Thurs. AM/PM TNT News Articles 7-8-21



Zimbabwe introduces Z$50 banknotes to ease cash shortages (7/7/21)

Zimbabwe will start circulating a new 50 Zimbabwe dollar note from Wednesday, central bank governor John Mangudya said, as authorities gradually introduce higher denominations in a country still haunted by memories of ruinous hyperinflation.

Mangudya said 360 million Zimbabwe dollars ($4.2 million) worth of new notes would be injected immediately into the banking system, making it easier for Zimbabweans to use cash in day-to-day transactions. Two of the new Z$50 notes would be roughly enough to buy a loaf of bread.

Zimbabwe reintroduced its own currency, the Zimbabwe dollar, in June 2019, ending a decade of dollarisation. The move sent inflation rocketing to as high as 837.53% by July last year, reviving memories of hyperinflation that wiped out the economy in 2008.

The government has since allowed the US dollar to circulate alongside the local unit, and inflation has come down to around 106 percent.

But the authorities have been loath to print bigger banknotes for fear of reawakening memories of the darkest days of the previous currency, when there were notes in circulation with a face value of Z$100 trillion.

The new Z$50 bank note is equivalent to $0.59 at the official exchange rate, or around $0.35 on the black market.


The government has since allowed the US dollar to circulate alongside the local unit, and inflation has come down to around 106 percent.

But the authorities have been loath to print bigger banknotes for fear of reawakening memories of the darkest days of the previous currency, when there were notes in circulation with a face value of Z$100 trillion.

The new Z$50 bank note is equivalent to $0.59 at the official exchange rate, or around $0.35 on the black market.

In May last year Z$10 and Z$20 notes were introduced but they have been eroded by inflation. Many Zimbabweans now conduct their transactions through mobile money, electronic cards or in US dollars.

Parliamentary Finance: The rise in oil prices will provide 24 billion dollars to the state treasury

The Finance Committee in the House of Representatives clarified, on Wednesday, July 7, 2021, that the difference in the price of oil approved in the budget at the end of this year will provide about 29 trillion dinars after the improvement .of oil prices in global markets

The committee’s reporter, Ahmed Al-Saffar, said in a statement to “The Obelisk” that all the numbers and data contained in the state’s general budget law are in fact estimates as they were drawn up for a future period, and these numbers may correspond to .reality and may differ with it, and in most cases the difference occurs

He added that the amount through which the deficit will be covered in full, while I talked about the possibility of achieving an abundance of it that goes to the payment of previous debts, and I talked about indications that the price of a barrel will reach next .December between 80 to 100 dollars

He added that the budget was set in light of the presence of two financial and health crises, accompanied by a decrease in oil prices on which Iraq relies by about 93% to feed its revenues, indicating that determining the price of oil is the main influencing factor in .the volume of revenues, and it also determines the deficit in the law

He pointed out that the budget was based on the price of a barrel of $45, at a time when the current price was $50, i.e. a difference of five dollars, and what was approved in the budget, I was at odds with him, because I followed the oil agencies and had a .perception that the price of a barrel might reach $100. Next December, or at least $80 to $90

He added that the adoption of the price of $ 45 was completely contrary to reality and is more conservative than what the economic reality requires, and it would have been better to put it at about $ 50, the difference for the current month is about $ 30, and this .figure is able to cover the deficit completely


He stressed, that the financial deficit in Iraq is imaginary and unreal, and as soon as the year ends, this deficit disappears through the difference in the price of a barrel of oil between what is put in the budget and what is in the markets, stressing that some years have witnessed a surplus and the reason is the price difference, as Iraq used to Not to implement its budget by 100%, and in the best case, the implementation did not exceed 80%, and the average price difference for the total of the current year, if we take into .account the past months, is estimated at 22 dollars per barrel

Al-Saffar added that this provides 24 billion dollars, and this amount, according to the current exchange rate, constitutes 29 trillion dinars, while the amount of the deficit is 28 trillion dinars, and if there is any financial abundance from selling oil, the Financial Management Law stipulates that either The following year, in the event that there is no intention to present a supplementary .budget, or the government is given powers to use this abundance to finance the stalled and stalled projects

