Iraqi Dinar: IBBC issues Major New Paper on De-Dollarisation of Iraq
[You must be registered and logged in to see this link.]
29th May 2024 in [You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.]
From the [You must be registered and logged in to see this link.]:
The Advisory Council members and IBBC members have actively contributed to the paper in the past 4 months. It will be presented online on the 18th June in a webinar and in person at the Spring Conference on 2nd July. The Arabic translation will be published soon.
[You must be registered and logged in to see this link.].
Previous advisory papers include 2020, '[You must be registered and logged in to see this link.]', '[You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.] and [You must be registered and logged in to see this link.].
Professor Gunter provides an analysis of the drivers of impact on the dinar exchange rate and examines how best to deal with the parallel market of dinars to dollars. He outlines the practical policy initiatives that should reduce the gap between the official and parallel exchange rates in the medium-term.
In particular he lauds the Government of Iraq on its commitment to tackle corruption and to modernise the banking system in one fell swoop but warns of the pressure on the dinar exchange rate as budgets are overstretched and the new banking recipients (state banks) receive the liquidity to enable the economy to perform.
He writes 'All three of these forces - the anti-corruption effort, the banking liberalization, and the lavish 2023-2025 budget - will create challenges for the management of the dinar exchange rate. One could argue that over the last two decades the Government of Iraq (GoI) had little control over its exchange rate; that exchange rate policy was determined by other sectors of the political economy in Iraq. But even if this is true, the level of the exchange rate and changes in that level are believed by many Iraqis and foreigners as providing valuable insight into the quality of economic management in Iraq. This importance is exemplified by the current efforts to de-dollarize the Iraqi economy while there is excess demand for dollars. This excess demand is shown by a parallel exchange rate of roughly 1500 dinars per dollar compared to the official exchange rate of 1310 dinars per dollar.
An important cause of this exchange rate gap is that the GoI, with the strong encouragement of the U.S. Federal Reserve, is attempting to reduce the use of the U.S. dollar in both Iraq's internal economy and its external transactions. Since 2003, the U.S. dollar has facilitated economic growth in Iraq by providing a widely accepted medium of exchange for purchases as well as a reliable store of value for savings. In the long run, whether de-dollarization will have a significant adverse impact on the Iraq economy will depend on how rapidly the GoI can increase both the efficiency of alternative mediums of exchange and the perceived security of alternative stores of value.'
[You must be registered and logged in to see this link.]
[You must be registered and logged in to see this link.]
29th May 2024 in [You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.]
From the [You must be registered and logged in to see this link.]:
Professor Frank Gunter launches a new white paper on de dollarisation of Iraqi economy
Professor Frank Gunter publishes a new paper commissioned as part of a series by IBBC's advisory council on the challenges of de-dollarisation for Iraq.The Advisory Council members and IBBC members have actively contributed to the paper in the past 4 months. It will be presented online on the 18th June in a webinar and in person at the Spring Conference on 2nd July. The Arabic translation will be published soon.
[You must be registered and logged in to see this link.].
Previous advisory papers include 2020, '[You must be registered and logged in to see this link.]', '[You must be registered and logged in to see this link.], [You must be registered and logged in to see this link.] and [You must be registered and logged in to see this link.].
Professor Gunter provides an analysis of the drivers of impact on the dinar exchange rate and examines how best to deal with the parallel market of dinars to dollars. He outlines the practical policy initiatives that should reduce the gap between the official and parallel exchange rates in the medium-term.
In particular he lauds the Government of Iraq on its commitment to tackle corruption and to modernise the banking system in one fell swoop but warns of the pressure on the dinar exchange rate as budgets are overstretched and the new banking recipients (state banks) receive the liquidity to enable the economy to perform.
He writes 'All three of these forces - the anti-corruption effort, the banking liberalization, and the lavish 2023-2025 budget - will create challenges for the management of the dinar exchange rate. One could argue that over the last two decades the Government of Iraq (GoI) had little control over its exchange rate; that exchange rate policy was determined by other sectors of the political economy in Iraq. But even if this is true, the level of the exchange rate and changes in that level are believed by many Iraqis and foreigners as providing valuable insight into the quality of economic management in Iraq. This importance is exemplified by the current efforts to de-dollarize the Iraqi economy while there is excess demand for dollars. This excess demand is shown by a parallel exchange rate of roughly 1500 dinars per dollar compared to the official exchange rate of 1310 dinars per dollar.
