ISSUED ON BEHALF OF THE IRAQI MINISTERS OF FINANCE AND TRADE AND THE

ISSUED ON BEHALF OF THE IRAQI MINISTERS OF FINANCE AND TRADE AND THE GOVERNOR OF THE CENTRAL BANK OF IRAQ IRAQ DELEGATION MEETS WITH WORLD BANK AND IMF – ‘FACT-FINDING’ AGENDA Statement from the Iraqi Ministers of Finance and Trade and the Governor of the Central Bank of Iraq At the conclusion of a three-day meeting between a delegation from Iraq with the World Bank and International Monetary Fund (IMF), Iraqi Minister of Finance Kamel al-Gailani today emphasized the continuing need to work closely with international financial institutions in rebuilding Iraq ’s economy. Speaking in Amman , where the meeting took place, he said: “The meeting was an opportunity for Iraq to bring the World Bank and IMF up to date with its current economic position, to outline some of the reforms that have recently been enacted - and to look forward, through the next six months to June 2004 when sovereignty will be transferred, and beyond. “It was the most recent in a series of contacts with the Bank and the Fund. No loans or loan conditions were discussed. “It was also an opportunity for the Bank and the Fund to describe their programme requirements and processes to the Iraqis as well as to offer comments and advice where appropriate and to outline where they could provide technical assistance in their areas of competence. “The meeting agreed that a macro-economic reform programme to modernize the outdated economic system and to help fight poverty was essential. The Iraqi delegation stressed that this must be conducted in a socially sensitive manner, so that the benefits of change would be visible to all. “Such a programme could, in the future, help in the renegotiation of Iraq ’s external debt. “The opportunity to talk through Iraq ’s economic position with experienced economists from the Bank and the Fund was extremely useful. “ Iraq looks forward to developing a broad relationship with these bodies.” Governor of the Central Bank of Iraq Dr Sinan al-Shabibi, also attending the meeting described some of Iraq ’s recent economic successes, including the creation of an independent central bank, but emphasized the broad need for international assistance in continuing the reconstruction effort. He said: “In the months since the conflict ended much has already been achieved. I head a central bank now free of government control for the first time in decades. Together with my team I am working to modernize our institution, policies and practices. Already, with help from the Coalition Provisional Authority (CPA) we have instituted a new currency and our huge currency exchange programme is two-thirds complete. We have also established a daily foreign exchange auction. “But Iraq has been isolated from international developments for many years. This affects capacity in all areas. We told the Bank and the Fund that a great deal of training is needed and that ongoing technical assistance is required, to help build on the work we have done with the CPA. The Bank and the Fund pledged training assistance to Iraqi financial institutions.” Iraqi Minister of Trade Dr Ali Allawi also in attendance said: “ Iraq ’s relations with the rest of the world continue to normalize, particularly in the economic sphere. “I told the Bank and the Fund that foreign investors are now beginning to come forward – here in Amman just yesterday, for example, firms from around the region and from the UK attended a British-hosted event aimed at encouraging trade. “We are encouraging private business at home too. The private sector will play an important part in regenerating Iraq ’s economy. “With the help of the international community and the financial institutions Iraq can relatively quickly stand on its own two feet. We aim to create an attractive location for business and investment to ensure our future is prosperous.” Notes to Editors: 1. The meeting took place in Amman , Jordan from 8th-10th December 2003 . A previous, linked meeting was held on 3rd December. 2. The delegation from Iraq comprised the Ministers of Finance and Trade, the Governor of the Central Bank of Iraq and representatives of each of their Ministries as well as representatives from the Ministry of Industry. Directors of the Rasheed and Rafidain Banks were also present. The delegation was accompanied by technical advisors from the CPA. The earlier, 3rd December meeting was attended by the Iraqi Minister of Planning who was unable to attend the later meeting and CPA advisors. 3. Future meetings are scheduled for early 2004.