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Iraq opens up to global investors
From CNN Correspondent Charles Hodson
DUBAI, United Arab Emirates (CNN) -- Iraq's provisional government is opening the country's shattered economy to international investment and will introduce a new currency next month. Speaking in Dubai, Finance Minister Kamil al-Gailani on Sunday said the coalition provisional authority has signed into law a wide-ranging series of reforms and would open a new central bank. Among the changes is a provision that allows overseas companies to own any of Iraq's assets, apart from its oil, and another inviting overseas banks to set up operations in the country. With many of Iraq's assets now up for sale, al-Gailani chose a conference of international investors in the United Arab Emirates to announce the sweeping changes to ownership regulations. "Our new foreign investment laws will make Iraq among the most open countries in the entire world. This law will allow one hundred percent direct ownership in all sectors except natural resources," he said. A blanket tax rate of 15 percent will apply to all Iraqi corporation and individuals and the bank notes adorned with the image of former president, Saddam Hussein, are to be replaced. "We will introduce a new national currency on October 15, called the New Iraqi Dinar. That will be a major improvement over Iraq's existing currency" said al-Gailani of a currency that has been virtually worthless since the fall of the former regime. Earlier, al-Gailani met U.S. Treasury Secretary John Snow on the sidelines of the International Monetary Fund (IMF) and World Bank annual meeting, also in Dubai. Snow said the IMF welcomed the reforms made law Saturday by the Coalition Provisional Authority in Baghdad. "This is for me a remarkable step forward to bring order in this development and also to have the Iraqi people themselves involved to define an economic strategy for recovery and development," said Horst Koehler, managing director of the IMF. Some observers say the privatization of Iraq's assets appears radical but is impressive only in theory as so many of them are old and dilapidated. "The privatization in fact in a really meaningful sense has been put off the agenda in a practical sense because the only things worth buying are the oil assets -- and they're not for sale," said Edmund O'Sullivan of the Middle East Economic Digest. While Washington seems pleased with the direction the newly appointed governing council has chosen -- out with the socialist economy of the Ba'ath Party and in with the free market -- security concerns will likely keep most investors away for now.
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