Samson: Dr. Saleh on the rise in the dollar exchange: sacrificing a side of the central bank’s reserves would allow price stability and ensure the stability of the standard of living
14th April, 2021
The economic expert and financial advisor to the Prime Minister, Dr. Mazhar Saleh, said about the possibility of a rise in the dollar exchange rate against the dinar that the rise in prices at a rate of 4.5% affects the consumer's livelihood, but it is not dangerous, considering that the fear is from the accumulation of inflationary expectations from the side of the forces generating inflationary expectations, namely the exchange rate speculators.
In an interview with the obelisk, Saleh considered that it is natural that imported goods and services have increased by reducing the exchange rate of the Iraqi dinar, as the decrease reached about 23% , but there are services and local goods (including government) such as fuel, electricity, and others, which remained constant in price.
The economic consultant, known for his accurate readings, continued that the lease contracts remained stable, making the annual inflation rate measured last month moderate compared to the low exchange rate, as the consumer price index in Iraq recorded an annual increase of 4.5% after it remained throughout the three years. The past is stable and with small annual rises between 1% and sometimes less, and I call it zero inflation.
The Deputy Governor of the Central Bank of Iraq, Ihsan Shamran Al-Yasiri, said, Tuesday, April 13, 2021, that the World Bank had proposed to Iraq to amend the exchange rate of the dollar to 160 thousand dinars per 100 dollars, as it is the real price.
Dr. Salih added: The price increase at a rate of 4.5% affects the consumer's livelihood, but it is not dangerous, but the fear of the accumulation of inflationary expectations on the part of the forces that generate inflationary expectations, which are the speculators at the exchange rate, which makes monetary policy obliged to meet the super-demand for foreign currency from The window of the central bank or auction and maintaining a fixed exchange rate of 1450 dinars / dollar.
He continued: Defending stability on this price is through the policy of continuous intervention and sacrifice of a side of the central bank’s foreign currency reserves to ensure that inflation remains within the goal of the one-decimal place in order to achieve stability and stability in the standard of living.
And Saleh considered that this is consistent with the monetary policy objectives in achieving stability in the general level of prices and preserving the purchasing power of the monetary income, which is denominated in the Iraqi dinar.
The Deputy Governor of the Central Bank of Iraq had said that "one of the demands of the World Bank during the negotiations to raise the exchange rate of the dollar is to reform the public financial departments, which are taxes, customs, levies and financing part of the financial savings achieved for the benefit of the vulnerable classes."
In the context of urgent solutions, the ration card items must be improved to reduce the damage caused by adjusting the exchange rate, according to economic experts. LINK
MilitiaMan: They have the tools they need and the expertise to keep inflation low whether it be at 1450 or 1.45 imo... Through continuous interventions into the currency market they can achieve stability in the currency and the citizens standards of living.
They have tools that are consistent with monetary policy objectives achieve stability in general pricing of goods and while preserving the purchasing power of monetary income denominated in dinars. They rely on the income from other sources outside of oil, through taxes, customs, levies, etc..
In my view, an objective of the Central Bank is to bring stability and security, and with it will come purchasing power. Keeping inflation low while at a program rate is proof they can also defend the new exchange rate at a much higher level, as the project to delete the zeros off the exchange rate brings the Dinar to 1.45, imo. One Decimal place.
That reality is what imo is what we expect within and form the Central Bank of Iraq.
Not necessarily outside the country, that will bring an international calculation for it, imo..
They have not activated the 2021 Budget yet. Why? The CBI will need to have the rate sorted prior to printing the budget to go into the Gazette.
It looks like that the rate of 1460 at present has not changed, therefore, we can deduce that the project to delete the three zeros is on track and they tell us so.
They talk about another week from 04/14/2021 is needed to avoid budget problems. 1460 is inflationary and had pressures on the citizens. PM Kahdimi was out talking to the poor. He told them he is working for them. 1460 exchange rate is not working for them, nor is taxing them at 1460.
So, with that said and back too, they can not activate the 2021 budget until it is published. They'll need the final rate to be in the budget to print it. imo It is that simple. They told us they need an additional week. That is not long from now. imo ~ MM
Representative Finance: Taxes imposed in the budget are applied retroactively
Al-Saadawi explained that "the federal budget comes into effect after its publication in the Iraqi newspaper Al-Waqa'i’ and the issuance of final instructions on it, "indicating that" until now, the Al-Waqa’i ’newspaper has not published the budget, and the instructions have not been published until it is implemented by the ministries." LINK
Harb: Two things, only two, enable Parliament to avoid the 2021 budget problems
"The second option is the easiest for Parliament at the present time, as publishing the budget needs another week, and therefore Parliament can prepare a supplementary budget with the same steps that were prepared by the original budget."LINK
Don961: What is the reason for the delay in publishing the budget law in the official gazette? Justice answers
Economy The Iraqi budge 2021-04-17 12:17 Shafaq News /
On Saturday, the Ministry of Justice revealed the reason for the delay in publishing the General Budget Law for 2021 in the official Iraqi newspaper.
A source in the ministry told Shafak Nyour agency that, "After the vote on the general budget law, the President of the Republic, Barham Salih, approved the law on April 8," explaining that "the Presidency of the Republic sent the draft budget law to the Ministry of Justice last Tuesday, and this is the reason for the delay." Published in the Iraqi newspaper Al-Waqi’a.
The source pointed out that "the draft budget law is ready for publication in the official newspaper Al-Waqae ', and will be published during the next Sunday or Monday."
It is noteworthy that the President of the Republic, Barham Salih, officially approved, on Thursday (April 8, 2021), the federal fiscal budget law for the current year, after the parliament voted on it. LINK
MilitiaMan: The week extension is coming to an end.. Sounds like they have it ready for publication... I like this one!!!
To implement or have taxes in order for to apply on income to the citizens, that won't work with the way it may have been presented in the past, however, if there is a new exchange rate that is internationally acceptable and Article 8 compliant, then what Saleh has spoken about being only 1 decimal place the purchasing power will support the taxation. imo ~ MM
Baghdad-Al-Sharqiya, April 17:
Political sources said that the Iraqi Prime Minister Mustafa Al-Kazemi directed not to promote the proposal made by the Ministry of Finance regarding the tax deduction from the salaries of employees. From outside the contexts that were previously approved. The sources indicated that the Prime Minister referred on more than one occasion to the need to pay attention to the income of the poor classes and to spare them the effects of fluctuations and economic crises. LINK