Shatha Khalil *
The deputy Minister of Industry and Minerals , Engineer Mohamed Shia al-Sudani confirms that the main reason for disabling the Iraqi national industry is the corruption, poor government support, lack of vision, and strict laws that protect the industry, especially in light of the changes that took place after 2003, as the transformation of the Iraqi economy from a totalitarian economy run and governed by the decisions of the central authority to the economy depends on the market mechanism which gives the private sector the role of the leader of economic activity as well as openness and trade liberalization.
And al-Sudani believes that the state ‘s role in the success of this conversion should not be canceled , ie the creation of appropriate means and ground for it, because any delay in action will undermine the conversion process and this explains the situation reached by the Ministry of Industry and Minerals before al-Sudani received it in 14/08/2016, who put the right foundations to the Iraqi economic reform .
The first duties for him is the ministry arrangement administratively, although the task of commissioning is temporary, but the situation imposed on the minister to enter into the heart of the administration and work with the existing national expertise and competencies to reform the deteriorating situation there, where investment plans under the previous federal budgets have been revised , indicating that the lack of taking advantage of the huge amounts of money estimated at 3,444 trillion Iraqi dinars, which was supposed to have an impact on the industry, made the minister management to be firm in reviewing plans and contracts, and to know the extent of compliance with the conditions and effectiveness in the service of the national economy.
The Minister says that the contracts concluded with foreign companies, for the rehabilitation and investment to the companies and plants of the Ministry of Industry were supposed to push the process of production forward and move to a better reality, but we found the suspicions of corruption and lack of clarity and the observations to many of those contracts, as we have applied to the Integrity Commission to send a team to review contracts, the fact that the Office of the Inspector General can not to cover those remarks.
And al-Sudani confirms that it was accomplished within the powers of the ministry to end many of the contracts with non – solid and non – productive companies and there are clear suspicions of corruption on it, and then to launch new contracts in accordance to the new vision with reputable companies and with the terms of public interest and depend on the transfer of technology and production lines and train of workers.
It is noted also that the legislation of laws of 2010 on the protection of the consumer, producer and customs tariff, has not activated only after the financial crisis, while these laws are binding on all States and all circumstances.
Among the series of reforms undertaken by the ministry in the short and medium term , it has put forward a new vision , and to take administrative measures , including working to secure the part of the employees ‘ salaries; to reduce dependence on the Ministry of Finance loans, and to improve the approach of work and taking more powers to be free from the ministry restrictions, The most important reforms undertaken by the Ministry: the integration of Central and South cement company and unified the management, by openness and prices, and the formation of a committee to study the effects of the merger, and detect any negative ones and correct them if exist.
And some companies were rehabilitated and its plants operated and its entry into the circle of production and solve all the problems relating to the laws of protection of the product committed by the state ministries and its institutions.
al-Sudani confirms that through the presence of the ministry in the Committee on Economic Affairs of the Council of Ministers, new contracts have been signed with reputable companies serving the national industry, we have made special meetings of the Ministry of Industry in relation to the economic affairs, as the meetings have contributed to solving the problematic issues of ministry which has not solved since 2012, and meetings were attended by more than 10 director generals , with a deputy of the ministry and advisor , to put forward the problem accurately and address it scientifically.
For example , drugs Samarra company for medicines and medical preparations , a giant and genuine company , was committed with Sukhtian Jordanian company, but the contract is not activated, as the Ministry has settled the matter and renewed the contract, offering new investment opportunities with international companies.
Thus , the company has achieved, which is one of the Ministry of Industry and Minerals ,a unique boom in the value of sales for the month of May 2017, and the Director of Information and Public Relations at the Ministry Louay al-Waeli said the realization of these sales came in accordance with directives of the Minister of Industry within the framework of his plan to turn a number of ministry companies into profitable companies , referring that the value of sales which exceeded five billion dinars have been achieved for the first time since 2003, despite the intense competition in the market, and an increase in the output value also compared to the previous months and years where the production value has exceeded the amount of four billion and three hundred million dinars.
