The text of Allawi's resignation
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The text of Allawi's resignation
Admin Wed Aug 17, 2022 9:32 am
The text of Allawi's resignation
17th August, 2022Shafaq News Agency publishes the text of the resignation of Iraqi Finance Minister Ali Abdul Amir Allawi, which he submitted to the Council of Ministers today, Tuesday.
This evening, Prime Minister Mustafa Al-Kazemi assigned Oil Minister Ihsan Abdul-Jabbar, with the tasks of managing the Ministry of Finance, an agency "temporarily", after approving the resignation of Finance Minister Ali Allawi.
To view the 10 page resignation text, click here
Translation.....
1. Prime Minister Mr. Mustafa Al-Kazemi, Respected, I am writing to inform you of my decision to resign from the position of Minister of Finance, because I believe that this is the right time for me to leave the story. Immediately. The country's financial situation is good, our treasury liquidity is good, our foreign exchange levels are very high, the economy as a whole is also well, and the International Monetary expects a growth of 11% this year. On the administrative side, I believe that the current senior general managers, led by the Acting Under Secretary, can manage the day-to-day financial under the supervision of the Acting Minister of Finance. As we do not have a budget for the year 2022, as this government was not allowed to present one of its current status as the day-to-day caretaker government. However, the Food Security Act has given us enough flexibility to continue to cover recurring expenses and any other additional expenses until such time as the budget can be drafted by the new government subject to Parliament.
Honorable Prime Minister, When you asked me to join your government for the first time, I accepted, and I appreciate your trust in me as a person and in my abilities. I have known you for more than a year. First in the struggle against dictatorship and then in the new regime that emerged after 2003. I have always considered you a friend and colleague and I did not ask for this position, either directly or indirectly, and I did not seek to continue my career in the world of politics. I did not make any promise or had any contact with any party or political figure in any matter related to the position of Minister of Finance. I accepted the position because I felt able to contribute to the new government and strive to improve the welfare of the country and its people. I wanted to help with the severe crises we faced and to set the framework for a long-term reform and restructuring plan for the economy. I did not envision a long-term existence, because this government is charged with arranging elections quickly. I have told you that I did not envision remaining in government after the date of the elections, which I thought would take place by the end of 2020. In this case, elections were held in October 2021 and I agreed to remain in the government until that date and to form a new government. It has been almost a year since the elections and there is no new government in sight yet. Our term has been extended due to political issues. But the government that agreed to serve in it has changed from a government with full powers to a caretaker government. A day caretaker, almost by definition, has a limited life of a few weeks. We are now in a situation where our term is a regular government, but our legal and operational status is a caretaker government. It is very frustrating to be in a situation where we know what to do but are unable to do so due to the very limited scope of action and the absence of parliamentary legitimacy. And vice versa also, we know that some things have to be stopped or modified but we can't do anything for our restricted lives.
There are very limited actions that the caretaker government can take without legal authority. Due to the current situation where my ministerial powers are severely restricted, it is almost impossible to launch any serious measures or initiatives. The balancing work on the budget has been completed.
2. 2022 has been around for a long time, but it can only be submitted by a government with full powers. In addition, our reform efforts are stalled by Mr. Al-Benin regarding the future direction and the priorities of the next government. We can say that the current situation is unreasonable and unacceptable. I believe that I have served faithfully and to the best of my abilities during the past few years, although I did not always agree with the decisions of the government and made my position clear on many occasions and in cabinet meetings in private and publicly. There was a difference of opinions, and I appreciate discussing these differences seriously and openly. However, in a few cases, it has been of such great importance to me that I have resigned. These were not superficial positions, but issues of principle. However, I appreciate your help and support. Six times more than once under constant pressure and attack, and you have stood by me during these many crises, and I greatly appreciate the positions. In May 2020 after the House of Representatives approved my candidacy, in a procedure that was not easy, as many parties did not vote against me. I still don't know why these parties took this position on my candidacy because I had had little political participation since 2006. It was the Sadrist vote that made my candidacy possible, but as I indicated I had no contact with them on this matter.
