocks into money or directly into other goods.” – F. A. Burchardt, K. Martin, “Western
Germany and Reconstruction”, Bulletin of the Oxford University Institute of Statistics Vol. 9 (December
1947) p. 409. It is therefore more than probable that many poorer urban households did not receive their
full 60 DM allocation per person.
9
The German text is more precise here; it refers to those natural and juridical persons which are
“steuerpflichtig” rather than “subject to taxation” - Gazette No. 25 Law No. 61 § 11 p. 850.
UAE will "most likely" revalue currency -report
Reuters - Tuesday, February 5The Gulf economies are growing at different speeds, with some, such as the UAE and Bahrain making considerable progress in weaning themselves off oil, but others such as Saudi Arabia and Oman, still heavily dependent on hydrocarbons as their main source of revenue, the chamber added. (Reporting by Ola Galal; Writing by Lin Noueihed; Editing by Valerie Lee) - DUBAI, Feb 5 - The United Arab Emirates, the second-largest Arab economy, will "most likely" revalue its dollar-pegged currency in a bid to control inflation, the Dubai Chamber of Commerce and Industry said in a report.
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"This will help, to some extent, in alleviating inflationary pressures, whilst retaining adherence to the dollar peg stipulated as an integral part of the convergence criteria necessary for a monetary union in 2010," the chamber said.
Gulf Arab oil producers plan to create a single currency by 2010. They have reasonably harmonised economies, but disparities in inflation rates are undermining their efforts to bring their economies together, the report said.
With Kuwait breaking ranks with its Gulf Arab neighbours to drop the dollar peg last year, and Oman opting out of the 2010 deadline for monetary union, pressure is mounting on Gulf states to revalue their currencies against the weakening dollar if they are to bring their economies together.
"It is therefore most likely that the UAE central bank will revalue the dirham against the U.S. dollar, in line with other GCC currencies," the chamber said on Monday.
The chamber did not make clear what it meant by "in line" with other Gulf Cooperation Council currencies.
The Gulf economies are growing at different speeds, with some, such as the UAE and Bahrain making considerable progress in weaning themselves off oil, but others such as Saudi Arabia and Oman, still heavily dependent on hydrocarbons as their main source of revenue, the chamber added. (Reporting by Ola Galal; Writing by Lin Noueihed; Editing by Valerie Lee)
Oil majors discuss oil for expertise deal with Iraq to boost output
Oil majors discuss oil for expertise deal with Iraq to boost output
Times Online - [2/5/2008]
The West's biggest oil companies are in talks with the Government of Iraq to boost the country's oil and gas output.
Under a specially designed technical services agreement, ExxonMobil, Chevron, ConocoPhillips and Shell would be paid in oil rather than cash to help to develop the fields.
The decision, which is politically highly charged in Iraq, would involve the oil majors taking on the role of special contractors to the Government. The agreements would cover a variety of oil and gasfields in western, southern, central and northern Iraq. Shell, for example, is interested in the Akkas gasfield in Anbar and another gasfield in the south of the country.
The Iraqi Oil Ministry has designed the contracts to encourage Western oil companies to provide training, equipment and expertise to help Iraq to meet a target of increasing production to 2.6 million barrels by the end of this year and 2.8million within two years, from about 2.4million now.
Officials from several oil companies have been meeting Iraqi officials in Amman, Jordan, in recent weeks to fix the terms. The companies involved would be favoured in bidding for longer-term contracts on the fields - which are some of Iraq's largest producers - set for this year. Another bidding round is expected to take place next year.
At an estimated 115billion barrels, Iraq's oil reserves are the third-largest in the world after Saudi Arabia and Iran.
However, a long-running political dispute with the Kurdistan Regional Government in Northern Iraq has delayed the introduction of a hydro-carbon law, which would direct how the funds raised would be used and whether they would go to central government in Baghdad or the regional administrations.
Security remains a key concern and most of the work is likely to be carried out by Iraqis or other Arab citizens rather than by expatriates.
you want to argue instead of adding anything positive. Why don't you ask yopur crystal ball guy..What is your financial expert's name again??? lmfao..Go take a ride in your Grand Marquis and hum yourself some showtunes.
heard you the first time Bob...need meds? it was a typo anyway.supposed to be 2.2...you couldn't tell just by m2? buzzzzz off...
Iraq - UN transfers millions from oil-for-food 5-Feb-08 [10:51]UNITED NATIONS(AP) - The United Nations has transferred $161 million from the defunct oil-for-food program to a development program for Iraq, Secretary-General Ban Ki-moon said Monday.
In a letter to the Security Council, Ban said the U.N. will continue to transfer "unencumbered funds" to the Development Fund for Iraq as it continues the process of terminating the oil-for-food program, found to be riddled with corruption.
The program, which ran from 1996 to 2003, was aimed at easing Iraqi suffering under U.N. sanctions imposed after Saddam's 1990 invasion of Kuwait. It allowed Iraq to sell oil provided the bulk of the proceeds were used to buy food, medicine and other humanitarian goods and pay war reparations.
