The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed sanctions today on Afaq Dubai, an Iraq-based money services business (MSB) that has been moving money for the Islamic State of Iraq and Syria (ISIS).

Today’s designation follows action taken by the Department of Defense—announced on October 11—against a key ISIS financial facilitation group.  This MSB is a part of ISIS’s financial network that includes an array of other MSBs, hawalas, and financial facilitators in the Middle East.

OFAC named Afaq Dubai as a Specially Designated Global Terrorist pursuant to Executive Order 13224, for assisting in, sponsoring, or providing financial, material, or technological support for, or financial or other services to or in support of, ISIS.  Contrary to what the name may imply, this MSB is located in Iraq and does not have any branches in the United Arab Emirates.

“This Iraq-based MSB is a part of ISIS’s complex network of money services businesses, hawalas, and financial facilitators funding terrorism across the Middle East.  We are targeting this network in concert with the Department of Defense as part of this Administration’s ongoing campaign to cut off ISIS’s ability to launder money and move illicit funds,” said Sigal Mandelker, Treasury Under Secretary for Terrorism and Financial Intelligence.  “Even as ISIS’s hold on territory is eliminated, we will continue to search for and shut down the illicit financial networks ISIS utilizes to fund terror attacks and sustain operations.”

Today’s action is a continuation of Treasury’s ongoing efforts to shut down financial facilitators and MSBs worldwide that move money on behalf of ISIS.  It follows the designation of two ISIS financial facilitators in September with ties to the Caribbean and the Middle East.  In December 2016, OFAC designated Selselat al Thahab Money Exchange in Iraq, ISIS financier Fawaz Muhammad Jubayr al-Rawi, and his company, the Hanifa Currency Exchange in Albu Kamal, Syria.  Prior to his death, al-Rawi used the Hanifa Currency Exchange in Albu Kamal, Syria and a global network of financiers to move millions of dollars on behalf of the terrorist group.

OFAC closely coordinated today’s designation with the Combined Joint Task Force-Operation Inherent Resolve (CJTF-OIR), which released details on October 11 regarding its joint action against members of a key ISIS financial facilitation group, who leveraged this MSB as part of its operation.   Coordinated actions such as those conducted by DoD and Treasury this week disrupt and curtail ISIS’s logistical infrastructure, recruiting, and revenue generation.

As a result of today’s action, all property and interests in property of Afaq Dubai subject to U.S. jurisdiction are blocked and U.S. persons are generally prohibited from engaging in transactions with them.

DESIGNATED TARGET

Afaq Dubai

Afaq Dubai was designated for assisting in, sponsoring, or providing financial, material, or technological support for, or financial or other services to or in support of ISIS.

Afaq Dubai — which is located in Iraq — is part of a network of ISIS-associated money services businesses and financial facilitators in the Middle East.  It is run by two ISIS financiers, and, as of early 2018, laundered money for ISIS and provided money to ISIS families.

In May 2018, a Jordan-based ISIS financial facilitator deposited $3 million from Iraqi dinar into three exchanges, including Afaq Dubai.

Identifying information on the entity designated today.

(Source: OFAC)

By John Lee.

Iran’s private banks have reportedly laid the groundwork for setting up a joint bank with their counterparts in Iraq.

Yahya Al-e Es’haq [Yahya Ale-Ishaq] (pictured), head of Iran-Iraq Chamber of Commerce, is quoted as saying that the bank would operate under the regulations of central banks of the two countries to facilitate money transfer.

(Source: Xinhua)

(Picture Credit: Tasnim, under Creative Commons licence)

By John Lee.

The Central Bank of Iraq (CBI) has released a series of new banknote designs, which will enter circulation next week.

According to a report from Rudaw, the notes are intended to modernise the currency and better reflect the nation’s heritage and diversity.

It adds that the CBI does not plan to recall old banknotes.

(Sources: CBI, Rudaw, Xinhua)

The World Bank Group, the Government of Iraq, and the Government of Canada launched today a US$1.95 million grant to support Iraq’s efforts to strengthen systems and deliver programs to empower women economically and politically.

The “Gender and Social Protection in Iraq: Towards Economic Empowerment” program consists of two complementary components: the first component will set in place long-term legislative and institutional capacity for gender mainstreaming, while the second will introduce programs that will support the economic and political empowerment of women in Iraq, including entrepreneurial programs for poor and vulnerable women.

