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Iraqi farmers in distress as severe water shortages affect wheat harvest

Salah Chelab crushed a husk of wheat plucked from his sprawling farmland south of Baghdad and inspected its seeds in the palm of one hand. They were several grams lighter than he hoped.

“It’s because of the water shortages,” he said, the farm machine roaring behind him, cutting and gathering his year’s wheat harvest.

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Chelab had planted most of his 10 acres (4 hectares) of land, but he was only able to irrigate a quarter of it after the Agriculture Ministry introduced strict water quotas during the growing season, he said. The produce he was growing on the rest of it, he fears, “will die without water.”

At a time when worldwide prices for wheat have soared due to Russia’s invasion of Ukraine, Iraqi farmers say they are paying the price for a government decision to cut irrigation for agricultural areas by 50 percent.

The government took the step in the face of severe water shortages arising from high temperatures and drought — believed to be fueled by climate change — and ongoing water extraction by neighboring countries from the Tigris and Euphrates rivers. All those factors have heavily strained wheat production.

Wrestling with the water shortage, Iraq’s government has been unable to tackle other long-neglected issues.

Desertification has been blamed as a factor behind this year’s relentless spate of sandstorms. At least 10 have hit the country in the past few months, covering cities with a thick blanket of orange dust, grounding flights, and sending thousands to hospitals.

“We need water to solve the problem of desertification, but we also need water to secure our food supplies,” said Essa Fayadh, a senior official at the Environment Ministry. “We don’t have enough for both.”

Iraq relies on the Tigris and Euphrates rivers for nearly all of itswater needs. Both flow into Iraq from Turkey and Iran. Those countries have constructed dams that have either blocked or diverted water, creating major shortages in Iraq.

Water Resources Minister Mahdi Rasheed told The Associated Press that river levels were down 60 percent compared to last year.

For Chelab, less water has meant a smaller grain size and lower crop yields.

In 2021, Chelab produced 30,000 tons of wheat, the year before that 32,000, receipts from Trade Ministry silos show. This year, he expects no more than 10,000.

His crops are both rain-fed and irrigated via a channel from the Euphrates. Due to low precipitation levels, he has had to rely on the river water during the growing season, he said.

Government officials say change is necessary.

The current system has been inefficient and unsustainable for decades. Water scarcity is leaving them no choice but to push to modernize antiquated and wasteful farming techniques.

“We have a strategic plan to face drought considering the lack of rain, global warming, and the lack of irrigation coming from neighboring countries as we did not get our share of water entitlements,” said Hamid al-Naif, spokesman at the Agriculture Ministry.
The ministry took measures to devise new types of drought-resistant wheat and introduce methods to increase crop yields.

“We are still dealing with irrigation systems of the 1950s. It has nothing to do with the farmers,” he said. “The state must make it efficient, we must force the farmer to accept it.”

Iraqi farmers have historically been heavily dependent on the state in the production of food, a reliance that policymakers and experts said drains government funds.

The Agriculture Ministry supports farmers by providing everything from harvesting tools, seeds, fertilizers, and pesticides at a subsidized rate or for free. Water diverted from rivers for irrigation is given at no cost. The Trade Ministry then stores or buys produce from farmers and distributes it to markets.

Wheat is a key strategic crop, accounting for 70 percent of total cereal production in the country.

Planting starts in October and harvest typically begins in April and extends to June in some areas. Last year, the Agriculture Ministry slashed subsidies for fertilizers, seeds, and pesticides, a move that has angered farmers.

Local demand for the staple is between 5-6 million tons a year. But local production is shrinking with each passing year. In 2021, Iraq produced 4.2 million tons of wheat, according to the Agriculture Ministry. In 2020, it was 6.2 million tons.

“Today we might get 2.5 million tons at best,” said al-Naif. That would require Iraq to drive up imports.

Most of the wheat harvest is usually sold to the Trade Ministry. In a sign of the low harvest, so far there are currently only 373,000 tons of wheat available in Trade Ministry storehouses, al-Naif said.

To meet demands amid the recent global crisis in the grain market, the government recently changed a policy to allow all Iraqi farmers to sell their produce to the Trade Ministry silos. Previously, this was limited to farmers who operated within the government plan.

