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By John Lee.

The Iraqi Cabinet has agreed to approve a recommendation from the National Investment Commission (NIC) for the Ministry of Electricity to proceed with an investment project for the construction of seven "alternative energy" power plants.

The new power stations are to be built in Karbala, Wasit, Babylon, and Al-Muthanna provinces.

(Source: Govt of Iraq)

By John Lee.

Iraq's Minister of Oil has his Ministry's goal is to support the Ministry of Electricity to have 20 gigawatts of solar energy capacity installed by 2030.

In a promotional video issued by the Government of Iraq, Ihsan Abdul Jabbar added that the recently-announced partnership with French energy company Total will include the production of clean solar energy in Southern Iraq.

He said the Ministry was in discussion with other oil producers, including BP, to use their sites to produce solar power.

(Source: Govt of Iraq)

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

KRG raises electricity rate by 20%

The Kurdistan Regional Government's (KRG) Ministry of Electricity is increasing the price of national electricity by 20 percent, the spokesperson told Rudaw on Monday.

Click here to read the full story.

Iran's Energy Minister Reza Ardakanian stressed the need to support Iranian and Iraqi private sectors and remove the obstacles to investment in order to achieve the goal of annual trade exchange of $20 billion between the two neighbors.

Delivering a speech to Iran-Iraq Economic Conference on Tuesday, Ardakanian said the main and common target of the two neighbors at the level of political leaders is to increase the value of annual bilateral trade exchanges to $20 billion.

The energy minister explained that achievement of the trade target requires plans to allow the private sector to get involved in the economic activities freely, remove the trade obstacles, set up a joint investment fund, and settle the problems arising in the transportation industry, standard and customs issues, or the preferential trade arrangements.

The Iranian Energy Ministry has been tasked three months ago with handling the affairs of Iran-Iraq Economic Cooperation Joint Commission, he noted, saying the first successful plan was to convene the commission after six years.

"The main purpose of the fourth meeting of the Economic Cooperation Joint Commission is to create facilities for the private sectors in the trade and economic activities," the minister said, adding that there are also plans to strengthen cooperation between the state-run organizations.

Ardakanian further expressed hope that negotiations among the participants in the conference, held on January 12 and 13 within the framework of four expert sub-committees on technical and engineering services, consular affairs, monetary and banking issues, and trade affairs, would result in agreements.

The Iranian minister also stressed the need to expedite the implementation of joint projects in the energy and transportation industries, customs affairs, as well as construction and health sectors, and warned the state organizations to avoid the obstructive and bureaucratic obstacles that may impede the activities of private sectors.

At the conclusion of the conference, Ardakanian and Iraqi Trade Minister Alla Ahmed Hassan visited an exhibition of Iranian and Iraqi products, held at the Energy Ministry of Iran, according to the government's official website.

The 4th session of Iran-Iraq Economic Cooperation Joint Commission kicked off on Tuesday morning, attended by high-ranking officials and business people from the two countries.

The commission is going to weigh plans for stronger cooperation in various sectors with an eye to the geographical, cultural and religious commonalities between the two Muslim neighbors.

Participants in the meeting are also planned to discuss the ways to boost economic ties, promote exports, and evaluate the markets for optimum productivity in various sectors, such as the transportation and energy industries, tourism sector, construction projects, and water and electricity industries.

(Source: Tasnim, under Creative Commons licence)

By John Lee.

Iran's Minister of Energy has said that a euro account is to be opened in Baghdad so that Iraq can pay its debts to Iran for electricity and natural gas purchases.

IRNA reports that Reza Ardakanian added that the same account can be used for Iraq's debts to Iranian private sector companies.

(Source: IRNA)

Iraqi Ministry of Electricity, Schneider Electric sign MoU to upgrade of 33/11kV Electricity Distribution Network in Iraq

• This is a part of the French government's efforts to rebuild Iraq and upgrade its electricity distribution network
• Emrah Tekdemir: The experience of Schneider Electric in energy efficiency helped our engineers gain great experience to train their peers in Iraq

The Iraqi Ministry of Electricity and Schneider Electric, a global leader in energy management and automation, signed a memorandum of understanding to implement an electrical substations, with a capacity of 11/33 kilovolts.

The new utility comes with the aim of contributing to the upgrade of Iraq's electrical distribution network and overcome the crisis of frequent power outages.

The MOU was signed between Iraqi Minister of Electricity Mr. Majid Mahdi Al Emara, and Luc Rémont, Executive Vice President of Schneider Electric for International Operations, followed by meeting with Iraqi PM in Paris on 19th Oct.

