By John Lee.

Egypt-based GB Auto (Ghabbour Group) has been appointed as the distributor of the Chinese-owned MG car brand in Iraq.

According to Trade Arabia, the new partnership will see six MG showrooms opened across the country, in Erbil, Baghdad (on 62 St and at Baghdad Mall), Duhok, Sulaymaniyah and Basrah.

Operations are expected to commence in late-Q3 or early-Q4 of this year.

(Sources: GB Auto, Trade Arabia)

By Robbie Gramer, for Foreign Policy. Any opinions expressed here are those of the author and do not necessarily reflect the views of Iraq Business News.

Fears Mount as Trump Administration Guts USAID’s Iraq Presence

The United States’ top aid agency is dismantling its presence in Iraq, leaving a skeleton crew ill-equipped to oversee over $1 billion in aid programs aimed in part at staving off the return of terrorist organizations such as the Islamic State, officials and lawmakers say.

An internal U.S. Agency for International Development (USAID) document obtained by Foreign Policy confirms that major cuts in staffing were made late last year and highlights the stark difference between the agency’s footprint in Iraq and other countries that receive foreign aid funding: In fiscal 2019, Egypt received roughly one-fifth the amount of U.S. foreign aid as Iraq, but it has more than seven times the number of staff to oversee it.

Click here to read the full story (subscription required).

By John Lee.

GB Auto has reportedly decided to cease its representation of Hyundai passenger cars in Iraq.

According to Daily News Egypt, the company rejected Hyundai’s new multi-distributor strategy, on the basis that such models never yield proper returns on investment.

It adds that Hyundai had a market share of approximately 25 percent last year.

(Source: Daily News Egypt)

Qatar Airways, Emirates and several other Persian Gulf airlines still fly in Iranian and Iraqi airspace and to cities in both countries since Iran and the United States traded military strikes.

Iranian airspace is important for all carriers in this region,” said Adil al-Ghaith, Emirates’ senior vice president, commercial operations, Persian Gulf, Middle East and Iran, Reuters reported.

Dubai-based Emirates and sister carrier flyDubai together serve 10 cities in Iran and Iraq, and have continued to use the airspace of both countries for other flights.

Kuwait Airways and Abu Dhabi-based Etihad Airways have also continued using Iranian and Iraqi airspace.

We will continue to fly to Iran because Iran is an important country to us and it is our neighbor and we want to serve the people of Iran,” Qatar Airways Chief Executive Akbar al-Baker said on the sidelines of a Kuwait air show.

However, some regional carriers have changed their routes. Bahrain’s Gulf Air has redirected European flights away from Iraqi airspace and now flies longer, more fuel consuming routes over Saudi Arabia and Egypt.

We want to take the safest option even if it costs us a little bit more for a period of time. We can live with that,” Deputy Chief Executive Waleed Abdulhameed al-Alawi said.

The UAE regulator told its carriers — Emirates, Etihad, flydubai and Air Arabia AIRA.DU — this month to “evaluate flight path risks” although it said it was up to the airlines to make the final decision on the routes they chose.

(Source: Tasnim, under Creative Commons licence)

Iraq’s media regulator should reverse its decision to order the closure of 12 broadcasters over a licensing dispute and should allow media outlets to freely cover protests in the country, the Committee to Protect Journalists (CPJ) said on Monday.

On November 12, the Communications and Media Commission (CMC), Iraq’s media regulator, ordered the closure of eight television broadcasters and four radio stations for three months for allegedly violating media licensing rules, and issued a warning against five more broadcasters over their coverage of protests, according to a copy of the closure decision, which CPJ reviewed, and reports by local news organizations and press freedom groups.

According to the decision, the commission also renewed the closure of U.S.-funded broadcaster Al-Hurra for an additional three months. The outlet was shuttered on September 2 after it aired a report on alleged state corruption, as CPJ reported at the time.

