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[size=39]The currency exchange rate in Iraq.. the economy is affected and a search for solutions to the problem
Free - Washington , Free / Agencies - Washington
February 12, 2023
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Free - Washington , Free / Agencies - Washington
February 12, 2023
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The exchange rates of the Iraqi dinar against the dollar still represent a dilemma for the Iraqi state apparatus, as it trades in the market at prices higher than those set by the Central Bank of Iraq.
And the Central Bank of Iraq announced, on Saturday, that it had held meetings with officials from the US Federal Reserve and the Treasury Department in Washington, pointing to a tendency to "launch a second package of facilities to enhance the stability of the exchange rate."
He said in a press [You must be registered and logged in to see this link.] that the US Federal Reserve and the US Treasury have expressed their willingness to "work together to face the challenges of working on the electronic platform for remittances and cash."
The Central Bank of Iraq recently decided to adjust the exchange rate to 1,300 dinars against the dinar, but the trading price in the market is 1,470 dinars against the dollar, according to a report by the Iraqi News Agency, "INA."
The US Federal Reserve Bank had imposed amendments to the procedures for Iraqi transfers that pass through the "Swift" system, to include an audit of the source of funds until the final future, which came after the consequences of what was known as the story of the "theft of the century" in Iraq.
[url=https://media.voltron.alhurra.com/Drupal/01live-106/styles/sourced/s3/2022-12/2012-10-03T120000Z_266337207_GM1E8A31IOZ01_RTRMADP_3_IRAQ-ECONOMY-DINAR %281%29.jpg?itok=vMxc-RiH][You must be registered and logged in to see this image.][/url]
The instability of the Iraqi dinar exchange rate against the dollar. archival
Professor of International Economic Relations at the Iraqi University, Abd al-Rahman Najm al-Mashhadani, expressed optimism about the talks between the Iraqi Central Bank, the Federal Reserve and the US Treasury because it “will contribute to easing the exchange rate crisis slightly,” noting that “limiting this crisis will take time until the gap is bridged.” between the exchange rate set by the Iraqi Central Bank and the price in the local market.
He added, in an interview with Al-Hurra, that the issue of “the time that Iraq needs to reach the stability of the exchange rate is not directly related to the discussions with American financial institutions, especially since the Iraqi Central Bank did not request any time to postpone electronic procedures,” explaining that “the Prime Minister, Muhammad Shia Al-Sudani affirmed Iraq's commitment to complying with international standards, especially as they contribute to supporting the country's efforts to fight corruption.
The Iraqi economist, Salam Sumaisem, believes that a solution to the crisis of "the exchange rate in Iraq is not on the horizon," despite the official efforts, stressing that the indicators indicate "a scarcity of liquidity with the official authorities from paying the dues of the general budget."
In response to Al-Hurra's inquiries, she explained that resolving the crisis and reaching a stage of stability in exchange rates "will take time with full reliance on the electronic platform, which will limit dollar smuggling outside the country."
The Iraqi News Agency, " [You must be registered and logged in to see this link.] ", quoted the advisor to the Iraqi Prime Minister, Hussein Allawi, as saying that Iraq "undertook a negotiating path that moved towards a positive atmosphere and constructive understanding between representatives of the Central Bank of Iraq and the US Treasury Department, stressing in their meeting the prospects for cooperation between the two sides, in a way that contributes to The stability of the exchange rate in Iraq.
He added that the current government managed "the exchange rate crisis effectively towards focusing on social growth and preserving the gains of the state's financial revenues from Iraqi oil, and correcting the course of the exchange rate and the local market after approving the study submitted by the Central Bank of Iraq that the official exchange rate of the dinar against the dollar be 1300." Dinars against one dollar and determine the flexibility of the market as well.
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The Central Bank of Iraq modified the exchange rate of the dinar against the dollar
And the Governor of the Central Bank of Iraq, Ali Mohsen Ismail, confirmed, "The bank's intention to launch the second package of facilities that would enhance the stability of the exchange rate."
The statement quoted the US Federal Bank as saying, "The Central Bank of Iraq's actions are in the right direction to build a sober banking sector."
The Iraqi economist, Mahmoud Dagher, said that he hopes that the second package, which will be launched by the central bank, “will have an impact on the money supply of dollars for import,” noting that the interest of merchants so far to open accounts through banks for transfers is still “limited.” There is a gap in meeting the demand for dollars.