The last time I entered the Ministry of Finance was in the year when I was also working as Minister of Finance under the transitional government of Dr. Ibrahim Al-Jaafari. And in the next few weeks of coming to the Ministry for the second time, I learned the shocking truth about how much the machinery of government had deteriorated in the past fifteen years. Large joints of the state we did have been taken over by political parties and special interest groups. The ministry itself was rudderless for more than a decade. One of its ministers had failed Basbad, claiming that he harbored terrorists. After that, the ministry was run by acting ministers assigned from other ministries. They had little understanding of finances, and thus they could not provide a fiscal policy framework for the country. During the war against ISIS terrorist gangs, the then Finance Minister was removed from his post by parliamentary questioning. A new finance minister was not appointed until after Mr. Adel Abdul-Mahdi assumed power in October 2018. My predecessor, Dr. Fuad Hussein, to whom I have the highest regard, held the position of Minister of Finance. However, his tenure was interrupted with the October 2019 demonstrations and the government resigned shortly after, I came to the ministry amid the double crises of the Covid-19 pandemic and the collapse of oil revenues, there was no budget and the state treasury was empty. All previous government surpluses have been used to fund emergency payments and maintain salaries for public sector employees. Public sector salaries themselves have been greatly expanded, in part to appease protesters' demands. The Ministry of Finance was at the epicenter of the crisis and people were looking to the Ministry of Finance to provide it with the necessary resources to finance the government's recurring expenditures, the investment budget and the health emergency financing. It was a very difficult task in the first few months of the government. There were times when the government was literally exhausted. Our foreign exchange reserves were withdrawn, and the International Monetary Fund predicted that we would lose a large portion of our foreign exchange earnings within a year.
The Ministry of Finance that I headed was a ghost compared to what it was in the past. Managers held their main positions for only short periods, and many of them fell under the influence of political parties. Not all general managers were suitable or qualified for the jobs for which they were responsible. The number of senior staff I was acquainted with in 2006 had been drastically reduced, through convergences of “fires, resignations and even murders." Standards have fallen to a very low level. The Ministry of Finance was full of people.
3. With a legacy I had to design a way forward. With questionable qualifications, no meaningful experience or skills, with little understanding of modern practices in public administration or financial management. Incompetent and politically connected administrators removed skilled and effective administrators. The Ministry of Finance was able to manage salary payments and other routine payments included in the budget, but it was far from being the principal institution of the country's financial and economic policies. This resulted in my realization, within a few weeks, of the extent to which the Ministry was devoid of its skills and capabilities during the past years. The six things through which I tried to develop the ministry's work strategy are: The first is the management of the immediate financial crisis due to the collapse of oil revenues and the loss of all our financial liquidity, as there were literally days that were implemented in the Ministry of Finance. Addressing the expectations of government departments, parliamentarians and the public. As they were often in a state of denial of the gravity of the financial crisis, the same amount of support and privileges from public resources. The pressure to get the money came from increasing intensity.
The third is to work on the 2020 budget and prepare for the 2021 budget. It was a balancing act. There are only a few months left in fiscal year 2020. A fourth is to work on a medium-term plan to reform public administration and the economy. The fifth was managing the Ministry of Finance itself and maximizing the limited human resources that we had. Long-term restructuring and repositioning of the Iraqi economy in light of the many great challenges that 2020 is a parliamentary demand although, with the recovery of the economy in 2021, another set of problems emerged represented by pressures on the cost of living as a result of the rise in global prices of basic commodities, Especially food. In addition to the high accumulation of arrears significantly during the period due to lack of funding.
All of this had to happen in an environment of constant political pressure from parties and parliamentarians, street demonstrations, without hostiles on social media and constant media slander, fake news and allegations, constant demands for funds by ministries exposing large-scale fraud and scandals, and emergency funding demands. In addition, I had to face funding requests from the Kurdistan Regional Government which were questioned, summoned to appear before the House of Representatives in two full sessions, and several times before the Finance Committee of the House of Representatives and other committees, signatures by members of the House of Representatives for my exclusion and the threat of legal action against me, and already started in two cases.
