On May 24, 2022
Independent/- Sovereign wealth funds represent, according to the economic perspective, an urgent necessity to support the economies of countries, as well as being a financial pillar to protect countries from fluctuations that occur as a result of crises, whether economic or other, which prompted many economic specialists in Iraq to repeat Demanding them to establish such funds, and to benefit from the financial abundance achieved as a result of the rise in global oil prices, by allocating an amount of 10 dollars for each barrel, the proceeds of which go to the assets of these funds, suggesting that the establishment of the “sovereign fund” begins with a capital of one billion dollars.Sovereign wealth funds are “arrangements for investment with a special purpose, owned and established by the general government for macroeconomic purposes, and they maintain, employ or manage assets to achieve financial goals.” The government can, according to the views of many specialists in economic affairs, adopt the establishment of “sovereign wealth funds.” – Or the Generations Fund, which is directed towards real investment inward within the framework of exceptional strategic economic and social development and in a different administrative style.
financial abundanceThe economist, Dr. Ali Hadi Judeh, said during his interview with the independent newspaper “Al-Sabah” that it is necessary for the government to move to establish the sovereign fund with real assets, taking advantage of the rise in oil prices and the increase in the financial abundance achieved as a result.Hadi suggested allocating $10 for every barrel, the proceeds of which would go to the assets of that fund, suggesting at the same time, the exploitation of the state’s untapped real estate, part of which can be transferred to the ownership of this fund by entering it into real investments, as well as benefiting from the suspended public sector companies. , by transferring part of its assets to this fund to provide financial liquidity.
Fund assetsThe expert, Hadi, indicated the possibility of starting with one billion dollars as real assets to establish this fund, as this number can be achieved by taking advantage of the high costs of oil, which reached the barrier of 110 dollars per barrel, and the arrival of “black gold” revenues to approximately 10-11 billion dollars. Monthly, and then the cash assets of that fund can be realized, and then other assets represented by government real estate and stalled companies can be provided.Hadi noted that there is a “Law of the Foreign Development Fund, affiliated to the Ministry of Finance, which was established in 1974, and whose name can also be changed to the Public Investment Fund or otherwise, and the government begins to offer no more than 25% of the shares of this fund for trading in the Iraqi market.” Securities to maximize its revenues and expand its assets and shareholder base.The expert, Hadi, stressed that “the sovereign fund has become a very important necessity, as it represents the pillar that supports the state’s finances and economy in the event of any damage, as well as being a fund for the stability of the budget in case it enters any emergency circumstance represented by a decrease in its revenues.”
resource maximizationEarlier, the financial advisor in the Cabinet, Dr. Mazhar Muhammad Salih, urged during an interview with “Al-Sabah” the need to work with “sovereign wealth funds,” stressing their importance in maximizing the nation’s depleting resources, achieving sustainable development goals, and continuing economic prosperity between generations, noting At the same time, to the possibility of accumulating double returns within the investment of the resources of these funds, which are essentially “investment”.The government advisor pointed out that “the majority of the world’s oil-producing countries in particular have established sovereign investment funds from their surpluses from oil revenues and employed them as capital in various investment assets, whether they were financial or real and generating income.”