Don961 » June 3rd, 2021
«Arab Monetary» and the Bank for International Settlements discuss monetary policy
Thursday 03 June 2021 Abu Dhabi: Follow up
The Arab Monetary Fund, in cooperation with the Bank for International Settlements, organized the fourth “remote” meeting of the Monetary Policy Working Group in the Arab Countries, during the period from 31 to 2 of this month.
The meeting presented global economic and financial developments and their repercussions on the banking sector and the management of monetary policy in the Arab countries, as well as discussing a number of technical issues related to the role of monetary policy in overcoming the repercussions of the Covid-19 pandemic, in coordination with both fiscal and macroprudential policies.
The meeting also organized a special session on the repercussions of digital currencies issued by central banks on monetary policy, in the presence of high-level monetary policy officials representing Arab central banks and monetary institutions, as well as representatives from international central banks, including the US Federal Reserve and the European Central Bank. and the German Central Bank, as well as a number of senior officials from Arab financial institutions.
The meeting is modeled after the BIS’s monetary policy working groups in Asia, Latin America, and Central Europe.
The Bank for International Settlements was established in 1930, and it is the oldest global financial institution with 60 members of central banks representing a number of countries in the world whose gross domestic product collectively constitutes about 95 percent of global gross domestic product.
The main objectives of the Bank are to support international central banks with the aim of achieving monetary and financial stability and to support international cooperation in related fields, to act as a central bank. link
Adviser to the Prime Minister of Iraq: The current account of the balance of payments is free from deficit
May 31, 2021 10:17 PM
Mubasher: Mazhar Muhammad Salih, the financial advisor to the Iraqi Prime Minister, confirmed today, Monday, that Iraq’s monetary policy will maintain the stability of the exchange rate.
The financial advisor to the Iraqi Prime Minister indicated that the current account of the balance of payments is free of deficit, but there is an expectation of achieving a surplus in the future.
Saleh told the Iraqi News Agency (INA), that “the reduction of the national currency against the dollar was based on a one-time decision”, and that the country adopts a fixed exchange system, stressing that “there is an equation between the theory of exchange rate adjustment and the deficit in the current account of the balance of payments relative to gross domestic product”.
He added, “Whenever the deficit increases by 4% or more, an adjustment or reduction is made in the external value of the currency to avoid a deterioration in external payments,” noting that “Iraq currently does not suffer from a current account deficit, but rather there is stability and balance.”
And the financial advisor to the Iraqi Prime Minister expected that there would be a surplus in the future relative to the gross domestic product, in light of the positive developments in the oil markets and the positive improvement in Iraq’s foreign exchange reserves.
The financial advisor to the Iraqi Prime Minister stressed that “the monetary policy will maintain the stability of the exchange rate in the present circumstance.”
On December 20, the Central Bank of Iraq decided to reduce the value of the Iraqi dinar against the dollar, bringing the price of 100 dollars to 145 thousand dinars, after it was 122 thousand Iraqi dinars.
Samson » June 3rd, 2021
Al-Mashhadani: America is complicit in smuggling Iraqi funds
10:35 – 03/06/2021
Economic advisor Abdul Rahman al-Mashhadani confirmed the existence of American “complicity” in smuggling Iraqi funds abroad, noting that Washington tracks every dollar that enters and exits.
Al-Mashhadani said in an interview followed by “The Information”, that “the United States of America is complicit in the issue of smuggling Iraqi funds abroad,” noting that “America knows every dollar that enters and leaves.”
Al-Mashhadani added that “the rise in the price of the dollar negatively affected citizens, the poor and those with daily income,” noting that “the increase in the percentage of the poor is caused by the failure of government policies.”
It is noteworthy that the President of the Republic, Barham Salih, announced earlier the submission of a draft law on “recovering the proceeds of corruption” to the House of Representatives, with the aim of recovering the looted funds outside Iraq. LINK
Without radical reform.” The Washington Institute: State collapse in Iraq is “inevitable.”
12:42 – 03/06/2021
A report by the Washington Institute for Near East Policy confirmed, Thursday, that if the current political situation in Iraq continues as it is without fundamental reform, the collapse of the state is inevitable.
The report, which was translated by / the information / stated that “unless there is a continuous decline in oil prices, it is likely that the collapse of Iraq will be gradual, and it will unfold through a continuous series of severe crises and bottlenecks, and it seems that this is the path that Iraq is currently taking, with the intensification of corruption Within the state and the parties that rule without worrying about the interest of the people and the future of the country. In addition, Iraq faces a persistent lack of services, lack of social justice, and widespread unemployment and poverty.
