IRAQ: U.S.CONTROLLED IRAQ IS TO ALLOW FULL FOREIGN OWNERSHIP IN ALL SECTORS OF ITS ECONOMY EXCEPT OIL.
Record ID:
646588
IRAQ: U.S.CONTROLLED IRAQ IS TO ALLOW FULL FOREIGN OWNERSHIP IN ALL SECTORS OF ITS ECONOMY EXCEPT OIL.
- Title: IRAQ: U.S.CONTROLLED IRAQ IS TO ALLOW FULL FOREIGN OWNERSHIP IN ALL SECTORS OF ITS ECONOMY EXCEPT OIL.
- Date: 22nd September 2003
- Summary: (EUROPE) BAGHDAD, IRAQ (SEPTEMBER 22, 2003) (REUTERS - ACCESS ALL) 1. GV: SHOPS IN STREETS. 0.06 2. VARIOUS: OF SHOPS IN THE STREETS SELLING SATELLITE DISHES AND APPLIANCES. (6 SHOTS) 0.38 3. CU: SIGN FOR THURAYA SATELLITE PHONES. 0.46 4. CU: MONEY BEING WEIGHED ON MONEY CHANGER'S TABLE. 0.51 5. MV/CU: OF MONEY CHANGER AT HIS TABLE IN THE STREET. (2 SHOTS) 1.02 6. GV: EMPTY STREET/ PAN TO FACTORY BUILDING. 1.09 7. VARIOUS: OF PEOPLE WORKING IN THE BOTTLING PLANT WHICH IS PART STATE OWNED, PART PRIVATELY OWNED. (3 SHOTS) 1.26 8. SCU: (SOUNDBITE) (Arabic) BOTTLING PLANT MANAGER, ADIB NOMAN SAYING: "If foreign companies come to Iraq of course it will have a negative effect on Iraqi factories because these companies are big and known worldwide, and so the small factories will be affected by this privatisation." 1.48 9. MV: MORE OF BOTTLING PLANT. 1.54 10. SCU: (SOUNDBITE) (Arabic) NOMAN SAYING: "It's the wrong time to sell the public sector. It won't serve the Iraqi people to sell the public sector. Iraq does not need foreign investment, it needs stability, security, a political vision of the future. We need to know whether or not the coalition forces will stay or leave Iraq. The future of Iraq is uncertain. It's too early to talk about privatisation and investments. Yesterday, all the media was talking about privatisation, it was like a bombing." 2.46 11. WS/CU: RAFIDIN BANK WHICH IS STATE-OWNED. (2 SHOTS) 2.57 12. VARIOUS: IRAQI COMMERCIAL BANK. (3 SHOTS) 3.12 13. WS: CREDIT BANK OF IRAQ. 3.18 Initials Script is copyright Reuters Limited. All rights reserved
- Embargoed: 7th October 2003 13:00
- Keywords:
- Location: BAGHDAD, IRAQ
- Country: Iraq
- Reuters ID: LVAC3AYNEGXEZZBNF1NDF9U3SVZH
- Story Text: Iraq is to allow full foreign ownership in all
sectors of its economy except oil.
U.S.-controlled Iraq is currently in talks in Dubai
to discuss Iraq's needs to be presented to potential
international donors in Madrid.
Iraqi Finance Minister Kamel al-Keylani unveiled on
Sunday (September 21) sweeping reforms which will allow
foreign investors into all sectors of the economy except
oil. This move will end 30 years of state economic control.
Al-Keylani said the reforms would "significantly
advance efforts to build a free and open market economy in
Iraq", spur economic growth and speed Iraq's re-entry into
the international community.
The list of reforms for liberalising foreign
investment, the banking sector and taxes and tariffs read
like a recipe devised by Washington for a capitalist Iraq.
Senior U.S. officials involved in Iraq's reconstruction
say the move will help the country create new jobs and
growth.
The surprisingly broad measures will end an era of
economic domination under Saddam Hussein and the socialist
Baath Party and are aimed at improving global opinion
before a donors' conference in Madrid next month.
Washington's invasion of Iraq in the face of worldwide
opposition raised hackles in Europe and concern in Iraq and
the Arab world that it sought control of Iraq's oil and
resources.
However, the reforms include 100 percent foreign
ownership in all sectors except natural resources,
excluding current outside participation in Iraq's coveted
oil reserves, the second-largest behind those of Saudi
Arabia.
The Alreem bottling plant in Baghdad employs around
100 people and produces about 2,000 bottles a day. It is a
small company which does good business bottling soft drinks
for larger multinationals like Pepsi.
The manager of Alreem, Adib Noman, is worried that the
influx of foreign investors in Iraq, bereft of a government
and struggling to rebuild itself after decades of war and
sanctions, will eat up small to medium firms like his.
"If foreign companies come to Iraq of course it will
have a negative effect on Iraqi factories because these
companies are big and known worldwide and so the small
factories will be affected by this privatisation," he says.
He is also worried that the new economic reforms are
coming too early and that the coalition's priorities should
be security and the building of a new government rather
than financial investment which will benefit countries
outside of Iraq.
Iraq's reconstruction has been hampered by lawlessness
five months after ousted former Iraqi President Saddam
Hussein's fall and its people are struggling to cope with
daily life.
"It's the wrong time to sell the public sector. It
won't serve the Iraqi people to sell the public sector.
Iraq does not need foreign investment it needs stability,
security, a political vision of the future. We need to know
whether or not the coalition forces will stay or leave
Iraq. The future of Iraq is uncertain. It's too early to
talk about privatisation and investments. Yesterday, all
the media was talking about privatisation it was like a
bombing," Noman said.
A U.S. official noted the open-ended foreign
investment proposals did not require any screening process
-- something he said the Iraqis had requested -- which
would make investment there more alluring to foreigners.
Foreign investors cannot own real estate but can lease
property for 40 years under the new rules.
The reforms also include a free transfer of foreign
exchange earnings for investors, full central bank
independence and relatively free entry for foreign banks
into Iraq.
New bank rules were signed in Iraq on Saturday, the
U.S. official said. Six foreign banks will get "fast-track"
entry into Iraq and full ownership of local banks within
five years.
Other foreign banks would be allowed 50 percent stakes
in local banks.
The new laws also slash top marginal tax rates for
individuals and corporations to 15 percent from a prior 45
percent, the U.S. official said.
Iraq will also slap a five percent surcharge on all
imports except for humanitarian goods like food, medicine
and books.
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