Banking on Baghdad: Financial Change in Postwar Iraq; Strategic Insights, v. 3, issue 5 (May, 2004)
Abstract : April 2004 represents an important milestone in Iraqi history--the one year mark after the overthrow of Saddam Hussein's Ba'athist regime. Assuming the insurrection and increased hostilities surrounding this date will abate, this represents a fitting time to assess the Iraqi government's likely strategy for restoring the country's economic health. That strategy was outlined in January 2004 by central bank governor Sinan Shabibi and finance minister Kamel Gailani. Their vision for Iraq is in accordance with the Bush Administration's neoliberal model and provides substance to some of the vague principles laid down by the Administration in the spring and summer of 2003. The strategy encompasses the creation of: (a) openness and transparency of Iraq's institutions; (b) strong incentives for private sector development; (c) close economic and financial integration with the international community, (d) international standards and best practices; and (e) a social safety net that addresses the needs of all Iraqis. While many factors within this framework will play a key role in the economy's recovery, emphasis on free markets and private sector investment suggest the creation of a viable efficient financial system will be the key to the country's economic recovery. In this regard, a recent United Nations' needs assessment notes that: With a dysfunctional financial system featuring a poorly organized regulatory framework and ineffective institutions, the task of rebuilding a sound and safe modern financial sector in Iraq is daunting. It should start with the banking sector, which is currently the essential component of the financial system and should cover the sector's legal and regulatory aspects as well as its main institutions. This would be a long term process that will require significant resources, technical as well as financial.
Financial liberalization and financial development in Iraq
This paper examines the impact of financial repression policies from 1970 to 2002, and the results 
of the financial liberalization polices between the years 2003-2007 on the financial development 
of Iraq. By using the Autoregressive Distributed Lag (ARDL) model, the paper argues 
that neither the financial repression policies nor the financial liberalization polices promoted 
the financial development of Iraq. This fact suggests that Iraq’s policy-makers have to launch 
multi-pronged measures, such as promoting private sector enterprises, reducing informal activities 
in the economy, stabilizing macroeconomic variables (reduction of fiscal deficit and inflation 
rate), and, most importantly, restore political and social security, in order to ensure the 
economic prosperity of the country.
Bean Counting in Baghdad : Debt, Reparations, Reconstruction, and Resources; Strategic Insights: v.2, issue 6 (June 2003)
Abstract : The Iraqi economy is in complete shambles. Even worse, the population is burdened with up to $400 billion in debt, reparations, and contractual commitments made under Saddam Hussein's regime. This article examines the fiscal challenges facing the country over the next decade. Even on the assumption of considerable debt forgiveness and foreign aid, it appears impossible to meet the government's operating and reconstruction costs without some sort of privatization of the oil sector. The sections that follow examine Iraq's fiscal challenges and possible financial strategies over the next decade. What options are available under United Nations Security Council (UNSC) Resolution 1483, and the resolutions coming out of the May 2003 G-8 Finance Ministers' meetings? Which strategies seem best from the perspective of Iraq's reconstruction? Under reasonable assumptions, will there be enough money to reconstruct the economy and revitalize the oil industry? The following topics are addressed: United Nations Security Council Resolution 1483, the G-8 resolutions of May 2003, strategies for reducing foreign obligations, conventional debt forgiveness, odious debt doctrine, the issue of reparations and war-related debt, outstanding contracts, debt servicing priorities, creative debt conversions, and privatization of the oil sector.