Iraq Economic News and Points To Ponder Tuesday AM 8-6-24
The National Currency Is Fluctuating.. An Expert To The “Iraq Observer”: We Need A Banking System That Creates Balance
August 5, 2024 Baghdad/Iraq Observer Dollar prices have witnessed a significant rise recently, with a difference of 20 thousand dinars from the official price, amid the absence of any real solutions to control it and limit its rise.
In this regard, Mustafa Hantoush, a researcher in banking and financial affairs, confirmed to the Iraq Observer that “the issue of currency stability and the exchange rate is determined according to monetary policy, which is represented by several axes, the most important of which is that the dollar currency and the rest of the foreign currencies are owned by a number of foreign countries.” He added, “At the same time, Iraq has policies and understandings with these countries, such as the United States, so the issue of trade with countries such as Iran and Syria must be done according to the platform,” pointing out that
“this trade is huge and must be financed according to a specific method by purchasing gold or making transfers.” Or goods are imported until there is an understanding with these countries.”
He continued, “The United States today prevents dealing with the dollar in official trade, so how can this trade be financed at a time when it is not allowed to deal in the dollar-denominated dinar?
The issue of the platform with Iran and Syria may raise the American momentum and reduce tensions, and thus stabilize the currency.” He pointed out that “to support and strengthen the national currency, there must be a basket of currencies that needs a banking system.
Today, the banking system is due to the mistake committed by the Central Bank of Iraq related to the lack of a platform system with countries such as Iran and Syria from day one, unlike countries in the region such as Turkey and others that have created a platform.”
Gold and remittances, as the banking system was stopped, restricted from the dollar, and eliminated with quasi-sanctions, which created a banking problem, and then introduced banks to foreign investors with another mistake.”
The researcher asked about banking and financial matters:
How are Iraqi banks given to foreign investors?
This matter led, as a result, to these investors transferring the dollar to their bank branches in their countries, to an account in Citibank and JP Morgan, and
their profits will be in exorbitant amounts transferred to foreign countries, as
the issue has begun to affect the sovereign financial security of Iraq.”
He explained, “Iraq needs to build a banking system that strengthens banking standards and
thus enables Iraq to build a banking system that provides a balance for the currency.
Also, the issue of people is not as important in monetary policies as the policies themselves are important,
because the presence of a specific person who follows the same policies and does not have any plan, he cannot benefit from it.
”Rather, there must be a plan related to monetary policy to achieve the
balance of the currency and the banking system,
plans for financing and attracting deposits, and
plans related to granting loans.
Whoever has banking policies will be the best.” https://observeriraq.net/العملة-الوطنية-تتأرجح-خبير-لـعراق-او/
A Financial Expert Diagnoses A “Fatal Error” In The Iraqi Banking System - Urgent
Economy | Today, 10:00 | Baghdad today – Baghdad Today, Tuesday (August 6, 2024), financial expert Saleh Al-Banker confirmed that Iraq is among the top countries in the Middle East in terms of hoarding money, while he diagnosed a grave error in the Iraqi banking system.
The banker said in an interview with “Baghdad Today” that “the accumulations that have been continuing for many years have led citizens to lose confidence in banks and resort to hoarding money in homes,” noting that “their percentage reaches 70% of financial flows, and these are large numbers that indicate that we are among The countries with the highest amount of money in the Middle East. He added, "Hoarding money in the financial concept is a grave mistake.
It will confuse the financial process and reduce the government's ability to provide cash to pay salaries," explaining that "resorting to electronic payment is a step in the right direction, but the most important thing is withdrawing cash, and there are several ways."
The banker pointed out that “the recent offering of treasury bonds is a correct decision, but the media propaganda to create a culture of safe investment on the street is very weak, and this is what creates low rates for dealing with them, even though the interest rates are attractive.”
He stressed "the necessity of seeking to expand the circle of withdrawing liquidity from homes and creating a movement of money that contributes to increasing the recovery of investment and granting government loans, especially with requests that are five times greater than the amount of funds allocated for loans in any sector, especially housing."
It is noteworthy that the Parliamentary Finance Committee commented on Saturday (July 13, 2024) on the impossibility of lifting US sanctions on some Iraqi banks.