Back in Chelab’s farm, the wheat is ready to be transported to the silo.

“It’s true we need to develop ourselves,” he said. “But the change should be gradual, not immediate.”

Read more:

Iraq sandstorm sends more than 1,000 to hospital

Iraq says to import wheat and rice through direct contracts

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Abu Dhabi Overtakes Oslo for Sovereign Wealth Fund Capital in Global SWF’s First City Ranking

Today, industry specialist Global SWF published a special report announcing a new global ranking of cities according to the capital managed by their Sovereign Wealth Funds (SWFs). The findings show that Abu Dhabi is the leading city that manages the most SWF capital globally, thanks to the US$ 1.7 trillion in assets managed by its various SWFs headquartered in the capital of the UAE. These include the Abu Dhabi Investment Authority (ADIA), Mubadala Investment Company (MIC), Abu Dhabi Developmental
Holding Company (ADQ), and the Emirates Investment Authority (EIA). Abu Dhabi now ranks slightly above Oslo, home to the world’s largest SWF, the Government Pension Fund (GPF), which manages over US$ 1.6 trillion in assets. Abu Dhabi and Oslo are followed by Beijing (headquarters of the China Investment Corporation), Singapore (with GIC Private and Temasek Holdings), Riyadh (home to the
Public Investment Fund), and Hong Kong (where China’s second SWF, SAFE
Investment Corporation, operates from). Together, these six cities represent two thirds
of the capital managed by SWFs globally, i.e., US$ 12.5 trillion as of October 1, 2024.
For the past few decades, Abu Dhabi has grown an impressive portfolio of institutional
investors, which are among the world’s largest and most active dealmakers. In addition
to its SWFs, the emirate is home to several other asset owners, including central banks,
pension funds, and family offices linked to member of the Royal Family. Altogether, Abu
Dhabi’s public capital is estimated at US$ 2.3 trillion and is projected to reach US$ 3.4
trillion by 2030, according to Global SWF estimates.
Abu Dhabi, often referred to as the “Capital of Capital,” also leads when it comes to
human capital i.e., the number of personnel employed by SWFs of that jurisdiction, with
3,107 staff working for funds based in the city.
Diego López, Founder and Managing Director of Global SWF, said: “The world ranking
confirms the concentration of Sovereign Wealth Funds in a select number of cities,
underscoring the significance of these financial hubs on the global stage. This report
offers valuable insights into the landscape of SWF-managed capital and shows how it is
shifting and expanding in certain cities in the world.”

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AM Best Briefing in Dubai to Explore State of MENA Insurance Markets; Panel to Feature CEOs From Leading UAE Insurance Companies

AM Best will host a briefing focused on the insurance markets of the Middle East and North Africa (MENA) on 20 November 2024, at Kempinski Central Avenue in Dubai.
At this annual regional market event, senior AM Best analysts and leading executives
from the (re)insurance industry will discuss recent developments in the MENA region’s
markets and anticipate their implications in the short-to-medium term. Included in the
programme will be a panel of chief executive officers at key insurance companies in the
United Arab Emirates: Abdellatif Abuqurah of Dubai Insurance; Jason Light of Emirates
Insurance; Charalampos Mylonas (Haris) of Abu Dhabi National Insurance Company
(ADNIC); and Dr. Ali Abdul Zahra of National General Insurance (NGI).
Shivash Bhagaloo, managing partner of Lux Actuaries & Consultants, will his present
his observations in an additional session regarding implementation of IFRS 17 in the
region. The event also will highlight the state of the global and MENA region
reinsurance sectors, as well as a talk on insurance ramifications stemming from the
major United Arab Emirates floods of April 2024. The programme will be followed by a
networking lunch.
Registration for the market briefing, which will take place in the Diamond Ballroom at the
Kempinski hotel, begins at 9:00 a.m. GST with introductory comments at 9:30 a.m.
Please visit www.ambest.com/conference/IMBMENA2024 for more information or to
register.
AM Best is a global credit rating agency, news publisher and data analytics
provider specialising in the insurance industry. Headquartered in the United
States, the company does business in over 100 countries with regional offices in
London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

