DJ Iraq Won't Rush Into Industry Privatization - Devt Min

KUWAIT CITY (Zawya Dow Jones)--Iraq won't rush into privatizing its industries, despite the government's leaning towards an open economy, Ali Baban, Minister of Planning & Development Cooperation, said Tuesday.

"We shouldn't rush as some negative results may accompany any unplanned privatization process," he said during a speech at the International Compact With Iraq preparatory group meeting in Kuwait.

The Iraqi government is considering plans to privatize state factories, but most of the factories depend on costly government assistance, Baban said.

"The recent move of keeping the import door open without regulations and restrictions has put an end to many factories," he said.

Although the Iraqi government is committed to adopting a free market policy, Baban said the removal of subsidies and facilities have hurt the agricultural and industrial sectors.

To strengthen these industries, the government is asking private sector firms to merge.

"Many of the private factories are still small and cannot do the required task...we are trying hard to urge the Iraqi businessmen to merge their companies and establish big ones," he said. "We believe that it is necessary to merge small Iraqi banks into big banks."

-By Sara Ismail, Dow Jones Newswires, +965 934 9692; djnews.dubai@dowjones.com

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(END) Dow Jones Newswires

October 31, 2006 06:58 ET (11:58 GMT)