The decision includes a recommendation to the prime minister’s office to send security forces to the outlets to force them to close. According to CPJ’s review of the outlets’ broadcasts, and an official with the media regulator who spoke to news website Arab News, none of the outlets have been closed as of November 25.

The outlets have critically covered the protests that have taken place throughout Iraq since October over a lack of basic services, unemployment, and government corruption, according to CPJ’s review of their broadcasts.

“Iraqi authorities are using all the means at their disposal, legal and otherwise, to intimidate outlets in an effort to prevent them from covering the ongoing protests in the country,” said CPJ Middle East and North Africa Representative Ignacio Miguel Delgado. “We call on the Iraqi Communications and Media Commission to reverse this order and to allow TV broadcasters, radio stations, and journalists to do their jobs.”

The outlets listed in the decision are the Amman-based Dijlah TV and Anb TV, the Dubai-based Al-Sharqiya TV, the Saudi-funded Al-Arabiya Al-Hadath, the U.S.-funded Radio Sawa, the Sulaymaniyah-based NRT News and Radio Nawa, and the Baghdad-based Al-Rasheed TV, Al-Fallujah, Hona Baghdad, Radio Al-Nas, and Radio Al-Youm.

The decision also issued a warning to five outlets to “adapt their discourse to the media broadcasting rules” or else face possible suspension: the Abu Dhabi-based Sky News Arabia, the Beirut-based Al-Sumaria, the Erbil-based Rudaw, and the Baghdad-based Asia TV and Ur TV.

The document recommends that the prime minister’s office approach representatives from the home countries of the foreign outlets listed in the decision, as well as the management of Egyptian satellite provider NileSat, to address the alleged violations.

Iraq’s Communications and Media Commission did not immediately reply to CPJ’s emailed request for comment.

Amid the protests, unidentified gunmen raided the Baghdad offices of four broadcasters, and the Communications and Media Commission ordered Al-Dijlah TV’s transmissions into Iraq to be blocked and its offices shut down for allegedly failing to abide by professional standards, according to CPJ reporting.

(Source: CPJ)

Dana Gas PJSC, the Middle East’s largest regional private sector natural gas company, announced that in the first nine months of 2019 collections in Egypt, the UAE and from its share of Pearl Petroleum Company Limited‘s sales in the Kurdistan Region of Iraq (KRI), increased 16.7% year on year to $230 million (AED 844m).

Dana Gas, which owns a 35% stake in Pearl Petroleum, saw its share of sales of condensate, LPG and gas in the KRI jump 52% to $118 million in the nine-month period from $77 million in the same period the previous year.  Dana Gas received cash dividends of $68.3 million from Pearl Petroleum over this period.

Meanwhile, the collections from Dana Gas Egypt were $105 million during the period, in line with the $111 million received in the same period of 2018 whilst collections from the Company’s Zora gas field in the UAE stood at $7.3 million.

Dr Patrick Allman-Ward (pictured), CEO of Dana Gas, said:

“We are pleased to record higher collections over the first nine-months of the year in the Kurdistan Region of Iraq, due primarily to an increase in production and regular payments from the government. Our overall collections are higher at $230 million, and our strong in-country relationships have continued to benefit our overall business performance. We are committed to operating all our assets to maximise production and value for all our stakeholders.”

Pearl Petroleum is boosting production in the KRI, where 25% of the region’s power needs remain unmet and the demand for power is expected to outstrip supply in the medium and long-term. The consortium operates world-class gas fields in the KRI and currently enables the power generation of three quarters of the area’s official electricity production.

It signed a 20-year gas sale agreement with the KRG earlier this year that will facilitate the production and sale of an additional 250 MMscf/d of gas. Pearl Petroleum’s expansion plan will see output increase to 650 MMscf/d in 2022, and then to 900 MMscf/d by 2023 from the current 400 MMscf/d.

