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Sunday, March 20, 2016

Tlar & Members:  Iraq’s Dysfunctional Government By Proxy

Post From Currency Chatter
Tlar & Members Discussion:  Iraq’s Dysfunctional Government by Proxy
 
March 19, 2016 in Politics  By Omar Sattar, for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

With Prime Minister Haider al-Abadi thought to be working on reforms that include the formation of a technocratic Cabinet, the issue of proxy appointments is back in the spotlight.

For more than a decade, Iraqi government institutions have been run by proxy, with the prime minister appointing officials in acting capacities to lead government bodies, independent commissions and military commands because of parliament’s failure to vote on candidates due to political disagreements over the distribution of positions.  [Articles in Full at  end of Comments]
 
Kimberley:  Abadi's got his work cut out for him.......  Just getting rid of those   'zombies'
​~~~
JD Blue:  This is much more in depth about the Reforms and where they are at... and what they are up against.
 
Kimberley:  I agree Blue....   this crisis in Iraq is a many faceted situation....   and the RV has never been as simple as pushing the button...
 
Tlar:       Kimberley in many ways you are correct but I see it a little differently.  The political problems are serious and hopefully they will be resolved as fast as they can be peacefully.  I believe the economic problems will also be resolved when they are ready to be resolved. 
 
Most folks in dinar land see these two issues as intertwined and it may well be, but I tend to think of these two issues as separate issues meaning they are not necessarily intertwined whereby the political issues have to be resolved first in order for the economy to be started. 
 
I see them as two separate isues with equal importance.  I hope that this is the way it is and that the IMF is interested in reforming the economy of Iraq separate from the political seen. 
 
In fact my reasoning is this and we have seen it in at least one article that I know of.  The economic problem if resolved should help the political problem be resolved because it will take a lot of the pressure off all of the participants. 
 
Both are important but the IMF may only needed to see certain changes such as OFAC to make sure that the banks were not used as weigh stations for terrorism.  Also the money laundering law was another important issue followed by openness or the compliance issue.
 
 All of these kinds of things were needed and demanded by the IMF.  All deal with the economy. 
 
The IMF ordinarily deals mainly with assisting nations to grow and diversify their economies many of which have political problems.  Hopefully the IMF sees these as satisfactory and will allow Iraq to enter Article VIII.
 
There are many countries with political issues that still have internationally accepted currencies.  Russia is a dictatorship pretending to be a democracy and yet they have a currency that is convertible. 
 
China is a communist/capitalist country and yet the renumbi is a convertible currency.  Cuba and many other countries have political problems that the international community sees as undesirable but yet they still can trade internationally albeit with some restrictions. 
 
So as I see it the economy of a country is sometimes allowed to enter world trade while the government is not to the liking of the IMF.  The question in my mind is only this. 
 
Is the government considered stable enough.  That is a question left to better minds than I have, but in my mind, the Iraqi government is as stable even with all its problems, as many who are openly trading in the world. 
 
No promises and don't hold me too it but I think Iraq is on track to join the world economy whether the government is done or not.  I am still very hopeful that it is this month on or before March 31st. 
 
There are more than just a few signs that at least that is a target in my mind.  Whether they hit it maybe another thing altogether.    tlar
 
Aloha Alex:         I would agree with you except that an exremist terrorist group has established a calliphate occupying roughly a third of the country. Now, it would help if we could get accurate information as to when Iraq will be liberated completely, but I wouldn't listen to anything coming out of Abadi's mouth about it.
 
hi-five:    Couldn't agree more, Tlar.  The question is when is the GOI stable enough?   Does amnesty and HCL have to be passed--- Does the evil judge Mahmoud have to be gone.----  Does Shabs have to be back in control of the CBI---- does ISIS have to be completely eliminated - --  There always seems to be a to do list before Iraq can turn their money on.   
 
IF it is true that Iraq tried to RV in 2012 but Maliki stopped it,  then it proves that the power brokers were OK with Article 8 eventhough amnesty and HCL, etc. had not been passed.    However, it may not be true that Iraq tried to RV in 2012 and that claim was guru poo poo. 
 
I'm looking more to the CBI and IMF progress than the political progress.  And, economically, it looks like Iraq is getting ready to welcome international business through a market economy with state of the art banking. 
 
Tlar:       Hi-five, there will always be a political to do list.  That will never stop.  The bigger question is "when is the right time" and what constitutes enough for the IMF IMO on the economical side of the argument.. 
 
I personally don't think the IMF is waiting for an amnesty law nor do I think Mahmoud needs to be out of office.  These kinds of things are political as is the HCL. 
 
As far as ISIS being gone from Iraq, I am not sure that the bombing of banks and the CBI branches, destroying the money in those banks both USD and dinars, as well as shutting down the flows of funds to all employees in those territories isn't enough to do the trick.  
 