Al- Waeli confirmed that the company has managed also during the last month of May and through the continuous pursuit to obtain an amount exceeding two billion and three hundred million dinars , its dues dating back to the long years in the hands of Ministry of Health / General Company for pharmaceutical marketing(Kimadia) , revealing that it is hoped that the next phase will witness an increase in the volume and value of contracts with the Ministry of Health and the environment, especially after the meeting held between the Minister of Industry and minerals and the Minister of Health and environment and the complementary meeting which was held on Sunday 4th / 6/2017 as well as improving the quality of packaging after the revision of the price of the company ‘s products by Kimadia making it to achieve greater economic feasibility, noting that these activities and achievements come within the framework of government policies that emphasize to support the national product and thus contributing to the improvement of the economic situation of the country and to walk in strict steps in order to achieve self – sufficiency.
As well as the Iron & Steel Company of Basra , which has not been working since 2003, however it was associated in the 2012 with a contract with the Turkish Aaboubi Holdnk company which has experienced a lot of problems and negotiating, and the company began to rehabilitate it , it is hoped to start production within 18 months, and then the company will be turned over two years to a profitable company.
The scrap file, it is one of the important notorious files in the Ministry of Industry , as the decision to hand over scrap to the Ministry of Industry and assembled it was misused , but the lack of rehabilitation of the iron and steel plant kept the engineering effort to collect large amounts of iron, without accurate inventory and control of these quantities, which allowed the opportunity for gangs to control the massive iron quantities and dismantling and removal of aluminum and copper for theft and smuggling, the ministry has formed investigative committees for the directors , officials, and the companies involved in this theft, and the investigations are continuing with them, which included two of the directors general , the General Company for the of the supportt engineering and the General company of al-Smood for steel industries considering them responsible for the damage that occurred in Tarmiya site caused by the loss of scrap iron .
According to an authorized source in the ministry saying ” based on the recommendations of the Central Committee Implication, the Minister approved to include managers an amount of $ 21 billion and 645 million dinars for the loss of scrap iron estimated at 77398 tons at the site of Tel Tasah in Tarmiya which belongs to the General company of Smood of steel industries for failing to maintain public money.
He added that ” the ministry has worked according Implication law, passed by parliament No. (31) For the year 2015 and the instructions of the Ministry of Finance No. (2) For the year 2017 in issuing the penalty decision of implication on the two managers. The Central Committee Implication took over the investigation in accordance with the provisions of this law and seen all the documents, data ,and edited a record of proven where what was done by the procedures with its recommendations on the inclusion of managers value of the damage at the site and submitted to the minister , pointing out that the minister approved the recommendations of the Committee to include managers the value of the damage for failing to preserve public money and the fight against corruption and punish corrupt.
Then a new vision was submitted to the presidency of the ministry for the sale of scrap to be calculated within the state funds (ownership of the ministry) until the completion of the iron and steel plant which is unqualified, so that the ministry can go back to collect scrap from ministries and benefit from it.
The military industrialization , more of its companies and plants were linked with the defense and finance since 2003 until 2007, after which companies began to re-link itself to the industry, and countries were not thinking of military industrialization before 10.6.2014, as it was if the government put forward the idea of industrialization ,it would face with rejection and accusations that it brings back the glories of the former regime, but after the emergence of Daesh and the emergence of the urgent need to fight it, they began to think about the military industry , and decided to re-join companies and the development of the legal framework related to military industry , and the introduction of new investment opportunities, as the industry is in need of modern technology, where all the equipment were destroyed that existed before 2003.
The minister stresses on the Iraqi national industry, and what it needs from us today of the support and patience and intensify efforts in accordance with the drawn plans, to take real place in the regional competition and promotion without boring or tirelessly, and we all remember the Korean and Japanese industry how they were ridiculed in the beginning, but today’s they record a high level of quality and international competition.