4. Both reached the Federal Supreme Court, which ruled against these allegations. In another case, I was threatened with a travel ban because I refused to respond to a summons from a political leader. It was a stressful and sad process in every sense of the word, yet the ministry achieved many tasks during this period, the most important of which are listed below:
We were able to repel the collapse in the state's finances through the in spending. - We maintained investment levels in light of severe financial constraints. We funded all the needs of the Ministry of Health during the pandemic. We presented the 2020 budget as promised, despite its withdrawal at the request of the House of Representatives. We have finalized an expansionary budget for 2021, which was approved by the House of Representatives. We proposed laws expanding our ability to borrow locally, which were necessary to maintain the country's solvency. We funded the elections by passing a law on financing the elections, as suggested by us. We financed the electricity sector and its insatiable demand for more money to meet its investment obligations and to buy fuel. Hanna is a comprehensive plan to reform the economy and the public sector. This was met with broad international and domestic support. And called the white paper, we were established to oversee the implementation of the white paper. We advocated devaluation, which was perhaps the single most important economic measure taken by the government during this period. It was a fundamental and much delayed decision, taken boldly and with the support of the majority of the parliamentary blocs, because it was so necessary.
The wave of upheaval in the competitiveness of the economy, and contributed to the distortions that allowed huge commercial profits to be achieved by a handful of speculators. We strongly defended the increase in allocations to the poor and needy in the 2021 budget to compensate for any potential loss of income as a result of the currency devaluation. Unfortunately, this was omitted by the House of Representatives in the final budget version for 2021. - We presented the first publicly marketed local bond issuance with good returns to encourage the flow of savings to new investment tools and start the process of establishing markets for government securities. We have completed the necessary preparations for the 2022 budget, and it has not been presented to the government for discussion and approval due to the Federal Supreme Court ruling that we are not authorized to present any law as a caretaker government. We introduced the Food Security Law to allow more transfers to the poor and needy as a result of the global rise in prices due to the Ukrainian war in the absence of a 2022 budget. This law gave the government an additional deadline to fulfill its current and investment financing obligations. Hanna created an entirely new framework for identifying, evaluating and developing major infrastructure works and projects of a strategic nature. Recently approved by the Council of Ministers, it will allow the government, through the Ministries of Planning and Finance, to appoint an internationally recognized project management company to oversee the selection process for large and strategic projects. Through the Ministry of Finance, it launched a number of new programs and initiatives to address the weaknesses that have multiplied over the years. We have started a comprehensive plan to automate the financial management of the entire country. This has been the IFMIS program that has been postponed since 2005. It is being implemented in cooperation with the World Bank, which will revolutionize public financial management. We launched the full automation of the customs authority by signing an agreement with UNCTAD to publish the globally recognized ASYCUDA system for the management of the customs machine. We completed the request for final proposals for a new system to reform the tax system of the Tax Authority with the help of the World Bank.
5. - We presented a final plan to reform the administration and board of directors of Rafidain Bank by proposing a new internal system for the bank, and it is now under the State Council's attention for final approval. Once approved, a similar set of internal systems will work for Al-Rasheed Bank, as government banks cannot be reformed if the current internal systems remain. A supervisory body to manage the troubled agricultural bank in cooperation with the Central Bank. We have accelerated the sale of state land at market prices wherever desired and possible, with significant increases in revenue from land sale, and we have significantly increased land for industrial projects. We have organized a new strategic framework for the Free Zones Authority and will propose a new law for the Free Zones Authority. The French Development Agency to support the establishment of an institute to train middle and senior government financial and economic cadres on international practices in financial and economic management. This will be run through the Development Department at the Ministry of Finance. The European Union and the German Development Agency support the team implementing the recommendations of the white paper and the Ministry of Finance with expertise offers a program to send 100 promising young candidates in the Ministry of Finance to cover postgraduate courses in management, finance, banking and public administration in international universities. Foreign technical expertise in the field of public financial management. Here I would like to point out that our relations with the Central Bank were excellent, which allowed us to coordinate with them in monetary and financial policies.