Committee member Moin Al-Kazemi said in an interview with “Baghdad Al-Youm” that “there is no weakness in Iraq’s foreign policy and there is no defect in the Iraqi banking system that makes the United States of America not lift the sanctions on Iraqi banks.”
Al-Kadhimi stated, “There is a clear intention by the United States of America to continue these sanctions despite the clear development in the banking system and the restriction of foreign transactions through the electronic platform in the Central Bank, but Washington is using this file as a political file towards Iraq.”
He added, "The Iraqi government is working with everything it has to lift the sanctions on the banks, especially since those sanctions negatively affected the banking sector and contributed significantly to the dollar crisis."
https://baghdadtoday.news/254943-خبير-مالي-يشخص-خطأً-فادحاً-في-النظام-المصرفي-العراقي-عاجل.htm l
Imposing Guardianship On Zain Iraq Bank Reveals The Extent Of The Deterioration In The Banking Reality
August 6, 2024 Last updated: August 6, 2024 Independent/- The Central Bank of Iraq placed the “Zain Iraq Islamic Bank” under guardianship, in a step that reflects the improper practices and unsatisfactory performance of the bank’s management, which threatens the independence and integrity of the Iraqi banking system.
According to an official document obtained by Al-Independent, the decision of the Board of Directors of the Central Bank, No. 165 of 2024, was issued in accordance with the provisions of Article 59 of the Iraqi Banking Law No. 94 of 2004.
Jalal Abdullah Salman was appointed as trustee of the bank, in accordance with the provisions of Article 60 of the same The law, and is granted the powers specified in accordance with this decision. faces
The banking reality in Iraq major challenges that negatively affect the stability of the financial system and investor confidence.
These challenges include mismanagement of some banks and their lack of transparency and good governance.
The recent decision to impose guardianship on Zain Iraq Islamic Bank reflects the weakness of the supervisory procedures and internal controls in this bank.
The Central Bank of Iraq is the body responsible for supervising the banking system and ensuring its stability.
However, criticism is growing about the effectiveness of this oversight and its ability to detect and prevent financial abuses in a timely manner.
The decision to impose guardianship on the “Zain Iraq Islamic Bank” indicates the delay in supervisory intervention, which raises questions about the feasibility of the preventive measures taken by the Central Bank.
Oversight of banks and the Central Bank must not be limited to them alone, but the
Iraqi Council of Representatives must have an effective role in following up and monitoring financial and banking performance.
However, the House of Representatives' oversight role appears weak and often ineffective, leaving the door open to further violations and improper practices.
The absence of parliamentary oversight contributes to the exacerbation of financial problems and weakens confidence in the Iraqi financial system.
In conclusion, the decision to impose guardianship on “Zain Iraq Islamic Bank” reflects the urgent need for radical reforms in the banking system and strengthening financial oversight by the responsible authorities.
It requires joint cooperation between the Central Bank, banks, and the House of Representatives to ensure the stability and safety of the financial system in Iraq. https://mustaqila.com/مصرف-زين-العراق/
The Governor Of The Central Bank Chairs The Meeting Of The Supervisory Committee On The Restructuring Process Of Rafidain Bank
August 05, 2024 The supervisory committee for the restructuring process of Rafidain Bank met under the chairmanship of His Excellency the Governor of the Central Bank of Iraq, Mr. Ali Mohsen Al-Alaq, and in the presence of the committee members from the Ministry of Finance and the advisors of the Prime Minister and the advanced staff at the Central Bank of Iraq, as well as the presence of the international consulting company (Ernst & Young). Ernst & Young).
The progress of work on the plan adopted by the government was reviewed in coordination with the Central Bank within the framework of the expanded program to reform the banking sector, improve its performance and services, and achieve financial stability.
The attendees discussed the process of organizing the administrative, financial and technical structure of Rafidain Bank, to move towards the best global banking practices.
It is worth noting that the aforementioned committee holds a monthly meeting under the chairmanship of the Prime Minister to provide a presentation on the steps taken and to monitor the progress of the process and provide guidance regarding it.
Central Bank of Iraq information Office August 5, 2024 https://cbi.iq/news/view/2631
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