Economist warns: The G7 agreement threatens Iraq’s economy

Economist warns: The G7 agreement threatens Iraq’s economy

06/17/2021 13:50:06

Economist warns - The G7 agreement threatens Iraqs economyAn economist warned against the agreement of the major industrial countries at the last seven countries summit on the future of the oil industry in Iraq and its imports, which constitute more than 90% of the rentier state budget.

Saleh Al-Hashemi told {Euphrates News}, “Currently, we are in a predicament, and not only in the past years, as a result of environmental conditions and changes that affected the reality of man and human resources, which are considered an economic basis in general, locally and internationally.”

He added, “At the last G7 summit, there was agreement on clean energy, so among the agreements is that in 2030, no company or car factory will produce fossil fuels. Therefore, the International Fund and the World Bank urged all countries to move towards clean energy.”

And he indicated that “Iraq suffers from problems, the first is that the dilapidated financial and political administrative system, which is engulfed by corruption, has caused the inability so far to start this project. For this moment ink on paper, there is also a proposal for the Iraqi Investment Authority to establish 350 megawatts of electric power plants in Anbar province that operate on wind energy.”

Al-Hashemi continued, “Iraq put these plans on the grounds that in the year 2025 it will produce more than 1,000 megawatts of clean energy, but until this moment because of the routine corruption and the Iraqi financial, administrative and political system and because of the economic chaos that exists in Iraq, these projects have not started.”

He stressed, “Iraq is still dependent on fossil fuels, which has greatly affected the environment, although Iraq has the ingredients in terms of the vast areas that clean energy needs, as there are large desert areas in Iraq, and it can be used to produce more than 10,000 megawatts within five years, but corruption What is in Iraq has led to the disruption of these projects.”

He pointed out that “Iraq suffers from a shortage of electrical energy, and it was possible to develop a plan to fill the shortage of electrical energy through clean energy. The Ministry of Electricity has drawn up a plan, but it has not been implemented or initiated, and the funds have not been allocated to it so far.”

On May 22, the Group of Seven major countries announced their agreement to halt international financing for coal projects by the end of this year, and they all reaffirmed their commitment to reducing greenhouse gas emissions and reducing the rise in temperature by 1.5 degrees Celsius, with a pledge to phase out the use of fossil fuels in various sectors by 2030, in an effort to combat the effects of climate change.

The Group of Seven major industrial countries includes the United States, Britain, Canada, France, Germany, Italy and Japan, in addition to the European Union.

“We stress the need to halt all international investment in coal, and commit to taking concrete steps towards the absolute end of new direct government subsidies for coal power generation by the end of 2021,” the Group of Seven major economies said after a virtual meeting.

The group stated that the ways to end the new direct government support include official development assistance, export financing, investments, and others, noting that eliminating subsidies for coal aims to expand later to include all types of fossil fuels, in an effort to meet the globally agreed climate change goals.

Halting fossil fuel financing is a major step towards limiting global warming to 1.5 degrees Celsius above pre-industrial levels, a level that scientists say will enable the world to avoid the most devastating effects of climate change.