I am writing to inform you of my decision to resign as Minister of Finance, because I believe that the time is right for me to leave the government.
From the perspective of the economic and financial conditions of this country, the situation is stable and there are no immediate issues. The country's financial situation is in good shape, our treasury liquidity is good, our foreign exchange levels are very high, the economy as a whole is also doing well, and the IMF expects growth of 11% this year.
On the administrative side, I believe that the current senior general managers, led by the acting undersecretary, can manage the day-to-day tasks of the Ministry of Finance under the supervision of the Acting Minister of Finance. We do not have a budget for 2022, as this government was not allowed to submit one because of its status as the caretaker government of the day. 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.
and approved by the House of Representatives.
Prime Minister,
When you first asked me to join your government, I accepted, and I appreciate your trust in me as a person and in my abilities. I have known you for more than 30 years. 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 have not made any promise or had any contact with any party or political figure on any matter relating to the position of Minister of Finance. I accepted the position because I felt capable of contributing to the new government and striving to improve the welfare of the country and its people. I wanted to help overcome 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 tasked 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 Or I 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 capable of contributing to the new government and striving to improve the welfare of the country and its people. I wanted to help overcome 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 tasked with arranging elections quickly. I have told you that I did not envision myself 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 they agreed to remain in the government until that date and to form a new government.
It has been almost a year since the elections were held and there is no new government in sight yet. Our term has been extended due to political problems. But the government in which she agreed to serve has changed from a government with full powers to a caretaker government. A daily caretaker, almost by definition, has a limited life of a few weeks. We are now in a situation where our tenure 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 work and the absence of parliamentary legitimacy. The opposite is also true, we know that some things have to be stopped or modified but we can't do anything because of
Our restricted powers.
There are very limited actions that a caretaker government can take without legal authority. The current situation where my ministerial powers are severely restricted makes it nearly impossible to launch any serious measures or initiatives. The budget work has been completed
Page 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 due to the uncertainty about the future direction and the priorities of the next government, and we can say that the current situation is unreasonable and unacceptable. , and I can say that the current situation is unexplained and asked
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 I made my position clear on many occasions and in cabinet meetings in private and publicly. There was a difference of opinion, and I appreciate your willingness to discuss these differences seriously and openly. However, in a few cases, it was so important to me that I had to resign. These were not superficial positions, but issues of principle. However, I appreciate your help and support. On many occasions, I have been subjected to constant pressure and attack more than once, and you have stood by me during these many crises, and I greatly appreciate these positions.
The ones that have done faithfully and Basil Adrani during the past few years, and they are the ones who have less money with the government's decisions. I made my time on many occasions and in cabinet meetings secret or financial, and he was there, I hope in the Aram, and I appreciate the material in discussing these differences seriously and the farmer, however, in a few cases, they have been of great importance to me to the extent that I had to submit my resignation This was not a flat money whose father is civil matters, however, I am fate media and he segum opinion many times pass I have ensured more than once for a continuous fall and attack, father and you are by my side during these many crises, and all appreciation captivated this mo of the house
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 I made my position clear on many occasions and in cabinet meetings in private and publicly. There was a difference of opinion, and I appreciate your willingness to discuss these differences seriously and openly. However, in a few cases, it was so important to me that I had to resign. These were not superficial positions, but issues of principle. However, I appreciate your help and support. On many occasions, I have been subjected to constant pressure and attack more than once, and you have stood by me during these many crises, and I greatly appreciate these positions.
Smoothly, I went to the Ministry of Finance on May 5, 2020 after the House of Representatives approved my candidacy, in a procedure or was it easy, as the voting was not smooth and many parties voted Indian, and I still do not know why these parties took this position on my candidacy because I only had Little political participation since 2009. It was Sadr's vote that made my candidacy viable, but as I indicated earlier, I had no contact with them on this matter.
The last time I entered the Ministry of Finance was in 2006, when I was working as ISNA Minister of Finance under the transitional government of Dr. Ibrahim Al-Jaafari, and in the next few weeks of my Majidi to the Ministry for the second time, I learned about the horrific burnout about how much the government machinery had deteriorated in the fifteen years The past of God then the seizure of large joints of the state was done by political parties and special interest groups, and the ministry itself was rudderless for more than a decade, and one of its ministers had accepted because of allegations of harboring terrorists, after that, the ministry was run by acting ministers in charge of Other ministries, and they had little understanding of finances, and therefore could not provide the country's fiscal policy framework, and during the war against ISIS terrorist casualties, that finance minister was removed from his post by parliamentary questioning, and a new finance minister was appointed only after the government of Mr. Adel Abdul Mahdi in power in October 2018. My predecessor, Dr. Fouad Hussein, who was highly respected and appreciated by my family, held the position of Minister of Finance, however, his term was cut short by the October 2019 demonstrations and the government resigned shortly thereafter.