Dana Gas’s share of the proved plus probable (2P) hydrocarbon reserves at Pearl Petroleum Khor Mor and Chemchemal Fields in the KRI increased by 10% following the recent certification of reserves by its independent external reserves auditor, Gaffney Cline Associates. Dana Gas’s total share is equivalent to 1,087 million barrels of oil equivalent, up from 990 million barrels of oil equivalent when Gaffney Cline first certified the fields in April 2016.

By 2040, natural gas demand in the Middle East and North Africa region is expected to grow 40% and oil demand will increase by 10 million barrels a day, according to industry estimates. To help meet that increase in energy demand, projects valued at $238 billion are being executed in the next 20 years.

(Source: Dana Gas)

By Ahmed Mousa Jiyad.

Any opinions expressed are those of the authors, and do not necessarily reflect the views of Iraq Business News.

Transparency in the Arab Countries’ Upstream Petroleum Sector- Iraq as case study*

While upstream petroleum sector is either dominant or has significant importance in many Arab economies of MENA region, the transparency of the sector is alarmingly lacking; this is manifested by their “formal” association with Extractive Industry Transparency Initiative (EITI), which is extremely limited and their Resource Governance Index (RGI) and Corruption Perception Index (CPI) that are too poor.

This presentation comprises three parts;

The first part addresses, briefly, the essence of transparency and what it entails:

  • Full disclosure & availability of and accessibility to related Data & Information;
  • Openness, answerability, accountability;
  • Multiplicity of involved, reporting or concerned entities;
  • Objective, Independent & Verifiable Indicators;
  • Transparency is not rhetorical claim; it is evidence-based;
  • Reconciliation of data: Materiality, Identifiably, Measurability;
  • Constitutional Premises (ownership) Right and Rights Based Development- RBD

Also, this part provides a selection of most known international entities specialized in the matter; these are EITI, Natural Resource Governance Institute (NRGI), Transparency International (TI), Publish What You Pay (PWYP) and the Fund for Peace. Each of these entities has its distinct methodology, working procedures and publications. In addition to them, this part refers to the IMF’ Fiscal Transparency Code.

 

The second part exhibits charts on the standing of the Arab countries based on the latest available data and information from three international entities: EITI, NRGI-RGI and TI-CPI.

As on September 2019 only Mauritania has “meaningful progress” standing with EITI; Iraq was “suspended” since October 2017 due to “inadequate progress” and Yamen was “suspended” on February 2015 due to “political instability”, then in October 2017, Yemen was “delisted” and, thus, could be invited to reapply to the EITI once conditions were again favourable for implementation.

Obviously, the above manifests extremely poor standing (in number of countries and their status) with EITI.

The NRGI’ RGI measures the quality of resource governance in countries that together produce 82 percent of the world’s oil, 78 percent of its gas and a significant proportion of minerals, including 72 percent of all copper. RGI is the product of 89 country assessments (eight countries were assessed in two sectors), compiled by 150 researchers, using almost 10,000 supporting documents to answer 149 questions.

NRGI’s RGI for 2017 (oil and gas only) covers 89 countries and provides their “Score” on a scale of 100 and “Rank” of 89. RGI 2017 classifies the standing of countries according to their scores into: Good (>74); Satisfactory (60:74); Weak (45:59); Poor (30:44) and Failing (<30).

All the 12 Arab countries covered by RGI scored less than 60 out of 100. Countries with Weak score are Tunisia, Kuwait and Oman. Those scored poorly are Qatar, UAE, Bahrain, Egypt, Iraq, Saudi Arabia, Algeria and Yamen. Finally, Libya scored failing.

TI’ CPI 2018 draws on 13 surveys and expert assessments to measure public sector corruption in 180 countries and territories, giving each a Score from zero (highly corrupt) to 100 (very clean) and their Ranks accordingly.

Syria, Yemen, Sudan, Iraq and Lebanon each scored less than 30; Egypt, Algeria, Kuwait, Tunisia, Morocco, Jordan and Saudi Arabia scored over 30 up to 50; Oman, Qatar and UAE scored over 50 to 70.