The cooperation between the Iraqi Ministry of Electricity and Schneider Electric comes within the framework of the projects that are supported by the French government as part of its efforts to rebuild Iraq through the implementation of vital infrastructure projects.

Under to the agreement, Schneider Electric will supply all equipment and technological solutions that contribute to solving the problems facing the electricity networks in Iraq.

It will also be responsible for training engineers and technicians in the Iraqi Ministry of Electricity on how to deal with the modern equipment and software, manage substations, and carry out proactive maintenance operations.

Emrah Tekdemir, Iraq Country Manager, said:

"Schneider Electric has a strong presence in Iraq, with operations in several key projects that contribute to the country's reconstruction.

"With the growth in demand for electricity in Iraq by nearly 10% annually, it was necessary to provide the technological solutions that contribute to increasing the efficiency of the services provided by the power stations, fulfilling the urgent need for a new station to solve the distribution problems in the energy sector and assisting the Ministry of Electricity in achieving its objectives of delivering electric energy to Iraqi citizens in an effective and reliable manner.

"The role of Schneider Electric will not be limited to the stage of completing implementation works in the stations, as we will also provide training for the Iraqi engineers and technicians, and we will rely heavily on Schneider Electric local presence in Iraq, which is part of Schneider Electric NEAL cluster."

About Schneider Electric

Schneider's purpose is to empower all to make the most of our energy and resources, bridging progress and sustainability for all. We call this Life Is On. Our mission is to be your digital partner for Sustainability and Efficiency.

We drive digital transformation by integrating world-leading process and energy technologies, end-point to cloud connecting products, controls, software and services, across the entire lifecycle, enabling integrated company management, for homes, buildings, data centers, infrastructure and industries.

We are the most local of global companies. We are advocates of open standards and partnership ecosystems that are passionate about our shared Meaningful Purpose, Inclusive and Empowered values.

www.se.com

(Source: Schneider Electric)

The Government of Belgium has invested an additional EUR 2 million in the Funding Facility for Stabilization (FFS).

The contribution will support stabilization efforts implemented by the United Nations Development Programme (UNDP) across Iraq's five governorates in Anbar, Diyala, Kirkuk, Ninewa and Salah Al-Din.

Since 2016, Belgium has contributed EUR 12.12 million to the Facility, which was recently extended to 2023. To date, Belgium's support along with other international donors to the FFS has benefitted over 1.46 million Iraqis, of which 50 percent are women.

With this generous additional funding, UNDP will be able to support additional essential services such as housing, and the rehabilitation of critical infrastructure in the sectors of electricity, water and education.

"The spread of COVID-19 in Iraq has increased economic instability, exacerbating existing challenges, such as the limited access to basic infrastructure and services, and a still-volatile security context. With Belgium's support we will better help the most vulnerable communities recover from the multiple crises they face today," says the UNDP Resident Representative for Iraq, Zena Ali Ahmad.

Belgium was one of the first international development partners to respond and support the UNDP rapid response to COVID-19, in partnership with national and local authorities. The support was used to establish isolation wards in Fallujah Teaching Hospital and Baqubah General Hospital that serve a catchment area of approximately 2.25 million people.

"We are grateful for Belgium's timely contribution towards supporting the people of Iraq build forward better, and for being one of the first to lend their support to our COVID-19 response," adds Ms. Ali-Ahmad.

"Belgium is very happy to continue its support for UNDP's FFS. The stabilization of Iraq remains an important challenge, even more in the context of COVID-19. We are therefore pleased that the FFS has been extended until 2023 and that other partners have renewed contributions," says Ambassador of Belgium to Jordan and Iraq, Filip Vanden Bulcke.

Since its launch in 2015, FFS has supported the return of 4.7 million Iraqis displaced by the ISIL conflict and helped more than 10 million Iraqis access critical services and infrastructure.

(Source: UN)

By John Lee.

Turkey has reportedly begun to export electricity to Iraq.

According to Anadolu Agency, Turkey's Energy Market Regulatory Authority (EMRA, EPDK) started supplying Iraq on Monday at a rate of 150 MW, through the Silopi-Zakho transmission line.

The deal is due to run until 1st November, 2021.

(Source: Anadolu Agency)

Iraq will begin exporting fuel to Lebanon starting January 2021 at "global prices", Minister of Oil Ihsan Abdul Jabbar announced.

Abdul Jabbar's remarks came in a statement on Monday after his meeting with his Lebanese counterpart, Raymond Ghajar, in the Iraqi capital city of Baghdad.

"Exported fuel will be part of a surplus over the Iraqi refineries' current demand," the minister pointed out, adding that the supply would be "limited and to be announced later."