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. It used all previous government surpluses to fund emergency payments and maintain public sector salaries. Public sector salaries themselves have been significantly expanded, in part to appease protesters' demands. The Ministry of Finance was at the epicenter of the crisis and people are 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 government money was literally exhausted. Our foreign exchange reserves were withdrawn, and the International Monetary Fund predicted that we would lose a large part of Our foreign exchange reserves within a year.
The Ministry of Finance I headed was a ghost compared to what it used to be. Managers held their key positions only for short periods, and many fell under the influence of political parties. Not all general managers were suited or qualified for the jobs for which they were responsible. The number of senior staff I was familiar with in 2006 was drastically reduced, through retirements, layoffs, resignations, and even murder. Standards have fallen to a very low level. The Ministry of Finance was full of people
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Those with questionable qualifications, no meaningful experience or skills, and 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 main institution for making financial and economic policies for the country. As a result, I realized, within a few weeks, how devoid of skill the Ministry was and capabilities over the past years.
With this legacy I had to design a path forward.
The six axes through which I tried to develop the ministry's work strategy were:
The first is the management of the immediate financial crisis due to the collapse of oil revenues and the loss of all our cash, as there were days when it was carried out Finance Ministry funds literally.
The second is to address the expectations of government departments, parliamentarians and the public. They were often in denial about the gravity of the financial crisis and expected the same amount of support and privileges from public resources. The pressure to get money from all sides came with
Increasing persistence and intensity.
The third is working on the 2020 budget and preparing for the 2021 budget. The 2020 budget has been a parliamentary requirement even though there are only a few months left in FY20.
The fourth is to work on a medium-term plan to reform public administration and the economy.
Fifth was managing the Ministry of Finance itself and maximizing the limited human resources that we had.
Finally, the issue of long-term restructuring and repositioning of the Iraqi economy in light of the multiple major challenges that are facing face it.
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 high global prices of basic commodities, especially foodstuffs. In addition, the accumulation of arrears increased significantly during the period 2020-2021 due to lack of funding.
All of this had to happen in an environment of constant political pressure from parties and parliamentarians, street demonstrations, hostile social media trolls and constant media misrepresentation, fake news and allegations, constant demands for funds by ministries, and revelations of widespread fraud and scandals. and emergency funding demands. In addition, I had to face funding requests from the Kurdistan Regional Government that were questioned. I have been summoned to appear before the House of Representatives in two full sessions, and several times before the House Finance Committee and other committees. Signatures were collected by members of the House of Representatives to exclude me and threaten to take legal action against me, and I have already started in two cases
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Both reached the Federal Supreme Court, which ruled on these allegations. In another case, I was threatened with a travel ban because I
She refused to respond to a summons request 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 prevent the collapse of the state's finances through strict spending discipline. We maintained investment levels under severe financial constraints.
We funded all the needs of the Ministry of Health during the pandemic. - We proposed laws expanding our ability to borrow locally, which were necessary to maintain the country's solvency.
- We presented the 2020 budget as promised, despite its withdrawal at the request of the House of Representatives. We put the final touches on an expansionary budget for 2021, which was approved by the House of Representatives.
- We financed the elections by passing a special law on financing the elections, proposed by us. - We have funded the electricity sector and students of understanding more money to meet its investment obligations and purchase fuel. - We proposed a comprehensive plan to reform the economy and the public sector, and this was met with broad international and domestic support and was called the White Paper.
Unit to oversee implementation of the white paper We advocated devaluation, which was perhaps the single most important economic measure taken by the government in this period. It was a major decision
And much postponed, and was taken boldly and with the support of the majority of the parliamentary blocs, because it was so necessary. The expensive currency destroyed the competitiveness of the economy and contributed to the distortions that allowed huge commercial profits to be made by a handful of speculators. - We strongly advocated increasing allocations to the poor and needy in the 2021 budget to offset any potential loss of income as a result of currency devaluation. Unfortunately, this was omitted by the House of Representatives in the final budget version for 2021. - We introduced the first publicly marketed local bond issuance with good returns to encourage the flow of savings to new investment vehicles and start a process
Establishment of markets for government securities.
- We completed the necessary preparations for the 2022 budget, and it was not presented to the government for discussion and approval due to the ruling of the Federal Supreme Court 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 Russian-Ukrainian war in the absence of a budget for 2022, and this law gave the government an additional deadline to fulfill its financing obligations
current and investment expenditures.
We proposed the creation of a completely new framework for identifying, evaluating and developing major infrastructure works and projects of a strategic nature. It was recently approved by the Council of Ministers and 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.
Within the Ministry of Finance, it has launched a number of new programs and initiatives to address weaknesses that have multiplied over the years.