Al-Sudan confirms the availability of the capabilities and infrastructure of the ministry’s companies to revive the Military Industrialization in Iraq, as it has been coordinating with the Ministries of Defense and Interior and the popular crowd and the Chancellery of the National Security and Intelligence Service and a number of general managers in the companies of the ministry specialized in military industries to discuss topics related to the industry and ways of enhancing them.
The government has paid great attention to revive the military industry as a result of the circumstances of the war waged by Iraq against criminal gangs Daesh and Iraq ‘s urgent need to secure the light and medium ammunition and diverse bombs and missiles as well as the ministry companies have the wide constituents and expertise and high competencies to revive this important industry and cover the needs of the country, pointing to the critical economic situation that Iraq is going through the weakness of the financial allocations in the budget, it was an incentive to guide the state to take care of domestic production, saving a big money from the hard currency that was spent on the import of weapons, and ammunition to maintain the battle against terrorism ,stressing on the interest and taking in to account the required quality and military specifications in the manufacture and production of various ammunition , weapons and equipment .
Al-Sudani refers to the trend of the government towards investment and sharing contracts to activate the industrial sector in general and activating the role of the companies of private industrial sector , and in particular the experienced companies that have already worked successfully in this area.
He stresses also on the need to deal with the International companies of solid military industry , for the purpose of transport of technology and the establishment of defense industries and production lines with high modern technology to meet the needs of the ministries and security departments in Iraq , noting at the same time , the ministry ‘s keenness on coordination between the ministries and departments concerned and to continue the ongoing dialogue in order to reach to a clear vision and achieve the desired cooperation and solving the problems and the obstacles that stand in front of the implementation of the action.
The Minister of Industry and Minerals stresses to identify functions of the Coordinating Council and its duties in order to introduce it before the eyes of the Prime Minister and obtaining fundamental approvals on them.
And it has been discussed a number of issues of concern to the ministry and its work in the field of military industries and the review the paragraphs put forward in the agenda and listen to the views and ideas of the the present about those paragraphs which included a discussion of modifying the Council of Ministers Decision No. 86 of 2016 which provides for the Ministries of Defense and Interior to purchase of ammunition and weapons from the military industries Commission and identify its needs of it with an authorization of it to bring the investment offers for the implementation of the project and the development of military industries project in the Ministry of planning and discuss technical and business presentations and drafts of contracts of products of the board of military industries which has been provided by the Ministry of Industry and Minerals to the security authorities in addition to discussing military industries projects (ten – year plan with its three phases and its priorities : short – term, medium – term and long – term), and the establishment of a security system for the protection of military industry companies and its staff in addition to the discussion of the draft of guided and non -guided air bombs required by the air force and army Aviation in addition to other topics were discussed so as to contribute to meeting the work requirements in the field of military industrialization and achieve the plans to exploit the positive data that serve the work and achieve the development and advancement aspired by the ministry during the next phase.
One of the challenges facing the industry is the lack of a clear vision , as there is a rampant corruption and contracts of corruption of companies, and we are facing the reality of corruption and lack of responsibility, since the ministry began to pick up things and set 2017 plan includes converting 10-15 losing company into a profitable ones and these positive indicators in the short term , while there is an industry strategy prepared during the work lasted three years since the previous administration, but the important challenge is the extent of commitment of the state institutions to buy the national product, but the national product is within the global specifications like the Japanese and German specifications , and the ministry assumes all responsibility about their products as any ministry can inspect the product and if it is not in conformity with the specifications, it can be rejected.
Among the companies affiliated to the Ministry of Industry , there is ur company that produces cables, this product is not marketed to individuals but to institutions and companies in the level of a state, here the Ministry of Electricity is bound to buy the product, and there is no justification for them to contract with Iranian companies or Lebanese or Saudi Arabia or China, because the product is national with world specifications , and we have ISO certification, this means providing hard currency for the country and operation of labor, stressing the protection of the national product by laws and decisions.