But an 18-month investigation led by former Federal Reserve chairman Paul Volcker, found massive corruption in the program. Its final report in October 2005 accused more than 2,200 companies from some 40 countries of colluding with Saddam Hussein's regime to bilk the humanitarian program in Iraq of $1.8 billion.
Ban reported to the Security Council on a meeting in Jordan last month between U.N. officials and representatives of Iraq's Foreign Ministry and Central Bank, aimed at reducing the number of outstanding letters of credit from the oil-for-food program.
As of the end of 2007, he said there were 210 outstanding letters of credit valued at over $656 million. He urged Iraqi ministries to resolve outstanding claims before March 31 and said the working group would meet again in March.
Ban said a reserve of $187 million and a balance of$225 million would be retained in the oil-for-food account until all remaining issues have been resolved.
CAAH got emails this morn...looks ok
CAAH looks ok here
Central Bank said on Tuesday that it will publish statistics and financial statements and related statistics macroeconomic Iraq for the first time in more than thirty years in the bulletin issued by the World Bank.
The Bank said in a statement issued on Tuesday, got Independent News Agency (Voices of Iraq) a copy of it, it will be published statistics on the Iraqi economy overall in Group and the International Financial Statistics in the periodic bulletin of the International Monetary Fund starting from the beginning of March next year.
He added: "It is the first time since 1977 that Iraq enjoy this advanced level of the publication and circulation of information Almatlgah macroeconomic of nominally after missing pages from Iraq any useful information and withheld from the international community for a period of over thirty years."
The statement said that the publication of these data "opened a new era of integration in the international community ... and give Iraq a classification ahead in the evaluation of international development and transparency as well as relevant markets and deepening international financial and economic institutions."
http://translate.google.com/translat...ial%26hs%3DU4h
Now Brady and Moss refuse to play in pro bowl...sad
zzzzzzzzzzzzzzzzzzzzzzzz meds time bob...lololol
ok Bob, you're right...we'll all be screwed. Now can you go back to your room and wait for nurse Ratchet? LMFAO
Have respect for those with money invested and and those who rely on news rather than obscure interpretation and speculation.
Coward Bill leaves the field with time left...tisk tisk Why not let Caughlin have his day? sad day for NE.....sour grapes
Desperate for Iraq's Oil Wealth
--------------------------------------------------------------------------------
Update......
A reported revelation by an Iraqi member of parliament that US oil companies are offering $5 million to each MP who votes in favor of the country's draft legislation on oil and gas law underlines the Washington-backed quest for control of Iraq's oil wealth.
Indeed, questions have been raised by vested interests about the veracity of the report, carried by a Bahraini newspapers, which did not identity the Iraqi MP who made the revelation. Some of the sceptics "observed" that the newspaper had opposed the US-led war against Iraq and therefore it was "biased."
According to the unnamed MP, the amount that could be paid to pass the votes do not exceed $150 million in the case of $5 million to each MP, pointing out that the draft law requires 138 votes to pass. It would mean that the companies said to be involved in the "secret offer" are already assured of 108 votes and they are seeking 30 more votes.
Whatever the case, it is definitely not beyond anyone's imagination that US oil companies are desperate to have the Iraqi parliament approve the draft legislation that would open up the country's oil and gas sector to foreign operators. Effectively, it would the nationalisation of oil companies in Iraq three decades ago.
With some experts suggesting that Iraq's reserves of oil could exceed even those of Saudi Arabia, international oil companies are rubbing their knuckles to enter Iraq's hydro-carbon sector with a free hand.
While Iraqi Prime Minister Nouri Al Maliki hails the country's new oil law as a "solid base for unity of all Iraqis," but Iraqi MPs are opposed to adopting it. Its passage through the Iraqi parliament definitely looks like a non-starter, but then there could be stronger forces at play, given the massive wealth involved.
For many Iraqi MPs, the issue is not as much as opening up the sector as is the fact that the draft legislation would lead to a division of the country's oil wealth. Some see it as focused on sectarianism and divides the country and the wealth into groups -- Kurds, Shiites and Sunnis, with the Sunnis getting very little, if any at all.
The Iraqi Federation of Oil Unions plans to mobilise its 23,000 or so members against the draft and says it wants different law, "which will be in the interests of Iraqis."
Allowing US oil giants to gain direct and indirect control of Iraq's oil sector was indeed one of the key objectives of the US invasion and occupation of Iraq. That is also one of the key reasons for the US not setting a timetable for withdrawing its military from Iraq despite regional and international pressure.
Clearly, the US has failed in its efforts to realise its other objectives, like installing a US-friendly regime in a "democratic" Iraq, and using Iraq as a base for action against "rogue" states such as Iran and Syria.
Against that backdrop, Washington's only hope is realise at least one of the objectives in order to make good its promise to US multinational oil companies that Iraq would be delivered to them in a silver platter, and, as far as the US is concerned, if it means looking the other way when bribes change hands in the bargain so be it.
http://www.godubai.com/gulftoday/art...tion=Editorial
The start of talks between Jordan and Iraq to settle outstanding debt file
3. Began today, Sunday, in the Jordanian capital of Amman final financial talks between Jordan and Iraq to settle the file of debt outstanding between them since in 2003.
