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By John Lee.

China's Huawei has organised a technical seminar at the Ministry of Electricity's headquarters, focused on digital transformation, the future of energy, and programs for protecting electrical systems.

The seminar was attended by the Director-General of the Technical Department, along with several specialists and advanced engineering and technical staff.

The participants provided a detailed explanation of the programs and advanced technologies employed by Huawei in communication systems and digital transformation. They elaborated on how modern digital technology contributes to achieving sustainability and creating smart communities aimed at development in the advanced world of technology, specifically in managing smart electrical systems.

The Minister emphasized the ministry's policy, highlighting the secure operation of the system, adherence to accurate scientific standards, and the analysis of technical issues to identify their root causes and prevent their recurrence.

(Source: Ministry of Electricity)

By John Lee.

The United Nations Development Programme (UNDP) has responded to a claim that large sums are being lost to corruption in Iraq as donors fail to track spending on post-war reconstruction.

According to an article in the British newspaper The Guardian:

"The alleged kickbacks are one of a number of claims of corruption and mismanagement the Guardian has uncovered in the Funding Facility for Stabilization, a United Nations Development Programme (UNDP) scheme launched in 2015 and backed by $1.5bn (£1.2bn) in support so far from 30 donors, including the UK."

In a statement (see below), the UNDP has emphasised that it has zero tolerance for fraud and corruption, adding:

"We take any allegations very seriously and are urgently looking into them. We will take appropriate and firm action should any of these allegations be substantiated ... UNDP welcomes scrutiny of our projects and programmes."

Full statement from UNDP:

In response to a recent Guardian UK article regarding the UNDP Iraq Funding Facility for Stabilization (FFS), the UN Development Programme (UNDP) would like to state the following:

We take any allegations very seriously and are urgently looking into them. We will take appropriate and firm action should any of these allegations be substantiated.

UNDP has zero tolerance for fraud and corruption, and this applies to all UNDP staff members, non-staff personnel, vendors, implementing partners and responsible parties.

But zero tolerance does not mean zero risk. UNDP has been transparent with our donors, partners and the public about the operational risks and challenges following years of conflict in Iraq.

Any allegation of bribery, corruption, or fraud is thoroughly assessed and, where appropriate, investigated by UNDP's independent Office of Audit and Investigation (OAI).

In cases where an OAI investigation substantiates evidence supporting allegations of misconduct, UNDP has a rigorous disciplinary process that enables it to take appropriate actions against perpetrators of fraud and corruption.

In the case of FFS, given the complexity and scale of the programme, and in line with best practices, UNDP implemented a series of additional monitoring measures beyond the standard protocols which include among others:

• In 2015, a specialized Operations Service Center was established for the FFS to manage complex procurement and operational cases, including providing due diligence and oversight.
• Since 2015, a dedicated M&E team has monitored impact and results of the FFS, undertaken physical verification of projects on the ground, and provided support to third-party monitoring missions, among other tasks.
• A dedicated OAI investigator is in place, attached to this project who thoroughly investigates all FFS allegations.
• Project audits have taken place every year for the period 2019-2022, covering more than US$1bn of expenditure on the FFS.
• OAI has also audited the operations of the Country Office as a whole in 2023.

All OAI's audits are publicly available on their website.

We are determined to take action on cases of wrongdoing. Over the last 8 years, OAI has processed more than 130 cases related to the FFS, brought to the attention of OAI by our own staff members and third parties, with prompt action taken by UNDP management in response.

UNDP welcomes scrutiny of our projects and programmes - as a public institution we are and should be held to account by our partners, by the public, and by the media.

In our work in Iraq and with the FFS, we have in place a rigorous set of measures to manage the risks inherent in working in such a challenging environment. We continue to strengthen these measures in close collaboration with our Independent Evaluation and Audit Offices.

We stand by our strong commitment to support the lives of millions of people in Iraq whilst maintaining the trust of everyone with whom we work.

What the FFS has achieved:

In 2015, at the request of the Government of Iraq and with the support of the international donor community, UNDP Iraq established the FFS to carry out a fast-tracked and accelerated program of reconstruction activities that have benefitted millions of Iraqi citizens to date.

The programme has enabled the return of almost five million out of six million Internally Displaced Persons, who might otherwise have remained stranded in IDP camps for years. Through the completion of more than 3,600 projects, Iraqi communities that host around 8.3 million people, now have access to restored basic services including schools, hospitals, water and electricity networks, housing and roads.

More information on reporting wrongdoing can be found at: https://www.undp.org/accountability/audit-and-investigations

(Sources: The Guardian, UNDP)

By John Lee.

Ziad Ali Fadel, Iraq's Minister of Electricity, chaired a strategic meeting with the Emirati company, Masdar, to move forward with the establishment of solar energy projects totaling 1,000 megawatts for the first phase.

The meeting was attended by several advisors and general directors.

The Minister stated that this meeting is a continuation of previous discussions where many obstacles were addressed, and solutions were found to complete the contracts and initiate implementation. Detailed and in-depth discussions took place to start the mechanisms of this important diversification in energy production.