In cooperation with - we began a comprehensive plan to automate the financial management of the entire state. This has been the IFMIS program that has been postponed since 2005. It is being implemented by 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 deploy the globally recognized ASYCUDA management system
customs. - We completed the Request for Final Proposals for a new tax system reform system for the Tax Authority with the help of the World Bank.
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- 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 before the eyes of the State Council for final approval. Once approved, a similar set of internal systems will work for Rasheed Bank
Government banks can be reformed by keeping the current internal systems. - We established 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 where desirable and feasible, with significant increases in revenue from sale
Land, and we have increased land for industrial projects significantly. We have organized a new strategic framework for the Free Zones Authority and will propose a new law for the Free Zones Authority. - We agreed with the French Development Agency to support the establishment of an institute to train middle and senior government financial and economic cadres on the best international practices in financial and economic management. This will be run through the Development Department at the Ministry of Finance. We agreed with the European Union and the German Development Agency to support the implementation team of the recommendations of the White Paper and the Ministry of Finance with expertise
Rich foreign in the field of public financial management. - We offer a program to send 100 promising young candidates in the Ministry of Finance to cover postgraduate courses in management, finance, banking and public administration at international universities.
Here, I would like to point out that our relations with the Central Bank were excellent, which allowed us to coordinate with them in the monetary and financial policies of the government.
Internationally, our economic relationship with international development agencies, G7 countries, China and the GCC countries is excellent. The Iraqi-Saudi Joint Committee, which I chair from the Iraqi side, has been activated with a number of projects and initiatives. We have also managed the difficult issues associated with making payments owed to Iran while maintaining our cooperation
And our compliance with US sanctions on this country.
I have made it my own approach to fight corruption whenever and wherever I can. In our first few weeks in office, we stopped several suspicious projects and carefully examined all requests for tax and customs exemptions. It personally followed up on approval requests for projects that passed all the scrutiny, but were unnecessarily blocked or delayed. It was the Ministry, by direct orders from me personally, that prevented the contract of Ishtar Gate payments with Rafidain Bank that would have imposed an unjustified cost burden of up to Manat.
Millions of dollars for many years on depositors in the bank.
The ministry also cooperated fully with all official, parliamentary and judicial authorities that look into corruption cases in the ministry
and the government 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 think that in the area of economic and financial management, the government has done exceptionally well. 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 given the context of our political economy. I must admit that I did not anticipate the appalling deterioration in the standards of governance in our country over the past fifteen years
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Corrupt that destroys moral foundations
and material of the country.
The electronic payment corruption cases for me were 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 system's imbalance. It crystallized the degree to which the state's status deteriorated and became a puppet for private interests. The matter is now with the judiciary and its investigations after the ministry has made its observations, so I cannot 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 without regard to the public interest. Extensive underground networks of corrupt high-ranking officials, businessmen, politicians, and state employees work in the shadows to control entire sectors of the economy, withdrawing billions of dollars from the public coffers. These networks are protected by major political parties, parliamentary immunity, the arming of the law and even foreign powers. It maintains the silence of honest officials because of fear and the 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 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 an abbreviation for the problems of the economy, as it is the end result of the process and not its beginning. It can be described as cancer that can kill the body, but it has spread due to the weakness of the body, weak immune system, lack of prevention, and neglect of curative measures. Corruption thrives in Iraq because the system tolerates it and allows it to thrive. It is not enough to tackle corruption through Increase speech against him, establish more investigative bodies and introduce more punitive measures.
We must rebuild the state's capacity to prevent the spread of corrupt practices. We have to radically reform the administration of the state 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 need to remove the protection that political parties and their leaders give corrupt individuals and corrupt practices. We must destroy the culture of greed, lethargy and impunity that allows corrupt practices to flourish. We need to demystify many government decisions about expenditures and investments, as corruption thrives as a result of regulated deals
We have to radically develop the qualities and skills of middle and advanced managers in the country. We need to remove the protection that political parties and their leaders give corrupt individuals and corrupt practices. We must destroy the culture of greed, lethargy and impunity that allows corrupt practices to flourish. We must remove the ambiguity that characterizes many government decisions about expenditures and investments, as corruption thrives as a result of regulated deals In the dark, lack of openness and transparency.
Service in all. First of all, we have to undo the double-wall system that allows corruption, meaning that there are double prices for the same product or for parts of the economy. There are market prices, then there are prices set by administrative orders or a ministerial committee that have nothing to do with market prices. This affects the land markets, housing, fuel markets, basic foodstuffs, agricultural and industrial inputs, credit markets, foreign exchange, pharmaceuticals and medical services, power generation and electricity distribution, tariffs, etc. It has been wrongly said that this system helps subsidize the poor, but it is in fact very costly and encourages corruption wherever there are double prices. 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 fundamental factors: the duties and responsibilities of my position; My desire is to see this government succeed. Loyalty to colleagues in the Cabinet.
