Harambe: Vietnam may receive $1.56 billion from $650 billion IMF special drawing rights (8/5/21)
The board of governors of the International Monetary Foundation (IMF) has approved a general allocation of special drawing rights (SDR) equivalent to $650 billion on August 2 to boost global liquidity. Vietnam could be one of the emerging countries receiving support from this package.
“This is a historic decision – the largest SDR allocation in the history of the IMF and a shot in the arm for the global economy at a time of unprecedented crisis. The SDR allocation will benefit all members, address the long-term global need for reserves, build confidence, and foster the resilience and stability of the global economy. It will particularly help our most vulnerable countries struggling to cope with the impact of the COVID-19 crisis,” Kristalina Georgieva, IMF managing director, said.
The general allocation of SDRs will become effective on August 23. The newly created SDRs will be credited to IMF member countries in proportion to their existing quotas in the fund.
About $275 billion of the new allocation will go to emerging markets and developing countries, including low-income countries in Southeast Asia such as Vietnam, Thailand, and the Philippines.
Bloomberg predicted Vietnam could receive $1.56 billion from the IMF package.
“We will also continue to engage actively with our membership to identify viable options for voluntary channelling of SDRs from wealthier to poorer member countries to support their pandemic recovery and achieve resilient and sustainable growth,” Georgieva said.
One key option is for members with strong external positions to voluntarily channel part of their SDRs to scale up lending for low-income countries through the IMF’s Poverty Reduction and Growth Trust (PRGT). Concessional support through the PRGT is currently interest-free. The IMF is also exploring other options to help poorer and more vulnerable countries in their recovery efforts. A new Resilience and Sustainability Trust could be considered to facilitate more resilient and sustainable growth in the medium term, the IMF stated.
However, in July, the IMF forecasted lower prospects for Indonesia, Malaysia, the Philippines, Thailand, and Vietnam where recent waves of COVID-19 infections are weighing on activity. The fund forecast that emerging Asia would grow 7.5 per cent this year, down 1.1 percentage points from the April forecast, according to Reuters.
Tishwash: Washington exempts Baghdad for 120 days to import gas and electricity from Iran
The United States of America granted Iraq a new exemption for four months from the sanctions imposed on Iran, giving Baghdad an opportunity to import electric power and gas.
And according to what the American “Al-Hurra” channel quoted an official in the US State Department, “the United States granted Iraq a 120-day exemption, allowing it to pay the costs of electricity imports from Iran,” noting that “US Secretary of State Anthony Blinken renewed the exemption from the sanctions, which gives Iraq is an opportunity to conduct financial transactions related to importing electricity from Iran .”
“The exemption ensures Iraq’s ability to meet its energy needs in the short term, while taking steps to reduce its dependence on Iranian energy imports,” he added.
For his part, a senior Iraqi official confirmed to Al-Araby Al-Jadeed that Washington granted the new extension at the request of the Iraqi government, which discussed the file with the American side during the strategic dialogue, noting that “Iraq informed Washington of its urgent need to obtain energy and gas, Especially as it suffers from a major imbalance in meeting energy requirements during the current summer.”
He stressed that “Washington was very understanding of the Iraqi circumstance, and later informed him of its approval of the extension, during which Iraq exceeds the summer season.”
The last extension granted by Washington to Iraq to continue Iraqi dealings with Iran was in early April.
Iraq is going through a severe crisis in the provision of electric power, as it currently produces only 16 thousand megawatts, which is much less than its actual need, which amounts to 24 thousand megawatts, and reaches 3 megawatts during the summer period.
This is taking place at a time when Baghdad is preparing to contest the early parliamentary elections, which are scheduled to be held on the tenth of next October. US President Joe Biden recently expressed his support for the Iraqi elections.
Meanwhile, today, Wednesday, electric power transmission lines were subjected to explosions with explosive devices that affected power equipment.
And the Iraqi Ministry of Electricity announced that a number of electric power transmission lines in Baghdad and Salah al-Din had been subjected to sabotage, which led to power outages in many areas. And she explained, in a statement, that “the high-pressure electric power transmission line (Salah al-Din – west of Baghdad) was detonated by explosive devices that damaged one of the towers.”