An important cause of this exchange rate gap is that the GoI, with the strong encouragement of the U.S. Federal Reserve, is attempting to reduce the use of the U.S. dollar in both Iraq's internal economy and its external transactions. Since 2003, the U.S. dollar has facilitated economic growth in Iraq by providing a widely accepted medium of exchange for purchases as well as a reliable store of value for savings. In the long run, whether de-dollarization will have a significant adverse impact on the Iraq economy will depend on how rapidly the GoI can increase both the efficiency of alternative mediums of exchange and the perceived security of alternative stores of value.'
[You must be registered and logged in to see this link.]
» MM&C Central Bank: Cancellation of Paragraph (5/d) of the instructions and standards for circulation
» utube 6/26/24 MM&C IQD Update-Iraqi Dinar-2024 Budget Deficit is Hypothetical-
» utube 6/25/24 MM&C Iraq Dinar - Iraq to Rejoin WTO - Cetral Bank Pressing Banks & Money Exhangers
» Judge Haider Hanoun: Imam Ali was the first to lay the foundations for the fight against corruption
» A Sunni agreement with the framework forces to elect Al-Halbousi's replacement
» Al-Atwani calls for reforming the tax system in Iraq
» Parliamentary Finance discusses strengthening financial management with the German Agency for Intern
» The Financial Supervision Bureau to Nina: A systematic plan to complete the state’s final accounts..
» The Minister of Transport and his Jordanian counterpart chair the general assembly meeting of the Ir
» The judiciary directs severe legal measures against those who leaked ministerial questions
» The file of tax deposits and compensation for victims of terrorism.. Slow procedures hinder retribut
» Arak Business: Türkiye is exploiting the Iraqi pipeline to export its oil
» Al-Muthanna Investment: The governorate is witnessing a qualitative boom in the size of projects
» Legal: Amending the constitution depends on political consensus
» Parliamentary Security: Sabotage operations in the electrical system during 2024 will be the lowest
» The popular movement explains the purpose of extending the Aqaba pipeline
» A Ukrainian company directly develops the Okaz gas field
» The Council of Ministers holds a make-up session for Eid
» The Central Bank of Iraq sells $275 million at auction today
» American monitoring reveals a Turkish military incursion into the Kurdistan Region and identifies it
» Iraq's oil exports exceeded 100 million barrels in May
» Allawi: Iraq is living in an undeclared civil war, and we must correct it before we lose it
» Is Iraq among them?.. Kuwait’s most prominent challenges towards the “Belt and Road” project
» The President of the Republic stresses the necessity of protecting water bodies, including lakes and
» Parliament moves to amend the Medical Graduation Law and directs a request to the government regardi
» A new decline in the dollar against the Iraqi dinar in Baghdad
» Qatar joins Iraq and Saudi Arabia in sending crude supplies to the UAE
» Directly rehabilitating 62 localities in Baghdad
» https://alsabaah.iq/98640-.htmlAl-Sudani: Iraq is a safe and attractive environment for capital
» Hundreds of low-voltage transformers installed in Baghdad
» Haider Makiya: Iraq is an “important destination” and we are witnessing an improvement in the invest
» Parliament: The cosmetic market is thriving and the government stops “intruders”
» 3000 projects compete to win the {national competition}
» Sulaymaniyah hosts the “Made in Iraq” exhibition
» Anbar opens a line to produce organic fertilizers using solar energy
» Transport is intensifying its efforts to lift the European ban on the green bird
» Parliament: Amending the investment law will reflect positively on the future
» No meters or pricing...Governmental decisions are “broken” on the rock of generator owners
» The Minister of Labor calls for intensifying inspection tours of work sites to follow up on safety p
» Parliamentary law challenges the “2024 budget tables” and the federal government is waiting for an a
» A foreign army... takes control in Amadiyah and military convoys penetrate the Kurdistan region
» The new “Arab-Kurdish” disintegration... Alekti reveals the common denominator between the “anti-Kur
» The Commission extends the registration period for candidates for the Kurdistan Parliament elections
» Diyala Council is “stuck in a black legal hole”... It cannot be held or dissolved - urgent
