Iraq: UN details ordeal of abducted protesters, welcomes Government’s promise to investigate and compensate
A United Nations report published today on the abduction of protesters in Iraq since last October details their ordeals from the time of abduction through interrogation to acts of torture.
In its fourth report on the protests, the UN Human Rights Office of the UN Assistance Mission for Iraq (UNAMI) documented cases involving 123 people who disappeared between 1 October 2019 and 21 March 2020. Of these, 98 people were located, but 25 remain missing or are in an unknown status.
Since the protests erupted at the start of October, the UN has verified 490 deaths of activists and 7,783 injured. Most of the protesters are young and unemployed, and have been demanding that their economic and social rights be respected. The demonstrations have continued even after the outbreak of COVID-19 in the country.
The report found that the “absence of accountability for these acts continues to contribute to the pervasive environment of impunity in relation to demonstration-linked reports of violations and abuses”.
“The establishment of a high-level fact-finding committee by the new Government to investigate casualties and related harm is a crucial step toward justice and accountability,” said Jeanine Hennis-Plasschaert, Special Representative of the United Nations Secretary-General for Iraq. “The Government’s commitment to provide medical treatment for injured demonstrators and compensation to the families of victims is encouraging.”
The report notes that the abductions and disappearances occurred amid numerous incidents involving additional violations and abuses targeting activists and protesters, including deliberate killings, shooting and knife attacks, threats and intimidation, and excessive and unlawful use of force at demonstration sites.
None of those interviewed knew the identity of those responsible for their abduction, although most speculated the involvement of ‘militia’. They added that they did not believe official Iraqi Security Forces were directly responsible, nor that ordinary criminal gangs were to blame.
The report does not speculate on who might be behind the abductions, points to “the involvement of armed actors with substantial levels of organisation and access to resources”.
The report provides concrete recommendations to the Government of Iraq, including:
Make immediate efforts to comply with its obligations under international law, including by making all efforts to locate those demonstrators and activists who remain missing.
Take immediate action to protect protesters and activists from abduction.
Take immediate action to investigate all alleged cases of abduction, disappearance and torture/ill-treatment, and to prosecute those responsible.
Publicly identify the so-called unidentified force, armed group or ‘militia’, behind the abductions.
Iraqi protesters gathered in Tahrir Square in the capital Baghdad after the government scaled back some of its anti-coronavirus measures during the month of Ramadan, Anadolu Agency reported
The protesters held photos of Prime Minister-designate Mustafa Kadhimi with a red “X” on his face in rejection of his candidacy for the role.
Activist Ghassan Adel told the news agency that “any transitional government that brings with it party quotas is rejected not only in Tahrir Square, but in all the country’s protest arenas”.
Adel, who had been protesting in Tahrir Square for months, said: “The masses are stronger than tyrants, parties and politicians,” adding that “this government will not pass. If it is passed, we will overthrow it with escalatory measures.”
Another protester, Mohamed Diyab said: “Kadhimi is forming a government of corrupt parties to continue the looting of the country.”
“We are the country of civilisations and we will no longer accept those who are ignorant and thieves to rule us,” he added.
Earlier this month, Iraqi President Barham Salih named Kadhimi, the head of National Intelligence Service, as the country’s third prime minister-designate this year.
This came after Adnan Al-Zurfi resigned his candidacy after he failed to gather enough support to form a government. Al-Zurfi blamed “internal and external reasons” for the failure.
Al-Zurfi had been appointed after Mohammed Allawi withdrew his candidacy on 1 March after parliament twice failed to achieve quorum to approve his government.
However, Iraqi protestors maintain that “oppression and fear are more dangerous than coronavirus,” and have consistently demonstrated a will to continue what has become known as the October 2019 revolution.
By Amnesty International. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Iraq: 3D reconstruction shows security forces deliberately killed protesters
An exclusive new visual investigation by Amnesty International and SITU Research shows that Iraqi security forces intended to kill or severely maim dozens of protesters when they fired military-style grenades directly into crowds on the streets of Baghdad from last October onwards.
By Zahra Ali for Jadaliyya. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Since October 2019, Iraq is experiencing a turning point in its history with popular mobilizations demanding radical change.
The Iraqi revolution is a societal uprising involving a wide spectrum of society including the dispossessed, the marginalized, the ones deprived of resources and power.