. He said the Iraqi ambassador in Amman Saad Jasim Alehiani in a statement published today, Sunday, the Kuwaiti Al-Qabas that the financial ministers of the two countries and the Iraqi statement Jabr Al-Zubaidi and his Jordanian Hamad Alexasabh reviewing financial claims of both countries but banking sources about their 1.2 billion dinars.
. , The two countries agreed two weeks ago to settle the issue between them initially through technical committees since Jordan submitted its own document of the value of frozen Iraqi deposits in Jordanian banks as well as the presentation of disclosures involving claims with the views of the Jordanian deal with the former Iraqi government in addition to the loan disclosures Jordan's Iraq and benefits accrued.
. Alehiani pointed out that the Iraqi delegation emphasized the need to make traders Jordanians documents proving that they have in custody by the Iraqi government business dealings with Iraq
http://64.233.179.104/translate_c?hl...%3D13%26m%3D09
Baghdad Secretariat sign a contract with an international company to develop a new basic design of the city of Baghdad
أعلن أمين بغداد صابر العيساوي ان الأمانة وقعت عقداً بقيمة ( 3.773.000 ) ثلاثة ملايين وسبعمائة وثلاثة وسبعين الف دولار مع شركة عالمية لوضع تصميم أساسي جديد لمدينة بغداد بمدة أقصاها (17) سبعة عشر شهراً. Baghdad announced Secretary Saber Variety that the secretariat has signed a contract valued at (3.773.000) three million, seven hundred and seventy-three thousand dollars with international companies to develop a new basic design of the city of Baghdad to a maximum (17) seventeen months.
جاء ذلك خلال ترؤسه إجتماعاً جديداً للّجنة العليا للتصميم الأساسي لمدينة بغداد والتي تضم عدداً من أساتذة الجامعات العراقية من ذوي الإختصاص فضلاً عن مدير التصاميم في أمانة بغداد ناقشوا فيه عدداً من الطلبات لتغيير صنف الأرض. This came during his chairing of a new meeting to the Supreme basic design of the city of Baghdad, which included a number of university professors with Iraqi jurisdiction, as well as the design director of the secretariat of Baghdad discussed a number of requests to change the type of land.
وذكر مصدر اعلامي ان الإجتماع ناقش عدداً من الطلبات تقدمت بها دوائر ومواطنون لتغيير صنف الأرض في التصميم الأساسي وجعله يتوافق وطلباتهم، وأتخذت اللجنة القرارات المناسبة والقانونية التي تحافظ على التصميم الأساسي الذي وضع لمدينة بغداد. The media source that the meeting discussed a number of requests made by the departments and citizens to change the type of ground in the basic design and making it compatible with the applications, and took the appropriate decisions and legal maintain the basic design developed for the city of Baghdad.
وأضاف المصدر ان القضايا التي نوقشت واتخذت القرارات بشأنها إشتملت على طلب تحويل صنف أرض من افقي منفرد الى عمودي وتحويل أجزاء من قطع أراضي صنف زراعي الى صحي وكذلك من زراعي الى سكني فقد وافق على بعضها ورفض الآخر بما يتناسب والتصميم الأساسي ولكي لايؤثر مستقبلاً على ذلك التصميم. The source added that the issues discussed and decisions were taken which included a request for conversion of land classified to a single horizontal and vertical transfer parts of the classified agricultural plots to health, as well as from agricultural to residential has agreed to some and rejected others, commensurate with the basic design, in order to prejudice future design .
Skinner: start negotiations Convention friendship and cooperation between Iraq and the United States in the third week of this month
اعلن الناطق الرسمي للحكومة العراقية الدكتور علي الدباغ أن المفاوضات بشأن اتفاقية التعاون والصداقة الطويلة الامد بين بغداد وواشنطن ستبدأ خلال الاسبوع الثالث من الشهر الجاري. The spokesman for the Iraqi Government to Dr. Skinner that the negotiations on the Convention on cooperation and long-term friendship between Baghdad and Washington will begin during the third week of this month.
الدباغ أوضح أن مجلس السياسي للامن اجتمع مساء يوم الاحد 3/2/2008 برئاسة رئيس الجمهورية وبحضور رئيس الوزراء ورئيس مجلس النوّاب ونائبي رئيس الجمهورية وممثلي الكتل السياسية، حيث ناقش آليات اتفاقية علاقة التعاون والصداقة طويلة الامد بين العراق والولايات المتحدة. Skinner explained that the Council's political security met Sunday evening 3/2/2008 chaired by the President of the Republic and the presence of the Prime Minister and the House Speaker, the Vice-President and representatives of the political blocs, as discussed mechanisms of the Convention on the relationship of cooperation and long-term friendship between Iraq and the United States.
واضاف الدباغ ان هذه الاتفاقية ستمكن العراق من تحقيق مصالح الشعب في المجالات الاقتصادية والامنية والعسكرية اضافة الى المجالات السياسية والدبلوماسية والثقافية وإقامة علاقات ودية مع الشعبالامريكي. Skinner added that the agreement will enable Iraq to achieve the interests of the people in the economic, security and military as well as political, diplomatic, cultural and friendly relations with Alcabalammeriki.