On the international level, our relationship on the economic level with international development agencies, the seven major industrial countries, China and the Gulf Cooperation Council countries is excellent. The Iraqi-Saudi Joint Committee, which I chair from the Iraqi side, has been activated by a number of projects and initiatives. We have also managed the difficult issues associated with making payments owed to Iran and maintaining our compliance with US sanctions on that country. I have made it my own approach to fighting corruption whenever and wherever I can. In the first few weeks of taking office, we stopped a suspicious network, and carefully examined all requests for tax and customs exemptions. She personally tracked requests for project approvals that passed all the scrutiny, but were unnecessarily blocked or delayed. And it was the Ministry, under direct orders from me: personally, that it was the Ishtar Gate payments contract with the Rafidain Bank, which would have imposed an unjustified cost burden of hundreds of millions and for many years on the depositors of the bank. The Ministry also cooperated fully with all official, parliamentary and judicial bodies that look into corruption cases in the Ministry as a whole. The question that arises here; Can the Ministry of Finance or the government as a whole achieve more achievements during the past two and a half years? It is easy to ask for a better performance than any government, but I believe that in the area of economic and financial management, the performance of the government is exceptionally good. We have achieved a lot and made some very important, even crucial, decisions that will affect the long-term course of the country's economy.
However, it is very difficult to make major economic changes and reforms on a continuous and sustainable basis in light of the political economy context. I must admit that I did not foresee the appalling deterioration in the standards of governance in our country over the fifteen years past.
6. Almost everything is conspiring to thwart real change and bribe the leaders with corrupt practices that destroy the moral and material foundations of the country. On the issues of electronic payment corruption for me is the straw that broke the camel's back. It was not a rare case, but it clearly reflected to all parties the extent of the imbalance in the system. It crystallized the degree to which the status of the state deteriorated and became a puppet of special interests. The matter is now with the judiciary and its investigations after the ministry has made its observations, so I can't comment on it, but it does raise a whole host of questions about how to make the right decisions that affect millions of people and vital state institutions in the public interest. Extensive clandestine networks of high-ranking officials, businessmen, politicians and state employees are working in the shadows to control entire sectors of the economy, withdrawing billions of dollars from the public treasury. These networks include major political parties, parliamentary immunity, the arming of the law, and even foreign powers. And it maintains the silence of the secretaries' officials because of fear and threat of force. This massive octopus of corruption and deception has reached every sector of the state's economy and institutions and must be dismantled at any cost if this country is destined to survive. Here, I hope that the investigative judges in the Ishtar Gate case will follow the threads wherever they go to be a good gesture to restore confidence in the system. Prime Minister, it makes no sense to talk about "corruption" as a shorthand for the problems of the economy, as it is the end result of the process and not the beginning. It can be described as cancer that can kill the body, but it spread due to the weakness of the body, the weak immune system, the absence of prevention, and the neglect of pelagic measures. Corruption thrives in Iraq because the system tolerates it and allows it to thrive and grow. Addressing corruption is insufficient by increasing the rhetoric against it, establishing more investigative bodies and introducing more punitive measures.
We have to rebuild the capacity of the state to prevent the spread of corrupt practices. We have to radically reform the state administration by reducing traditional procedures, laws and practices. We have to radically develop the qualities and skills of middle and advanced managers in the country. We must remove the protection given by political parties and their leaders to corrupt individuals and corrupt practices. It can destroy the culture of greed, idleness and impunity that allows corrupt practices to flourish. We must demystify many of the government's decisions about expenditures and investments. Corruption thrives on unfortunate deals - in the dark, lack of openness and transparency. And we have to retreat from the double price system that allows corruption, that is, there are double prices for the same product throughout the economy. There are market prices, then there are prices determined by administrative orders or a ministerial committee that have nothing to do with irrigation prices. This affects the land markets, housing, fuel markets, basic foodstuffs, agricultural and industrial inputs, credit markets, foreign exchange, medicines and medical services, power generation and electricity distribution, and tariffs) that. It has been wrongly said that this system helps subsidize the poor, but it is in fact very expensive and encourages corruption wherever it is found. There are better and more effective ways to help the poor without these massive distortions that destroy the functioning of markets. Throughout my tenure in this government, I have been guided by three basic factors: the duties and responsibilities of my position; My desire is to see this nation succeed. Loyalty to colleagues in the Council of Ministers.