The coalition in conjunction with Iraq and the Peshmerga has pretty much insulated ISIS from being able to take advantage of any RV other than the few dinars remaining in circulation in the captured territories.
 
This coalition has been systematically isolating ISIS economically from any new flow of dinars while having destroyed the bulk of what dinars they had in their effort to economically deprive them of income.  Tlar
 
Full  Articles In Discussion:
 
JD Blue:   Proxy positions are a problem.
 
Iraq’s Dysfunctional Government by Proxy
 
March 19, 2016 in Politics  By Omar Sattar, for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
 
With Prime Minister Haider al-Abadi thought to be working on reforms that include the formation of a technocratic Cabinet, the issue of proxy appointments is back in the spotlight.
 
For more than a decade, Iraqi government institutions have been run by proxy, with the prime minister appointing officials in acting capacities to lead government bodies, independent commissions and military commands because of parliament’s failure to vote on candidates due to political disagreements over the distribution of positions.
 
In an interview with Al-Monitor, Hamdia al-Husseini, a member of the parliament’s legal committee, explained:
 
“Acting officials include undersecretaries and independent commission heads, like at the Central Bank and integrity and intelligence commissions, as well as military commanders and other senior officials. They hold over 80% of the posts at government bodies, especially at the Ministries of Defense and Interior, in addition to security bodies and other important Iraqi official institutions.”
 
Husseini added:
“Appointment by proxy contradicts the constitution and the Civil Code of 1960 prohibiting acting officials from holding their post for more than one annual term.
 
“The issue of acting officials, whether in the Cabinet or the rest of the government institutions, is a critical one, because their decisions are not constitutional. Their appointment is not subject to any legal standards, as acting officials cannot be legally held accountable because they were appointed by the prime minister, not the parliament as per the constitution.
 
“The problem of appointment by proxy will likely be resolved as part of the new Cabinet reforms Prime Minister Abadi is seeking to implement in addition to the formation of a technocratic Cabinet.
 
“It is illogical to implement political reforms and form a professional Cabinet while most undersecretaries and director generals are being appointed without parliamentary approval as stipulated by the constitution.”
 
Zaher Khatouni, a member of the Iraqi National Forces Alliance, spoke to Alforat News on Feb. 13 about the need “to select the new ministers on the basis of professionalism,” stressing that the issue of appointment by proxy should be settled.

In a Feb. 28 statement, Kamel al-Zaidi, a member of the State of Law Coalition, said, “[We] will force the Iraqi parliament to urge the Cabinet to settle the issue of acting officials and replace them with qualified individuals.” He explained, “The problem of appointment by proxy arose as a result of the rivalry between political parties contesting these posts.”
 
In one example of the issue, according to the Iraqi Commission of Integrity, 3,200 director general positions have been filled by acting appointments and without regard to the law limiting their tenure to one year.
 
Mohsen Saadoun, a member of the parliamentary legal committee and the Kurdistan Alliance, told Al-Monitor:
 
 “The delay in resolving the problem is due to the inactivation of the parliamentary committee [to achieve national] balance, tasked with settling the issue of acting officials since 2005. But in February, the committee was able to hold several meetings, and it expects to find a final solution for the problem during March, to end the assignment of government employees by proxy by agreeing on allocating the higher ranks among the parliamentary parties that represent the Iraqi people and vote for them in parliament.”
 
The committee had been formed during the legislature’s first session in 2005 with the goal of distributing government appointments as well as military commands in accordance with the social components of the Iraqi people — Arab Shiites and Sunnis, Kurds, Christians, Turkmens and so on — and their parliamentary representation.
 
“The results of the general elections determine each political party’s share of government posts in a fair manner without marginalizing any party when it comes to leadership and decision-making,” Saadoun claimed.
 
“Taking the election results into consideration does not imply sectarian or racial quotas with respect to distributing posts or adopting a technocracy, for each parliamentary bloc can nominate several qualified figures for each government post before the prime minister selects one among them.”
 
In regard to the larger issue, Yasin Bakri, a political science professor at Nahrain University, told Al-Monitor:
 
“The suspension of Article 61 of the Iraqi Constitution has been intentional over the past few years, ever since the constitution was adopted in 2005 until now. The prime ministers who were in office have been trying to control all aspects of the state by overriding parliamentary powers in terms of appointing senior public officials.”
 
According to Article 61, the parliament must approve the appointment of the president and members of the Federal Court of Cassation, chief public prosecutor and the president of Judicial Oversight Commission, ambassadors, the army chief of staff and his assistants, division commanders and ranks above and the director of the intelligence service.
 
“Just as the parliament approves the appointment of state senior officials, independent commission heads and military commanders, it must also approve their dismissal; therefore, the prime minister has limited powers over the members of parliament,” Bakri said.
 
“In the event of the prime minister appointing senior officials by proxy, as is the case now, their dismissal is also the responsibility of the prime minister. For this reason, the latter may extort and control them, in his attempt to impose a dictatorship.
 