Since both RGI and PCI are composite indexes, there is strong correlation between Scores and Ranks: low scores are associated with high rank numbers; high rank number means at the bottom of the list.

In conclusion all the standing of Arab countries is alarmingly very poor and disappointing with EITI, NRGI and TI.

 

The third part of the presentation focuses on Iraq as a case study on transparency through its association and experience with EITI.

Briefly, Government of Iraq (GoI) launched (2007/8) the International Compact with Iraq (ICI) in cooperation with the UN and the WB. ICI specifically calls to, “Establish and implement mechanisms to ensure transparency of petroleum sector flows”.

The government publicly announced its commitment to work with all stakeholder groups at the 4th EITI Global Conference in Doha, Qatar, in February 2009, and then made formal commitment to EITI at the Iraq EITI (IEITI) launching conference on 10-11 January 2010; a month later the country was accepted, by EITI Board, as a Candidate.

The first validation report, prepared by EITI’ International Secretariat- IS staff, endorsed by Adam Smith International- ASI, prompted EITI Board to announce, on 12 December 2012, Iraq as “Compliant” country under EITI rules and process. On 3 April 2013, IEITI organized big event in Baghdad celebrating this achievement by Iraq.

A team from EITI-IS visited Iraq during 1-9 April 2017 and held numerous meetings in Baghdad and, also, in Dubai (UAE); IS Report presents the findings and initial assessment of the data gathering and stakeholder consultations and followed EITI usual and unified “Validation Procedures” and applied the “Validation Guide” in assessing Iraq’s progress with the EITI Standard.

Iraq was found to have inadequate progress in implementing the EITI Standard in October 2017. The country status as “compliant member” was suspended and, according to EITI rules, was given a grace period to rectify the shortcomings to achieve at least “Meaningful” progress on all identified requirements.

Why and what went wrong

The presentation highlights and discussed questions relating to why and what had led to such suspension under the following headlines:

  • “Mission accomplished” and sense of complacency; frequency of MSG meetings and attendance curve
  • Wrong understanding of what “compliant” status really means;
  • Focus on “release on time” not on the quality and contents of the IEITI Annual Reports;
  • IEITI Annual report mostly Copy & Paste; most Parts are prepared by MoO/ MIM officials and full of flaws and inaccuracies;
  • Structure & composition of the MSG: dominated by Government representatives, IOCs not active, CSO lack understanding of Extractive Industry and language;
  • Big Secretariat, weak national capacity contribution and complete reliance on the Administrator;
  • Opposing domestic views: useless/invisible; event-base; abused by authorities and two extreme views (Rosy vs. UN full control!):
  • Surprising passivism on Corruption!!!!!!;
  • IEITI itself is a Black Box
  • Limited impacts that led to diminishing international support and lack of funding e.g., NORAD; NRGI: from “priority country” to “Limited engagement” to only in “RGI”;

What are next and the way forward

In this part, the presentation reviewed responses and actions taken by the Iraqi authorities since the suspension: From the initial “muteness” and “passivism” October -2 November 2018,….., to 4 Nov 2018 alerting article; Committees & changes,  …; February 2019 Baghdad Conference; EITI-IS second validation; EITI Global Conference, Paris- June 2019.

In case of re-instating Iraq “Compliant” status, IEITI still has to take specific necessary measures and actions for real impacts instead of making rhetorical statements; such measures and actions were proposed, justified and discussed during the presentation. The PowerPoint slides are attached herewith.

* Presentation delivered before the 12th Middle East and North Africa Oil & Gas Conference, organized by Target Exploration www.targetexploration.com, Imperial College, London, UK. 18 September 2019. I am very grateful to Target Exploration for sponsoring my participation.

Click here to download the PowerPoint slides presented at the conference.

Mr Jiyad is an independent development consultant, scholar and Associate with the former Centre for Global Energy Studies (CGES), London. He was formerly a senior economist with the Iraq National Oil Company and Iraq’s Ministry of Oil, Chief Expert for the Council of Ministers, Director at the Ministry of Trade, and International Specialist with UN organizations in Uganda, Sudan and Jordan. He is now based in Norway (Email: mou-jiya(at)online.no, Skype ID: Ahmed Mousa Jiyad). Read more of Mr Jiyad’s biography here.