7. I will give you my personal view on the nature of the rules by which history must be issued. To have any evaluation process. The first rule of assessment is whether the government has succeeded in preserving the unity of the homeland and citizens and protecting the people from external and external threats. The second rule: Were the explicit promises made by the government at its formation fulfilled? These were linked to holding the elections within an acceptable time frame and defusing tensions that had been exacerbated by large-scale protests. The third relates to managing the shocks that the state has experienced during your tenure as Prime Minister. These twin crises Covid 19 and the collapse of oil prices and government revenues. Each of these huge challenges culminated in the first months of this government. Especially political reform, these rules are applied to the period of any normal government, but this government was exceptional, and it came to power as a result of a state crisis with the collapse of the previous era. This government was a government with powers, but its main political goal in bringing it to power was the abbott procedure. Since October 2021, and since then this government has been operating with significantly reduced powers as a caretaker government. The last factor relates to whether the government has succeeded in achieving the objectives of its broad public policy, anti-corruption and economic restructuring agendas.
That, and in my personal opinion, the initial results of the performance of this government can be summarized as follows: - The government has improved the security and livelihood of the people, despite all the setbacks, the general situation is now much better than it was when the government came to power in May 2020. The government's respect for political violence in the country. Despite the recent large-scale demonstrations, the violent incidents in Al-Shwar are negligible compared to the October 2019 demonstrations. Free and fair elections, agreed by all independent observers, within the promised timeframe. An important promise has been fulfilled. The government effectively managed the twin crises of the Covid-19 epidemic and the collapse of oil revenues. The comprehensive control of public expenditures, the timely, necessary and effective currency devaluation, the successful 2021 budget, and the food security law have made public finances on an equal footing. The White Paper was a detailed roadmap for reform and restructuring of broad domestic and international recognition and support, as well as containment of damage from COVID-19 during a massive vaccination campaign.
8. The government has succeeded only partially in its political agenda, as the political scene is much more divided and conflicted than it was in 2020. The government is able to achieve a degree of independence from the main political groups; Nor has the state as a whole been freed from the domination of 107 political parties and foreign interest groups. This was a concern of mine. Mostly successful foreign policy government. Iraq's foreign relations, although tensions flared up from time to time, were balanced and proceeded in the greater interest of the country. Initiatives such as the Baghdad Conference have been launched that can have great long-term development potential. It has been instrumental in attracting our Saudi and Iranian friends and neighbors to a neutral forum in Baghdad where they can discuss their issues and problems. But this government has not been able to reduce or eliminate foreign interference in politics. The government has put in place a bold strategy for economic and administrative reform. However, the strategy has not yet achieved the desired effect in halting the decline in administrative capabilities and the effectiveness of the public sector, or in radically changing the country's economic hubs. But the government did not succeed in controlling corruption and then reducing it. Corruption is a multi-headed beast and in the past twenty years has taken root in the country. It cannot be controlled, let alone uprooted, if there is no political will and consensus to do so. Corruption is still rampant, debilitating and widespread.
I think the government has accomplished a lot, and if given time and pain, it could have done so much more. The white papers laid out a detailed roadmap for public sector reform. I had hoped to lay out a vision for reform and restructuring and help create institutions to oversee the process. I knew that the process had exceeded the term of this government. We needed four or five years to implement the vision of the White Paper and to see the desired results. However, the government's plans and programs were always constrained by the need to reach broad agreement from a fractured political class which proved difficult and elusive. I hope that the country's political leaders realize the seriousness of the issues facing us and push for a solution that ends this exhausting impasse. All calls for reform have been hampered by the political framework of this country. The parliamentary system introduced in 20 has been distorted in order to serve special interest groups and undermine the state and its institutions. It has allowed the takeover of the state by patrons of narrow interests. There is no doubt that reforming this system with constitutional changes or even a new constitution is necessary. And for humans, countries do not die permanently. Zombie countries can remain for years or even decades before they are buried. I think that the Iraqi state that was born after the 2003 invasion shows signs of an incurable disease. It is true that the mechanism of government continues, and the manifestations of state power remain, but there is no substance to the form. The central authorities of the state face challenges at all levels. Where the state does not control its borders, its sovereignty is constantly violated, and terrorists who target our neighbors use our lands as a haven, our security forces are institutionally divided and our parliament is currently broken. Our constitution is often impractical and is regularly neglected and our political system generates stagnation and blockage. Account and punishment do not include the great leaders, and the state's resources are ineffectively exploited, wasted, misused or stolen, and no one is held accountable for the disasters that befell this country. Foreign powers directly affect vital institutions and are behind the appointment of key figures in the government, and the end result is the fractured country in which we see ourselves. A country of 40 million people, with the set of difficult issues we face, must have a government with the powers to be able to implement the necessary plans and measures with the appropriate legal authority. It is a clear indication of the defect.