Dagher, a former official at the Central Bank of Iraq, added, in response to inquiries from the "Al-Hurra" website, that "as long as the problem is related to the money supply, the central bank should aim to bridge this gap through the banking system."
He called for more "flexibility that attracts merchants, importers and companies to integrate more within the Iraqi banking system and conduct transfers through banks."
Academic Al-Mashhadani believes that monetary stability "is linked to the compliance of merchants and importers inside Iraq by completing their deals through the banking system and not by relying on the parallel market."
Al-Mashhadani calls for any facilitation package to be aimed at "facilitating the entry of small traders and importers into the system of financial transactions through banks, and expanding the base of various financial transfer systems."
For her part, expert Sumaisem confirms that any new package from the Central Bank of Iraq must aim at "reducing the smuggling of cash dollars outside Iraq, and reducing the gap in exchange rates between what is officially determined and what is sold in the parallel market."
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Smuggling the dollar abroad.. a problem that threatens the Iraqi economy
With the continuation of the dollar crisis in Iraq, and the decline in the price of the local currency, hundreds of Iraqis demonstrated, on Wednesday, in front of the headquarters of the Central Bank in Baghdad, demanding a reduction in the price of the dollar, and they hold it responsible for what has happened.
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And the advisor to the Prime Minister for Financial Affairs, Mazhar Muhammad Salih, confirms that "the central bank's packages will speed up the levels of meeting the demand for foreign currency," explaining that the rise in prices in the parallel market is "artificial and based on false information that is called colored noise and does not correspond to the strength of the financial situation." .
Saleh told "INA" agency that the dollar reserves exceeded $115 billion.
In late December, the Iraqi Central Bank approved a package of measures to control the stability of the exchange rate against the dollar, including facilitating the financing of private sector trade in dollars through Iraqi banks, and opening outlets for selling foreign currency in government banks to the public for travel purposes.
The bank called on merchants at the time to stress the importance of dealing "with banks directly and not resorting to intermediaries and speculators to avoid charging their imports with undue commissions and expenses," noting the importance of the Cabinet's decision to "not collect customs duties and tax secretariat amounts in advance," especially since this will lead to a reduction in procedures. Eliminate costs resulting from upfront fee problems.
[You must be registered and logged in to see this link.]
And the Central Bank of Iraq announced, on Saturday, that it had held meetings with officials from the US Federal Reserve and the Treasury Department in Washington, pointing to a tendency to "launch a second package of facilities to enhance the stability of the exchange rate."
He said in a press [You must be registered and logged in to see this link.] that the US Federal Reserve and the US Treasury have expressed their willingness to "work together to face the challenges of working on the electronic platform for remittances and cash."
The Central Bank of Iraq recently decided to adjust the exchange rate to 1,300 dinars against the dinar, but the trading price in the market is 1,470 dinars against the dollar, according to a report by the Iraqi News Agency, "INA."
The US Federal Reserve Bank had imposed amendments to the procedures for Iraqi transfers that pass through the "Swift" system, to include an audit of the source of funds until the final future, which came after the consequences of what was known as the story of the "theft of the century" in Iraq.
"A matter of time"
[url=https://media.voltron.alhurra.com/Drupal/01live-106/styles/sourced/s3/2022-12/2012-10-03T120000Z_266337207_GM1E8A31IOZ01_RTRMADP_3_IRAQ-ECONOMY-DINAR %281%29.jpg?itok=vMxc-RiH][You must be registered and logged in to see this image.][/url]
The instability of the Iraqi dinar exchange rate against the dollar. archival
Professor of International Economic Relations at the Iraqi University, Abd al-Rahman Najm al-Mashhadani, expressed optimism about the talks between the Iraqi Central Bank, the Federal Reserve and the US Treasury because it “will contribute to easing the exchange rate crisis slightly,” noting that “limiting this crisis will take time until the gap is bridged.” between the exchange rate set by the Iraqi Central Bank and the price in the local market.
He added, in an interview with Al-Hurra, that the issue of “the time that Iraq needs to reach the stability of the exchange rate is not directly related to the discussions with American financial institutions, especially since the Iraqi Central Bank did not request any time to postpone electronic procedures,” explaining that “the Prime Minister, Muhammad Shia Al-Sudani affirmed Iraq's commitment to complying with international standards, especially as they contribute to supporting the country's efforts to fight corruption.