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History will give its final verdict on the success of this government, but I will mute my personal view of the nature of the rules which ought to be in any evaluation process.
- The first rule of assessment concerns whether the government has succeeded in preserving the unity of the homeland and citizens and protecting the people from internal and external threats.
The second rule: Were the explicit promises made by the government at its formation fulfilled? This was related to the holding of elections in
Acceptable time frame and defuse tensions exacerbated by large-scale protests
The third rule relates to managing the shocks that the state has experienced during your tenure as Prime Minister. These twin crises, the COVID-19 pandemic, and the collapse in oil prices and government revenue — all of these huge challenges culminated in the first months of this government.
- The last factor relates to whether the government has succeeded in achieving the objectives of its government program, especially broad political and administrative reform, anti-corruption agendas and economic restructuring.
These rules apply to the period of any normal government, but this government was exceptional, which came to power as a result of a state crisis with the collapse of the previous government. This government was a government with powers, but its main political goal in bringing it to power was to hold elections. Since October 2021, and since then this government has been operating with significantly reduced powers as a caretaker government.
However, in my personal opinion, the preliminary results of this government's performance can be summarized as follows:
- The government has improved the security and livelihood of the people, despite all the setbacks, the situation in science is much better now than it was when the government came to power in May 2020.
- The government's containment of the political file in the country. Despite recent large-scale demonstrations, violent incidents in the streets
Not negligible compared to the October 2019 demonstrations.
- 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.
- Government containment of political violence in the country. Despite recent large-scale demonstrations, violent incidents in the streets
Not negligible compared to the October 2019 demonstrations.
- The government held free and fair elections with the agreement of all independent observers within the promised timeframe. An important promise has been fulfilled.
The government effectively managed the twin crises of the COVID-19 pandemic and the collapse of oil revenues. Comprehensive control of public expenditures, timely, necessary and effective currency devaluation, successful 2021 budget, and food security law are steps that put public finances on a par. The white paper served as a detailed roadmap for reform and restructuring, garnering broad local and international recognition and support, as well as containing the damage from COVID-19 during a massive vaccination campaign.
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- The government has succeeded only partially in its political agenda, as the political scene is more divided and conflicted than it was in 2020. The government was not able to achieve a degree of independence from the main political groups; Nor has the country as a whole been freed from the control of political parties and external interest groups. This was a concern of mine.
The government has implemented a mostly successful foreign policy. 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 have great long-term development potential. It has been instrumental in bringing 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 the country's domestic politics.
- The government succeeded in developing 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 public sector effectiveness, or in fundamentally changing the country's economic axes.
- 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 it has dug deep roots in the country. It cannot be controlled, let alone uprooted, if there is no political will and consensus to do so. Corruption remains rampant, debilitating and widespread.
I think the government has accomplished a lot, and given the time and space it could have done so much more. The white paper laid out a detailed roadmap for public sector reform. I was hoping to set out a vision for reform and restructuring and help create institutions to oversee the process. And I knew that the process was beyond the term of this government. It took four or five years to implement the vision of the White Paper and to see the desired results. However, government plans and programs have always been constrained by the need to
Gaining broad agreement from a fractured political class has proven difficult and elusive. I hope that the country's political leaders realize the gravity of the issues facing us and push for a solution that ends this debilitating impasse.
All calls for reform have been hampered by the political framework of this country. The parliamentary system introduced in 2005 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 narrow interest groups. There is no doubt that reforming this system with constitutional changes or even a new constitution is necessary. And unlike humans, nations 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 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, 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 obstruction. 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 influence vital institutions and are behind the appointment of key figures in government, and the end result is the fractured country in which we see ourselves.
It must be a state informs . With a population of 40 million people, with a range of difficult issues we are facing, a government has the powers to be able to implement the necessary plans and measures with the appropriate legal authority. It is a clear indication of a defect in
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our political life, as the political parties were not able to choose a new president and a new prime minister long after the elections. It is also very problematic and disturbing that a major political force has abandoned the political process and withdrew from Parliament. Replacing resigned council members cannot be compensated politically or even morally by simply appointing those whose only electoral achievement is to take second place after the winners. In any other country with a parliamentary system this would result in either new elections at the national level or a special election to replace those who resigned. I say this, no, to detract from the legitimacy of the House of Representatives, whose rules I respect
and its procedures despite a lot of observations. I say this to confirm that the opposition outside the parliament is now a force that must be taken into account politically and its opinion and viewpoints should be 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 formed under the current regime lacks complete legitimacy in my opinion unless the opposition outside the House of Representatives recognizes it, if not necessarily approved by it, as a government with powers. The fact of the matter is that there is now 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 situation. The political impasse has now reached very dangerous levels. The demand for reform of the political process has become irresistible. But because the channels for bringing about change within the system were almost completely blocked, the only recourse was civil disobedience. This is not unusual in democratic countries where the formal channels for bringing about change are controlled by forces of resistance to change. Usually a crisis or shift in public opinion shifts the accounts in favor of change. This did not happen in Iraq. The more people alienate the system and express their disapproval by not participating in elections, the more likely the system will persist in favor of those who want to maintain the status quo. The forces that maintain the existing order, for whatever reason, are formidable. Arguments for working within the current political process range from constitutional formalities, appropriate legal and administrative procedures, and, frankly, self-interest. There is no external 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 abandon the current regime
And move forward towards a new system.
