Iraqi News

Wednesday Evening Iraq Economic News Highlights 1-11-23

Sudanese Advisor: The Stability Of The Dollar Exchange Rate Requires A “Diplomatic Effort”

Economy |Yesterday, 18:48 | Baghdad today – Baghdad Today, Tuesday, the financial and economic advisor to the Prime Minister, Mazhar Muhammad Salih, said that the stability of the exchange rate of the dollar against the Iraqi dinar in the local market requires a “diplomatic effort.”

Saleh said, to (Baghdad Today), that “international compliance restrictions in foreign currency requests for private banks and merchants through the window of the Central Bank of Iraq, pushed to reduce the sale of currency during the past days, and this matter prompted a temporary excess demand for foreign exchange, which had a direct impact on the issue of raising the exchange rate in the local market.

He added, “The issue of controlling the stability of the exchange rate of the dollar against the Iraqi dinar in the local market requires a diplomatic effort in order to obtain flexibility regarding the international constraint, especially since there is a strategic framework agreement between Iraq and the United States, the essential basis for regulating the economic interests between the two countries, and in a way that contributes to Iraq’s interest.

Dollar exchange rates rose to the threshold of 160,000 dinars for every $100, despite government pledges to move to restore the exchange rate to its original price. 145 thousand dinars for every 100 dollars.    LINK

Disagreements Over The Oil And Gas Law Impede Its Passage

Sumerian special  2023-01-11 | 05:00  Source:  Sumerian   102 views  The draft oil and gas law may remain stalled, due to disagreement over some of its paragraphs, despite the agreements concluded between the center and the region prior to the formation of the current government.

The longer the dispute lasted, the more complicated things became. This is what is happening in the matter of the oil and gas law, which was long awaited to be passed by the Kurds in particular, and after the matter was imminent, its implementation faltered due to objections to some paragraphs of the law.

But the Kurds have another opinion, as they see that according to the agreement concluded prior to the formation of the current government, the law can be passed, without any problems.

Since the year 2005 and until now, three versions of the oil and gas law have been drawn up, all of which have not been passed in parliament due to the differences in the issue of managing oil fields. This time, a satisfactory solution formula is needed for Baghdad and Erbil, so that the politically crippled law can see the light.  LINK

An Economist Highlights The Main Reasons For The Dollar’s Rise In The Parallel Market

2023-01-10 06:39   Shafaq News/ An economist considered, on Tuesday, that there are a number of main reasons related to the rise of the dollar in the parallel market.

The economist and academic expert at the Iraqi University, Abd al-Rahman al-Mashhadani, said in an interview with Shafaq News agency, “The average daily imports of goods and commodities are about $175 million, and annually about $45 billion is funded through the window,” noting that “the trade financing process is done through ( Manifests) purchases that individuals and merchants provide to banks until they are entered into the auction and then transferred abroad.

He added, “The Central Bank, with its current new administration, changed the classification of banks, which raised our questions about the reasons for that, and the bank abandoned following its previous policy regarding the names of banks that enter the auction and the quantity that they buy, and therefore we do not know the names of the banks that buy the dollar.”

He pointed out that “after changing the classification of banks, it was found that there are four banks affiliated with Ali Ghulam, which were punished by the US Federal Reserve later,” explaining that these four banks “were acquiring 45% of the central bank’s sales of dollars through the currency auction.”

Al-Mashhadani pointed out that “the US Federal Bank indicated this and explained to the Central Bank of Iraq that the numbers are suspicious and the issue must be checked in this regard, and he explained to them that they expect that there are money laundering operations taking place through the central bank auction,”

noting that “these banks are involved in money laundering and these funds It goes to countries that have been banned by the US Federal Reserve, and therefore it is required to punish these banks and they were removed from the currency auction, which was actually proven as they did not announce their protest against that when they were removed from the auction, which indicates that they were smuggling the currency.

And he went on to say that “the merchant used to previously go to the bank and ask him to obtain the dollar through the auction to buy goods from any country, and in turn the bank takes the money from the merchant and takes the requests and deposits them in the account of the central bank, and after a week it is implemented and this money goes through the bank in Dubai, as most of it You go through Dubai, and the transfer ends in Dubai. After that, no one follows this transfer, where it goes.”

And the expert added, “The Federal Bank demanded that the bank must know the transfer that reaches the Dubai Bank, where it will go later, and complete information about the importer and the country sending it to buy the goods, and complete information about the person receiving and shipping the goods.”

He noted that these “strict instructions from the Federal Bank do not benefit banks and merchants because they will reveal a lot of things about where the money goes, and therefore the bank’s sales decreased from 200 million to less than 100 million dollars.”

Al-Mashhadani warned that “the high price of the dollar in the parallel market currently is not due to travel, because what the traveler needs per month is only 10 million. Swift) made the dollar rise and the government could not control it.