By Ahmed Mousa Jiyad.

Any opinions expressed are those of the authors, and do not necessarily reflect the views of Iraq Business News.

Transparency in the Arab Countries’ Upstream Petroleum Sector- Iraq as case study*

While upstream petroleum sector is either dominant or has significant importance in many Arab economies of MENA region, the transparency of the sector is alarmingly lacking; this is manifested by their “formal” association with Extractive Industry Transparency Initiative (EITI), which is extremely limited and their Resource Governance Index (RGI) and Corruption Perception Index (CPI) that are too poor.

This presentation comprises three parts;

The first part addresses, briefly, the essence of transparency and what it entails:

  • Full disclosure & availability of and accessibility to related Data & Information;
  • Openness, answerability, accountability;
  • Multiplicity of involved, reporting or concerned entities;
  • Objective, Independent & Verifiable Indicators;
  • Transparency is not rhetorical claim; it is evidence-based;
  • Reconciliation of data: Materiality, Identifiably, Measurability;
  • Constitutional Premises (ownership) Right and Rights Based Development- RBD

Also, this part provides a selection of most known international entities specialized in the matter; these are EITI, Natural Resource Governance Institute (NRGI), Transparency International (TI), Publish What You Pay (PWYP) and the Fund for Peace. Each of these entities has its distinct methodology, working procedures and publications. In addition to them, this part refers to the IMF’ Fiscal Transparency Code.

 

The second part exhibits charts on the standing of the Arab countries based on the latest available data and information from three international entities: EITI, NRGI-RGI and TI-CPI.

As on September 2019 only Mauritania has “meaningful progress” standing with EITI; Iraq was “suspended” since October 2017 due to “inadequate progress” and Yamen was “suspended” on February 2015 due to “political instability”, then in October 2017, Yemen was “delisted” and, thus, could be invited to reapply to the EITI once conditions were again favourable for implementation.

Obviously, the above manifests extremely poor standing (in number of countries and their status) with EITI.

The NRGI’ RGI measures the quality of resource governance in countries that together produce 82 percent of the world’s oil, 78 percent of its gas and a significant proportion of minerals, including 72 percent of all copper. RGI is the product of 89 country assessments (eight countries were assessed in two sectors), compiled by 150 researchers, using almost 10,000 supporting documents to answer 149 questions.

NRGI’s RGI for 2017 (oil and gas only) covers 89 countries and provides their “Score” on a scale of 100 and “Rank” of 89. RGI 2017 classifies the standing of countries according to their scores into: Good (>74); Satisfactory (60:74); Weak (45:59); Poor (30:44) and Failing (<30).

All the 12 Arab countries covered by RGI scored less than 60 out of 100. Countries with Weak score are Tunisia, Kuwait and Oman. Those scored poorly are Qatar, UAE, Bahrain, Egypt, Iraq, Saudi Arabia, Algeria and Yamen. Finally, Libya scored failing.

TI’ CPI 2018 draws on 13 surveys and expert assessments to measure public sector corruption in 180 countries and territories, giving each a Score from zero (highly corrupt) to 100 (very clean) and their Ranks accordingly.

Syria, Yemen, Sudan, Iraq and Lebanon each scored less than 30; Egypt, Algeria, Kuwait, Tunisia, Morocco, Jordan and Saudi Arabia scored over 30 up to 50; Oman, Qatar and UAE scored over 50 to 70.

Since both RGI and PCI are composite indexes, there is strong correlation between Scores and Ranks: low scores are associated with high rank numbers; high rank number means at the bottom of the list.

In conclusion all the standing of Arab countries is alarmingly very poor and disappointing with EITI, NRGI and TI.