The outstanding issues for any new government are critical. It can only be dealt with with great political decisiveness and foresight.
For my part, I do not wish to serve in any ministerial position anymore. It is time for young people to take on the heavy mantle of government. We need new elections with a high turnout to solidify the credibility of our democratic institutions. I also think 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, uncertain powers, difficult and even impossible conditions for making adjustments, made the (there seems to be a word missing here)
It is necessary to consider the possibility of new constitutional arrangements.
I think we are facing one of the most serious challenges any country has faced 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 Iraq crisis is multidimensional. It brings together a large number of critical issues that few countries face at such a seriousness. These issues cover the full range of political, security, governance, economic, energy, labor, social, 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.
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It's hard. But with great problems come great opportunities, 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 be built on a solid foundation of necessary political, ethical and institutional preconditions.
We need leadership of the highest quality, that influences 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 we will 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.
Allawi's REsignation letter translation
link
Honorable Prime Minister Mustafa Al-Kazemi,
I am writing to inform you of my decision to resign as Minister of Finance, because I believe that the time is right for me to leave the government.
From the perspective of the economic and financial conditions of this country, the situation is stable and there are no immediate issues. The country's financial situation is in good shape, our treasury liquidity is good, our foreign exchange levels are very high, the economy as a whole is also doing well, and the IMF expects growth of 11% this year.
On the administrative side, I believe that the current senior general managers, led by the acting undersecretary, can manage the day-to-day tasks of the Ministry of Finance under the supervision of the Acting Minister of Finance. We do not have a budget for 2022, as this government was not allowed to submit one because of its status as the caretaker government of the day. 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.
and approved by the House of Representatives.
Prime Minister,
When you first asked me to join your government, I accepted, and I appreciate your trust in me as a person and in my abilities. I have known you for more than 30 years. 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 have not made any promise or had any contact with any party or political figure on any matter relating to the position of Minister of Finance. I accepted the position because I felt capable of contributing to the new government and striving to improve the welfare of the country and its people. I wanted to help overcome 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 tasked 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 Or I 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 capable of contributing to the new government and striving to improve the welfare of the country and its people. I wanted to help overcome 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 tasked with arranging elections quickly. I have told you that I did not envision myself 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 they agreed to remain in the government until that date and to form a new government.
It has been almost a year since the elections were held and there is no new government in sight yet. Our term has been extended due to political problems. But the government in which she agreed to serve has changed from a government with full powers to a caretaker government. A daily caretaker, almost by definition, has a limited life of a few weeks. We are now in a situation where our tenure 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 work and the absence of parliamentary legitimacy. The opposite is also true, we know that some things have to be stopped or modified but we can't do anything because of
Our restricted powers.
There are very limited actions that a caretaker government can take without legal authority. The current situation where my ministerial powers are severely restricted makes it nearly impossible to launch any serious measures or initiatives. The budget work has been completed
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 due to the uncertainty about the future direction and the priorities of the next government, and we can say that the current situation is unreasonable and unacceptable.
, and I can say that the current situation is unexplained and asked
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 I made my position clear on many occasions and in cabinet meetings in private and publicly. There was a difference of opinion, and I appreciate your willingness to discuss these differences seriously and openly. However, in a few cases, it was so important to me that I had to resign. These were not superficial positions, but issues of principle. However, I appreciate your help and support. On many occasions, I have been subjected to constant pressure and attack more than once, and you have stood by me during these many crises, and I greatly appreciate these positions.
Smoothly, I went to the Ministry of Finance on May 5, 2020 after the House of Representatives approved my candidacy, in a procedure or was it easy, as the voting was not smooth and many parties voted Indian, and I still do not know why these parties took this position on my candidacy because I only had Little political participation since 2009. It was Sadr's vote that made my candidacy viable, but as I indicated earlier, I had no contact with them on this matter.