The Minister explained that there are pivotal points to be resolved and recommendations to be submitted to the Ministerial Energy Council and the Cabinet. This includes amending some decisions in favor of signing the project, such as tax exemptions according to the Investment Law.

The head of the company's delegation expressed optimism about working with the Ministry, thanking them for the facilitations provided. The company is ready to proceed with the implementation, pending finalization of the loan agreement mechanism and the selection of the executing company. Responsibilities and commitments of relevant government entities, such as the Ministry of Finance and the National Investment Commission (NIC), will be determined in accordance with Iraqi laws and regulations.

During the session, the financial and commercial model of the company was requested for study purposes. Other topics discussed included the authorization for opening the account, the selection of the technical consulting entity for the project, and discussions on the implementation, connection, and power purchase agreements. The meeting addressed longstanding issues that have been unresolved for years.

In 2021, Masdar agreed to build five solar power stations in Iraq.

(Source: Ministry of Electricity)

By John Lee.

Iraq's National Investment Commission (NIC) has hosted a joint meeting with the Ministries of Industry and Minerals and Electricity to discuss the technical proposal for establishing a turbine maintenance workshop.

The proposal was presented by the French engineering company "Warmer" [IBN believes it to be Wamar Engineering], along with its Iraqi partner, Al-Waqd for Contracting and Services.

The meeting, chaired by the Commission's Economic and Institutional Development Advisor, Zafar Taqi, and attended by Dr. Mona Al-Jaberi, the Commission's Renewable Energy Consultant, and representatives from the two ministries, included a technical presentation on the workshop's operations.

According to a statement from the Commission, this workshop marks the first of its kind in Iraq, encompassing maintenance of turbines used in various sectors such as electricity, oil, aviation, and more. It adds:

"The discussion emphasized the significance of establishing such workshops, positioning Iraq as a regional leader in this field. The workshop aims to maintain all operational turbines using modern technology and engineering expertise, facilitating quicker and more efficient turbine maintenance within Iraq.

"This initiative is expected to reduce reliance on foreign currencies, provide job opportunities for the youth, and train them in modern technologies within this vital sector."

(Source: NIC)

By John Lee.

The Iraqi government's "Ur" electronic portal, has successfully expanded its e-government services, offering 708 services, of which 352 are electronic and 356 are paper-based.

Government spokesman, Haider Majid, also told the state-run Iraqi News Agency (INA) that the portal has more than 2.3 million registered users.

He said Ur includes 6,358 governmental websites representing 68 institutions, providing services in various sectors such as education, justice, law, complaints, loans, finances, transportation, infrastructure, housing, citizenship, youth and sports, culture, electricity, water, agriculture, irrigation, retirement, health, and electronic information systems.

Additionally, the portal offers an advisory service accessible at the number 5599 to inquire about the services available. The advisory service operates from 8 AM to 12 PM.

Regarding the cancellation of paper-based issuance, Majid reported that 4,203,795 documents have been cancelled and replaced with electronic versions. The cancellation system involves 81 key entities, including ministries, provinces, presidential authorities, unions, and various agencies.

In terms of private sector services, the portal features a company registration service, aligning with the Prime Minister's directives for public-private partnerships and future national data center plans. Majid emphasized plans for collaboration with the private sector and the establishment of electronic services.

(Source: INA)

By John Lee.

Iraq's Commission of Integrity has reported the detection of "excesses and waste" exceeding $33 million in two contracts for Dhi Qar Oil Company (DQOC) and several departments affiliated with the Ministry of Electricity in the province.

The department revealed excesses in the cost of a contract for the construction and maintenance of warehouses for the Garraf [Gharraf] oil field. The signed contract with a UAE company amounted to $27 million, while the estimated cost of the project did not exceed $12 million. The team also observed excesses of up to $18 million in a contract for the supply of oil pipes and covers for the Garraf field.

The Commission also pointed out the waste of 37,795,000 dinars [$29k] in the purchase of photocopying machines, printers, and archive devices at inflated prices. Additionally, there was an excess of around 52 million dinars in the purchase of medical waste incinerators and three basins.

The investigations also uncovered the waste of public funds in equipping a power generation station for the public company Al-Aur, amounting to $2 million, which has not been put into service for more than ten years.

(Source: Commission of Integrity)

By John Lee.

Iraq's Minister of Electricity, Engineer Ziad Ali Fadel, met with a delegation from the Qatari company Urbacon on Monday.

The discussions focused on plans for the reconstruction of the Baiji Thermal Power Station in Salahuddin Province.

The plant, which the Ministry sees as an investment opportunity, has a capacity of 2,100 MW.

Urbacon, also known as UCC Holding, is part of Power International Holding (PIH). The companies took part in a major trade mission from Qatar to Iraq in June 2023.

(Source: Ministry of Electricity)

By John Lee.

