A year after the devaluation of the Iraqi dinar... an economic move between supporters and opponents

[size=52]A year after the devaluation of the Iraqi dinar... an economic move between supporters and opponents[/size]

[size=45]Baghdad / Hussein Hatem[/size]
[size=45]A year has passed since the exchange rate of the dollar against the dinar was changed, and there are still conflicting opinions between the beneficiary and the harmed, and specialists believe that the devaluation of the dinar against the dollar is no longer a benefit to the citizen, but rather caused the poor to become poorer and the rich to become richer.[/size]
[size=45]According to contacts made by (Al Mada) with specialists in economic affairs, the government did not find realistic solutions to the demand for such a step that ended with a quarter of the value of the citizen's income being reduced.[/size]
[size=45]And the Central Bank of Iraq decided in December 2020, to reduce the value of the dinar, from 1200 Iraqi dinars against the dollar to 1460 dinars, a decrease of 22%.[/size]
[size=45]The expert in economic affairs, Salam Sumaisem, said in an interview with Al-Mada that "the increase in the exchange rate of the dollar against the dinar has passed in two directions. The first represented the benefit accruing to the government from the availability of financial liquidity, which enabled it to secure and pay the salaries of employees."[/size]
[size=45]As for the second trend, Sumaisem explains, “the devaluation of the dinar against the dollar negatively affected the citizen, as the value of income decreased by 25%, or a quarter of the income.”[/size]
[size=45]She pointed out, "The change in the exchange rate contributed to the rise in market prices, which led to the loss of half the real value of the citizen's income." And the expert in economic affairs continued, "The step to change the exchange rate of the dollar against the dinar was supposed to be compatible with other steps by providing treatments represented by increasing and providing the components of the ration card, as well as setting the prices of medicines." She indicated that "there are contradictions between the parties to the fiscal policy," surprisingly, "the oil prices have risen, and the citizen is still the one who pays the price through his salary."[/size]
[size=45]In turn, economic affairs specialist Dia Al-Mohsen said in an interview with Al-Mada that "the change in the exchange rate of the dollar against the dinar was supposed to have a positive impact on the Iraqi economy, but we did not see anything but the opposite." Al-Mohsen added, "The government should have established a competitive advantage between imported and local goods," noting that "the real economic sectors on which the government depends are not activated."[/size]
[size=45]The specialist in economic affairs pointed out, “The prices rose to more than 33%, which affected the citizen significantly,” noting that “the devaluation of the dinar against the dollar made the poor poorer and the rich richer.”[/size]
[size=45]For his part, the financial affairs specialist, Safwan Qusay, said that "the process of reducing the value of the Iraqi dinar came late, and it was assumed that the value of the dinar would be at the current price level from an early age."[/size]
[size=45]Qusay continued, "The main reason behind the decision to devalue the dinar is due to the decline in the central bank's reserves during the year 2020 by at least 25 billion dollars due to the withdrawals conducted by the government to pay the dues of employees working in the state in the same value so that they are not affected during the Corona pandemic, despite A drop in oil prices by at least 50% of the usual prices.” And the financial affairs specialist indicated that “the devaluation of the dinar allowed the government to finance the salary item without delay during 2021 and to pay its dues on a regular basis, including external debts, in addition to increasing the central bank’s reserves by no less than 13 billion dollars, but the segments linked to the Iraqi dinar were not able to The opposite of price resistance.”[/size]
[size=45]Qusay went on to say, "The reform white paper was referring to the need to support local production, whether agricultural or industrial, in order to compensate for the shortage in imports, and this did not happen, as the sector was and still needs support," stressing "the need to organize the Iraqi private sector through An integrated study, especially since Iraq has many untapped resources.[/size]
[size=45][You must be registered and logged in to see this link.]