Iraq adopts sweeping economic reforms - BBC

Discussion in 'Politics, Religion, Social Issues' started by ibjoshua, Sep 21, 2003.

  1. ibjoshua macrumors 6502a

    ibjoshua

    Joined:
    Jan 17, 2002
    Location:
    Japan
    #1
    The American-backed administration in Iraq has announced sweeping economic reforms, including the sale of all state industries except for oil.

    The surprise announcement by Iraqi Finance Minister Kamel al-Keylani dominated the second day of meetings organised by the International Monetary Fund in Dubai.

    The recently-appointed minister unveiled a string of reforms that analysts said read like a manifesto devised by Washington, signing off 30 years of Saddam Hussein and the socialist Baath Party.


    http://news.bbc.co.uk/2/hi/business/3126522.stm

    Only one comment:

    kaa-ching!!

    i_b_joshua
     
  2. Ugg macrumors 68000

    Ugg

    Joined:
    Apr 7, 2003
    Location:
    Penryn
    #2
    One of the many really bad aspects of this is that there is no provision for Iraqi businesses to be allowed to purchase companies. Sure they can bid just like everyone else but they will be outbid in most cases. Now I'm sure that a lot of Iraqi businessmen have operated on the wrong side for quite some time but this more or less guarantees that they will continue to do so. There has also been a lot of rumors of Iraqi sub-contractors bidding for Bechtel and Brown & Root contracts with the majority of them being turned down.

    None of this is surprising though as gw & co. have made it clear that they have no intention of allowing the Iraqis to control their own country.
     
  3. Desertrat macrumors newbie

    Joined:
    Jul 4, 2003
    Location:
    Terlingua, Texas
    #3
    Yeah, Iraqis sure oughta get bids if they're qualified and price-competitive...

    But with respect to "One of the many really bad aspects of this is that there is no provision for Iraqi businesses to be allowed to purchase companies.": This wasn't stated in the article; why wouldn't Iraqi businesses be allowed to buy what they can afford--part or all? Or is it that the previously state-owned industries are more costly than in-country money can pay for at fair market value? I don't know...

    I see that the income tax on Iraqi individuals and businesses is limited to 15%, and the import duty is limited to 5%, which is good.

    'Rat
     
  4. Ugg macrumors 68000

    Ugg

    Joined:
    Apr 7, 2003
    Location:
    Penryn
    #4
    I didn't state my case very well. What I meant to say is that no preference is given to Iraqis. There should be some kind of a quota system whereby Iraqis are guaranteed a certain percentage of business purchases. Say 5-10%, that would recognize that few Iraqis have the money to bid in comparison to foreign companies. The success of their business would depend upon competitive practices but at least they would have a foot in the door. It seems pretty strange that the US hasn't done something like this. There is enough anti-American feeling already. Why add to it with neo-colonial behaviour?
     
  5. ibjoshua thread starter macrumors 6502a

    ibjoshua

    Joined:
    Jan 17, 2002
    Location:
    Japan
    #5
    Isn't it just a little bit odd that the Iraqi people have no say in the fact that the whole country is going to be privatised? What happened to bringing them democracy?

    i_b_joshua
     
  6. Sayhey macrumors 68000

    Sayhey

    Joined:
    May 22, 2003
    Location:
    San Francisco
    #6
    We are bringing them the miracle of market economics. You'd have to be a communist to object to that! ;)

    And just to show them how good the free market is, we will auction all of the Iraqi State industries off to the higest (read foreign) bidder. Nevermind that it took decades for the people of the Middle East to get control of their resources from the old colonial powers and the US. What was that term macfan and I were debating a while back -- Oh, yes -- neocolonialism. Welcome to the bad old days.
     
  7. pseudobrit macrumors 68040

    pseudobrit

    Joined:
    Jul 23, 2002
    Location:
    Jobs' Spare Liver Jar
    #7
    Let me explain it, in Bushese:

    Democracy = capitalism

    Mission accomplished.
     
  8. Thanatoast macrumors 6502a

    Thanatoast

    Joined:
    Dec 3, 2002
    Location:
    Denver
    #8
    This has a high potential to backfire. (Obviously, it's a Bush plan:rolleyes:) If foreign companies outbid all domestic companies, all the profits earned will be leaving the country and will not be re-invested into the Iraqi economy. Seems kinda dumb to me. Basic econ, anyone?

    Hmm. If the economy never really recovers, the political situation will probably remain unstable. If the politics remain unstable, then the Iraqis will never be "ready" to govern themselves (under Bush logic). Meanwhile, all the profits will be going to Bush's cronies in the Corporate States of America. [/conspiracy theory]
     
  9. Desertrat macrumors newbie

    Joined:
    Jul 4, 2003
    Location:
    Terlingua, Texas
    #9
    Well, now, if they get the oil production up to the pre-Gulf War I range of some 2 million bbl/day, that's $50 million a day to the Iraqi government. It's estimated to take up to ten years to drill/develop the remaining capacity of an additional 4 million bbl/day. That ain't chump change, climbing from some $15 to $18 billion a year on up to three times that. What was the GDP, pre-war?

    Question: Does anybody know of specific industrial plant/operations to be sold? Magnitude of values, etc.? And, given the past history, how much money do non-Baathists have available for purchases of this size?

    I think the more useful "fuss" would be over maximizing the use of Iraqi sub-contractors to the greatest extent possible.

    'Rat
     

Share This Page