He concluded his speech by saying that the existing data do not show the possibility of submitting a supplementary budget, because the original budget has not been implemented so far despite our arrival in the seventh month, and therefore the amounts resulting from the oil price difference will revolve to the next year, and that the complete lack of budget is due to several reasons, the most important of which Presenting it late to the House of Representatives, as well as the circumstances that accompanied its legislation to its approval at the end of last March, and it also needs ratification, and that the issuance of implementation instructions from the .Ministry of Finance requires a full month    link

Moody’s International expects a sharp upward reversal in the financial sector in Iraq – urgent

Today, Thursday, Moody’s International Agency expected a sharp upward reversal in the Iraqi financial sector during the current year 2021.

Moody’s Investors Service confirmed Iraq’s rating with a grade of ( Caa1 ), any country that has good bonds of stability, but involves credit risks for non-payment), and maintained its stable future outlook for the country .

The agency said, in a statement published by “the international” and translated (Baghdad today): “The confirmation of the rating reflects the credit challenges posed by Iraq’s economic and financial dependence, which is heavily dependent on oil, the restriction of the government’s ability to respond to external and domestic shocks, and the low competitiveness of the Iraqi economy.” 

Iraq, the second largest producer in OPEC, relies heavily on oil to cover 90 percent of its spending .
Moody’s predicted: “a sharp upward reversal in financial sector metrics in 2021” with higher oil prices, but “progress in economic diversification remains slow and hampered by the weak business environment and investment climate in Iraq.”

And maintained the rating agency, its stable view of the country, as the Iraqi government continues discussions with the International Monetary Fund to obtain financial support .

“Ongoing discussions with the IMF suggest the possibility of a supported adjustment program that would serve as a pillar of policy and the financial sector, but the country’s poor track record regarding its past commitments to the IMF limits a potential credit rally,” the agency added.

She pointed out that “the government’s plans to double the production capacity of oil will support economic growth and strengthen Iraq’s financial and external situation.”

And she continued, “However, Iraq’s plans are constrained by the uncertain outlook for global oil demand and the ongoing challenges to the government and political stability in Iraq that discourage investment in the oil and gas sector. “

Moody’s noted, “rising risks to political stability and a deeply fragmented political landscape will continue to impede progress on institutional and economic reforms.”   link

Source: Dinar Recaps


ALSharqiya, July 8: Former Iraqi Prime Minister Iyad Allawi said that the United States removed Iraq from its list of foreign priorities and put it on the sidelines because it was fed up with its problems over the previous years.

Allawi revealed, during a program with the three, about the visit of a delegation from Biden’s team to Baghdad last week to assess the situation, noting that the members of the delegation confirmed that Washington was tired of Iraq’s complex and linguistic situation   link

just saying Remember to watch the 7/15/21 date with all this talk coming out of iraq now about white paper implementation .


Al-Kazemi’s advisor: Announcing the actual implementation of the white paper soon

The economic advisor to the Prime Minister, Alaa Abdel Hussein, confirmed that the actual implementation of the white paper will soon be announced, while noting that there are central and sub-committees to implement it .

Abdul Hussein said in a televised statement, today, Wednesday, that “Iraq over the past decades has suffered from economic problems,” noting that “the Iraqi economy has gone through several stages, which made it rentier and dependent on oil .”

He added, “There is an increase in population growth by 3% annually and our resources are limited,” noting that “the white paper included analyzing and diagnosing economic problems and identifying effective solutions .”

He continued, “We are working with various ministries to identify projects for the official announcement of the actual implementation of the white paper,” stressing, “Very soon, the actual implementation of the white paper will be announced .”

He pointed out that “there are central and sub-committees to implement the white paper,” noting that “the projects mentioned in the white paper are of a professional, not political, character .”   link 

Source: Dinar Recaps


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