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Ministry of Finance and Banking

The Ministry of Finance establishes budgets, manages debt, and establishes economic policy. It pays Iraq's 1.8 million pensioners and 1.4 million state employees, and collects taxes and customs revenues. The CPA initially planned to have a new operational budget by June 15, 2003. Many finance records were nonetheless intact with people handing them over.

The banking system centers around two large banks, Al Rasheed, and Rafadine and the Central Bank. Other smaller banks are the Industry and Real Estate Banks. Rasheed Street in Baghdad is considered the Iraqi equivalent of "Wall Street".

Baghdad has approximately 170 banks with the Central Bank ran a check clearing facility. Some banks are already functioning. The CPA's initial goal was to have a fully functioning banking system up and running by June 30, 2003.

According to an Iraqi Central Bank spokesperson's account, in excess of $900 million was looted following the collapse of the Hussein regime. The US has announced that all assets frozen in the U.S. during the first Gulf War would be returned to the Iraqi people. These funds would partially be used to pay salaries, emergency payments, and basic costs of the Iraqi government.

Initial plans to help the Iraqi Finance and Banking sectors called for:

• Opening the borders for 90 days for free trade to encourage foreign trade and create jobs as well as provide a lift to the economy;
• Lifting of UN sanctions to improve economic conditions and enhance Iraq's ability to restart its economy;
• ORHA and the finance ministry to work together to establish a budget for the government of Iraq and to identify appropriate levels of revenue and expenditure;
• ORHA and the finance ministry to support the continuance of the food distribution program;
• ORHA to develop a plan to pay farmers for their agricultural products as a result of Wheat playing an important part in the Iraqi economy;
• the continuance of payment of salaries to pensioners and civil servants is important to the development of the Iraqi economy;
• Of the $1.7 billion in funds that were frozen after the first gulf war, $300 million had been earmarked for potential claims and $1.4 million will be used for emergency payments;
• ORHA and the finance ministry are working together to develop a new wage scale system based upon merit, not political affiliation;
• Iraqi bank leaders to announce Iraqi banking ministry directors. This would begin the stability of the banking system;
• Stressing the importance of opening of bank services for Iraqi citizens and the safety of their deposits. Some Iraqi banks were already performing banking transactions as of May 2003;
• ORHA to work closely with bank industry leaders to establish an armored car service to safely transfer money throughout the country;
• Coalition forces to safeguard and maintain security of vaults at Iraqi banks. ORHA and Iraq's banking community are stressing to Iraqi citizens that their currency will not be abolished and will be accepted as a form of payment and or deposit in business transactions.