The last time I entered the Ministry of Finance was in 2006, when I was working as ISNA Minister of Finance under the transitional government of Dr. Ibrahim Al-Jaafari, and in the next few weeks of my Majidi to the Ministry for the second time, I learned about the horrific burnout about how much the government machinery had deteriorated in the fifteen years The past of God then the seizure of large joints of the state was done by political parties and special interest groups, and the ministry itself was rudderless for more than a decade, and one of its ministers had accepted because of allegations of harboring terrorists, after that, the ministry was run by acting ministers in charge of Other ministries, and they had little understanding of finances, and therefore could not provide the country's fiscal policy framework, and during the war against ISIS terrorist casualties, that finance minister was removed from his post by parliamentary questioning, and a new finance minister was appointed only after the government of Mr. Adel Abdul Mahdi in power in October 2018. My predecessor, Dr. Fouad Hussein, who was highly respected and appreciated by my family, held the position of Minister of Finance, however, his term was cut short by the October 2019 demonstrations and the government resigned shortly thereafter.
The Ministry of Finance I headed was a ghost compared to what it used to be. Managers held their key positions only for short periods, and many fell under the influence of political parties. Not all general managers were suited or qualified for the jobs for which they were responsible. The number of senior staff I was familiar with in 2006 was drastically reduced, through retirements, layoffs, resignations, and even murder. Standards have fallen to a very low level. The Ministry of Finance was full of people
With this legacy I had to design a path forward.
The six axes through which I tried to develop the ministry's work strategy were:
The first is the management of the immediate financial crisis due to the collapse of oil revenues and the loss of all our cash, as there were days when it was carried out Finance Ministry funds literally.
The second is to address the expectations of government departments, parliamentarians and the public. They were often in denial about the gravity of the financial crisis and expected the same amount of support and privileges from public resources. The pressure to get money from all sides came with
Increasing persistence and intensity.
The third is working on the 2020 budget and preparing for the 2021 budget. The 2020 budget has been a parliamentary requirement even though there are only a few months left in FY20.
The fourth is to work on a medium-term plan to reform public administration and the economy.
Fifth was managing the Ministry of Finance itself and maximizing the limited human resources that we had.
Finally, the issue of long-term restructuring and repositioning of the Iraqi economy in light of the multiple major challenges that are facing face it.
All of this had to happen in an environment of constant political pressure from parties and parliamentarians, street demonstrations, hostile social media trolls and constant media misrepresentation, fake news and allegations, constant demands for funds by ministries, and revelations of widespread fraud and scandals. and emergency funding demands. In addition, I had to face funding requests from the Kurdistan Regional Government that were questioned. I have been summoned to appear before the House of Representatives in two full sessions, and several times before the House Finance Committee and other committees. Signatures were collected by members of the House of Representatives to exclude me and threaten to take legal action against me, and I have already started in two cases
She refused to respond to a summons request 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 prevent the collapse of the state's finances through strict spending discipline. We maintained investment levels under severe financial constraints.
We funded all the needs of the Ministry of Health during the pandemic. - We proposed laws expanding our ability to borrow locally, which were necessary to maintain the country's solvency.
- We presented the 2020 budget as promised, despite its withdrawal at the request of the House of Representatives. We put the final touches on an expansionary budget for 2021, which was approved by the House of Representatives.
- We financed the elections by passing a special law on financing the elections, proposed by us. - We have funded the electricity sector and students of understanding more money to meet its investment obligations and purchase fuel. - We proposed a comprehensive plan to reform the economy and the public sector, and this was met with broad international and domestic support and was called the White Paper.
Unit to oversee implementation of the white paper We advocated devaluation, which was perhaps the single most important economic measure taken by the government in this period. It was a major decision
And much postponed, and was taken boldly and with the support of the majority of the parliamentary blocs, because it was so necessary. The expensive currency destroyed the competitiveness of the economy and contributed to the distortions that allowed huge commercial profits to be made by a handful of speculators. - We strongly advocated increasing allocations to the poor and needy in the 2021 budget to offset any potential loss of income as a result of currency devaluation. Unfortunately, this was omitted by the House of Representatives in the final budget version for 2021. - We introduced the first publicly marketed local bond issuance with good returns to encourage the flow of savings to new investment vehicles and start a process
Establishment of markets for government securities.
- We completed the necessary preparations for the 2022 budget, and it was not presented to the government for discussion and approval due to the ruling of the Federal Supreme Court 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 Russian-Ukrainian war in the absence of a budget for 2022, and this law gave the government an additional deadline to fulfill its financing obligations
current and investment expenditures.
We proposed the creation of a completely new framework for identifying, evaluating and developing major infrastructure works and projects of a strategic nature. It was recently approved by the Council of Ministers and 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.
Within the Ministry of Finance, it has launched a number of new programs and initiatives to address weaknesses that have multiplied over the years.
In cooperation with - we began a comprehensive plan to automate the financial management of the entire state. This has been the IFMIS program that has been postponed since 2005. It is being implemented by 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 deploy the globally recognized ASYCUDA management system
customs. - We completed the Request for Final Proposals for a new tax system reform system for the Tax Authority with the help of the World Bank.
