US sets up trade bank in Iraq
The US-led Coalition Provisional Authority (CPA) in Iraq has established a trade bank with an authorized capital of $100 million. Along with the creation of this new institution comes an international tender for the bank’s management.
The Trade Bank of Iraq (TBI) has been established as a separate government entity, independent of the Central Bank of Iraq. It will provide financial and related services to facilitate the importation and exportation of goods and services to and from Iraq.
The CPA issued on July 21, 2003, a Request for Proposal, to encourage offers of assistance and partnership from international banks interested in helping establish the TFI. Following the announcement, banks worldwide worked swiftly to form consortiums in order to bid for the tender.
US administrators are expected select a number of international banks by August to run the bank, reported Wall Street Journal. Some of the banks that have expressed interest in the bid are JP Morgan Chase & Co, which has joined forces with Britain's Standard Chartered, the Australia and New Zealand Banking Group, the National Bank of Kuwait and Poland's Millennium Bank.
The TBI will provide expertise and a point of contact within Iraq to bolster confidence between trading partners that funds will be received in exchange for goods delivered. Existing Iraqi banks are presently ill-equipped to support import-export trading activities. They lack sufficient expertise and international links. Moreover, existing financial institutions within Iraq are fully engaged in reestablishing basic banking services and have limited capacity for specialized trade services. The TBI will facilitate the transition from state owned enterprises to greater privatization.
The operations of the TBI will be directed by a President and Board of Directors. The new interim Minister of Finance, due to be selected by the Governing Council shortly, will act as the interim President, and will help select the Board of Directors. — (menareport.com)
© 2003 Mena Report (www.menareport.com)