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Saleh: The dollar exchange is a story that not many people know about, and the effects of the parallel market noise are 10%.
12/21/2023
{Economic: Al-Furat News} Advisor to the Prime Minister for Financial Affairs, Mazhar Muhammad Saleh, explained that the policy of setting the exchange rate is affected by many factors, and the most important of these factors is the relationship between the Ministry of Finance and the Central Bank, noting that “the effects of exchange noise in the parallel market are 10%.”
Saleh said in a press statement, “The reality of the policy of setting the exchange rate is affected by many factors, and the most important of these factors is the relationship between the Ministry of Finance and the Central Bank. The exchange rate in Iraq is a story that many do not know about. It is essentially a contractual price between Finance and the Central Bank.”
He pointed out that the price is 1,320 Iraqi dinars per dollar, and this is the price approved in the budget and for all contracts and foreign transactions.
Therefore, the question is; Why should we fight "dollarization"? The Sudanese advisor wondered, and pointed out that “dollarization” did not exist in Iraq before 1982. There was no use of foreign currency within the economy in buying and selling, contracts, transactions, etc., but the deviation of the Iraqi economy was due to the Iraq-Iran war, and the entry of the blockade later, and then The change that occurred after the year 2003 and economic openness made there two currencies, the national currency, and the currency of another country subject to a different monetary policy.
In light of this scene, Saleh saw that “holding a price system has become difficult, so one of the reasons for any country to respect its sovereignty is that there should not be two currencies within the economy, as the foreign currency is intended to be dealt with outside the economy, so it is not possible to consider the existence of a price in the dollar.” And the price in the dinar, one of which rises and the other falls, so no monetary policy can control such a situation, which is what prompted the monetary authority to intervene in the matter.”
The Sudanese advisor continued, “There are two things: the legacy of dealing in foreign currency and keeping it, and considering it part of savings and a refuge for preserving value. This is a story that has been inherited since the eighties of the last century. It is not difficult to dismantle it overnight. Therefore, the extent of the success of monetary policy in this case remains, by financing... Foreign trade, 80% of which passes through the international compliance platform concerned with auditing transfers, is it really to finance Iraq’s foreign trade?
The Sudanese advisor pointed out, “Estimates of auction sales are around 45 billion dollars a year, and it is part of the foreign currency window. Approximately 15% is usually cash, and it is said that it is for simple travel needs, and the rest can be transferred via cards that people were not using, and which have now become possible.” “Use them, but on the condition that this process is regulated and not random.”
Regarding government measures to control the market, Saleh went on to say, “This is not propaganda, but rather that there are consultations by a high-level technical team in the Central Bank, and the American side is not arrogant, but rather they have principles that they are working on, as is the Iraqi Central Bank, and therefore There are ongoing understandings, but they take some time, and the most important thing is for the market to adapt and for banks to adapt to (Kyc), and for global compliance.”
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12/21/2023
{Economic: Al-Furat News} Advisor to the Prime Minister for Financial Affairs, Mazhar Muhammad Saleh, explained that the policy of setting the exchange rate is affected by many factors, and the most important of these factors is the relationship between the Ministry of Finance and the Central Bank, noting that “the effects of exchange noise in the parallel market are 10%.”
Saleh said in a press statement, “The reality of the policy of setting the exchange rate is affected by many factors, and the most important of these factors is the relationship between the Ministry of Finance and the Central Bank. The exchange rate in Iraq is a story that many do not know about. It is essentially a contractual price between Finance and the Central Bank.”
He pointed out that the price is 1,320 Iraqi dinars per dollar, and this is the price approved in the budget and for all contracts and foreign transactions.
Therefore, the question is; Why should we fight "dollarization"? The Sudanese advisor wondered, and pointed out that “dollarization” did not exist in Iraq before 1982. There was no use of foreign currency within the economy in buying and selling, contracts, transactions, etc., but the deviation of the Iraqi economy was due to the Iraq-Iran war, and the entry of the blockade later, and then The change that occurred after the year 2003 and economic openness made there two currencies, the national currency, and the currency of another country subject to a different monetary policy.
In light of this scene, Saleh saw that “holding a price system has become difficult, so one of the reasons for any country to respect its sovereignty is that there should not be two currencies within the economy, as the foreign currency is intended to be dealt with outside the economy, so it is not possible to consider the existence of a price in the dollar.” And the price in the dinar, one of which rises and the other falls, so no monetary policy can control such a situation, which is what prompted the monetary authority to intervene in the matter.”
The Sudanese advisor continued, “There are two things: the legacy of dealing in foreign currency and keeping it, and considering it part of savings and a refuge for preserving value. This is a story that has been inherited since the eighties of the last century. It is not difficult to dismantle it overnight. Therefore, the extent of the success of monetary policy in this case remains, by financing... Foreign trade, 80% of which passes through the international compliance platform concerned with auditing transfers, is it really to finance Iraq’s foreign trade?
The Sudanese advisor pointed out, “Estimates of auction sales are around 45 billion dollars a year, and it is part of the foreign currency window. Approximately 15% is usually cash, and it is said that it is for simple travel needs, and the rest can be transferred via cards that people were not using, and which have now become possible.” “Use them, but on the condition that this process is regulated and not random.”
Regarding government measures to control the market, Saleh went on to say, “This is not propaganda, but rather that there are consultations by a high-level technical team in the Central Bank, and the American side is not arrogant, but rather they have principles that they are working on, as is the Iraqi Central Bank, and therefore There are ongoing understandings, but they take some time, and the most important thing is for the market to adapt and for banks to adapt to (Kyc), and for global compliance.”
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