Monday Morning Iraq Economic News Highlights 2-6-23
Obelisk Clock: Iraq Is Turning Into An Economic Battlefield, And America Is Bargaining With It Over Its Deposited Money
February 6, 2023 Baghdad / The Obelisk: The Obelisk publishes the most prominent interactions of Sunday’s television dialogues.
Hossam Al-Rubaie, a member of the National Support Gathering, during a televised interview:
– Russia has large investments in Iraq
– There is enough room for Iraq to be a good player in the international file
– NATO may disintegrate militarily due to the continuation of the war
– America wants to give economic spaces within the Middle East
– The American strategy includes a kind of concession and weakness
– Americans cannot get involved with dictates New to Iraq
– the Ukrainian war has drained America and Europe financially
– security and economic files that must be discussed in Washington in addition to the dollar
– Saudi Arabia and Kuwait have applied to join the Brexit countries
– America is groaning from the war and Iraq is facing a golden opportunity
– China will reap the first place in terms of economic output
– America does not You can impose sanctions on the Chinese currency
– the Europeans have left the language of war and the return of this scene disturbs them
– America may resort to easing sanctions on Iran
– the Sudanese needs a real political decision to advance the global balance
Economist Bassem Jamil Antoine during a televised interview:
– Iraq has turned into an economic battlefield
– America has “hysteria” as a result of the decline in dealings with the dollar
– America has a fiscal deficit and large debts
– Washington considers the Middle East its property
– speculators play a “dirty” role in the dinar and dollar file
– political forces do not have an economic culture
– Al-Sudani needs political support to restore the national industry
– Iraq has turned into an economic battlefield,
PUK member Mahmoud Khoshnaw during a televised interview:
– The intervention of the judiciary in the political and partisan situation in the region is an attempt to fish in troubled waters
– Interventions by the court impede political stability in the region
– Important files that must not be overlooked, which are the elections and the economic file
– The security file must be examined because of its importance in national security
– The opposition Popularity in the region has begun to crystallize clearly
– we must go for a new election law in the region
Member of the Kurdistan Democratic Party, Ali Al-Faili, during a televised interview:
– The meetings between the Union and the Democratic Party are not due to the recent
decisions of the Federal Court – the decisions of the Federal Court do not deserve all this media hype by some members of the Union
– the Union has participated in the regional government for four years
– the demand for a new law months before the elections is incorrect and is intended to postpone the elections
– The National Union is not ready to contest the elections and argues to postpone the elections
Political analyst Ramadan Al-Badran during a televised interview:
– Iraq needs the dollar, some of which are related to the transfer in its original form, and some of it disappears to the sources to which it was transferred, and there is a dollar that reaches Iraq and disappears inside
– the American vision says that part of the dollar is being smuggled, and the dialogue with it will be about the leaked and smuggled dollar
– which depends on the measures taken by Iraq Not to smuggle corruption dollars through transfer companies and bags
– the challenges facing the Sudanese will ramify and will not stop at the dollar, including transfers to the Kurdistan region and the Jordan oil pipeline in addition to corruption files
– Americans in general in the agencies need a personality that deals with their common files and they do not care who the character is, which is a point American requirements with Iraq
– Al-Sudani in the State Administration Coalition, which includes everyone and runs the state with the title of Iraq as a whole, and the government seeks to solve the problematic of the central bank’s procedures regarding the dollar
– the problem of Iraq with forcing the United States to deal with the companies offered, and the Basra-Aqaba pipeline will be rejected if it harms the country
– the SWIFT system was in place and did not He does it only with the advent of the Sudanese government and America. Iraq bargains over its money deposited with it as trusts
– Iraq exchanges trade with three countries, namely China, Turkey and Iran; But most of the money transfers go to the Emirates
– the head of the Patriotic Union of Kurdistan, Pavel Talebani, said in the text that the dollars smuggled by the work and planning of the Kurdish leaders to Turkey
– the rise and fall of the dollar are nothing more than speculations, therefore the government measures deal with the root of the problem, which is an existing and an opportunity to prevent smuggling
Washington prevents the rehabilitation of the electricity sector because it does not want Iraq to have sovereignty and prevents it from managing its money. It also prevents the conclusion of service agreements and the management of the economic file. https://almasalah.com/archives/40574
A Government Directive For Iraqi Airways To Deal In Iraqi Dinars Instead Of Dollars
2023-02-06 06:00 Shafaq News/ On Monday, the Iraqi Minister of Transport, Razzaq Muhibis Al-Saadawi, instructed all the ministry’s formations, including the Iraqi Airways General Company, to deal with tickets for travelers in Iraqi dinars instead of dollars, “in support of the national currency.”
The minister stressed, according to a statement, received by Shafaq News Agency, that “all the formations of the ministry, in particular the general company of Iraqi Airways, must deal in dinars and at the rate of the Central Bank of Iraq.”