With the support of the Minister for the State Company of al-Furat , the company is unique to meet the market needs of a substance (sulfuric acid), as it got an exception in production to cover the local need fully to all ministries and companies benefiting from it locally, and an official at the ministry source said that the minister al-Sudani requests from the Ministry of Commerce to stop granting import licenses for hazardous materials to entering Iraqi territory including substance of ( concentrated sulfuric acid ) as well as his support to the security forces through the imposition of security control over the circulation of this dangerous substance .
According to a source in the ministry, the minister follows the work of the marketing department and survey and promotion committees in Al Furat State company where he was briefed on the monitoring for the entry of concentrated sulfuric acid from the border crossing points into Iraqi territory through import licenses granted by the ministries of trade and health without notice to the Ministry of Industry and Minerals of these licenses , creating strong competition to the ministry products that have self – potential to cover the total need of the country of this substance .
Al-Sudani confirms the existence of cooperation between the ministries of industry and agriculture, noting that the contract between them is of the biggest contracts in their history, as it has been providing about 300 thousand tons of urea fertilizer, and the Southern Fertilizer Company is providing to the Ministry of Agriculture everything the ministry needs , and there are ongoing studies to provide everything the ministry needs , The fertilizer company is in the best condition after providing a product lines with all potential after the completion of the Japanese loan to provide production lines.
There are other investment opportunities, they are fertilizers of Abu al -khasib as it has been invested in the right way, because there will be a productive surplus and that the industry will return to its normal era when the Iraqi fertilizer tops the global market.
The Ministry of Industry supports small and medium enterprises to provide job opportunities that embrace competencies and innovators and support and honoring them morally, and the application of the Ministry of the strategy of poverty reduction , creating a domestic industry and the establishment of a national industry to provide more job opportunities, and to address cases of corruption and the advancement of the industrial reality of the country, but there are actors and personalities do not want the advancement of the national industry; for the reasons of its narrow interests to keep Iraq a market for poor commodity .
Al-Sudani refers to the role of the media and the Ministry of Industry and Trade as being a supportive and important factor for any authority, to shed light on corruption and negatives that are harmful to the national economy, and criticizes with all boldness and courage, and provides information from which an address and immediate repair can be made.
The minister seeks with great efforts and follow – up in obtaining a decision to bind all government departments to examine plastic pipes used in the implementation of the projects in the laboratories of the General Company for Construction industries of the ministry .
This is a new and successful step towards the support of national product and restore confidence in the capabilities of local industry as it would give the company the ability to real competition to market its products and contribute to the reconstruction and construction of the country’s infrastructure, and to confirm the keenness of the companies of the ministry to make more efforts to develop the industrial reality and raise production capacity.
As part of the development of economic reality, and the expansion of important investments for the country , the Ministry of Industry and Minerals visited the United Arab Emirates based on understandings between the Prime Minister Haider al – Abadi, and Mohammed bin Zayed Al Nahyan, with a view to the development and advancement of the economic reality and this visit was fruitful where it was agreed with the companies to invest Rasheed camp as a residential city and the adjacent area to the Baghdad airport , as well as there are great investment opportunities and the most important strategic projects were offered in order to attract companies, noting that the ministry noted that there is a real and serious desire for the UAE to enter as a partnership to invest in Iraq.
As a matter of fact What is needed for the Ministry of Industry and all ministries of Iraq is the real reformers who are making active efforts for the advancement of the country, and the best proof of this is carried out by the Ministry of Industry’s efforts to serve the Iraqi economy since al- Sudani assumed the ministry as he carried out an important and serious and quick steps to get rid of corruption and the trend towards real development , the ministry today in front of new opportunities and challenges imposed on it to change the economic and industrial plans to comply with the developments in the global economy.
To activate the Iraqi economic activity, the ministry applied a strategy for industrial development in Iraq as it prepared – in cooperation with the United Nations Industrial Development Organization (UNIDO) – a presentation of the strategy and the institutional framework controlling the process of restructuring of the industry and achieve the desired diversity in order to increase the contribution of the industry; to achieve sustainable development of the Iraqi economy, as that strategy is part of a broader reform process in Iraq.
Economic Unity
Rawabet Center for Research and Strategic Studies