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The dollar.. a “battle” that the state is resisting, and the Central Bank is confronting Emwazi with surprises
- Time: 08/04/2023 10:25:00
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{Reports: Al-Furat News} It is a "battle" more than a crisis that the state is facing to control the exchange rate of the dollar and prevent it from escaping, according to the description of Prime Minister Muhammad Shia'a al-Sudani.
Over the past days, the value of the dinar decreased steadily, bringing the dollar exchange rate to 1570 dinars, after the US Treasury's decision to ban 14 Iraqi banks from dealing in dollars, which created a gap in supply and demand for dollars in the local market.
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Al-Sudani said during a press conference last Tuesday that: "The dollar crisis is not a crisis, but rather a battle between the state, which insists on completing reform of the financial and banking system, and an affected group, which is a group of speculators and smugglers."
Although the current crisis is nearing an end, experts saw - an explanation for its recurrence - that it is "complex" and carries political and economic dimensions.
The rapporteur of the Finance Committee in the former parliament, Ahmed Al-Saffar, said that "the instability of the dollar exchange rate makes us think that it is caused by a political, economic and financial one," noting that "the Iraqi economy is in the hands of politicians, meaning that politics is what drives the economy," noting that "the political class, since In 2003, it was unable to set a financial and economic policy to rebuild the Iraqi economy, but it deliberately increased dependence on oil rents.
Economists ruled out the inability of the Central Bank of Iraq to control the exchange rate of the dollar on the black market or the so-called "parallel market" for many reasons, including its inability to cover domestic demand, the introduction of brokers and giving them a preferential price below the market price, forcing those who transfer dollars from outside Iraq By receiving it in Iraqi dinars and at the exchange rate of the Central Bank, which prompts the parties to use private offices in order to preserve their money from loss due to the exchange rate difference and the high commission rate.
And the Central Bank issued several decisions related to the banking sector, and the deputy governor of the bank, Ammar Hamad Khalaf, promised yesterday other decisions that will be issued next week, which may contribute significantly to reducing the exchange rate of the dollar.
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“Speculators and the initiative.”
The Prime Minister vowed, “with all determination, to pursue speculators and smugglers of foreign currency,” revealing that “the Central Bank is currently reviewing the work of all banks and exchange companies to verify funds.”
For its part, the Central Bank affirmed its continuation to meet the legitimate requests for the dollar from the official outlets licensed by it and at the official rate set for the beneficiary, which amounts to (1320) dinars to the dollar.
“The parallel has no legitimacy,”
and the Central Bank confirms that it is the only source of dollars circulating in the local markets, which it offers through banks, exchange and mediation companies, at the official price (1320) dinars per dollar.
Accordingly, what is called the "parallel market" has no reality, according to a bank statement.
The description of the “parallel currency market” is given when the market has its own sources of foreign currency, through private sector exports, local tourism, remittances of residents abroad, and others, as is the case in other countries, and then the role of the central bank is to work to achieve balance in the exchange rate, so it is Seller or buyer of foreign currency in the market.
And the Central Bank says that: “The exchange market in which the dollar is traded is a speculative market in a currency with a fixed price and purposes, and it is illegal trading, and it cannot be legalized, or exchange rates invented by speculators can be announced, and the competent authorities must stop the platforms and sites that announce prices.” exchange for a fixed-price currency.
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"Black remittances and the rise will return."
And the economic expert, Nasser Al-Kinani, attributes “the recent rise in the exchange rate of the dollar due to banks, agencies and personalities that relied on black transfers to finance some imports, and which began to withdraw dollars from the market in order to finance and pay those imports, and this rise will not stop, and it will be gradual, if it remains.” The crisis without real solutions by the government and the central bank.
The “four categories”
and the Central Bank identified the categories that buy the dollar from the market and cause an opportunity for speculators and beneficiaries to trade in an unofficial exchange rate, they are:
First: importers from merchants who do not follow the fundamental methods of external transfers (remittances and documentary credits) via the electronic platform.
