Replacing the dinar with the dollar
Finally, the Central Bank of Iraq announced in a statement last week that “the coming year will witness the restriction of all internal commercial and other transactions to the Iraqi dinar instead of the dollar, except for those delivered to travelers.”
Financing foreign trade will be directly for merchants dealing in remittances outside the electronic platform, through licensed banks that will deal with correspondent banks in foreign transfer operations and in the local currency of the country from which the merchant wants to import.
Then the dollar auction will be gradually dispensed with and the central bank will intervene to control the exchange rate through a shift in its tools.
Cash, which will be more effective in achieving monetary stability, due to the expected decline of the so-called black market and the emergence of a real parallel market that will effectively contribute to financing the total demand for foreign currencies after the local currencies of the trading countries are traded within the parallel market following the opening of transfer channels for those currencies in a way Official.
Thus, we will witness a new phase in which exchange rates will be more stable than the phases witnessed in previous years if dollar smuggling operations are controlled, which is expected to decline automatically with the decline of the dollar supply on the black market.
At that time, the country will witness the real beginning of an attractive investment environment, as the confusion in the dollar exchange rate was often an element that repelled investors due to their inability to delve into the area of expectations in which the exchange rate was fluctuating, which makes financial feasibility studies more difficult in calculating construction and operating costs and recovery periods. Total costs and profit calculations. This is in addition to other repulsive factors, which were the confusion of the security situation, the incompleteness of legislation related to the investment environment and the regulation of market relations, the failure to activate the package of economic laws that had been legislated, and the spread of corruption and bureaucracy.
However, there is a problem linking the exchange rate and the costs of production in neighboring countries compared to the costs of production inside Iraq.
The lower the exchange rates of neighboring countries’ currencies are against other currencies, such as in Turkey, Iran, and Syria, compared to the exchange rate of the Iraqi dinar, the lower the cost of producing goods in those countries.
The cost of production is comparable to that in Iraq, which makes the investment environment unattractive at the level of production of traditional goods produced in neighboring countries unless borders are controlled to protect the local product in addition to protecting exchange rates from currency smuggling. link
Iraq and 5 countries renew commitment to support oil stability
Iraq, Saudi Arabia, the United Arab Emirates, Kuwait, Oman and Bahrain on Monday renewed their commitment to “collective and individual voluntary production adjustments” for oil.
According to a joint statement, the oil ministers of the six countries met on the sidelines of the Middle East and North Africa Climate Week, launched by the United Nations in Riyadh.
The ministers reaffirmed the readiness of the countries of the Declaration of Cooperation to take additional measures at any time as part of their ongoing efforts to support market stability and build on the strong cohesion of the OPEC+ (alliance) countries.
The OPEC+ alliance, which includes OPEC and non-OPEC allies led by Russia, agreed in June to extend voluntary oil cuts first announced in April until the end of 2024.
Saudi Arabia and Russia have announced additional voluntary cuts until the end of 2023, subject to a monthly review. OPEC+ ministers on Wednesday made no changes to the group’s oil production policy after Saudi Arabia and Russia said they would maintain voluntary supply cuts to support the market
CBI warns banks reluctant to withdraw dollar deposits
Baghdad – Iraq Today:
The Central Bank of Iraq warned, on Sunday, all banks, not to deliver dollars to citizens, under the pretext of implementing the bank’s decisions, which will take effect early next year.
“In confirmation of our circular No. 180/3/9 on 2020/6/30 and subsequent circulars about foreign exchange centers, the latest of which is our circular No. 204/2/9 on 2023/3/30, your banks must observe the foreign exchange centers allowed in accordance with the above circulars to avoid being unable to meet your customers’ requests to withdraw dollars deposited in cash in their accounts opened with you,” said a letter issued by the Central Bank addressed to banks.
The CBE added that “several complaints were received regarding the failure to meet these withdrawals under the pretext of the existence of instructions issued by the Central Bank that prevent this,” stressing that “the Central Bank will take into account the complaints received from customers and will take the necessary measures against the abstaining banks.”