She stressed that “the bombing will negatively affect the supply of electrical power for part of Salah al-Din Governorate and areas north of Baghdad,” adding that “two lines for transmitting electrical energy in the town of Tarmiyah (north of Baghdad) were also exposed to detonation of explosive devices that damaged one of the towers, which led to the separation of lines. North of Baghdad, which feeds the areas of Adhamiya, Rashidiya and Husseiniya, and will also affect the supply of electric power for the Karkh water project. link
Tishwash: The World Bank issues a statement on supporting Iraq and sets a time limit
The World Bank Group has renewed its commitment to continue its support to Iraq by adopting the Special Strategic Partnership Framework until 2026.
The World Bank said in a statement today (August 5, 2021) that the World Bank renews its commitment to continue its support for Iraq by reliance on the Special Strategic Partnership Framework until 2026, and the new framework identifies the main development goals that the World Bank Group wishes to support in Iraq and also proposes the implementation of a set of strategic solutions Necessary to help Iraq respond to the ongoing Corona pandemic crisis and also to fix the deficiencies in the Iraqi economy.”
He added, “The new framework for this partnership comes against a backdrop of increasing fragility in Iraq, where the duality between the effects of the Corona pandemic, fluctuations in oil prices and growing climate risks have exacerbated the current challenges facing the country.”
The World Bank indicated that “although such challenges may lead to more instability in Iraq, at the same time they provide an opportunity for his new government to rearrange the country’s priorities by moving forward with the process of economic reform and addressing structural issues rooted in this economy.”.
Saroj Kumar Jha, Regional Director of the Mashreq Department at the World Bank, said: “The strategic partnership framework, with its flexibility at its core, will serve as a platform for the World Bank Group to meet the immediate needs of the poor and needy groups of Iraqis and address the causes and drivers behind the situation. The fragility and crises in Iraq The World Bank Group stands ready to support the Iraqi people by contributing to fighting corruption, building transparent and accountable institutions, and empowering the public sector further to improve the business environment in Iraq..”
The Strategic Partnership Framework with Iraq was developed in line with the World Bank Group’s strategy for the years 2020-2025 for countries experiencing fragility, conflict, and violence. This strategy allows the World Bank Group to continue its partnership with countries during periods of conflict and violence to help them achieve greater success in emerging from their crises. The strategic partnership framework is in line with the reform priorities of the Government of Iraq included in its national programs and strategies, and promotes the renewal of the social contract between citizens and the state, as well as promoting a healthy local private sector, strengthening the legitimacy of key government institutions and developing their capabilities
Ramzi Afif Noman, Head of the World Bank Office in Iraq, said: “The foundations of the strategic partnership framework are aimed at improving governance, providing public services, increasing the participation of the private sector in economic activity, and enhancing human capital. Citizens side, gender equality and response to climate change.
For her part, Merly Baroudi, Director of Economics and Sustainability at the Multilateral Investment Guarantee Agency (MIGA), commented, “Indeed, the Strategic Partnership Framework with Iraq provides a strong opportunity to promote comprehensive, environmentally friendly and resilient development, and to benefit from the World Bank Group’s 2021-2025 action plan to confront the change climate, as well as putting the country on a more sustainable path towards a low carbon future.”
The World Bank Group has built a portfolio in Iraq, having maintained its involvement and presence in Iraq since 2003. This has led to a number of initiatives, most notably in multi-sectoral emergency reconstruction programs in areas liberated from ISIS control, and reforms directed at improving the governance of the country. Public finance, social protection system, etc., in addition to private sector investments of more than one billion US dollars.
Commenting on this, Abdullah Al-Jafri, Regional Director of IFC’s Levant Department, said: “As Iraq rebuilds its economy, the private sector will have a critical role in creating jobs and more opportunities for Iraqi youth. The Strategic Partnership Framework will provide the necessary framework for a group The World Bank to focus on advisory and investment partnerships with the business community in priority sectors, as well as support efforts to improve the environment for economic empowerment and business activities to pave the way for the Iraqi private sector to lead the country’s future and achieve prosperity that everyone shares in reaping its benefits link