Women’s massive participation from young female students to older women has turned this uprising to a people’s revolution.
While remarkable, this participation is not surprising, it only makes visible deep societal realities and transformations that have found their space of expression in the Iraqi streets and squares of protest.
By Ahmed Tabaqchali, CIO of Asia Frontier Capital (AFC) Iraq Fund. This article was originally published by the LSE Middle East Centre.
Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Between a Rock and a Hard Place: Iraq’s Political Class’ Dilemma between Budget Realties and Protestor Demands
The twin shocks of the effect of coronavirus on the world economy and the current oil price war will stress Iraq’s budget to the limit, and lead to an economic crisis if it continues for an extended period.
While as extraordinary shocks they were unforeseeable, the Iraqi budget’s structural imbalance would have inevitably led to such an economic crisis – the only question being when and not if.
A low oil price environment exposes the structural faultiness of the budget with projected revenues not covering current spending, which is mostly composed of salaries, pensions and welfare spending. These have increased from 50% of current expenditures in 2004 to an estimated 81% in 2019, and likely to more than 85% in 2020. As such the default choice for the government would be to cancel all investment spending, especially non-oil investment spending, and resort to borrowing.
Such measures have allowed the government to continue functioning, but these come at a huge cost to the economy as Table 2 below shows. Global debt markets are not as accommodating as they were in 2014-17 given Iraq’s estranged relationship with the US and the change in the IMF’s stance toward Iraq. As such the government would have to resort to domestic sources, which ultimately means indirect monetary operations by the CBI at the expense of the its foreign reserves as happened in 2014-16.
Moreover, these measures would only postpone and not resolve the crises, needing much higher oil prices to contain or mask it like in 2017-19. Medium-term oil prices would probably (for Brent prices) settle within a range of $50-60/bbl, which should partially relieve the stress on the budget, but not the need to address its imbalance.
Iraq’s 2019 budget, initially proposed by the prior government, submitted with minor changes by the current government and approved by the current parliament, perpetuated the same deficiencies and weaknessess of all Iraq’s budgets since 2003. Crucially, it deepened the structural imbalance between the budget’s current and investment expenditures, in which public sector wages consumed an ever-increasing share of government revenues.
Moreover, it undermined and reversed most of the small, but essential, fiscal reforms agreed with the IMF in the 2016 Stand-By Agreement (SBA) to address this structural imbalance; and which needed considerable follow-up reforms over the years to put the country on a sustainable path to growth and reduce the economy’s vulnerabilities to the volatile oil market. The extent of these vulnerabilities came to the fore during the collapse in oil prices in 2014, and coupled with the cost of the ISIS conflict, this led to a sharp contraction to the non-oil economy in 2014-17.
Undeterred by these memories, the budget’s planners, buoyed by the bounty of higher oil revenues, from late 2017 embarked on an expansionary budget that magnified these very vulnerabilities. This was achieved by simultaneously reversing the growth of non-oil revenues and by increasing current spending. Non-oil revenues decreased in both absolute terms and as a percentage of total revenues: -18% and -29% respectively in 2019 and 2018.
Additionally, 25% of these non-oil revenues were in fact oil-related in the form of taxes on foreign oil companies and the budget’s share from profits from the state’s oil companies. Current spending increased by 15% with the salary and pensions component growing by 7.5% instead of decreasing continuously.
The budget’s trumpeted increase of 29% in investment spending hides the fact that only 43% of this total spending for 2019 was earmarked for non-oil investment, which would nevertheless increase by 43% in 2019. However, historically this spending is on paper only, with an execution rate of under 65%. The performance in 2019 was much worse than normal with non-oil investment spending at about IQD 3.3 trn as of November 2019 from a planned budget of IQD 14.0 trn, or about a 24% execution rate.
The budget planners’ aims for 2020 were for a continuation of the expansionary budget of 2019, which dismayed the IMF enough for it to issue a critical country report (19/248) – the first since 2004. Adding to the dismay was the fact that the government’s plan for fiscal probity was based on expectations of continued high oil prices, as well as sticking to its historic under-execution of the budget. Essential budget reforms to address the structural imbalance were delegated to an expression of interest for inclusion in medium term fiscal strategy planning.