» He discussed with the American Ambassador the end of the mission of the international coalition... T
» He discussed with the American Ambassador the end of the mission of the international coalition... T
» Civil Defense puts the blame on the citizen for the high rates of fires, and an economist shows: Res
» Planning publishes experimental population census data
» Al-Sudani confirms the progress of completing the automation system for customs
» Al-Sudani chairs the 8th meeting of the Reconstruction and Investment Committee
» Transportation: Postponing the opening of Baghdad Airport to citizens
» Telecommunications signs a contract for the submarine cable project with Saudi Arabia
» A positive signal from the European Union regarding international investment in Iraq
» Al-Sudani renews his support for holding Kurdistan parliament elections
» UNAMI welcomes setting a date for Kurdistan elections
» A parliamentary directive to amend the medical progression law
» Al-Sudani stresses the importance of developing cooperation with NATO after the end of the internati
» The thefts of the century continue... revealing an organized corruption window that caused the theft
» Surprise.. “An article in the General Amnesty Law encourages theft.”
» Makiya: Iraq provided real guarantees to attract foreign investments
» Iraq and deceptive growth: Is it dancing to the tunes of oil or singing the tune of development?
» The Gaza war extends to southern Lebanon: possible effects on the Iraqi interior
» About $300 million in Iraqi Central Bank sales at today's auction
» What is the importance of Iraq joining international agreements?
» Al-Sudani chairs a meeting to follow up on the implementation of networking between border crossings
» Central Bank sales exceeded $281 million
» Al-Asadi renews the call for all workers to take advantage of the retirement law and expedite regist
» The first official Iraqi comment on the fact that “Hamas moved to Iraq”
» Ending the coalition’s mission in Iraq and the “risks of war” are on the table of Al-Sudani and Roma
» They left because of tribal problems.. 5 accused were arrested for trading in private and government
» Comment from the Ministry of Interior on World Anti-Drug Day
» Al-Sudani receives US Ambassador Alina Romanowski
» Details of the meeting between Al-Araji and the commander of the NATO mission in Iraq
» The Presidency of the Kurdistan Region rejects the forced return of displaced Iraqis
» The Ministry of Electricity in the Kurdistan Region announces the gradual return of energy
» Parliamentary Committee: The amounts of money at the Ministry of Electricity are not commensurate wi
» Professional ethics: theoretical and methodological imperatives and economic transformation
» An “elaborate ambush” befalls a foreign currency speculator in Baghdad
» The Prime Minister confirms that he will continue to address the problems that the outskirts of Bagh
» Iraq Fifth: 10 Arab countries that consume the most electricity
» A country neighboring Iraq launches a geographical survey project to locate renewable energy sources
» “Mystery dominates the project.” Parliamentary Committee: We do not have information about the inves
» It included filling in fish lakes and burying wells... removing 24,000 water encroachments
» Diwaniyah witnesses the launch of the largest package of projects in Iraq
» Iran competes with Iraq to rank as the “worst” country in the world for burning gas
» Iran competes with Iraq to rank as the “worst” country in the world for burning gas
» Karim Hammadi discusses with the Arab States Broadcasting Union the “Baghdad Summit”
» Representative immigration: Weak services hinder voluntary return
» Democratic Party: The Sunni blocs must decide their candidate for the presidency of Parliament
» Iraqi children are outside the list of {armed conflicts}
» The beginning of next July.. Trade launches the construction basket
» "Early elections"... difficulties prevent their holding
» Integrated projects
» Experts: The path to development is the beginning of an economic partnership
» The "short life" of the government puts Baghdad's administrative authority to the test and a proposa
» In preparation for sending it to Baghdad.. The Kurdistan government finalizes the payrolls of its em
» The Ministry of Electricity is a “black box”.. The Baghdad Council knows nothing about the plans and
» Prime Minister: The new residential city of Ali Al-Wardi will be the largest city in the history of