Saroj Kumar Jha (pictured), World Bank Mashreq Regional Director, said:

We are excited to partner with the Government of Canada to support women’s empowerment in Iraq. We are committed to supporting women in Iraq and we’ll work tirelessly to ensure that Iraqi women have the opportunity to participate fully in all facets of life and to contribute to Iraq’s socio-economic development.

This project contributes to the wider World Bank’s socio-economic intervention in Iraq and is consistent with the Iraq’s Second Poverty Reduction Strategy and the Social Protection Strategic Framework.

H.E. Dr. Mehdi Al-Alak, Secretary General of the Council of Ministers, said

The program will support the ongoing gender empowerment efforts led by the government. It will help us achieve women’s empowerment by reducing legal, institutional, and social constraints and unleash their talent and energy to make our economy and society stronger.

Ambassador Paul Gibbard, Canada’s first resident Ambassador to Iraq since 1991

Canada recognizes that supporting gender equality and the empowerment of women is the best way to build a more peaceful, more inclusive and more prosperous Iraq. With our partners from the World Bank and the Government of Iraq, we will work to empower women so that they are able to play a vital role in establishing and maintaining peace in their communities—a necessary precondition for stronger economic growth in Iraq.”

The “Gender and Social Protection in Iraq: Towards Economic Empowerment” program will entail a review of existing women’s empowerment programs and provide technical support through workshops and working sessions to government officials on enhancing the design and implementation of these programs, as well as on strengthening monitoring and evaluation schemes.

(Source: World Bank Group)

By Adnan Abu Zeed for Al Monitor. Any opinions expressed here are those of the author and do not necessarily reflect the views of Iraq Business News.

The Iraqi Ministry of Planning announced the launch of the Social Fund for Development on Sept. 23, with initial capital of $300 million, in cooperation with the World Bank.

The project aims to improve the living conditions of Iraq’s poor. High poverty rates in Iraq have led to repeated protests for 15 years calling for improving the standard of living and for more employment opportunities. These protests have resulted in dozens of deaths and injuries.

A May 2018 World Bank report noted that Iraq’s population of 38.5 million sits at the poverty line with a poverty rate of 22.5%. The spokesman for the Iraqi Ministry of Labor and Social Affairs, Ammar Menem, told Al-Monitor that this high rate is due to “exceptional security conditions ensuing from the war and its costs, as well as to the slump in oil prices. This resulted in the cessation of funding of projects for the rehabilitation of unemployed persons, a lack of investment projects and faltering economic growth.”

Click here to read the full story.

By John Lee.

The state-owned Trade Bank of Iraq (TBI) is reported to be in talks to buy a Gulf bank with branches in the United Arab Emirates (UAE) and Qatar.

Chairman Faisal al-Haimus told Reuters that talks are underway and the purchase is expected to be completed in six to eight months. The name of the bank was not disclosed.

According to the report, Haimus was in Abu Dhabi to sign a 100 million euros ($115.5 million) loan agreement with Germany’s Commerzbank to enable it to support small and medium sized projects in Iraq.

More here.

(Source: Reuters)

Advertising Feature

By Veronica Cotdemiey, CEO of Citizenship Invest.

Recently Cyprus has been recognized as the ‘super star’ of the citizenship by investment programs worldwide. The country has the most appealing second citizenship program being the only European country which grants the nationality in only 6 months without ever having to reside there. Cyprus has officially and by far, the fastest form of legally obtaining a European citizenship and passport which enables living, working and studying in any of the 28 countries members of the European Union.

Moreover, Cypriot passport holders can travel to major destinations without applying for visas. It allows instant visa free travel to over 170 countries including the UK, UAE, European Union countries, Canada, Australia among other major countries and often allows a stay from 30 up to 90 days at a time depending on each country.

Most importantly, the citizenship can be inherited by family members and future generations. Children, grandchildren, great-grandchildren and beyond also have the right to obtain the citizenship and passport through a very simple process which takes only two weeks.

Unlike many of the fast track citizenship programs which require a non-refundable financial contribution to a Government fund, Cyprus offers its investors the possibility of earning a good return while obtaining the citizenship. The Cypriot citizenship law requires a temporary investment of EUR 2 million in a Real Estate investment in Cyprus which is required to be held for 3 years and thereafter can be sold while maintaining a property worth 500,000 EUROS. It is certain that not everyone can afford it, but for those who can, this is potentially on of the best investment they would have made in their lifetimes, leaving their families a great legacy.