The IMF then modelled for a 2020 budget with revenues estimated at IQD 113.1 trn based on oil price assumptions of $55.8/bbl. Expenditures were estimated at IQD 123.2 trn, made up of current expenditures at IQD 99.1 trn, while oil investment spending was estimated at IQD 15.5 trn and non-oil investment spending at IQD 8.6 trn. This would have needed debt financing of IQD 10.0 trn to balance the budget. Since it’s almost impossible to cut the bulk of current spending, the government must have been anticipating a better budgetary situation through Iraqi oil prices higher than $55.8/bbl and from under-executing much needed non-oil investment spending and reconstruction.
By October, plans for budget expenditure ballooned by 31% to IQD 162.0 trn, necessitating debt financing of IQD 48.9 trn. While there are no details apart from spending and deficit figures, the political paralysis following the failure of the prime minister-designate to form a government in early March has put a halt to these runaway expenditure plans.
As long as the political class’ existential fear from the five-month long youth-led countrywide demonstrations continues to ebb and flow, this political paralysis is likely to continue. However, the main economic consequences would be the same whether a new government forms under a new prime minister-designate, or if the current caretaker government continues to limp on. The outcome either way will be that no new budget will be passed, with the government continuing to implement the executed parts of 2019’s budget throughout 2020 according to the ‘1/12th rule’.
Essentially, this means the government will continue to spend (per month) 1/12th of the actual spend in 2019 – effectively extending the current spending component for 2019 in addition to the increased spending of IQD 10.5 trn as a result of government measures to appease the demonstrators in October 2019. The government will likewise continue with the investment projects initiated in 2019.
Estimating the effects of the current events on the Iraqi budget is fraught with uncertainty. Current predictions on the extent of the decline in oil prices mirror those made following the 2014 oil price war, which then assumed a continuation of the decline into the future. This in time proved to be overly pessimistic, as will the current ‘worst-case’ prognoses. Moreover, though the effects of the new coronavirus on the world economy will be profound in Q1/2020, the extent and the continuation of these effects for the rest of the year remains uncertain.
However, these negative effects would be compounded for oil prices by a sharply increased supply in an environment of weakened demand. The upshot would be an extended period of lower oil prices. The table below looks at the budget for 2015-19 and estimates for 2020 based on different realised oil prices for 2020 as whole (please see footnote 2 for notes and assumptions used).
Past policies of spending oil revenues on expanding the public payroll and welfare spending, in the process depleting the country’s wealth without building its infrastructure, has resulted in an economy dependent on imports of goods and services, a stunted private sector and a labour market skewed towards public employment. This development has been at the root cause of successive countrywide demonstrations. The need to urgently restructure the budget’s structural imbalances will require painful reforms and a long adjustment period, and thus would need a buy-in by the population at large.
This, given the extent of the current anti-political elite protest movement and the scale of the repression of this movement, is unlikely without significant political reform.
 The percentage figures are made up of salaries, pensions and transfers. Transfers are mostly composed of welfare spending and transfers to State-Owned Enterprises (SOEs) which in turn are primarily for salary payments and support to SOEs. Source: IMF Iraq country reports 2004-19.
 Revenues and expenditures for 2015-19 sourced from Ministry of Finance (MoF). These figures constitute revenues and expenditures actually received/made at the time and not booked. As such they differ, sometimes significantly, from those provided by the IMF. The crucial difference being that they resemble an actual cash flow statement and not an income statement. This can be seen from the difference between the Ministry of Oil’s (MoO) revenue data which show sales made and the MoF’s data which how funds received which can lag actual sales.
Iraqi oil sales and average Iraqi oil price are taken from MoO website, while average Brent prices can be found here. CBI foreign reserves are as of end of 2019 and are found here. 2019 budget numbers are as of November 2019 and projected to continue into end of 2019. Oil revenues are based on MoO data which are available as of the end of December 2019. The 2020 budget numbers assume a continuation of the budget spent for 2019. It is assumed that Iraq would maintain market share through aggressive pricing and thus that the discount to Brent would increase from $3.35 for 2019 to $4.50.
Disclaimer: Ahmed Tabaqchali’s comments, opinions and analyses are personal views and are intended to be for informational purposes and general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any fund or security or to adopt any investment strategy. It does not constitute legal or tax or investment advice. The information provided in this material is compiled from sources that are believed to be reliable, but no guarantee is made of its correctness, is rendered as at publication date and may change without notice and it is not intended as a complete analysis of every material fact regarding Iraq, the region, market or investment.