كما أشار الدباغ ان المجلس ناقش الاوضاع الامنية في الموصل وخطط الحكومة لمواجهة المجموعات الارهابية والبدء بتنفيذ خطة امنية لتأمين محافظة نينوى من شرور الجماعات الارهابية. Skinner also noted that the Council discussed the security situation in Mosul and the government plans to confront the terrorist groups and to begin implementation of a security plan to ensure the province of Nineveh from the evils of terrorist groups.
انتهى Ended
Iraqi dinar recovering and it is the base in business dealings
Iraqi dinar recovering and it is the base in business dealings
Translated by IRAQdirectory.com - [2/4/2008]
Heads of Iraqi unions of Chambers of Commerce confirmed that 2008 will be a year of quality transition in economic performance and the Government is expected to initiate the implementation of important projects, although that is linked to the adoption of the budget, which is still under parliament examination, scrutiny and amendment for approval.
On the sidelines of the sixth meeting of the Union within its to twelfth session which was held in Baghdad, here are some interviews with a number of heads of unions representing the traders segment.
Head of the Iraqi Federation of Chambers of Commerce, Jaafar Al-Hamadani, is optimistic for achieving a qualitative development in the area of trade relations with the world and for the improvement of security; however, he blamed on some differences in the formation and delay of activating the role of the National Authority for Investment to benefit from the advantages of the new investment law, but he expressed confidence in the promising future of the private sector, especially after the government decided to support it. He pointed out that supporting private banks will facilitate the work of traders, and the partnership launched by the ministries of industry, minerals and oil with international companies will be reflected on private activity in Iraq. He called for speeding up the establishment of the intellectual property rights law to be presented to the Cabinet and then to the Parliament and considered it an important means in the organization of economic life in the country.
Head of Baghdad Chamber of Commerce, Amjad Al-Jibouri, considered the monetary policy followed by the Central Bank to control the exchange rate of the dinar against the dollar a successful policy because it maintained trade from the losses which traders are exposed to due to monetary shocks. He said that The Central Bank and the Ministry of Finance succeeded in supporting the national economy in their monetary and fiscal policy, and raising the value of the Iraqi dinar is one of the results of these policies.
Al-Jibouri called for adopting an import policy that limits the chaos afflicting the commercial market and represented by dumping it with commodity and especially of the bad type, and believes that this is the responsibility of the Ministries of Finance and Trade relying on the representatives of chambers of commerce. About his vision for the future of the Iraqi economy, he said, "the economy is the engine of social and political life and if stability is achieved, the future of the Iraqi economy will be in the ranks of developed countries ... And will leave developing countries."
Head of Najaf Chamber of Commerce, Zuhair Mohammed Radhi, is optimistic of the economic future of Iraq due to the ingredients of success it has both in human and material wealth or its strategic position and border outlets which overlooks the world. He called for the creation of a new structure that suits the potentials of Iraq to start toward the economy of market and reiterated the importance of the supporting laws and legislation.
The last speaker was the Head of Nasiriyah Chamber of Commerce, Abdul Razzaq Al-Zuheiri,, who spoke about the lack of clarity and knowledge of the importance of the role of the private business sector in the formulation of trade policy, pointing out that the merchants segment is the one relied on to provide requirements of daily life and construction requirements. He trusted the government to support the commercial sector in a way that suits the size and role in the development of other economic sectors. He pointed out to understanding of government departments for the importance of Chambers of Commerce; therefore, involving them in all committees is hallmark of the success of proper planning for the economic process and development of the country.
ALL LOPSTERS ARE BEST BOILED......LOLOLOL
Oil production in Iraq is at its highest level since the US-led invasion of 2003, reaching 2.4 million barrels a day, thanks largely to improved security measures in the north.
The country’s Oil Ministry will shortly invite international oil companies to bid for contracts to help Iraq to boost output at its investment-starved “super-giant” oilfields. Production is expected to pass the prewar level of 2.6 million barrels by the end of the year, and Hussain al-Shahristani, the Iraqi Oil Minister, told The Times that he expected production to reach six million barrels a day within four years.
The International Monetary Fund predicts that Iraq’s economy, boosted by rising oil revenues, will grow by more than 7 per cent this year, compared with 1.3 per cent last year.
A new report from the US Inspector-General says that the Iraqi Government will receive a $15 billion (£7.5 billion) windfall to help its reconstruction efforts thanks to soaring oil prices.
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Mr al-Shahristani said that the Government would not wait for Iraq’s fractious parliament to approve long-delayed legislation providing a legal framework for foreign investment in the oil industry. The Government is to invite foreign companies to help Iraq to develop new fields.
Jeroen van de Veer, the chief executive of the Anglo-Dutch oil company Shell, confirmed yesterday that it was “very interested” in new opportunities in Iraq, which sits on the world’s third largest proven oil reserves. “We have made various proposals to the Government,” he said.
The company is understood to be interested in a gas field called Akkas, in Anbar province near the border with Syria, to produce supplies for export to Europe. Eastern Anbar was until recently one of the most violent parts of the country, although tribal militias have ensured greater security.