The program has become so popular among HNWI citizenship applicants from all over the world especially Asia, Middle East and Russia, that the Cypriot Government has recently announced a cap of only 700 applications per annum to maintain its high standards. According to Cypriot news agencies, the Government of Cyprus has released reports of issuing passports for over 3,300 families bringing into the economy approximately USD 4.5 Billion. This has helped turning the Cypriot economy around becoming one of the fastest growing GDP’s in Europe. At the moment, Cyprus GDP levels are considerably higher than those of the Eurozone and the European Union according to a report released by the international firm KPMG.

The Cypriot citizenship by investment program is one of the many incentives established by the Government to attract foreign direct investment to the country. The first amendments to the citizenship law were introduced back in 2013. Since its inception, the program has undergone various improvements to make it more accessible and attractive for investors. In September 2016, the Government of Cyprus introduced an amendment which reduced the minimum investment amount to EUR 2 million (from EUR 2.5 million) and the option to add the parents of the main applicant for an additional EUR 500,000 plus VAT investment in a property in Cyprus.

According to official statistics from the Department of Land and Surveys, in 2017 Cyprus has recorded a 24% increase in real estate sales contracts, 30% of which accounted to non-nationals. Not surprisingly 31% of the real estate transactions in 2017 were properties valued at around 2 million EUROS, which indicates that a high number of investors are purchasing real estate as a mean to obtain the Cypriot citizenship.

The contribution of real estate to Cyprus’ GVA amounted to EUR 2,4 Billion in 2017. Construction activities from 2013 onwards indicate to have broken through the slowdown of the financial crisis, which has been clearly left way behind, and entered into an expansion period which until 2019 is set stretch to pre-2013 levels where Cyprus recorded all-time highs in real estate transactions.

From a taxation point of view Cypriot passports holders actually benefit. Non-tax residents are not liable for income tax generated outside the country. More importantly Cyprus does not impose inheritance tax on property, which gives the ability to pass it down to future generations without incurring costs.

So how does all this benefit investors? Cyprus has become one the of the most attractive real estate investments in Europe. This injection of billions of Euros in luxury real estate and infrastructure is turning the Cypriot landscape around. Limassol will soon have ‘One’ the tallest residential tower in Europe, Ayia Napa is undergoing the non-stop 24/7 construction of the most luxurious marina in the region with high end international restaurants and villas worth EUR 5 million with their own private berths. The whole country is having a radical facelift with modern contemporary architecture of glass and refined design are taking over. In the next 3 years, when allowed to re-sale, investors will be able to appreciate the growth of their investments as part of this radical transformation.

One can understand the excitement of savvy businessmen when considering buying property in Cyprus, after all they know that they are purchasing luxury real estate in a newly booming property market.

It is clear that Cyprus has not only become the ‘super star’ of citizenship programs but also earned a prime position amongst the most profitable real estate investments worldwide. Demand translates into growth which then translates into high profits. Whether applying for citizenship or not, Cyprus seems to be the place to invest in.

The Deputy Chairman of the Iraq Britain Business Council (IBBC), Rasmi Al Jabri, and Managing Director, Christophe Michels, hosted a dinner for members and guests at the Babylon Warwick Hotel in Baghdad on 29th August.

Many representatives from member companies were in attendance, including the Chairman of Khudairi Group and the International Islamic Bank, the CEO’s of Kuwait Energy and the National Bank of Iraq, as well as representatives from Al Burhan Group, Al Nukhba-OFS, Constellis, G4S, Standard Chartered Bank, Serco, Shell and XReach Ltd.

Ms Beverly Simpson, Iraq Country Director for the Department for International Trade, gave guests an update on the latest visa and labour regulations being applied in Iraq, followed by a discussion.

(Source: IBBC)

By John Lee.

The state-owned Trade Bank of Iraq (TBI) has reportedly put plans to buy a Turkish commercial bank on hold because of the fall in the Turkish lira.

TBI chairman Faisal al-Haimus told Reuters that the bank is keen to expand its footprint in Turkey, Iraq’s largest trading partner.

According to the report, TBI has assets of around $20 billion, and is responsible around 80 percent of the trade finance business in Iraq.

