Central banks of UAE and Iraq sign deal to boost co-operation

Pact to focus on banking supervision, technical assistance and knowledge exchanges

The UAE Central Bank has joined forces with the Central Bank of Iraq to enhance banking supervision. Ryan Carter / The National

The Central Bank of the UAE has signed a preliminary agreement with the Central Bank of Iraq (CBI) to enhance co-operation on banking supervision matters.

The agreement covers three key areas — control and supervisory issues, the exchange of supervisory information, and strengthening bilateral co-operation on training workers and upgrading the professional skills of both parties.

It will also focus on technical assistance and knowledge exchanges between the two entities, the central banks said in a joint statement on Monday.

“We are keen to strengthen co-operation with our counterparts in the CBI to achieve common goals in enhancing banking supervision and exchange the necessary information to advance the interests of both parties to protect our financial systems,” said Khaled Balama, governor of the UAE Central Bank.

The central banks will exchange information and communications during licensing processes and the continuing supervision of banks and other financial institutions operating in both countries. It will allow effective cross-border supervision, while maintaining complete information confidentiality, the banks said.

“We believe that the time has come to raise the level of financial and banking relations between the two countries in proportion to the volume of trade and investments between us, as well as to enhance joint co-operation to address the challenges facing the banking sector,” said Mustafa Mukheef, governor of the CBI.

Iraq, Opec's second-largest oil producer, has taken tentative steps to restructure its economy away from fossil-fuel dependency as the world prepares to reach net-zero emissions by 2050.

The World Bank estimates Iraq’s economy will grow 1.9 per cent this year and expand 6.3 per cent over the next two years.

Ties between the UAE and Iraq are also strengthening.

In October, the UAE signed an agreement with Iraq to promote and protect mutual investments, as the Emirates seeks to strengthen economic co-operation with a number of different countries.

The accord, signed by the UAE Ministry of Finance and Iraq's National Investment Commission, aims to boost foreign investment in both countries by providing a suitable investment environment and securing a balance between the rights and obligations of investors and the host country.