The Minister of Transport warned that “violators of directives and reform measures to address the dollar crisis will expose themselves to legal accountability,” calling on citizens to “report any violation in this regard.” LINK
Mps And Experts: Two Obstacles Stand In The Way Of Passing The 2023 Budget
2023.02.06 – Baghdad – Nas Politicians, parliamentarians, and experts in economic and financial affairs have warned of the possibility of a rise in the exchange rate of the dollar and the subsequent rise in the markets in the event of legislation and approval of the state’s general budget 2023 without precedent by real procedures and treatments that contribute to the stability of the dollar’sexchange rate, indicating that this factor and the calculation of the price of a barrel of oil They are delaying so far the enactment of the upcoming budget law.
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And the rapporteur of the Parliamentary Finance Committee for the fourth session, Dr. Ahmed Al-Saffar, in an interview with the official newspaper, followed by “Nass” (February 6, 2023), suggested that the “budget” would be delayed even if it was sent by the Council of Ministers to the House of Representatives, “because it needs a period of time because of what it contains.” problematic.”
He explained, “According to information, Prime Minister Muhammad Shia’ al-Sudani – as a good first step – carried out a simple restructuring of the budget in line with his government approach, especially with regard to finding solutions to address poverty, unemployment, inflation, and others.”
And he noted that “the problem that will face the budget (the price of a barrel of oil) on which the budget is prepared and built, and in light of the fluctuation of oil prices between high and low, the legislator faces a problem on which price the budget will depend on, in addition to the problem of the exchange rate of the dollar, and this is a big problem, especially There is talk that the government will change the exchange rate approved in the budget.
Al-Saffar warned that if the budget is approved and money is pumped into the market through public expenditures while maintaining the same ineffective measures, this “will amplify and exacerbate the problem of the exchange rate, given that an increase in the amount of cash in circulation leads to greater demand.” on the dollar, which in turn leads to further increases if the necessary measures are not taken by supplying the dollar.
And regarding the recent measures taken by the Central Bank of Iraq after the special meeting with the deputy head of the US Treasury in Istanbul, Al-Saffar saw that it was a “good” preliminary package of measures, calling for appending it to a “firm and swift” package of measures, and he also called for focusing on the “smuggling issue”.
In addition to the government’s intervention in monitoring the market and the government’s entry as an exhibitor and seller of commodities, especially basic ones, at cost, he added, “On the other hand, the central bank is facing a great challenge and it must be strict and unified in the banking sector, especially with some private banks and speculators,” whom he accused of causing In confusing the market and thwarting every attempt by the central bank.
For his part, the expert on economic affairs, Dr. Jaafar Baqir Alloush, said in an interview with the same newspaper that “the delay in approving the budget is related to the crisis of the rise in the exchange rate of the dollar in the parallel market,” explaining that “the relationship lies in the extent to which expenditures are compatible with the gap in the exchange rate and an attempt to bridge it by By increasing expenditures directed to support foreign trade, and this was announced in the state’s official speech.
He noted that the exchange rate is not linked to the budget, “on the contrary, the budget is affected by the exchange rate of the dollar.” With regard to the volume of estimated expenditures in the budget (200 trillion dinars) compared to the exchange rate, Alloush explained that it is “a price equation that helps increase the mass Dinar cash directed to restrict aggregate demand (of this size) with limited dollar revenues, and thus will contribute to raising the value of the dollar against the Iraqi dinar.
The expert called for finding a simultaneous treatment of the crisis through three real starting points: the first is controlling liquidity levels and not inflating them, and the second is finding a new mechanism that governs the relationship between the two currencies (the dinar and the dollar) outside the rules of the old currency window, and the third is controlling foreign trade and directing it towards the necessary commodities.
The average, they are: directing demand towards the interior, closing the real outlets for smuggling, and creating a sound economic environment for national production, and there is nothing wrong with returning to activating industrialization strategies to replace imports.
Alloush said, “The temporary patches that help expand the base of dollar provision create fragility in the exchange market, and the crisis may exacerbate at any time. Monetary and financial policies must be reformulated and the current method of financial hegemony, which has proven incapable of addressing emergency crises, must be abandoned.”
As for the economist, Nabil Al-Marsoumi, he stated in an interview with the same newspaper that “the launch of the budget will lead to spending in both its consumer and investment parts, which will lead to spending additional funds, which will generate inflation in money and government spending, and this leads to an increase in imports funded in dollars, and the pressure on the hard currency will increase.” Noting that “if the exchange market does not stabilize in Iraq, it is possible that approving the budget will lead to a rise in the exchange rate at higher levels than it is now.”
