Follow up The economic expert, Majed Al-Suri, warned, Tuesday (October 20, 2020), of a move to raise the value of the exchange rate of the dollar at the expense of the Iraqi dinar, because it will affect those with limited incomes and the classes of the poor. "One of the paragraphs in the white paper that the government sent to Parliament indicates that there is an intention to study the possibility of raising the value of the dollar exchange rate while preserving the monetary policy and fixing the value of the dinar," Al-Suri said in a press statement followed by (Baghdad Today), considering that these "solutions More dangerous than reducing salaries. " He added that "the meaning of devaluation is to reduce the value of salaries indirectly, and all incomes that enter the Iraqi people, as it will affect those with limited incomes and classes of the poor through the rise in commodity prices." Al-Suri clarified that, "If the value of the dinar is reduced by 25%, the prices will be multiplied by a factor of about 40 to 50%," noting that "the white paper did not explicitly say that the exchange rate would be reduced, but rather said that it is among the measures that are possible." To resort to it is to reduce the exchange rate. " The picture added that "the government did not present a direct proposal calling for the reduction of the value of the dinar, but one of the proposals adopted by the government in its white paper is to reduce the exchange rate of the Iraqi dinar against the dollar." The economist pointed out that "one of the reasons for the high exchange rate is" irresponsible statements that dealt with the issue that the government will move towards reducing the exchange rate, "adding that" other things that contributed to the increase in the price of selling the dollar are the absence of political or security stability, which led to an increase. " The price of the dollar and commodities. " The economist touched on "the solutions that the government will pursue to overcome its financial crisis, saying that" the government has several options to solve the financial crisis, including fighting corruption and reducing operational expenses by canceling all salary allocations, which are estimated at more than (15) trillion dinars out of (28) trillion dinars. Total salaries of employees in the Iraqi state. " Al-Suri added that "the government's actions in the year 2019 led to an increase in the size of salaries, which rose from 40 trillion dinars to more than 50 trillion dinars," explaining that "reducing allocations and large salaries will save very large funds amounting to more than (15) trillion dinars." . "Among the solutions or options presented are the reduction of operating expenses and the reduction of salaries over three years from 25% of the gross domestic product to 12.5%, meaning the reduction is up to 50%," he stressed. I believe that "this measure will save large parts of the Iraqi people from the crisis of price inflation," noting that "also among the proposals put forward is to increase financial resources from non-oil such as ports and direct and indirect taxes, activate the public, private and mixed sectors and activate industry and agriculture will lead to employment." Labor and consequently increase taxes. " The economist indicated that "among the proposals submitted to the central bank, which it rejected is to raise the exchange rate," noting that "this option is one of the last options that the central bank may resort to in the absence of other solutions to address the financial crisis."
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