However, resolving the problem of acting officials by ending the prime minister’s control and monopoly over the activities of government institutions will not eradicate the sectarian and party quota system in force since 2003.”
 
Finding a solution to the issue of acting senior officials will not be easy. The implementation of the constitution, including the parliament’s power to approve candidates for senior positions, will be colored by the sectarian quota system, like the distribution of Cabinet portfolios, despite that average Iraqis as well as elites are opposed to this type of approach.

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JD Blue:      Saleh has quite a bit of perspective. He comments here on the reform package Abadi is putting together.
 
 
Consultant Abadi: Document Prime Minister based on state - building and market adoption of smaller and more powerful government
 
Author: AB, HH, ZJ   Editor: AB, HH   19/03/2016 16:36   Number of Views: 237
 
Long-Presse / Baghdad  The head of the Council of Ministers for Economic Affairs Advisor to the appearance of Mohammed Saleh, said on Saturday that the document, Prime Minister Haider al-Abadi reform based on "state-building and market adoption of smaller and more powerful government,"
 
and unveiled a plan pursued by the government for the development of the private sector by making it owns 55% of the value of gross domestic product by the year 2030, and as pointed out that there are to ensure the rights of workers in the private sector plan in cooperation with the international Monetary Fund, he stressed the need to develop this sector to eliminate "parallel state".
 
He said the appearance of Mohammed Saleh said in an interview to the (long-Presse), "The document government's reform of the Prime Minister based on two axes rebuild the state and the market," returned to "the country's dependence on a rentier economy makes it unable to meet the requirements of all citizens."
 
Saleh added that "the change that needs to change the current mentality requires a more effective government, and smaller than those currently in the number of ministries and agencies and the characters, and strong laws and their ability to control and regulation," noting that "the reform document is going in this direction."
 
Saleh revealed that "the Council of Ministers adopted since last year, in 2015, a program to develop the private sector, runs until 2030, and is based on mixing market companies and activities, to extend to industry, agriculture and other activities," pointing out that "the first step of the program is to simplify registration procedures companies and reduce the cost, to convert the private activity Activity irregular and outside the control of the law, to the organized activity under the legal umbrella. "
 
He said the Prime Minister adviser, that "the plan is linked to the axis of market financing, the fact that the country is facing a big problem in terms of the banking sector and save money," noting that "the launch of the six trillion dinars program by the central bank was aimed at concessional financing to the private sector to be the operator, instead of the state taking over that responsibility Vstkhalq an army of zombies through corruption legit. "
 
Saleh pointed out, that "the private sector development program that includes market protection through provision of guarantees for private sector employees," revealing that "the government has been working since last year, in 2015, the draft program with the IMF ends with 2019 solutions, and is designed to provide protection for personnel sector under the name of the private (social security). "
 
Saleh also highlighted, that "the program includes setting up a data base for all employees and covered both market your work or social care, and determine the persons entitled to social welfare according to these data, identifying registered within the pension fund," stressing that "the program will provide protection for workers in the private sector as do The state employees. "
 
Saleh pointed out, that "the government is also seeking to integrate retired workers fund with retired state employees fund, among retired unified national fund", stressing that "the private sector development program aims to reach to that sector participation rate of up to 55% of the size of the gross domestic product by 2030 ".
 
He stressed favor, that "the State so will leave a lot of activities for the market, and the task of export laws and regulations to protect workers, as well as to monitor the work of the private sector," explaining that "the state in the future will play the role of partner and observer, but the bulk of the partnership will be the private sector to ensure the elimination of parallel state. " 
The Custom Fit, the parallel state to "processes that you get outside the framework of the law and customs," pointing out that "these operations are spread further in conjunction with the government's loss of the reform program and Ankavaiha on itself."
 
He stressed economic adviser, that "the function of the reform program is to eliminate the parallel state, being very dangerous and is working to exploit the conditions in various images, including the carrying of arms outside the scope of the law, corruption Kaljpayh for the benefit of individuals and personalities, and the use of tribal law of force against civil law," adding that " eliminating it is strongly the government and the reform of all its programs, whether they are legal or administrative or economic. "
 
The Prime Minister gave in (10 March 2016), and document comprehensive reforms ministerial amendment to the heads of political blocs, while that document included the political and economic reforms under which the reshuffle will be forthcoming.
 
The Economic Adviser to the Prime Minister, Haider al-Abadi, in the (November 2015), the government embarked on a public social security strategy of the current 2015, in coordination with the World Bank, hoping completed in 2017, while between the base point which is the introduction of "Council market "during the 2016 year or next, counting that the Board will remove the" great Wall of China "that separated the government from the private sector.
 
The banking system in Iraq consists of 54 banks as well as the Central Bank and distributed by ownership between 7 state banks and 23 commercial banks, including special (9) Islamic banks in addition to the 15 branches of foreign banks.

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