He noted that the exports were expected to cover the "requirements of the Lebanese power stations to generate electricity", the Middle East Monitor reported.

On his part, Ghajar told reporters that the meeting had discussed an "expansion in bilateral relations between the two countries."

Lebanon has been suffering from a severe lack of power for years, with most residential and commercial establishments dependent on generators.

(Source: Tasnim, under Creative Commons licence)

From the International Monetary Fund (IMF):

IMF Staff Completes 2020 Article IV Mission with Iraq

End-of-Mission press releases include statements of IMF staff teams that convey preliminary findings after a visit to a country.

The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF's Executive Board.

Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF's Executive Board for discussion and decision.

December 12, 2020

• The COVID-19 pandemic and the sharp decline in oil prices and output have aggravated Iraq's economic vulnerabilities. Real GDP growth this year is expected to contract by 11 percent amid a sharp widening of fiscal and external imbalances.
• A comprehensive package of near-term economic policies anchored in a credible fiscal strategy is needed to overcome the health crisis, ensure economic stability, and protect the vulnerable.
• Achieving durable and inclusive growth amid formidable challenges will require wide-ranging structural reforms aimed at strengthening public finances, improving governance, reforming the electricity sector, promoting private sector development, and ensuring financial sector stability.

An International Monetary Fund (IMF) team led by Tokhir Mirzoev held a virtual mission with the Iraqi authorities from November 11 to December 10, to conduct discussions for the 2020 Article IV consultation with Iraq.

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

"The fallout of the COVID-19 pandemic and the sharp decline in oil prices and output have aggravated Iraq's economic vulnerabilities. Real GDP growth is expected at -11 percent in 2020, reflecting a contraction of oil output and an interruption of non-oil economic activity. The sharp decline in oil revenue is expected to widen the fiscal and external current account deficits to 20 and 16 percent of GDP respectively.

"A decisive recalibration of near-term economic policies will be critical to ensure macroeconomic stability and protect the vulnerable. Overcoming the health crisis is the highest priority. The next phase of the pandemic will require additional fiscal resources, including to acquire and distribute widely a viable vaccine, supported by a strong governance framework. A comprehensive policy package to reduce fiscal and external imbalances will be critical to relieve financing constraints and ensure debt sustainability, while safeguarding international reserves. In this context, fiscal efforts in the 2021 budget should target key areas of fiscal vulnerability, notably reversing the unsustainable expansion of wage and pension bills, reducing inefficient energy subsidies, and raising non-oil revenues. Protecting the vulnerable will be of paramount importance and requires boosting significantly the targeted cash transfers and expanding their coverage, as well as improving targeting of other parts of the social safety net.

"Achieving durable and inclusive medium-term growth amid formidable challenges and vulnerabilities will require sustained implementation of wide-ranging structural reforms. These reforms should aim at strengthening public finances to enable critical health and social expenditure needs, reforming the electricity sector, fighting corruption, and expanding institutional capacity. Uncertain medium-term oil market prospects and strong population growth further raise the urgency of advancing the reform agenda.

"Continued strengthening of public finances over the medium term would create much-needed fiscal space for development and social protection. A comprehensive civil service reform would strengthen the effectiveness of the public sector while reducing fiscal costs. Recalibration of the pension system is needed to ensure its sustainability. Stemming the electricity sector's mounting financial losses and reforming the sector will enhance service provision and ensure its financial viability. Overhauling the tax and customs policy and administration will help diversify fiscal revenues. These efforts should be combined with improvements in public financial management and reforms to minimize fiscal risks stemming from government guarantees and other contingent liabilities.

"Addressing governance weaknesses and reducing corruption will be vital for Iraq's future economic development. Simplification, digitalization, and greater transparency of key public services and institutions would reduce corruption risks, especially in public procurement. Alongside, strengthening audits, improving legal and regulatory frameworks in line with international standards and conventions, expanding capacity for risk-based supervision and enforcing compliance with AML/CFT rules will help strengthen public trust and investor sentiment.

"A decisive strategy to reform the large state-owned banks and level the playing field in the financial sector will enable private sector development and secure financial stability. In addition to strengthening control over these banks' governance and enhanced supervision, it will be important to perform an international audit of the large state-owned banks to inform options for their restructuring.

"The team exchanged views with senior officials of the Central Bank of Iraq (CBI) and the Ministry of Finance, members of the Parliamentary Finance Committee, as well other ministries, government agencies, and representatives from the civil society.

"The IMF team would like to thank the authorities for candid and productive discussions during this mission."