Report: The Coordination Framework Bartered Washington To Obtain Dollar Facilities
Baghdad – Nas The leaders of the coordination framework, who met in Baghdad, picked up the signal made by US President Joe Biden regarding strengthening relations between Iraq and Jordan, to offer a trade-off that would allow the provision of trade and economic facilities to Jordan, in return for easing monetary pressure on the Central Bank of Iraq, according to a report by Al-Arab newspaper.
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President Biden had included the Jordanian monarch, King Abdullah II, who is visiting Washington, in the phone conversations he had with Iraqi Prime Minister Muhammad Shia al-Sudani, the day after the meeting that took place in Istanbul between the Governor of the Iraqi Bank, Ali Mohsen Al-Alaq, and the Undersecretary of the Treasury for Terrorism and Financial Intelligence, Brian Nelson, and representatives of the reserves. The US Federal Reserve, regarding restrictions on dollar transfers to Iraq.
And Biden urged the Sudanese to strengthen economic cooperation between Iraq and Jordan. This was considered by the leaders of the coordination framework as an opportunity to offer a bargain that proposes extending an oil pipeline from Basra to Aqaba in return for easing restrictions on cash transfers from the Federal Reserve to Iraq.
And the London-based newspaper mentioned in a report followed by “NAS” (February 6, 2023), that the leaders of the framework offered their agreement to reduce the economic activity of the factions, as an expression of compliance with Washington’s concerns about remittances going to Iran.
Observers say that the real meaning of this trade-off is to allow the flow of dollars into Iraq, to feed free markets with it, which is tantamount to plan “B” for dollar transfers to Iran, in return for reaching new trade agreements with Jordan.
Observers question the feasibility of the Basra-Aqaba oil pipeline proposal, saying that it is more beneficial for the two countries to extend the Kirkuk-Aqaba pipeline, but the framework forces want to prolong the implementation period until they are sure of the continued flow of dollars from the United States.
Observers of the newspaper believe that the forces of the framework do not want to stand in the face of Washington, because the restrictions imposed by the United States will not be limited in their effects to dollar flows to Iran, but threaten the plans of the Sudanese government to implement some development projects, which will eventually lead to a weakening of its grip. power or chances of staying in it.
The Central Bank of Iraq announced the day after the Istanbul meeting to take a series of measures to provide the dollar for legitimate purposes, which are subject to monitoring by the Federal Reserve at the same time.
However, the “private” banks affiliated with the framework factions deliberately bought dollars from free markets, to transfer them to Iran, which led to a decline in the price of the dinar again, especially since Iran owns huge quantities of Iraqi dinars, and it is ready to throw them into the Iraqi market at any price in exchange for the dollar. .
And officials in the Iraqi Ministry of Finance revealed that their American counterparts last month provided conclusive evidence that “Iran obtained large sums of dollars through Iraq in various ways, and that Iran uses what it gets from dollars in its nuclear program.”
The officials stated that Iraq is trying to reduce illegal transfers and that it has achieved success in that by up to 70 percent. sold in Iraq, and that Baghdad should take stricter measures by banning its access to smuggling suspects.
On the other hand, the Foreign Minister pledged that the delegation he heads to Washington (within two days) will present “a set of sober proposals that would reassure the American side of the success of the Iraqi government’s steps to consolidate the sale of the dollar and prevent its smuggling, and that it is proceeding with its procedures and will not back down from it.”
But the visit is aimed at easing restrictions on dollar transfers to Iraq. This will end up feeding alternative mechanisms for smuggling the dollar to Iran, Syria and Hezbollah in Lebanon.
Framework groups fear that the US warnings will end in imposing sanctions on some personalities and factions about whom the Undersecretary of the Treasury for Terrorism and Financial Intelligence has full details.
Although the framework groups are awaiting Washington’s reaction to the barter proposal, Jordan hastened to offer other aspects of possibilities to build better trade cooperation relations.
The head of the Jordan and Amman Chambers of Industry, Eng. Fathi Al-Jaghbir, said, “Jordanian industry possesses distinct elements in a number of highly competitive sectors and industries.”
Al-Jaghbir mentioned that Jordan has many potentials that make it able to contribute to reconstruction projects in Iraq, especially those related to infrastructure, health care, building schools, housing, rehabilitating factories, providing consulting and engineering services, and various technology programs.
The Jordanian industry also has the ability to support the reconstruction process in Iraq, such as the construction and mining industries that have a solid and wide production base of iron, cement, stone and marble products, in addition to chemicals such as paints, fertilizers and primary chemicals used in the construction and engineering industries, sanitary and electrical supplies.
These areas refer to projects that go beyond laying an oil pipeline to Aqaba, but they may not be implemented because local companies affiliated with Iran want to undertake them, on the one hand, to provide a kind of “legitimate cover” to obtain dollars from the Central Bank, and on the other hand, to show that the Sudanese government Real development projects are being implemented.