9. Our political life, as the political parties were not able to choose a new president and a new prime minister after a long period of elections. It is also very problematic and disturbing that a major political force has abandoned the political process and withdrew from the parliament. The replacement of the council members who resigned politically or even morally cannot be disregarded by simply appointing those whose only electoral achievement is to get second place after the winners. In any other country with a parliamentary system this will lead to either new elections at the national level or a special election to replace those who have resigned. I say this not to detract from the legitimacy of the House of Representatives, whose rules and procedures I respect despite many comments. I say this to confirm that the opposition outside the dome of the House of Representatives is now a force that must be taken politically and its opinion and viewpoints taken into account in forming the new government.
In fact, I now believe that state institutions, even in their weak state, lose their credibility and authority with the withdrawal of the Sadrist movement from the parliament. Any new government that is formed under the current regime lacks full legitimacy in my opinion unless the opposition outside the House of Representatives recognizes it, and if it does not necessarily agree to it, as a government with powers. The fact of the matter is that there is a widening gap between the political class and the public as a whole. The citizens of this country are increasingly disconnected from the political process, the political class, the state in its current state, and even the very idea of democracy as it is practiced in our country. We don't have much time to reverse this very dangerous friendliness. The political impasse has now reached very dangerous levels. The demand for reform of the political process became but because the channels for bringing about change within the system were almost completely blocked, the only recourse was civil disobedience. This is not usual in democratic countries where the official channels for bringing about change are controlled by the forces resisting change. Usually a crisis or a shift in public opinion to change the accounts in favor of change. This did not happen in Iraq. The more people alienate the regime and express their disapproval by not participating in elections, the more likely the regime will continue in favor of those who want to maintain the status quo. The forces that maintain the existing order, for whatever reason, are formidable. The arguments for age within the current political process range from constitutional formalities, following appropriate legal and administrative procedures, and frankly, interest. There is an outside party that can resolve the dispute, and there is no, at least for the time being, willingness on the part of the honorable reference in Najaf to influence one side or the other or against both. This could give legitimacy to abandoning the current system rather than moving towards a new one.
The outstanding issues for any new government are critical. It can only be dealt with with great political decisiveness and foresight. On my part, I do not wish to serve in any ministerial position anymore. It is time for youth to take on the heavy mantle of government. We are in need of new elections with a large participation rate to consolidate the credibility of our democratic institutions. I also believe that we need a fundamental review of our constitution. There is no sacred constitution. It must be changed and modified as necessary to serve the greater interest of our people. In particular, the vague clauses, the uncertain powers, and the difficult and even impossible conditions for making amendments, made or consider the possibility of new constitutional arrangements. We are facing one of the most serious challenges faced by any country in the last century. I presented my views on the critical economic and financial issues facing this country to all political leaders several months ago. It is also publicly available on the Ministry of Finance website. The Iraqi crisis is multidimensional. It brings together a large number of critical issues faced by a few countries of such gravity. These issues cover the full range of political, security, management, economic, energy, employment, social, and environmental, climatic and demographic risks, in an environment of uncertainty and geopolitical turmoil. It is a crisis of the effectiveness of a state, a society, and even individuals among themselves.
10. It's hard. But with big problems comes the awesome, that's what history teaches us. Our leaders and people must realize the seriousness of the dangers we face. With the rise in oil prices, we had another opportunity to plan for a better and more fulfilling life for our people. But plans and strategies are not enough. It must build n a solid foundation of necessary political, ethical and institutional preconditions. We need a leadership of the highest quality that affects itself and its immediate self-interests. We need ethical behavior in the highest positions in the country to become a moral compass for society and government departments. We need institutions with effectiveness, depth and integrity. We need stability, cohesion and continuity in our political arrangements. Countries facing enormous challenges need the best kind of leadership. I hope to have such a leader with the right team to lead the country forward and to safety. I wish success and success to all our people who have suffered a lot and expect their leaders to be up to the task and responsibility.
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