Second: Importers of prohibited or narcotic substances, such as drug dealers and others, or materials that do not pass through the official border crossings, to escape the requirements of the law or customs, such as importers of cigarettes and some importers of precision instruments, so they go to the market to buy dollars that are not allocated to them to pay their bills.
Third: The category that generates returns from the proceeds of crimes, such as bribes, thefts, kidnapping, extortion, selling contraband, etc., and they transfer them abroad to hide them.
Fourth: Citizens who pay for their purchases of goods and services inside Iraq in dollars, which drives them to buy dollars from the market, and since there is no allocation from the central bank’s sales of dollars for this purpose, then their purchase is from a share allocated for other purposes, especially travel.
Central bank in the face of change
Informed sources report that the Sudanese Prime Minister "is working continuously with his government team to find these solutions, including making administrative changes to the executive staff within the Central Bank, in the event that the dinar continues to decline against the dollar and the bank is unable to face this rise, which contributed significantly to raising Food prices are on the market again.
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“A crisis may worsen.”
Economic affairs professor Jaafar Alloush believes that “the dollar crisis is an actual crisis that may worsen. The US dollar is owned by the rest of the countries and the owner sets controls to deal with it, and underestimating these controls is not always possible.”
"Not within reach"
As for the economic researcher, Ali Dadoush, he believes that: "Solutions in the short term may not be within reach, as most of the reasons that led to the dollar's rise are external, especially after 14 Iraqi banks were punished by the US Federal Reserve."
He points out that the most effective solutions to confront the "dollar dominance" lie in activating factories and laboratories and operating them to produce goods that are imported from countries banned from the dollar, and the government directs towards activating institutions and companies in the public and private sectors, operating and managing industries and working to increase their production, stressing that these steps will lead to elimination On the gap between the official and parallel prices, as it will produce imported commodities whose amounts are covered by the cash dollar.”
And the coming days remain the decisive factor in resolving the victor in the “dollar battle” amid a state of anticipation and concern for citizens about its impact on the prices of goods, goods, and services.
[You must be registered and logged in to see this link.]
{Reports: Al-Furat News} It is a "battle" more than a crisis that the state is facing to control the exchange rate of the dollar and prevent it from escaping, according to the description of Prime Minister Muhammad Shia'a al-Sudani.
Over the past days, the value of the dinar decreased steadily, bringing the dollar exchange rate to 1570 dinars, after the US Treasury's decision to ban 14 Iraqi banks from dealing in dollars, which created a gap in supply and demand for dollars in the local market.
[You must be registered and logged in to see this image.]
Al-Sudani said during a press conference last Tuesday that: "The dollar crisis is not a crisis, but rather a battle between the state, which insists on completing reform of the financial and banking system, and an affected group, which is a group of speculators and smugglers."
Although the current crisis is nearing an end, experts saw - an explanation for its recurrence - that it is "complex" and carries political and economic dimensions.
The rapporteur of the Finance Committee in the former parliament, Ahmed Al-Saffar, said that "the instability of the dollar exchange rate makes us think that it is caused by a political, economic and financial one," noting that "the Iraqi economy is in the hands of politicians, meaning that politics is what drives the economy," noting that "the political class, since In 2003, it was unable to set a financial and economic policy to rebuild the Iraqi economy, but it deliberately increased dependence on oil rents.
Economists ruled out the inability of the Central Bank of Iraq to control the exchange rate of the dollar on the black market or the so-called "parallel market" for many reasons, including its inability to cover domestic demand, the introduction of brokers and giving them a preferential price below the market price, forcing those who transfer dollars from outside Iraq By receiving it in Iraqi dinars and at the exchange rate of the Central Bank, which prompts the parties to use private offices in order to preserve their money from loss due to the exchange rate difference and the high commission rate.
And the Central Bank issued several decisions related to the banking sector, and the deputy governor of the bank, Ammar Hamad Khalaf, promised yesterday other decisions that will be issued next week, which may contribute significantly to reducing the exchange rate of the dollar.
[You must be registered and logged in to see this image.]
“Speculators and the initiative.”