The expert concluded that “the central bank cannot currently control the rise in dollar prices except by the return of external and cash transfers in a regular and smooth manner through the auction, and what is required is that we adhere to the instructions issued by the bank not out of fear as long as its slogan is fighting corruption.”   LINK

The Iraqi Government Obliges State Institutions To Deal In Dinars

Posted On2023-01-10 By Sotaliraq   On Monday, the Ministerial Council for the Iraqi Economy took a number of economic decisions, including obligating all ministries and state institutions to pay wages for goods and services in dinars.

This came, during the presidency of the Deputy Prime Minister and Minister of Foreign Affairs, Fuad Hussein, the meeting of the Ministerial Council for the Economy, in the presence of the Deputy Prime Minister and Minister of Planning, the Ministers of Finance, Trade, Industry, Agriculture, Labor and Social Affairs, the Secretary-General of the Council of Ministers, the Governor of the Central Bank of Iraq, and the acting head of the National Investment Commission. And the prime minister’s advisors for economic and legal affairs, according to a statement issued by the meeting.

At the beginning of the meeting, the council discussed, according to the statement, the draft law of the state’s general budget and the revenues and expenditures contained therein. It also discussed the economic issues on its agenda, and took many important economic decisions.

Among these decisions is obligating all state ministries and institutions to pay wages for goods and services in Iraqi dinars, and whoever chooses from the private sector to have sales as mentioned above, provided that the Central Bank of Iraq compensates those amounts in dollars and at the official rate, in order to fulfill their obligations and purchases outside Iraq.

The Ministerial Council of Economy approved that the Central Bank of Iraq contract with the Zaha Hadid Foundation to design the Central Bank building in Nineveh Governorate.  LINK

The Markets Are Boiling In Dollars, And Parliament Intends To Open Its Session By Discussing The Crisis

Posted On2023-01-11 By Sotaliraq     Baghdad / Hussein Hatem  The House of Representatives intends to open its first session in the new legislative term by discussing the “dollar crisis,” while the Central Bank of Iraq confirmed that the exchange rates are “temporary and will return to normal within two weeks, i.e. 1470 for every 100 dollars.”

Members of Parliament held the Central Bank of Iraq responsible for the rise in the exchange rate of the dollar, especially after it crossed the barrier of 160,000 dinars for every $100 for the first time in the year 2023, yesterday, Tuesday.

A member of the Parliamentary Finance Committee, Nazem Al-Shibli, says, “The House of Representatives has sought more than once and is still trying to reduce the exchange rates of the dollar.”

Al-Shibli added, “The great responsibility lies with the Central Bank of Iraq, and parliament is a legislative authority that does not have a trick in its hands to manipulate prices.”

He pointed out, “The Central Bank of Iraq is primarily responsible for financial policy in Iraq,” noting, “If there are previous or new mistakes, the bank is the one who bears those mistakes.”

Al-Shibli put forward solutions to control the exchange rates of the dollar, represented by “increasing sales outlets, and controlling receipts that were provided fraudulently to banks and the central bank.”

In turn, a member of the House of Representatives, Baqir Kazem Al-Saadi, says, “The first session in the new legislative term of Parliament will be related to discussing and finding solutions to the crisis of the high exchange rate of the dollar.”

Al-Saadi added, “The House of Representatives will submit a report and proposals to the Ministry of Finance in order to study the issue of dollar exchange.”

He explained, “The work of the parliamentary committees in the previous period focused on finding solutions and proposals in order to work to reduce the exchange rate of the dollar after the speculations it witnessed.”

Al-Saadi stressed, “The next session will be an emergency to solve the dollar exchange rate crisis, and all aspects that will contribute to preserving the value of the Iraqi dinar will be studied.”

For his part, another member of the House of Representatives, Kazem Al-Touki, says, “Most members of the House of Representatives collected signatures in order to hold an extraordinary session to discuss the rise in the exchange rate of the dollar in the local markets and to find out its causes and repercussions.”

Al-Touki added, “Parliament intends to start its new legislative term by holding a session in which the aforementioned issue will be discussed in order to summon the authorities concerned with financial affairs in order to find out the real solutions to the rise and restore the situation to its predecessor.”

And he pointed out, “The government’s treatments regarding the dollar exchange rate did not produce the desired results, despite the distribution of the currency to banks authorized with the same value, as it was temporary and was unable to restore the exchange rate to its previous position.”

In addition, the advisor to the Central Bank of Iraq, Ihsan Shamran al-Yasiri, said, “The central bank is committed and compliant with the decisions of the international community, and as long as there are countries that are prohibited from receiving the dollar, then the central bank cannot bypass that and not violate the controls.”

And he emphasized that “the turmoil in dollar prices is a temporary situation, and within two weeks the dollar price will return to its normal stable position of 1470, that is, before the end of this month of January,” noting that “the central bank’s resources are now at their highest levels in decades.”

Al-Yasiri explained, “The state’s financial situation is very comfortable,” noting that “the controls that were put in place to sell the dollar on the platform came in order for the dollar to go to the real beneficiary, and it is a regulatory process.”   LINK