The Iraqi economist, Salam Sumaisem, believes that a solution to the crisis of "the exchange rate in Iraq is not on the horizon," despite the official efforts, stressing that the indicators indicate "a scarcity of liquidity with the official authorities from paying the dues of the general budget."
In response to Al-Hurra's inquiries, she explained that resolving the crisis and reaching a stage of stability in exchange rates "will take time with full reliance on the electronic platform, which will limit dollar smuggling outside the country."
The Iraqi News Agency, " [You must be registered and logged in to see this link.] ", quoted the advisor to the Iraqi Prime Minister, Hussein Allawi, as saying that Iraq "undertook a negotiating path that moved towards a positive atmosphere and constructive understanding between representatives of the Central Bank of Iraq and the US Treasury Department, stressing in their meeting the prospects for cooperation between the two sides, in a way that contributes to The stability of the exchange rate in Iraq.
He added that the current government managed "the exchange rate crisis effectively towards focusing on social growth and preserving the gains of the state's financial revenues from Iraqi oil, and correcting the course of the exchange rate and the local market after approving the study submitted by the Central Bank of Iraq that the official exchange rate of the dinar against the dollar be 1300." Dinars against one dollar and determine the flexibility of the market as well.
achieve "monetary stability"
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The Central Bank of Iraq modified the exchange rate of the dinar against the dollar
And the Governor of the Central Bank of Iraq, Ali Mohsen Ismail, confirmed, "The bank's intention to launch the second package of facilities that would enhance the stability of the exchange rate."
The statement quoted the US Federal Bank as saying, "The Central Bank of Iraq's actions are in the right direction to build a sober banking sector."
The Iraqi economist, Mahmoud Dagher, said that he hopes that the second package, which will be launched by the central bank, “will have an impact on the money supply of dollars for import,” noting that the interest of merchants so far to open accounts through banks for transfers is still “limited.” There is a gap in meeting the demand for dollars.
Dagher, a former official at the Central Bank of Iraq, added, in response to inquiries from the "Al-Hurra" website, that "as long as the problem is related to the money supply, the central bank should aim to bridge this gap through the banking system."
He called for more "flexibility that attracts merchants, importers and companies to integrate more within the Iraqi banking system and conduct transfers through banks."
Academic Al-Mashhadani believes that monetary stability "is linked to the compliance of merchants and importers inside Iraq by completing their deals through the banking system and not by relying on the parallel market."
Al-Mashhadani calls for any facilitation package to be aimed at "facilitating the entry of small traders and importers into the system of financial transactions through banks, and expanding the base of various financial transfer systems."
For her part, expert Sumaisem confirms that any new package from the Central Bank of Iraq must aim at "reducing the smuggling of cash dollars outside Iraq, and reducing the gap in exchange rates between what is officially determined and what is sold in the parallel market."
[You must be registered and logged in to see this link.]
[You must be registered and logged in to see this image.]
[You must be registered and logged in to see this link.]
Smuggling the dollar abroad.. a problem that threatens the Iraqi economy
With the continuation of the dollar crisis in Iraq, and the decline in the price of the local currency, hundreds of Iraqis demonstrated, on Wednesday, in front of the headquarters of the Central Bank in Baghdad, demanding a reduction in the price of the dollar, and they hold it responsible for what has happened.
[You must be registered and logged in to see this link.]
And the advisor to the Prime Minister for Financial Affairs, Mazhar Muhammad Salih, confirms that "the central bank's packages will speed up the levels of meeting the demand for foreign currency," explaining that the rise in prices in the parallel market is "artificial and based on false information that is called colored noise and does not correspond to the strength of the financial situation." .
Saleh told "INA" agency that the dollar reserves exceeded $115 billion.
In late December, the Iraqi Central Bank approved a package of measures to control the stability of the exchange rate against the dollar, including facilitating the financing of private sector trade in dollars through Iraqi banks, and opening outlets for selling foreign currency in government banks to the public for travel purposes.
The bank called on merchants at the time to stress the importance of dealing "with banks directly and not resorting to intermediaries and speculators to avoid charging their imports with undue commissions and expenses," noting the importance of the Cabinet's decision to "not collect customs duties and tax secretariat amounts in advance," especially since this will lead to a reduction in procedures. Eliminate costs resulting from upfront fee problems.
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