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Future of Automotive Mobility 2024: UAE Leads the Charge in Embracing Digital Car Purchases and Alternative Drivetrains

-UAE scores show highest percentage among the region in willingness to purchase a car
completely online
– Openness to fully autonomous cars has grown to 60% vs previous 32%.
– More than half of UAE respondents in the survey intend to move to hybrid cars during
next car purchase, while less than 15% intend to move to fully electric car.
– UAE sees strong use of new mobility services such as ride-hailing (Uber, Careem, Hala
Taxi)
– The perceived future importance of having a car is not only increasing in UAE but is
higher than any other major region globally, even China

Arthur D. Little (ADL) has released the fourth edition of its influential Future of Automotive Mobility (FOAM) report, presenting a detailed analysis of current and future trends in the automotive industry. This year’s study, with insights from over 16,000 respondents across 25 countries, includes a comprehensive focus on the United Arab Emirates (UAE). The report examines car ownership, electric vehicles,
autonomous driving, and new mobility services within the UAE.

“The UAE is at the forefront of automotive innovation and consumer readiness for new mobility
solutions,” said Alan Martinovich, Partner and Head of Automotive Practice in the Middle East
and India at Arthur D. Little. “Our findings highlight the UAE’s significant interest in
transitioning to electric vehicles, favorable attitudes towards autonomous driving technologies,
and a strong inclination towards digital transactions in car purchases. These insights are critical
for automotive manufacturers and policymakers navigating the evolving landscape of the UAE
automotive market.”
Key Findings for the UAE:
1. Car Ownership:
o Over half of UAE respondents perceive that the importance of owning a car is
increasing, with the study showing the increase higher than any other major
region, including China.
o Approximately 80% of UAE respondents expressed interest in buying new (as
opposed to used) cars, above Europe and the USA which have mature used
vehicle markets

2. Shift to Electric and Hybrid Vehicles:
o While a high number of UAE respondents currently own internal combustion
engine (ICE) vehicles, more than half intend that their next vehicle have an
alternative powertrain, with significant interest in electric and plug-in hybrid
(PHEV) options. Less than 15% plan to opt for pure battery electric vehicles
(BEVs).

3. Emerging Mobility Trends:

o Ride-hailing services are the most popular new mobility option among UAE
residents, with higher usage rates than traditional car sharing and ride sharing.
The study indicates a strong openness to switching to alternative transport modes
given the quality and service levels available today.

4. Autonomous Vehicles:
o UAE consumers are among the most open globally to adopting autonomous
vehicles, with a significant increase in favorable attitudes from 32% in previous
years to 60% this year versus approximately 30% in mature markets. Safety
concerns, both human and machine-related, remain the primary obstacles to
broader adoption.

5. Car Purchasing Behavior and Sustainability:
o The internet has become a dominant channel for UAE residents throughout the car
buying process, from finding the right vehicle to arranging test drives and closing
deals. UAE car buyers visit dealerships an average of 3.9 times before making a
purchase, higher than any other region in the world, emphasizing the need for
efficient integration of online and offline experiences.
o Upwards of 53% of respondents from the region would prefer to ‘close the deal’
and complete the purchase of their car online, which is the highest for any region
in the world.
o Sustainability is a key factor cited by UAE consumers as influencing car choice.
The UAE scored among the top half of regions, highlighting the importance of
environmental considerations.

“Our study confirms the promising market opportunities for car manufacturers (OEMs) and
distributors in the UAE” commented Philipp Seidel, Principal at Arthur D. Little and co-Author
of the Global Study. “Consumers in the Emirates show a great and increasing appetite for cars
while being among the most demanding globally when it comes to latest vehicle technologies
and a seamless purchase and service experience.”
The comprehensive report, “The Future of Automotive Mobility 2024” by Richard Parkin and
Philipp Seidel, delves into global automotive trends and their impact on various regions,
including the UAE. This study is an invaluable tool for industry stakeholders seeking to navigate
and leverage the dynamic changes driving the future of mobility.

 

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