(Source: Reuters)

Prime Minister Nechirvan Barzani chaired the 49th regular session of the Council of Ministers on Tuesday. It was also attended by Deputy Prime Minister Qubad Talabani.

Prime Minister Barzani briefed the Council about his recent visit to Baghdad and meeting with Prime Minister Haider al-Abadi. He said, they agreed to continue dialogue and coordination and demanded implementation of the Iraqi Council of Representatives decision to unify salaries and privileges of the families of the martyrs and Anfal victims in the Region with those of their counterparts in the federal government. They also discussed reopening the Erbil-Kirkuk road and the readiness of the KRG to export Kirkuk oil.

Regarding the new Iraqi government, Prime Minister Barzani emphasized the KRG has no veto against anyone. While protecting common interests, he said what is important to the Kurdistan Region is the new government’s programme that would help to materialize the rights and the constitutional authorities of the Kurdistan Region.

Minister of Martyrs and Anfal Affairs Mahmood Haji Salih and Secretary of the Council of Ministers Dr. Amanj Rahim presented a report on the latest developments in the effort towards international recognition of the crimes committed by ISIS against Yezidis and other ethnic and religious communities as genocide, and on UN Security Council’s Resolution 2379 to form a team to investigate this situation.

The Council of Ministers affirmed the Security Council Resolution to be an important step towards recognizing these crimes as genocide. The Council of Ministers assigned the High Commission on Recognition of ISIS Crimes as Genocide to coordinate with the international team.

Prime Minister Barzani instructed the commission to deliver to the UN team all evidence collected during the past four years about crimes against humanity and acts of genocide directed at Yezidis, Christians, and all other communities to apply justice to perpetrators to the full extent of the law and to compensate the victims and their families.

The Council of Ministers called on the Iraqi federal government to take into account the involvement of legal practitioners, experts, and other representatives of the Kurdistan Region in the implementation of the Security Council Resolution.

The Council of Ministers re-emphasized its policy that protects religious rights and freedoms as basic principles of human rights, believes a nation’s strength lies in its diversity, and that the KRG will continue to endeavor to make the Kurdistan Region a safe place for all members of society.

2019 budget draft

The Council of Ministers also discussed the 2019 budget draft. KRG Minister of Finance and Economy, Rebaz Hamlan, presented a report on the 2019 budget draft, a process suspended since 2014 due to the financial crisis. He informed about steps being taken to estimate general revenues and expenditures in collaboration with ministries.

The Council of Ministers expressed its support and called upon all ministers to coordinate with the Ministry of Finance and Economy as well as the Ministry of Planning.

In a press conference after the meeting, Prime Minister Barzani briefed the media on latest development in the region.

Regarding reports suggesting that US Special Envoy Brett McGurk urged postponement of the September 30th Kurdistan election, Prime Minister Barzani stated, “There is nothing like that. He hasn’t discussed this issue with us. What has been discussed is whether elections will be held or not. Yes, they will be held on time. No talk of postponing elections by Mr. Brett McGurk with us has happened. Up to the moment, no political party in Kurdistan Region has asked that the September 30th elections be postponed. If I speak as the KDP, we from the Kurdistan Democratic Party emphasize that elections need to be held at their scheduled time.”

About negotiations with Baghdad on various issues, Prime Minister Barzani said, “There are some principles important in negotiations with Baghdad. It is very important for the people of Kurdistan and for all parties to jointly participate in this process. Serious talks will begin after manual vote counting is concluded and the results are officially confirmed and announced by the Iraqi Federal Court.

Regarding trade between the Kurdistan Region and Islamic Republic of Iran after the sanctions were reimposed on Iran by the US Government, Prime Minister Barzani said, “Until now, the sanctions are not clear to us. But certainly, the Kurdistan Region will take steps within the framework and position of Iraq. We asked the US and talked with Baghdad to make it clear to us. We asked and await the US to send a delegation to explain what exactly should and should not be done.”

Regarding the Rosneft agreement and any tension with Baghdad, he said, “What we have done with Rosneft is a commercial matter. Our contracts are within the framework of the Iraqi Constitution.” He also said, “Now that Baghdad can’t practically export Kirkuk oil, which is about 250 to 300 thousand barrels per day, we have told them we are ready to facilitate export to Ceyhan port where Iraq’s State Oil Marketing Organization, SOMO, can sell the oil and, of course, all revenue will be for all Iraq.

(Source: KRG)