Don961: Adapt to the exchange rate
Monday April 12, 2021 Muhammad Sharif Abu Maysam
On the 16th of last March, the Central Bank of Iraq explained, through a statement, the reason for the decline in the exchange rate of the dollar in the parallel market - especially in February - from the official selling price after changing the price by the bank at the end of December of 2020.
And the central explained This decline in what he called "the domestic market shock" which required a period of adjustment to make the settlements that occurred between each of the merchants (wholesale, retail, singular) and the settlements of wholesalers with banks, as imports decreased to severe levels, and then the demand for Foreign currency decreased. ».
However, this interpretation based on the market mechanism did not take into account the impact of the political space on this mechanism, as the apprehension of many of the public, including many traders and speculators, remained escalating at times and decreasing at other times, according to the statements and promises regarding the influence of the central decision and the intention to retract it in favor of Slogans, which were employed to win positions, without taking into account the nature of the variable that requires preparation for the influx of foreign investments and the establishment of an investment climate led by capital allied to globalization capital in the region
Which requires working on several axes in order to achieve this trend, and the exchange rate has not increased in the parallel market Only after approving the budget, and ensuring that the relevant authorities proceed with their policies without return, to create a competitive environment that protects the local product from the decline in the prices of goods produced in the geographical neighborhood countries and to pave the way for monetary stability that encourages foreign capital to enter the Iraqi arena in a security, legal and stable monetary environment.
But adapting to the exchange rate will not take its form that attracts investment, except by liberalizing the exchange rate and creating monetary stability in an atmosphere of freedom of exchange and circulation to ensure the movement of capital into and out of the Iraqi interior, without any effect of the difference in the value of the exchange rate with Other currencies .
And to ensure investment accounts in the feasibility studies prepared by the investors, as they are keen in the financial feasibility studies to ensure that the price does not change in the parallel market, during the life of the project to achieve the feasibility of establishing the project, as well as the importance of competitiveness to protect the local product, which is likely to adopt the method of "floatation.
" Al-Madar »in the next step, in conjunction with the increase in the central reserves, which will contribute to giving more freedom to maneuver those in charge of monetary policy, and to ensure adaptation to the fluctuations of the parallel market up to For stability. LINK
MilitiaMan: This article is so very telling. We have seen they increased their reserves. They have found that the political banter of late created an environment that Investors, I. E., "COUNTRIES" were not pleased with which created instability.
Now that the budget has been signed and about ready to be opened, they returned in full force. Kahdimi did the rounds recently and for good reason.
The region not only knows it is show time but, the world does now imo.. Those that wrote the feasibility study for the country, have the reigns now and will float the currency while the reconstruction effort is underway.
They want stability and will get it with a stable exchange rate that is not 1460.. imo..
This is a rock star article!
They will have to show us the color of the money too. It is coming.. imo ~ MM