The Central Bank of Iraq confirms the guarantee of dollar deposits and the citizen who deposited his money in dollars with any Iraqi bank previously or by 2024 has an inherent right to receive these amounts in cash in US dollars.
The central bank has indicated that the reforms it is carrying out aim to achieve compliance of the bank and the Iraqi banking system in general, with international compliance standards, and to prevent the dollar from reaching parties prohibited from obtaining or speculating in it.
The President of the Republic stresses the importance of approving laws that affect the lives of citizens
The President of the Republic, Abdul Latif Gamal Rashid, stressed today, Monday, the importance of activating the work of the House of Representatives to legislate and approve laws that directly affect the lives of citizens.
The Presidency of the Republic stated in a statement received by:Alsumaria News“The President of the RepublicAbdul Latif Jamal RasheedHe was received today at the palaceBaghdadThe parliamentary Taqadum bloc delegation, headed byAbdul Karim Abtan Al-Jubouri“, indicating that “the overall developments on the political scene were discussed.”
He stressed “the importance of activating the work of the House of Representatives to legislate and approve laws that directly affect the lives of citizens, including the lawSupreme CouncilFor water andFederal Supreme Court LawAnd the law of the Supreme Authority for the Empowerment of Women and the law of the Federation Council,” stressing “the need to put the interests of the people above all considerations.”
The meeting discussed the issue of rebuilding the liberated governorates, rehabilitating the infrastructure, and providing services to their residents, as they have suffered from terrorism and gang crimes.ISISThe President of the Republic pointed out “the importance of the upcoming governorate council elections and the necessity of holding them on time according to the constitutional timings and ensuring their integrity, transparency and success in order to achieve an improvement in the service, health and economic reality and support the government effort in this field.”
In turn, the members of the Taqadum Party delegation thanked the president for his valuable directives, stressing that “their party, with all its cadres and leaders, seeks to expand cooperation and coordination with the rest of the blocs and parties in order to consolidate political and security stability in the country.” link
Source: Dinar Recaps
What happened today in Baghdad banks? Dollar customers will not be patient any longer.. They will close their accounts – Urgent
Journalists are prohibited from entering
For the second day in a row, chaos has prevailed in the branches of government and private banks in Baghdad, with large numbers of customers arriving to withdraw whatever amounts they can deposited in US dollars, amid fears of “banks exploiting depositors’ accounts,” according to a number of customers.
Since Monday morning, customers have flocked to the branches of major and regional banks in the hope of withdrawing their dollar balances.
Most banks still refuse to hand over their balances to customers on the grounds of the lack of cash liquidity in foreign currency.
The media was prevented from covering the situation inside or near banks, with security tightened around most banks.
A number of customers describe the banks’ practices as “organized theft” with fears of “bad exploitation” of the balances of depositors and dollar account holders.
Customer trends were divided into three options: those who wanted to close their bank accounts, those who wanted to close them, and those who preferred to wait until the end of the year.
Those wishing to close their accounts hope that this step will force the bank to disburse the rest of their balances, while others seem more clear by demanding that their account be zeroed out and keep it open without a balance in the hope of using it if the situation changes.
Those demanding access to their dollar balances fear that the banks will postpone their disbursement in order to deliver them after the end of the current year in Iraqi dinars and at the official exchange rate, which means that depositors will lose a large percentage of the value of their deposits.
Customers who preferred to wait do not have large accounts or do not care about changing the value of their balances later, while awaiting a solution from the central bank.
source in one of the Baghdad banks:
We advised customers to wait a day or two while awaiting the arrival of an increase in our balances from the Central Bank, which today disbursed a new portion of them.
Number of bank customers:
The words of bank officials cannot be trusted. We have relied on them throughout the past period, and they have led us to where things are today.
The state must intervene to end the crisis. The dollar problem cannot be solved in this way, which raised the exchange rate in the market instead of contributing to controlling it. link
Source: Dinar Recaps
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