The Prime Minister vowed, “with all determination, to pursue speculators and smugglers of foreign currency,” revealing that “the Central Bank is currently reviewing the work of all banks and exchange companies to verify funds.”
For its part, the Central Bank affirmed its continuation to meet the legitimate requests for the dollar from the official outlets licensed by it and at the official rate set for the beneficiary, which amounts to (1320) dinars to the dollar.
“The parallel has no legitimacy,”
and the Central Bank confirms that it is the only source of dollars circulating in the local markets, which it offers through banks, exchange and mediation companies, at the official price (1320) dinars per dollar.
Accordingly, what is called the "parallel market" has no reality, according to a bank statement.
The description of the “parallel currency market” is given when the market has its own sources of foreign currency, through private sector exports, local tourism, remittances of residents abroad, and others, as is the case in other countries, and then the role of the central bank is to work to achieve balance in the exchange rate, so it is Seller or buyer of foreign currency in the market.
And the Central Bank says that: “The exchange market in which the dollar is traded is a speculative market in a currency with a fixed price and purposes, and it is illegal trading, and it cannot be legalized, or exchange rates invented by speculators can be announced, and the competent authorities must stop the platforms and sites that announce prices.” exchange for a fixed-price currency.
[You must be registered and logged in to see this image.]
"Black remittances and the rise will return."
And the economic expert, Nasser Al-Kinani, attributes “the recent rise in the exchange rate of the dollar due to banks, agencies and personalities that relied on black transfers to finance some imports, and which began to withdraw dollars from the market in order to finance and pay those imports, and this rise will not stop, and it will be gradual, if it remains.” The crisis without real solutions by the government and the central bank.
The “four categories”
and the Central Bank identified the categories that buy the dollar from the market and cause an opportunity for speculators and beneficiaries to trade in an unofficial exchange rate, they are:
First: importers from merchants who do not follow the fundamental methods of external transfers (remittances and documentary credits) via the electronic platform.
Second: Importers of prohibited or narcotic substances, such as drug dealers and others, or materials that do not pass through the official border crossings, to escape the requirements of the law or customs, such as importers of cigarettes and some importers of precision instruments, so they go to the market to buy dollars that are not allocated to them to pay their bills.
Third: The category that generates returns from the proceeds of crimes, such as bribes, thefts, kidnapping, extortion, selling contraband, etc., and they transfer them abroad to hide them.
Fourth: Citizens who pay for their purchases of goods and services inside Iraq in dollars, which drives them to buy dollars from the market, and since there is no allocation from the central bank’s sales of dollars for this purpose, then their purchase is from a share allocated for other purposes, especially travel.
Central bank in the face of change
Informed sources report that the Sudanese Prime Minister "is working continuously with his government team to find these solutions, including making administrative changes to the executive staff within the Central Bank, in the event that the dinar continues to decline against the dollar and the bank is unable to face this rise, which contributed significantly to raising Food prices are on the market again.
[You must be registered and logged in to see this image.]
“A crisis may worsen.”
Economic affairs professor Jaafar Alloush believes that “the dollar crisis is an actual crisis that may worsen. The US dollar is owned by the rest of the countries and the owner sets controls to deal with it, and underestimating these controls is not always possible.”
"Not within reach"
As for the economic researcher, Ali Dadoush, he believes that: "Solutions in the short term may not be within reach, as most of the reasons that led to the dollar's rise are external, especially after 14 Iraqi banks were punished by the US Federal Reserve."
He points out that the most effective solutions to confront the "dollar dominance" lie in activating factories and laboratories and operating them to produce goods that are imported from countries banned from the dollar, and the government directs towards activating institutions and companies in the public and private sectors, operating and managing industries and working to increase their production, stressing that these steps will lead to elimination On the gap between the official and parallel prices, as it will produce imported commodities whose amounts are covered by the cash dollar.”
And the coming days remain the decisive factor in resolving the victor in the “dollar battle” amid a state of anticipation and concern for citizens about its impact on the prices of goods, goods, and services.
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