The South Gas Company (SGC) and Halfaya Gas Company (HGC) have signed a contract for the development and processing of gas from the Nahr Bin Umar field, with a capacity of 150 million standard cubic feet per day.

Deputy Prime Minister Hayan Abdul Ghani emphasized the project's contribution to the national economy through increased gas production, investment, and processing associated with oil operations. The initiative aims to reduce external imports, establish a liquefied gas export terminal at Umm Qasr Port, curb harmful emissions, and safeguard the environment.

A Ministry statement says the contract is a "Build, Own, Operate, Transfer" (BOOT) model, and is expected to create 5,000 job opportunities and prevent the release of over 8 million tons of pollutants into the atmosphere.

The Ministry's Gas Affairs Undersecretary, Ezat Saber, explained that this project, part of a series, intends to utilize associated gas from oil fields to support the energy sector and enhance national production. The General Manager of Southern Gas, Hamza Abdul Baqi, clarified that the contractual focus is on investment, assembly, and processing of 150 million cubic feet of gas, aiming to boost electricity and export surplus condensates and liquefied gas while reducing carbon emissions.

Representing Halafaya Gas Limited, Ahmed Al-Muhsin, stated that the contract aims to build, develop, transfer, and process 150 million cubic feet, expandable to 150 million more in the second phase.

According to the website of RASEP, part of the Baghdad-based Raban AI Safina Group of Companies: "The [Nahr Bin Umar] project is being developed by Halfaya Gas Company Ltd. (HGC), a special purpose project company owned by RASEP, pursuant to a 15 years' BOOT contract with South Gas Company [SGC] (a subsidiary of the Iraqi Ministry of Oil)."

(Source: Ministry of Oil)

From Rudaw. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

Protesters block Sulaimani-Erbil road over electricity shortages

The residents of over a dozen villages in the Khalakan area blocked cargo trucks' access to the main Sulaimani-Erbil highway on Tuesday, decrying the amount of subsidized electricity supplied.

Click here to read the full article.

By John Lee.

A team from the International Monetary Fund (IMF) has concluded a visit with Iraqi officials, concluding:

• Economic activity is recovering, although oil production cuts are weighing on overall growth, and at the same time inflation has declined.
• The large fiscal expansion in the three-year budget law poses significant risks to fiscal and external sustainability over the medium term.
• Fiscal prudence and structural reforms are critical to safeguard macroeconomic stability, ensure sustainability, and achieve durable and more inclusive growth.

Full statement from the International Monetary Fund:

A staff team of the International Monetary Fund (IMF) led by Jean-Guillaume Poulain met with the Iraqi authorities in Amman, Jordan during Dec 12-17 to discuss recent economic developments and outlook as well as policy plans.

At the end of the mission, Mr. Poulain issued the following statement:

"Against the background of a large fiscal expansion, non-oil GDP is expected to grow by 5 percent in 2023. Continued budget execution should help sustain strong non-oil growth in 2024. However, lower oil production, following the closure of the Iraq-Turkey pipeline and OPEC+ production cuts, will reduce overall GDP growth in 2023 and 2024. Inflation has declined from its January peak and is projected to stabilize in the coming months-helped by the Central Bank of Iraq's (CBI) tighter monetary policy, passthrough from the exchange rate revaluation, lower international food prices, and normalization of trade finance as compliance to the new anti-money laundering/combating the financing of terrorism (AML/CFT) framework improved.

"The three-year budget approved in June 2023 marked a shift in Iraq's budgeting practice, envisaged to improve fiscal planning and continue important development projects over the medium term. Despite a late start of budget implementation, the fiscal balance is expected to shift from a large surplus in 2022 to a deficit in 2023. Staff projects that the deficit would widen further in 2024 reflecting the full year impact of recent measures. The large fiscal expansion, including a substantial increase in public hiring and pensions creates permanent spending that will put pressure on public finances over the medium term.

"Ensuring fiscal sustainability, in context of uncertain outlook for oil prices, requires gradually tightening the fiscal policy stance while safeguarding critical infrastructure and social spending needs. This would require mobilizing additional non-oil revenues, containing the large government wage bill, and reforming the pension system. These measures should be supported by moving toward a more targeted social safety net that better protects the vulnerable.

"The mission welcomed the government's plans to strengthen public financial management including steps towards the establishment of the Treasury Single Account. In this context, the mission reiterated the importance of adhering to the framework for managing government guarantees.

"The CBI has appropriately tightened its monetary policy, including by increasing its policy rate and reserve requirement. The mission welcomed the progress in strengthening the domestic liquidity management framework and encouraged continued efforts to mop up excess liquidity and develop an interbank market to strengthen monetary policy transmission.

"Structural reforms to spur private sector led economic diversification and job creation remains pivotal for sustainable and inclusive growth. Priorities include creating a level playing field for the private sector through banking and electricity sector reforms, reducing distortions in the labor market, and continuing efforts to enhance governance and reduce corruption.

"The IMF staff team stands ready to support the authorities in their reform efforts and would like to thank them for candid and productive discussions during this mission."

(Source: IMF)