Attract a financial or economic alienation? (3-3)
Attract a financial or economic alienation? (3-3)
The problem of economies in transition in Iraq
d. the appearance of Mohammed Saleh
away from Polemics circle that all damage in a vicious circle, where you see a school of public finances in a liberal financial market, and its ability continued to generate financial capital and the National Maerafgah phenomena of alienation financial ends in warehouses financial wealth outside the country, is to graduate from being a tax recession incubator development that contribute to the joints of disabling output, investment and employment in the opinion of the real sector. While you see the school Alncodeh Iraq in the behavior of public finance consumer severe and holy for the rule of the consumer and the search for additional resources through the desire to borrow from the foreign reserves of the Central Bank, the lid supporter for the stability of the Iraqi dinar, is the way to undermine the stability and the generation of pressures and inflationary expectations, which caused the crush standard of living during the past decades, which works against the goals of stability exerted by monetary policy in achieving its goals through the collection of tax by borrowing represents the inflation tax. Taxes are the first crush of development while crushing tax the second level of living and people’s lives and brought into the tunnel release cash dark.
and noticed that the pillars of the reform Whatever moved away or close to it damaged on the principles that are enshrined in the law of the Iraqi Central Bank No. 56 of 2004, which was born as an introduction to financial market liberalization and access to a Transitional Economy holistic form of the Central Bank head of the spear in the development of liberal financial in Iraq.
began Supplies transition to a market economy really financial activity or financial market without other sectors marked by the liberalization of prices and the use of the sector to achieve macroeconomic stability and make the inflation at the lowest level in the economic history of the near in Iraq and the launch of the forces of demand suppressed, as well as the development of the indirect means of monetary policy based financial market is free to stability and financial depth to influence the development process and development investment in the real market, provided that such market-transformed and blessed with infrastructure adequate legal.
The procedures and banking reforms and the liberalization of interest rate, credit and adapting the law of the Iraqi market for securities and the formation of the Securities Commission as a regulatory organization for the capital market and reform the legal infrastructure for the financial sector, which was issued a number of laws and regulations, regulatory and organizational transformation of the financial sector to a market economy, all of which have generated a truly market transition very liberal in front of markets is incomplete Off relatively untouched transformation desired toward a market economy or improving its a private sector is stagnant and is unable to movement that did not interfere financial capital of the state or civil to move it within the coordinate system of macroeconomic.
question the field of controversy, is whether fiscal policy lacks the capacity to stimulate economic development and management are efficient across their balance sheets of investment since 2004 and until near time, as she believes that the financial sector signing to a free market economy is the one who will exercise such as this post funding and implementation, we turn to independent monetary policy, which indulged in the provision of climate stability and the achievement levels of an ideal of it, they nevertheless did not move are other capabilities development and boost real investment in the market.
So notice, he did not fiscal policy, that lack of availability of the elements of sufficiently productive to meet the development goals, which plunged right in distributive justice and building elements of the welfare state consumer is able to create the investment climate development and enable development and to maximize the business environment, especially in weak markets is transitional and sectors of production, the real inherent , nor as well as independent monetary policy, which provided stability at the top levels of fitness in the country, has stimulated the financial capital for moving towards real investment desired.
said the call to change or modify the law of the Iraqi Central Bank in force No. 56 of 2004, is an explicit call to respond to the manifestations of economies in transition in Iraq by this unilateral liberalization in the transition to the market, the financial transition of free exclusively, especially after the launch of its strength and its liberation from the constraints that have provided stability Kmnach important for development, but did not provide criteria for development in the real market because of the dilemmas caused by the polarization of the high financial capital in the economy of the state and the market together due to the absence of economies in transition coordinator destruction.
Although it does not find a value for the diagnosis of the objective in shaping the future of the country’s economic unless put economic policy approach intellectually and clear for them to come out of the national economy from its current crisis in the development of any necessary development.
Valrjoa to the idea of extreme centralization, again in management of the economy posed by the other between now and then or we read between the lines is the return to the game of snakes and ladders, but this time the beats where the number of snakes on the number of stairs, which enters the country in a bind constitutional intersects with the orientations of the new Iraq eager to strengthen the institutions of a free market, conditional improvement market behavior and move it from a free market incontinent to a free market oriented.