Government banks can be reformed by keeping the current internal systems. - We established 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 where desirable and feasible, with significant increases in revenue from sale
Land, and we have increased land for industrial projects significantly. We have organized a new strategic framework for the Free Zones Authority and will propose a new law for the Free Zones Authority. - We agreed with the French Development Agency to support the establishment of an institute to train middle and senior government financial and economic cadres on the best international practices in financial and economic management. This will be run through the Development Department at the Ministry of Finance. We agreed with the European Union and the German Development Agency to support the implementation team of the recommendations of the White Paper and the Ministry of Finance with expertise
Rich foreign in the field of public financial management. - We offer a program to send 100 promising young candidates in the Ministry of Finance to cover postgraduate courses in management, finance, banking and public administration at international universities.
Here, I would like to point out that our relations with the Central Bank were excellent, which allowed us to coordinate with them in the monetary and financial policies of the government.
Internationally, our economic relationship with international development agencies, G7 countries, China and the GCC countries is excellent. The Iraqi-Saudi Joint Committee, which I chair from the Iraqi side, has been activated with a number of projects and initiatives. We have also managed the difficult issues associated with making payments owed to Iran while maintaining our cooperation
And our compliance with US sanctions on this country.
I have made it my own approach to fight corruption whenever and wherever I can. In our first few weeks in office, we stopped several suspicious projects and carefully examined all requests for tax and customs exemptions. It personally followed up on approval requests for projects that passed all the scrutiny, but were unnecessarily blocked or delayed. It was the Ministry, by direct orders from me personally, that prevented the contract of Ishtar Gate payments with Rafidain Bank that would have imposed an unjustified cost burden of up to Manat.
Millions of dollars for many years on depositors in the bank.
and the government 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 think that in the area of economic and financial management, the government has done exceptionally well. 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 given the context of our political economy. I must admit that I did not anticipate the appalling deterioration in the standards of governance in our country over the past fifteen years
and material of the country.
The electronic payment corruption cases for me were 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 system's imbalance. It crystallized the degree to which the state's status deteriorated and became a puppet for private interests. The matter is now with the judiciary and its investigations after the ministry has made its observations, so I cannot 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 without regard to the public interest. Extensive underground networks of corrupt high-ranking officials, businessmen, politicians, and state employees work in the shadows to control entire sectors of the economy, withdrawing billions of dollars from the public coffers. These networks are protected by major political parties, parliamentary immunity, the arming of the law and even foreign powers. It maintains the silence of honest officials because of fear and the 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 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 an abbreviation for the problems of the economy, as it is the end result of the process and not its beginning. It can be described as cancer that can kill the body, but it has spread due to the weakness of the body, weak immune system, lack of prevention, and neglect of curative measures. Corruption thrives in Iraq because the system tolerates it and allows it to thrive. It is not enough to tackle corruption through Increase speech against him, establish more investigative bodies and introduce more punitive measures.
We must rebuild the state's capacity to prevent the spread of corrupt practices. We have to radically reform the administration of the state 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 need to remove the protection that political parties and their leaders give corrupt individuals and corrupt practices. We must destroy the culture of greed, lethargy and impunity that allows corrupt practices to flourish. We need to demystify many government decisions about expenditures and investments, as corruption thrives as a result of regulated deals
Service in all. First of all, we have to undo the double-wall system that allows corruption, meaning that there are double prices for the same product or for parts of the economy. There are market prices, then there are prices set by administrative orders or a ministerial committee that have nothing to do with market prices. This affects the land markets, housing, fuel markets, basic foodstuffs, agricultural and industrial inputs, credit markets, foreign exchange, pharmaceuticals and medical services, power generation and electricity distribution, tariffs, etc. It has been wrongly said that this system helps subsidize the poor, but it is in fact very costly and encourages corruption wherever there are double prices. 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 fundamental factors: the duties and responsibilities of my position; My desire is to see this government succeed. Loyalty to colleagues in the Cabinet.
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- The first rule of assessment concerns whether the government has succeeded in preserving the unity of the homeland and citizens and protecting the people from internal and external threats.
The second rule: Were the explicit promises made by the government at its formation fulfilled? This was related to the holding of elections in
Acceptable time frame and defuse tensions exacerbated by large-scale protests
The third rule relates to managing the shocks that the state has experienced during your tenure as Prime Minister. These twin crises, the COVID-19 pandemic, and the collapse in oil prices and government revenue — all of these huge challenges culminated in the first months of this government.
- The last factor relates to whether the government has succeeded in achieving the objectives of its government program, especially broad political and administrative reform, anti-corruption agendas and economic restructuring.