 

The third part of the presentation focuses on Iraq as a case study on transparency through its association and experience with EITI.

Briefly, Government of Iraq (GoI) launched (2007/8) the International Compact with Iraq (ICI) in cooperation with the UN and the WB. ICI specifically calls to, “Establish and implement mechanisms to ensure transparency of petroleum sector flows”.

The government publicly announced its commitment to work with all stakeholder groups at the 4th EITI Global Conference in Doha, Qatar, in February 2009, and then made formal commitment to EITI at the Iraq EITI (IEITI) launching conference on 10-11 January 2010; a month later the country was accepted, by EITI Board, as a Candidate.

The first validation report, prepared by EITI’ International Secretariat- IS staff, endorsed by Adam Smith International- ASI, prompted EITI Board to announce, on 12 December 2012, Iraq as “Compliant” country under EITI rules and process. On 3 April 2013, IEITI organized big event in Baghdad celebrating this achievement by Iraq.

A team from EITI-IS visited Iraq during 1-9 April 2017 and held numerous meetings in Baghdad and, also, in Dubai (UAE); IS Report presents the findings and initial assessment of the data gathering and stakeholder consultations and followed EITI usual and unified “Validation Procedures” and applied the “Validation Guide” in assessing Iraq’s progress with the EITI Standard.

Iraq was found to have inadequate progress in implementing the EITI Standard in October 2017. The country status as “compliant member” was suspended and, according to EITI rules, was given a grace period to rectify the shortcomings to achieve at least “Meaningful” progress on all identified requirements.

Why and what went wrong

The presentation highlights and discussed questions relating to why and what had led to such suspension under the following headlines:

  • “Mission accomplished” and sense of complacency; frequency of MSG meetings and attendance curve
  • Wrong understanding of what “compliant” status really means;
  • Focus on “release on time” not on the quality and contents of the IEITI Annual Reports;
  • IEITI Annual report mostly Copy & Paste; most Parts are prepared by MoO/ MIM officials and full of flaws and inaccuracies;
  • Structure & composition of the MSG: dominated by Government representatives, IOCs not active, CSO lack understanding of Extractive Industry and language;
  • Big Secretariat, weak national capacity contribution and complete reliance on the Administrator;
  • Opposing domestic views: useless/invisible; event-base; abused by authorities and two extreme views (Rosy vs. UN full control!):
  • Surprising passivism on Corruption!!!!!!;
  • IEITI itself is a Black Box
  • Limited impacts that led to diminishing international support and lack of funding e.g., NORAD; NRGI: from “priority country” to “Limited engagement” to only in “RGI”;

What are next and the way forward

In this part, the presentation reviewed responses and actions taken by the Iraqi authorities since the suspension: From the initial “muteness” and “passivism” October -2 November 2018,….., to 4 Nov 2018 alerting article; Committees & changes,  …; February 2019 Baghdad Conference; EITI-IS second validation; EITI Global Conference, Paris- June 2019.

In case of re-instating Iraq “Compliant” status, IEITI still has to take specific necessary measures and actions for real impacts instead of making rhetorical statements; such measures and actions were proposed, justified and discussed during the presentation. The PowerPoint slides are attached herewith.

* Presentation delivered before the 12th Middle East and North Africa Oil & Gas Conference, organized by Target Exploration www.targetexploration.com, Imperial College, London, UK. 18 September 2019. I am very grateful to Target Exploration for sponsoring my participation.

Click here to download the PowerPoint slides presented at the conference.

Mr Jiyad is an independent development consultant, scholar and Associate with the former Centre for Global Energy Studies (CGES), London. He was formerly a senior economist with the Iraq National Oil Company and Iraq’s Ministry of Oil, Chief Expert for the Council of Ministers, Director at the Ministry of Trade, and International Specialist with UN organizations in Uganda, Sudan and Jordan. He is now based in Norway (Email: mou-jiya(at)online.no, Skype ID: Ahmed Mousa Jiyad). Read more of Mr Jiyad’s biography here.