He added, “The only reason for the failure of the Iraqi government completely in the past years is the abundance of oil revenues that covered the state’s operational expenses and were sufficient for all parties to distribute their shares. However, this previous financial abundance is in danger due to low oil prices, and inflated spending on the bloated public sector.” and increasing operating expenses. The day will come when the state will not be able to manage its finances. As such, the pace of the state’s collapse will accelerate with the first sharp drop in oil prices. Examples of this danger emerged with the state’s inability to pay employees for several consecutive months when the oil price fell below $40 a barrel last year.
He continued, “The Ministry of Finance has resorted to devaluing the Iraqi dinar by about 23% against the US dollar to prevent a financial collapse, and although the measure severely affected the local market and worsened the living conditions of all Iraqis to varying degrees, but in addition to the recovery of the global oil market and the return of The oil price reached $70 a barrel, these strict measures allowed the government to pay government salaries while showing the fragility of government revenues in Iraq.”
He explained, “In the event that the situation deteriorates further, the most likely scenario is the administrative collapse of the current system and the decline of the government’s role in managing limited business with control over certain areas including central Baghdad and the Green Zone, and in this case, the government will lack legitimacy and lose control over Some governorates of IraqIt is possible that parties in some provinces will refuse to fully recognize the central government.”
The report indicated that “the current situation in Iraq requires radical solutions to avoid the potential catastrophic repercussions of the current situation, and this can only be achieved if political parties, religious leaders and civil society work together to save what can be saved and return the country to a place of civil peace and coexistence.” They must take the lead in building sustainable development and consensus around a series of common solutions.” LINK
Lebanon: Central Bank decision ignites nightly protests
3rd June, 2021
Night protests erupted in Beirut, Tripoli and other Lebanese regions, in rejection of a banking decision that places additional restrictions on citizens’ withdrawals from their accounts deposited in US dollars
Anadolu Agency reported that a number of young men gathered at the “Ring” intersection in central Beirut, blocking the main road for some time, and others set fire to the “Martyrs’ Square” road in the capital
Likewise, protesters blocked the main roads in the areas of Antelias and Zouk, north of Beirut, and those roads link the capital with the northern regions of the country, for the same reason. In Tripoli (north), demonstrators blocked the road in front of the central bank building in the city, and set fire to protest the decision. The protesters also denounced the living suffering they suffer from as a result of the economic crisis
Yesterday, Wednesday, the Central Bank issued a decision asking banks operating in Lebanon to suspend depositors’ withdrawals from their dollar account funds at the rate of 3900 Lebanese pounds to the dollar. The bank based its request on a “preparatory” (initial) decision issued by the State Council, which stipulates that payment to dollar account holders must be made in the deposit currency, i.e. in dollars, and not in Lebanese pounds, at the exchange rate of 3900 pounds to the dollar
Lebanese banks set restrictions on withdrawals in dollars, and allow withdrawals in Lebanese pounds only, and according to an exchange rate of 3900 pounds, based on a previous decision of the Bank of Lebanon, at a time when the exchange rate of the dollar in the parallel market is currently about 13 thousand pounds, which means that depositors lose about 70 % of their money value
However, the Central Bank, after requesting to stop the withdrawals according to the exchange rate of 3900 pounds to the dollar, did not specify in which currency the deposits will be paid to their owners, and according to what exchange rate if they will be made in Lebanese pounds
This raised the fears of depositors in foreign currencies that withdrawing their money would be available only according to the exchange rate of 1507 liras, which is the official exchange rate at the Central Bank, at a time when the dollar exchange rate in the parallel market is about 13,000 liras, which increases their loss to about 88% of the value of their money
The Lebanese Depositors Association supported the decision of the State Council, declaring its refusal to pay withdrawals from dollar deposits in Lebanese pounds, whether according to the exchange rate of 1515 pounds, or 3900 pounds and she said in a statement via her Twitter account that “the deposit is paid in the same currency as the deposit only, not in Lebanese pounds
A year and a half ago, a severe economic crisis afflicted Lebanon, which led to an unprecedented financial collapse, and a scarcity of basic materials such as medicine and fuel, in addition to a record high price of food commodities. In the past months, Lebanon witnessed a series of protests denouncing the financial collapse and the reality of living, sometimes interspersed with acts of violence and the smashing of the facades of some banks LINK
Source: Dinar Recaps
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