Economy crisis and opportunities for reform 2 3

8/10/2015 0:00

Dr. Ahmed Ali Abrihi

It is necessary to understand that the real solution to unemployment in the economic development in the traditional sense. It is despite the inclusion of all sectors of the economy except the manufacturing-centered and do not have another way. The strength of the unconditional efficient investment any investment generates attractive returns financially
And economically.

To clarify, Iraq's population is now estimated 36 million people, and the working-age population to 59 percent of the total population, and to assume that economic policy designed to run one-third of the total population or 56 percent of the working age population, it means the economy access to the possibility of providing some 24 million 2040 work outside the oil sector, and at the moment there are no more than an opportunity to 8.4 million of them.

How much capital is required to achieve this goal? The answer depends on the non-oil GDP per capita, which is intended to achieve at that time and not 15 thousand dollars, which is not much, but keep the economy within the category of developing countries, and without the newly industrialized countries ahead threshold Important.

This goal requires at least $ 3 trillion from $ 2015 at an average annual capacity of 120 billion dollars, starts at about $ 47 billion a year to start and ends with a modest $ 241 billion by the year 2040, the end of the track.

And to ensure that this investment provides the voltage needed jobs should adopt an economic policy influence the choice of technology consistent with the presentation of the workforce to be employed.

Economic and express characteristics of such technology that the average capital of the worker at the time by about 140 000 dollars, and the intervention in the index of all direct and indirect capital to build any infrastructure, economic, social, and investment product directly in the lab And the field.

And this example does not mean the postponement of the solution for many years but the economic goals for the long term is the path which leads the economy in the right direction towards progress, which responds to the legitimate demands and show good results since direct Out.

In 2003, the scenario for the development of the economy of Iraq proposed on the basis of strategic growth Almkad industrial exports which Asian model (Japanese, Korean, and Chinese now). And it reached to the possibility of the arrival of Iraq in 2030 the threshold of the newly industrialized countries. And demonstrated financial, monetary and trade policies are consistent with those elements Strategy.

She suggested that the state departments initiate programs to provide an initial investment for the development of sectors, to form informational material help to choose. And controlling government spending and a clear relationship to GDP (total economic potential),
Government is committed to a ceiling of wages and employment in the public sector in harmony with the economic role of the private sector on the one hand and financial sobriety on the other hand, it has not taken such Indicators.

In the second half of 2008, the price of oil fell and that was appropriate to remedy things. It prepared a study of the political economy of the budget deficit at the time, and later became the first part of the book of the international financial economy and monetary policy.

In that study the mechanism of how to cut costs proposed based on the examination of the operations carried on departments and adoption by the General Directorate and similar starting point. It is the first step to re-examine the budget, at the time, and work continues to rebuild government agencies on the basis of cost reductions in the context of ensuring the efficiency and good disposition of resources.

The study also showed internal financing of budget deficit ceiling with government spending commitment to take into account the possibility of the international reserves of the Central Bank in bridging the balance of payments deficit, and the time period allowed by those reserves under different assumptions, and neglected those proposals such as its predecessors.

I've had to reduce the exchange rate of 2,000 dinars to the dollar to 1500 dinars and later to 1170 dinars error right the damage to the economy and opportunities for development.
It is known that over-evaluation of the Iraqi dinar in foreign currency (ie reduce the dollar exchange rate) lead to the deterioration of the international competitiveness of the national economy, a shrinking commodity production for the benefit of the importer and the decline of the potential Export.

With great regret experts and decision-makers was a rush to respond without request for clarification by saying: we do not have what we export, while not intended to export than we have. But investment in commodity production decision is the essence of the act, which is intended Development.

Because the price and the cost structure and including the exchange rate and the prices of local shops and cost the Cubs, for the unity of the product under the prevailing technology and organization, these elements are determined by the financial and economic feasibility of the investment project. And industrial development does not begin until the moment when the investment is worthwhile, and the exchange rate is an important element in This system.


We cross the floor Msmoao experts and socially influential figures their opinion literally «Let's have the ability to export first and then adjust the exchange rate», and told semantics Unfortunately they do not realize Tnaqdahm which is no different to say, let the patient recovers first and then give out Medication.

In the fields of economic activity to the private sector there are a lot of studies that have attempted to diagnose the obstacles at the detailed level. But common approaches have failed to take off from the private business sector mechanism in watercourses decision which is always centered prices and revenues, costs and risk ..

And so on. Did not speak of an economic government consulted on the subject of the economy and did not show the exchange rate, wages, inflation and tax and subsidy and interest rate relationship at home and return on investment in overseas investment ... the decision of the private sector, and accuse others of being Nzeraon or Mrkzion government. A similar failure in the foreign investment policy because it did not come from homes Doors.

They did not speak even once on the macroeconomic framework for foreign investment, and it relates to rates of return and risk in Iraq, and the depth of the financial market. What are the potential for the flow of foreign investment effects, the imposition of receiving, in an oil economy when the balance of payments in the case of the surplus and how they differ when it gets the deficit, and the relationship between investment flows from abroad and reserves of the Central Bank, and the relationship of foreign investment, the total size of the investment activity and national savings ...

And that foreign investment looking for economic success does not benefit from it to make a development success story for Iraq, has shown that foreign investment in my book (2014).
If it is really owned by the state departments of the nation and not to the occupants of what things have reached what we are.

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