These rules apply to the period of any normal government, but this government was exceptional, which came to power as a result of a state crisis with the collapse of the previous government. This government was a government with powers, but its main political goal in bringing it to power was to hold elections. Since October 2021, and since then this government has been operating with significantly reduced powers as a caretaker government.
However, in my personal opinion, the preliminary results of this government's performance can be summarized as follows:
- The government has improved the security and livelihood of the people, despite all the setbacks, the situation in science is much better now than it was when the government came to power in May 2020.
- The government's containment of the political file in the country. Despite recent large-scale demonstrations, violent incidents in the streets
Not negligible compared to the October 2019 demonstrations.
- 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.
- Government containment of political violence in the country. Despite recent large-scale demonstrations, violent incidents in the streets
Not negligible compared to the October 2019 demonstrations.
- The government held free and fair elections with the agreement of all independent observers within the promised timeframe. An important promise has been fulfilled.
The government effectively managed the twin crises of the COVID-19 pandemic and the collapse of oil revenues. Comprehensive control of public expenditures, timely, necessary and effective currency devaluation, successful 2021 budget, and food security law are steps that put public finances on a par. The white paper served as a detailed roadmap for reform and restructuring, garnering broad local and international recognition and support, as well as containing the damage from COVID-19 during a massive vaccination campaign.
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The government has implemented a mostly successful foreign policy. 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 have great long-term development potential. It has been instrumental in bringing 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 the country's domestic politics.
- The government succeeded in developing 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 public sector effectiveness, or in fundamentally changing the country's economic axes.
- 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 it has dug deep roots in the country. It cannot be controlled, let alone uprooted, if there is no political will and consensus to do so. Corruption remains rampant, debilitating and widespread.
I think the government has accomplished a lot, and given the time and space it could have done so much more. The white paper laid out a detailed roadmap for public sector reform. I was hoping to set out a vision for reform and restructuring and help create institutions to oversee the process. And I knew that the process was beyond the term of this government. It took four or five years to implement the vision of the White Paper and to see the desired results. However, government plans and programs have always been constrained by the need to
Gaining broad agreement from a fractured political class has proven difficult and elusive. I hope that the country's political leaders realize the gravity of the issues facing us and push for a solution that ends this debilitating impasse.
All calls for reform have been hampered by the political framework of this country. The parliamentary system introduced in 2005 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 narrow interest groups. There is no doubt that reforming this system with constitutional changes or even a new constitution is necessary. And unlike humans, nations 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 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, 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 obstruction. 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 influence vital institutions and are behind the appointment of key figures in government, and the end result is the fractured country in which we see ourselves.
It must be a state informs . With a population of 40 million people, with a range of difficult issues we are facing, a government has the powers to be able to implement the necessary plans and measures with the appropriate legal authority. It is a clear indication of a defect in
and its procedures despite a lot of observations. I say this to confirm that the opposition outside the parliament is now a force that must be taken into account politically and its opinion and viewpoints should be 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 formed under the current regime lacks complete legitimacy in my opinion unless the opposition outside the House of Representatives recognizes it, if not necessarily approved by it, as a government with powers. The fact of the matter is that there is now 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 situation. The political impasse has now reached very dangerous levels. The demand for reform of the political process has become irresistible. But because the channels for bringing about change within the system were almost completely blocked, the only recourse was civil disobedience. This is not unusual in democratic countries where the formal channels for bringing about change are controlled by forces of resistance to change. Usually a crisis or shift in public opinion shifts the accounts in favor of change. This did not happen in Iraq. The more people alienate the system and express their disapproval by not participating in elections, the more likely the system will persist in favor of those who want to maintain the status quo. The forces that maintain the existing order, for whatever reason, are formidable. Arguments for working within the current political process range from constitutional formalities, appropriate legal and administrative procedures, and, frankly, self-interest. There is no external 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 abandon the current regime
And move forward towards a new system.
The outstanding issues for any new government are critical. It can only be dealt with with great political decisiveness and foresight.
For my part, I do not wish to serve in any ministerial position anymore. It is time for young people to take on the heavy mantle of government. We need new elections with a high turnout to solidify the credibility of our democratic institutions. I also think 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, uncertain powers, difficult and even impossible conditions for making adjustments, made the (there seems to be a word missing here)
It is necessary to consider the possibility of new constitutional arrangements.
I think we are facing one of the most serious challenges any country has faced 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 Iraq crisis is multidimensional. It brings together a large number of critical issues that few countries face at such a seriousness. These issues cover the full range of political, security, governance, economic, energy, labor, social, 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.
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 be built on a solid foundation of necessary political, ethical and institutional preconditions.
We need leadership of the highest quality, that influences 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 we will 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.
Appreciation,
Ali Haider Abdul Amir Allawi
Baghdad - Tuesday, August 16, 2022.