Shell, which had worked in Iraq for decades until the 1970s, is also thought to be interested in building an export terminal in Basra for supercooled, liquefied natural gas for export to other parts of the Middle East. A number of other Western oil companies are interested in opportunities in Iraq. They include Total and the Norwegian company DNO, which has a drilling programme in the Kurdish region of Iraq.
Mr al-Shahristani suggested that the competition would be intense. “Everybody in the world, more than 45 companies, have approached us and shown a very keen interest in working with us — the Chinese, Russians, Indians, Brazilians,” he said.
Reliable economic statistics remain almost impossible to collect in Iraq, but US officials said that the Government had cut inflation to 5.5 per cent from 60 per cent a year ago.
The Iraqi dinar has strengthened against the dollar. Property prices are rising in safer parts of Baghdad. But unemployment remains stubbornly high at 18 per cent, and 40 to 60 per cent of the population are employed for less than 15 hours a week.
Foreign investment remains minimal apart from the $3.75 billion paid by three consortiums last year for mobile telephone licences.
The US military is trying to prime the economy by directing contracts worth more than $100 million a month to Iraqi businesses, generating an estimated 42,000 jobs.
On the streets of Baghdad and other cities it is now possible to see new building projects, bustling markets and other signs of economic regeneration for the first time since the war, but confidence remains fragile.
Jalil Khalid, 39, a store manager in central Baghdad, said that business was gradually improving but added: “Every time there’s any stability and people start coming back another bomb goes off and they vanish again.”
Misys reports Iraq bank deal
British banking systems vendor Misys is teaming with UK consultancy B-Plan Information Systems to supply and implement an integrated core banking platform at Rafidain Bank, the largest state bank in Iraq.
Established in 1993 in Manchester by two Iraqi Kurdish brothers, B-Plan provides financial and operational IT management services in the UK and Ireland.
Misys will work with B-Plan to provide a new integrated platform which underpins a restructuring programme at the bank aimed at improving performance and enabling Rafidain to compete more effectively.
The contract includes the deployment of Misys' Bankmaster platform as well as electronic clearing systems and supporting hardware and communications networks across the bank's 148 domestic and seven international branches.
Commenting on the contract win Guy Warren, EVP and general manager, Misys Banking, says: "Our deep knowledge of the market alongside B-Plan's expertise in implementing turnkey ICT solutions in Iraq, will enable Rafidain to maintain its leading position in the region and compete more successfully internationally."
Misys says the joint Misys/B-Plan offering was chosen by Rafidain Bank ahead of competing bids from Temenos and Systems Access.
The deal is part of an initiative by Iraq's Central Bank and Ministry of Finance to restructure the state-owned banks in the country. Bayan Jabr, Iraq's Minister of Finance, has stated that he wants every Iraqi citizen to have "a Visa card" and a bank account that can be managed over the Internet.
The launch of the GCC common market has raised hopes of the region emerging as an economic juggernaut. But experts believe there's a need to bring in economic convergence in practice before the real benefits start coming through. GULF BUSINESS looks at the gains from the common market as well as the challenges.
The year 2008 couldn't have taken off on a merrier note when the long-awaited launch of the common Gulf Cooperation Council (GCC) market saw the light of the day, as scheduled on January 1. At a time when the region is investing huge funds on infrastructure, with enormous investments pouring in from around the world and ample liquidity feeding the local economy, the launch of a common economic bloc by the GCC members has struck the right cord at the right time.
With the oil boom setting the region's economic flywheel spinning, few would disagree that the GCC - with a combined GDP totalling over $715 billion - is on the cusp of a giant leap forward. A common GCC market now means that there will be equal treatment of all GCC nationals in terms of travel, residence, employment, education, social insurance and all other economic, occupational, services and investment activities.
GCC Secretary General Abdul Rahman Al-Attiyah says: "The GCC common market would ensure economic equality among GCC citizens. The GCC common market aims to create one market. It will move beyond the free movement of goods and services that has been agreed upon in the GCC customs union (formed in January 2003) to include labour and capital flows as well. The common market offers equal opportunities for all GCC citizens including the right to work in all government and private institutions in member states, buy and sell real estate and make other investments, move freely between the countries, and receive education and health benefits."
Analysts believe that the common market holds a lot of promise for banking, real estate, industries, services, and capital markets. An increase in labour and capital mobility will lead to a consequent increase in productivity in the long run. As Marios Maratheftis, Regional Head of Research, Middle East & North Africa (MENA), Standard Chartered Bank, says: "The GCC common market will foster closer political links within the GCC, and it's easier for businesses across the region to establish contacts with each other. Further, it will lead to greater freedom of movement of capital, thus promoting investments within the region.
"Moreover, since there's greater freedom of movement of labour, the common market will help the booming economies to import labour from neighbouring countries. This is beneficial both for the countries that need the labour, and also for the labour itself. The common market will also reduce the cost of trading, which will become an even bigger advantage once the common currency is established in 2010," he adds.
Fostering competition
For businesses within the market as well as consumers, the GCC common market will turn into a very competitive environment. Businesses can now benefit from economies of scale, increased competitiveness and lower costs, as well as expect increased profitability. On the other hand, consumers, too, will benefit from the common market since the competitive environment will bring them cheaper products, more efficient providers of products and also increased choice.