The call to reform the law of the Central Bank of Iraq’s current requirement of maintaining the independence (and that this independence does not mean the intersection with the provision of credit to the general budget when economies reach critical stages threaten its security national economic) should be correlate such a call in the reform strategy of the general budget in order to provide the conditions under which lock onto the fiscal and monetary policies and Tensjama in their work towards the activation of moving mass to the free market-oriented homogenized, and the re-weft real investment and promote economic development Bmnachat new, requiring the integration of economic policy in the policies of free market-oriented in order to generate after the backflow feed back to financial capital and turn the situation negative to the case of positive actors to finance the actual investment inherent in development activity and to maximize the use of local instead of infiltration into reservoirs outside the country under the influence of the behavior of alienation financial financial alienation which we noted it in advance.
Think about that the law reform Central Bank of Iraq, while maintaining the independence of monetary policy is the idea should not begin in isolation from the reform orientation of fiscal policy before the change inherent in the paths and the appropriate monetary policy. Should be on fiscal policy that Atstsel go into the inflation tax through easy access to cash cheap or easy easy money as referred to when it pleases, and as you want except critical situations affecting the interests of the country and be a cause to threaten national economic security then lend to the general budget of the Central Bank and the limits drawn by the law.
As long as oil revenues and its growing will remain a surplus of central economic of the country in term perspective it is necessary to take two-way complementary in terms of investment:
First: The budget and investment orientation toward the production of public goods, public goods, and we mean here the physical infrastructure or other infrastructure as well as enabling investment climate and development in the private sector including the provision of strategic partnership between the market economy and the country’s economy through what could be called the creation of a free market-oriented or uncontrolled and draw strategies to do so immediately and kept the state from producing goods for private goods, which holds the output of many public sector companies.
and the other: the creation of sovereign wealth fund supportive of the public budget to cope with failures in annual revenue and meet the deviations between revenue and public expenditure and the promise of bumper financial fiscal buffer and an average balance of 15 percent of the budgets of the past five years consistently invested financially Khguibh investment sovereign.
and as much as it came to repaired monetary policy, the development of its credit towards a free market-oriented (according to the personal vision of the author) should take another course in moving the Real investment in accordance with the perceptions do not affect the independence of the central bank to the market this time and maintain stability at the same time which is consistent with the objectives of the Bank Central to the achievement of stability and development of one level in terms of the so-called competence Dual Dual Mandate comes this approach because of the privacy of the circumstances of our country, which requires direct market strongly effective, additional and more of the axis!
noting that the areas of empowerment of the market that can be exercised by the monetary policy in the development and economic progress and the performance of its role in this subject areas are not exceeding the Advancement of financing public goods-use custom club public good away from indulging in investment in private goods which are the prerogative of the free market-oriented transition. And I think from the standpoint of personal that provide credit to those investment activities through the national banking system will pay the rates of development and real investment to the level of desirable contribute to breaking the cycle of attrition financial experienced by the national economy by creating a climate of active and attractive reduces the external saving and provides areas of strong attraction to the head Capital Financial Ahli positive.
the scenic fiscal policy and monetary policy as a response above represent undoubtedly walk to the principles of work and the atmosphere of healthy economic strong coordination with each other and keep time the same principles and mechanisms of economies in transition towards a free market-oriented without violation of constitutional and ensure the independence of the Central Bank and end the Problems of conflict within joints of the economic policy of the hand and joints of the system total capital on the other. as the lending market by the rules and discretionary discrition and enable development paths and real investment in the part of monetary policy and the promise to focus active towards the market must be synchronized with the configuration of sovereign wealth fund compensates the needs of the general budget when deviation of income and the face of failures in it.
conclusion: that walk in the repair system of capital, requires in essence, the reform of economic policy pillars all in order to provide the objective conditions of the national economy in the transition mass to the free market economy competitive disciplined or directed in one package keeps on track to ship Iraq strong economic and adjust the compass in the stability and the fight against inflation and economic development of parallel lines and equal without resorting to the lifeboats!!.