From Redd Starr: "IMF, METAC & Iraq" 6-20-2023
Emailed to Recaps-Thank you Redd Starr!
Redd Starr: IMF, METAC, & Iraq
I'm going to try to set this information up & hopefully give everyone a clear picture of where we are at in this process. I don't believe that we'll be waiting much longer for this blessing!
METAC (Middle East Regional Technical Assistance Center) released some information, not long ago, that has some key information! I haven't seen anyone talking about this, so I wanted to share it!
Who is METAC? METAC is a collaborative venture between the International Monetary Fund (IMF), member countries, and bilateral and multilateral development partners. The mission of METAC is to assist members in advancing public policies and institutions that enable inclusive and sustainable growth, so that living standards improve for all citizens.
METAC provides capacity development services in the areas of Banking Regulation and Supervision, Central Bank Operations, Public Financial Management, Revenue and Customs Administration, and Real Sector Statistics.
Before I give you the link to what I'm talking about, here is some more key information.
There have been numerous articles stating that Iraq had a plan, a 3 step process! We are about to see the 3rd and final step!
https://ina.iq/eng/24702-adviser-to-the-prime-minister-reveals-a-new-package-of-the-process-of-reforming-the-iraqi-economy.html
"Wait for the next package of reforming the Iraqi economy,"
https://www.iraq-businessnews.com/2023/04/06/the-iraqi-budget-and-the-stock-markets-next-move/
"The fundamental underpinnings for the market's next move would come from the conclusion of parliament's review of the 2023 budget proposal and its passage into law, expected in the next few weeks. The expansionary budget, after coming into force, would result in meaningful liquidity injections"
The third step was getting the budget finalized so the new rate can be implemented.
According to METEC and what the IMF has said along will be the peg to the US dollar. 1 to 1 with the potential to move higher over time.
In 2003 US economist Mark Spiegel talked about different monetary regimes for post war Iraq. He specifically mentioned what is taking place today with METAC.
Here is the link if you want to read it? It's very interesting that he was right on target with his information!
https://www.frbsf.org/economic-research/publications/economic-letter/2003/may/what-monetary-regime-for-post-war-iraq/
Now here is the information from METAC! "The mission raised awareness on the necessity to complete the monetary policy framework under an exchange rate peg by introducing an active domestic liquidity management. The mission provided a set of focused recommendations to address the short-term challenges to the sustainability of the exchange rate peg. Follow-up TA is envisaged to build a full instrument set supported by liquidity monitoring and forecasting."
Also the last paragraph states- "In March 2023, METAC assisted the Iraqi Central Statistics Organization (CSO) with implementing improvements to the consumer price index (CPI) in areas identified as shortcomings during the October 2022 mission. This included working with the authorities to create an experimental compilation system based on chained short-term relatives and geometric means in Excel. This new compilation system is planned to be introduced by July 2023"
https://www.imfmetac.org/content/metac/en1/technical-assistance/areas/iraq.html
Why are the statistics essential for Iraq?
Because they cover inflationary gaps for higher costs of goods, services, imports/exports etc. They also cover individual and corporate tax brackets for economies that expecting financial shifts. See where this is going?
Also if you look at the IMF's Monetary and Financial Statistics compilation guidebook. https://www.imf.org/external/pubs/ft/cgmfs/eng/pdf/cgmfs.pdf
It outlines everything a country needs to have in place for international compliance. This manual is a "significant component of the IMF work on enhancing the quality, availability, and analytical usefulness of financial-sector data in both in-country and international contexts" and this is a lot of what METAC has been working with Iraq on since 2015!
They have been quietly working behind the scene to get everything the IMF need to give them the green light! Well the green light was given!
Hang in there folks! It's been 18 years for me! Let's see what happens July 1st!
Thanks to Recaps!