As Eckart Woertz, Program Manager ? Economics at Gulf Research Centre (GRC), Dubai, says: "The GCC common market will lead to the creation of a larger market and attract more foreign investments. Further, it will also lead to greater synergies among local companies and make way for more economies of scale, thus increasing the region's competitiveness."
Another windfall from the common market will be an increase in efficiency and responsiveness of the GCC countries due to greater labour mobility, improved flexibility and resilience of the economies.
Dr. Nasser Saidi, Chief Economist, Dubai International Financial Centre (DIFC), says: "The common market will spur investments as well as return on investments in infrastructure and projects. The cost of production is likely to decline because now the countries will be producing for a larger market. Moreover, free capital movement coupled with the upcoming common currency regime will add to growth. The common currency will also boost intra-GCC trade by three to four times as accounting, exchange costs, and transaction costs will come down."
Challenges ahead
Theoretically, the GCC common economic bloc is embedded with tremendous opportunities. The long path to a practical common market doesn't seem to be an easy one. Analysts point out it's hard to wish away various pitfalls coming in the way of the full realisation of a common market.
There are issues like the absence of regulatory and standardised underpinnings in order to facilitate free movement of labour and capital across borders. Countries across the GCC have been following different policies on product regulations, labour laws, capital market investments, quality benchmarks in industries, among others, that stand in the way of a common market.
Monica Malik, Director (Economics Equity Research), EFG-Hermes, says: "The launch of the GCC common market is just the beginning, and it will take some time before we come to see its full realisation. The economic bloc, no doubt, will lead to equal employment, education and investment opportunities to GCC nationals, and greater labour and capital mobility. But for all of this to happen, the GCC should first move towards harmonising the rules and regulations relating to investments, real estate, among others, across the board. The 2010 deadline for the monetary union also seems a bit ambitious as there are issues like common monetary tools, common monetary goals, currency conversion criteria, etc that need to be sorted out first."
Woertz adds: "It will also not be possible to keep laws of labour nationalisation (such as Saudisation, Emiratisation, among others,) in their current form and labour laws will need to be applied to all GCC nationals equally. The same is true for the sponsorship systems, and the respective stock markets will need to offer equal access for all GCC citizens. But so far considerable restrictions persist. For example, the Haj tourism industry is, and most likely will remain, a closed Saudi market, and all GCC stock markets, except for Bahrain, have limited the percentage of shares that other GCC nationals can hold in a publicly listed company. Despite some liberalisation like Saudi Arabia opening up its banking sector to other GCC investors, this state of limbo is going to persist for some time."
Experts also fear the GCC's transition to a common market can have short-term negative impacts on some sectors of a member's economy due to increased international competition. Industries that previously enjoyed market protection and national subsidy (and could therefore continue in business despite falling short of international performance benchmarks) may struggle to survive against their more efficient regional peers..."
"Syed A. Basher, an economist specialising in GCC economies who is based in Qatar, points out the challenges of the common market implementation. "The biggest challenge will be to undertake coordinated common market-style reforms in areas of investment, property and residence. Even if the member states agree on harmonising the legal requirements, the next challenge will then be the actual implementation by the respective administrative institutions and their bureaucracies."
He adds: "Unlike the European Union, GCC economies are not as diverse and are still heavily oil-dependent. Moreover, trade between GCC member states currently represents just around 10 per cent of total GCC trade. Therefore, unless the GCC finds ways to increase trade among its member states, the core of the common market will remain symbolic. Another challenge will be to increase diversification of the GCC's non-hydrocarbon sector in order for market integration to work effectively."
Need to move cautiously
Analysts look at the 2010 deadline for monetary union as an ambitious target and believe it'll not be a smooth ride. This is because of two reasons. First, as they believe, Kuwait's decision last year to depeg its currency from the dollar in favour of a basket of currencies, coupled with Oman's declaration that it isn't ready for the 2010 monetary union, have made harmonisation of monetary policies difficult.
Though Kuwait is still committed to monetary union and its decision to depeg was justified given the inflationary pressures the country was facing, but as Basher points out, its move will lead to a discussion of whether the planned common currency should be pegged to a basket of currencies rather than the dollar as originally envisaged..."
"What are the advantages of the GCC common market?
The common market brings a very potent economic bloc together, with a combined economy of more than $700 billion. The common market will place the GCC as one of the most powerful trading blocs, comprised of just six states. The GCC bloc is sitting on 484 billion barrels of oil, and they represent more than half of the oil reserves of the Organisation of Petroleum Exporting Countries (OPEC). There will be freedom of labour, services and goods flow from one country to another without any restrictions. The intra-GCC trade is expected to increase in the next few years. We expect that intra-GCC trade will increase from 10 per cent to 20 per cent by 2012, a huge boost to trade flows between GCC countries.
The GCC will benefit as the young population of this region will be able to pursue studies, work within the region and compete with others. Competition is an advantage for the young people of this region.
According to you, what are the challenges lying in the way of a common market?
The common market was established 27 years after it was first proposed and if we want to go forward, the region has to brace itself and move ahead. Some changes have to be made, especially in the harmonisation of regulations, such as those governing labour laws and social security entitlements. Such harmonisation will have to be applied in both the public and private sectors of all the GCC countries.
In what ways will the common market impact the regional banking and other sectors?
It should not only increase the flow of investments but also it will encourage a phase of further expansion of banking activities and cross-border M&A activities. As trade and labour become more mobile so will businesses. Products will have access to other markets with great ease and that will help trade, which in turn helps companies grow and generate employment.
Last year Kuwait depegged its currency from the dollar in favour of a basket of currencies and Oman has declared it's not ready for the 2010 monetary union. Do you think the road towards the 2010 monetary union will be a smooth ride, given the independent monetary policies being adopted by some members?
No, the road is smooth. We have seen there were many hurdles in the history of the European Union. Since the Treaty of Rome in 1960, the then European Economic Community (EEC) had to tackle many problems. The hurdles faced today can and will be overcome in the GCC. In the past it was said that the GCC states have independent monetary policies, but they all seem to act more in unison than otherwise, and that is a good sign..."
'Movement of capital will get a boost'
The formation of a GCC common market will result in an increase in production efficiency and optimum usage of available resources and improvement in the GCC's negotiating position in international economic forums, according to Kuwait-based Global Investment House (GIH). The market will also increase investments and trade between the member countries. Trade between GCC countries currently stands at around 10 per cent of overall foreign trade, while with the introduction of the common market, it is expected to increase to 25 per cent by 2010.
The same concept applies to the free movement of capital, which seeks better investment opportunities, increasing the rates of returns. The GCC common market will also allow citizens the option of real estate ownership across the member states. Thus, with the creation of a common market, production efficiency will be raised and the usage of resources will be optimised.
International trade has been increasing lately, driven by an unprecedented increase in global oil prices, which helped boost the GCC member states' surpluses. To that end, a common market will provide the GCC member states with a bargaining power when conducting international trade agreements. The sectors which will benefit the most from this step include real estate, investment, banking and logistics. The real estate sector will be among the major beneficiaries of the GCC common market. This is evident from the fact that only around 33,000 GCC citizens (out of a total 35 million GCC citizens) own real estate in other member states as of 2006.
The investment sector will also get a major push as companies will be able to increase their investments in other GCC countries. The stock markets are expected to get a major fillip and GCC banks will benefit by opening branches in other GCC countries, thereby gaining access to a wider customer base. With the expected improvement in intra-regional trade, the logistics sector is set to gain more..."
ding-dong-the-witch-is-dead-which-old-which-the-wicked-witch....
wake-up-you-sleepy-heads.....lmao
Ignore the Obituaries, U.S. Reign Will Endure: Kevin Hassett
Commentary by Kevin Hassett
Bloomberg.com
Feb. 4 (Bloomberg) --
The negative employment report on Feb. 1 was another sign the U.S. economy is on the ropes. Increasingly, this downswing is being portrayed as more than just a cyclical phenomenon. The U.S. used to be the envy of the world, the story goes, and soon it will be just another nation.
The question no longer seems to be whether the U.S. will recede into the pack, but rather, who is to blame. The New York Times recently explored that question with a provocative cover piece in its Sunday magazine by Parag Khanna, entitled ``Waving Goodbye to Hegemony.''
But has the U.S.'s position in the world really changed?
In terms of gross domestic product, the U.S. has been an economic colossus for a long time, and continues to be so.
Economist Angus Maddison writes in his book, ``The World Economy: a Millennial Perspective,'' that America's share of world GDP peaked at almost 28 percent in 1951, up from 1.8 percent in 1820, 8.8 percent in 1870 and 18.9 percent in 1913.
The U.S. share of world income then declined consistently until 1975, when it accounted for 21 percent of world GDP. It has been roughly the same since. Maddison, who has compiled global national-income data for the world from 1 A.D. to 2001, estimates the U.S. share of world GDP was 21.4 percent in 2001.
Since then, growth outside the U.S. has picked up, while the expansion inside the U.S. has slowed. According to the International Monetary Fund, which offers more recent statistics, the U.S. accounted for 21.0 percent of world income in 2001 (which is close enough to Maddison's estimate to allow one to draw on both); it declined to 20.0 percent in 2005.
Not Cover Material
Such a minor deterioration may just be cyclical, and is hardly magazine-cover material.
The U.S. economy continues to be positively awe-inspiring compared with the competition. The value of U.S. imports in 2006 was roughly the same as the entire GDP of France. The U.S. is the world's largest exporter; indeed, if all U.S. exporters banded together and seceded from the country, they would have the eighth-largest GDP in the world.
The economy of Brazil is about the size of the economy of Texas. The economy of India is about the size of the economy of America's Plains states. The economy of Venezuela is about the size of the economy of Alabama.
The U.S. share of the value of global-equity trading is more than 40 percent. The total value of trading on the New York Stock Exchange in 2006 was greater than all of Europe's combined. While the Sarbanes-Oxley corporate-governance law may have made the U.S. a less-attractive locale for new issues, the NYSE was still the world leader in total new capital raised in 2006.
Foreign Capital Magnet
The U.S. is still the place that foreign capital wants to be and is the largest receiver of foreign direct investment. Nine of the top 50 transnational financial corporations are American, including the top two (Citigroup Inc. and General Electric Capital Corp.). Thirteen of the top 50 non-financial transnational corporations are American, including four of the top eight: General Electric, General Motors Corp., Exxon Mobil Corp. and Ford Motor Co.
Looking ahead, the U.S. has relatively high immigration and fertility, something that should help it avoid the demographic nightmares awaiting many of its trading partners.
Big Footprint
My colleague at the American Enterprise Institute, Nicholas Eberstadt summed up the conventional wisdom on the importance of demographic trends as follows: ``In 2005, Europeans outnumbered Americans in virtually every age group, exceeding Americans by 37 percent among people of prime working age, between 35 and 49 years old. By 2030, however, there will be nearly as many Americans as Western Europeans in the 35-to-49-year-old category and many more Americans under the age of 30.'' With regard to Europe, the footprint of the U.S. will inevitably increase.
While China's growth has been impressive lately, a recent study found that it may well be at least 50 years before it catches up to the U.S.
The U.S. stands out in another way. Among developed nations, it is by far the most committed to a strong national defense. U.S. national defense spending in 2006 was greater than the combined national incomes of Saudi Arabia, Iran and Qatar.
The Stockholm International Peace Research Institute keeps a database of world military spending that goes back to the late 1980s. According to the institute, U.S. defense spending as a share of world defense spending peaked at 44 percent in 1992, and then declined until 2001, when it fell below 39 percent of the world total.
Iraq, Terror
Since 2001, however, the U.S. military has grown considerably, largely because of the war in Iraq and the war on terror, and the U.S. constituted 45.7 percent of global defense spending in 2006.
Given the relative size of the U.S. armed forces, there is little doubt the U.S. will have to take a leading role going forward in assuring world security.
Looking both at the economic and the military facts, one can only conclude that the U.S. is a singular nation, and will likely be so for a long, long time.
Kevin Hassett, director of economic-policy studies at the American Enterprise Institute, is a Bloomberg News columnist.
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big increase in demand for buying the dollar exchange rate and low
Baghdad - Iraq votes
04 02 2008 at 12:52:45
Increased demand UAE buy the dollar at a meeting, Monday, the second week of meetings of the Central Bank of Iraq auction on the sale of the dollar, recording total volume of demand was 162 million and 515 thousand dollars, compared with 74 million and 460 thousand dollars Sunday.
The special bulletin ERA Central Bank of Iraq to sell Una demand distributed by 11 million and 880 thousand dollars in cash, 150 million and 635 thousand Dolarali form of remittances outside the bank Alktrguetaha fully exchange rate low of $ 1211 dinars after four meetings Astaqrarali 1212 dinars, the exchange rate yesterday.
Two of the 13 banks participating in the auction offers for the sale of one million and 200 thousand dollars purchased by the bank in full at an exchange capacity of Low 1209 dinars to the dollar.
He said the Yasiri, one dealing with the auction, the Independent News Agency (Voices of Iraq) that "remittances rose significantly by the most consistent futures remittances by banks, which were awaiting weekly decline to be transferred outside the country."
Yasiri pointed out that "demand was also increased the cash to buy the dollar, but the rise was slightly compared to yesterday's hearing in the equivalent of the growing demand for remittance transfers influenced by the fact that more than Balenkhad demand that the monetary exchange rate of remittances declined by ten points on the exchange rate under the monetary policy Central Bank ".
For his part, Abbas said Alkhbayralaguetsadi Amita that "rates of depreciation in the exchange rate stable for the last two months at a point which makes the weekly rate in the event of continuing monetary policy to the current reality in the way of access to different names exchange rate 1000 dinars middle of next year, which paves the way unanimity monetary policy to delete the zeroes and making the dinar equivalent of the dollar, which would pave the return of the Iraqi economy to Surrounding strongly and join the unified Gulf currency to be launched within a few years, in addition to building the Iraqi dinar currency mainly in the Arab region being based on a solid economic foundation that qualify to play leading role in the basket of currencies Middle East after several years of marginalization could float them because of the loss of exchange rate international official and stopped circulation in the global market. "
, The expert said the economic and industrial Abdul Razzaq Abaiji "The reduction is a currency exchange rate for two months did not affect the commercial rate of the dinar because of the Iraqi situation no stability caused by the crisis, making the former market in the event of any suspect or spreading decline in the price and not get sidetracked behind ".
As described Uday Rustum Shabib's banking office in Baghdad dollar exchange rates "Palmstkrh cash on the stock market by 1215 purchase of 1225 sales, unchanged."
Shabib and that "the commercial market is unified in exchange rates in the three exchanges struggle Harthiya and Kazimiya are all experiencing very active in working this morning."
Z RB (m) - h m
US Govt is too heavily fortified in Dinar for it to lop, r/s or any other kind of BS you haters can come up with. I have an idea: invest in Disney or shuuuuuuuuuuuuuuuush !!!!!