"Iraq, Iran and Vietnam News" Posted by Samson 12-19-2021
KTFA:
Samson: Saleh: The Central Bank Has A Comfortable Reserve That Helps It Impose Stability In Exchange Rates
The economic expert and financial advisor to the government, Mazhar Muhammad Salih, confirmed today, Sunday, that the Central Bank currently possesses a comfortable cash reserve of foreign currencies, pointing out that there is a direct correlation between the current account surplus of the Iraqi balance of payments and the development of foreign reserves.
Saleh said in a statement to the "Information" agency, that "the monetary policy of the Central Bank of Iraq has today, a strong foreign reserve tool that can maintain the purchasing power of the Iraqi dinar and face inflationary expectations with a high capacity due to the surplus in the current account of the balance of payments."
He added that "the Central Bank of Iraq's dollar reserves can be exploited through the power of intervention to impose stability in the exchange market through open market operations exercised by the monetary authority to achieve the operational goals of monetary policy with ease and flexibility."
He pointed out that “there is a positive indicator of the accumulation of the foreign reserves of the Central Bank of Iraq during the year 2021 with a change in the direction of increase by more than 20% compared to the levels of the year 2020. .
And the Central Bank of Iraq revealed, earlier, the rise in the Iraqi hard currency reserves to 64 billion dollars.
International reserves, or foreign exchange reserves - deposits and bonds of foreign currencies held by central banks and monetary authorities - are important to support the currency and pay debts owed by the state. link
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Samson: Iraq raises its holdings of US bonds to more than 20 billion dollars in a month
19th December, 2021
The US Treasury announced, on Sunday, that Iraq’s holdings of US bonds increased by more than two billion dollars to reach 20.364 billion dollars during the month of October
The Treasury said in a table seen by “Economy News”, that “Iraq’s possession of US Treasury bonds for the month of October rose by $2.410 billion, or by 13.55%, to reach $20.364 billion, after it was $17.954 billion in the month of September
Noting that “these bonds decreased from the same month of last year 2020, when Iraq’s possession of bonds amounted to 21.6 billion dollars. She added that “Iraqi bonds, including long-term guarantees amounting to 9.028 billion dollars and short-term guarantees amounting to 11.336 billion dollars,” noting that these bonds represent 0.2% of the world’s bonds
In the Arab world, Saudi Arabia is at the forefront of the most possessing countries, with an amount of 116.4 billion dollars, followed by the UAE with 53 billion dollars, Kuwait third with 45.9 billion dollars, then Iraq fourth, Oman fifth with 5 billion dollars, then Morocco with 3.7 billion dollars
She pointed out that “the most countries in possession of US bonds are Japan, with a value of 1.320 trillion dollars, followed by China, with a rate of 1.065 trillion dollars, followed by Britain, with a rate of 579 billion dollars LINK
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Samson: “The collapse of the Iranian currency” … And a demand for the dismissal of the Minister of Economy!
19th December, 2021
In light of the historical decline in the value of the currency, 50 Iranian deputies signed a petition calling for the dismissal of the Minister of Economy.
In addition, the collapse of the Iranian rial was not limited to the US dollar only, but also included all foreign currencies such as the euro and the pound sterling.
The Iranian rial has lost about 7% of its value since the resumption of the seventh round of negotiations between Iran and the rest of the nuclear agreement parties in Vienna on November 29, affected by the pessimistic European and American statements that followed the nuclear meetings.
In a related context, Iranian President Ibrahim Raisi, in a speech to a crowd of university students in Tehran, accused internal and external parties of being behind the process of the deterioration of the exchange rate.
Raeisi said on the occasion of the University Student’s Day: “I have accurate information that there are those who are trying to raise the foreign exchange rate in conjunction with the nuclear negotiations with the aim of mortgaging the negotiations on the economy.”
It is noteworthy that due to the US sanctions and the decline in Iranian oil exports, the inflation rate in the country has risen significantly, while the prices of basic commodities have risen and the purchasing power of Iranians has declined. LINK
KTFA: Vietnam News:
Samson: World Bank, HSBC optimistic about Vietnam’s economy
19th December, 2021
Việt Nam’s economy should get back to GDP growth of 6.8 per cent next year, which will be driven by a return of strong foreign direct investment (FDI) into the market, mainly focusing on the manufacturing sector, CEO of HSBC Vietnam Tim Evans has said.
This would benefit Việt Nam’s exports, especially as free trade agreements that have been signed over the past two years start to bear fruit, according to the CEO. The continued expansion of the middle class and in particular the rising affluent sector will lead to changes in consumption as Vietnamese people start spending more and more on leisure and travel.
Infrastructure roll-out will also continue to fuel economic activities especially in the renewable/green arena given the strong ambitions made by the Vietnamese Government following the recent 26th United Nations Climate Change Conference of the Parties (COP26) in Glasgow, the UK. Meanwhile, the World Bank (WB) said in the December edition of its Việt Nam Macro Monitoring that Việt Nam’s economic conditions continued to improve, with both industrial production and retail sales registering a third month of growth.
Merchandise exports hit a record high of US$31.9 billion, helping maintain a second consecutive month of trade surplus while FDI commitments recovered after a brief dip in October, according to the report.
Inflation ticked up due to fuel price hikes, recovering non-food domestic demand and rising logistics costs while credit growth remained stable, providing ample liquidity to support the economy recovery. After two months of decrease, the Consumer Price Index (CPI) increased by 0.3 per cent month-on-month in November. Compared to a year ago, the CPI rose by 2.1 per cent year-on-year, slightly higher than in October, but well below the 4 per cent target set by the State Bank of Việt Nam.
The government continued its contractionary fiscal stance as the budget balance posted another month of surplus, driven by strong revenue collection, the report noted.
The policy of “living with COVID-19” will involve continued vigilance and fast action by the authorities, both in vaccination and in social distancing, testing, and quarantining. There is also a clear need for fiscal policy support to boost private demand and help the domestic economy recover. Providing financial assistance to impacted workers and households would be an essential avenue to achieve this objective, according to the report.
Given the available fiscal space, and difficulties registered in implementing the budget in 2021, another policy option for consideration is a reduction in the value-added taxes for 2022 to support private consumption. LINK
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Samson: Việt Nam to develop its own logistics services to Europe and America
18th December, 2021
Việt Nam has many opportunities to enhance exports to the European and American markets but logistic issues are causing bottlenecks to this potential.
Deputy Minister Ministry of Industry and Trade Đỗ Thắng Hải addressed a conference yesterday, entitled “Development of Việt Nam’s logistics industry with Europe – America region”. He said that the local logistics industry has had strong development in recent years but still faced many challenges such as service costs, bottlenecks in infrastructure, warehousing, equipment and human resources
Hải said that the World Bank’s most recent logistics performance index ranked Việt Nam 39th out of 160 countries and third in Southeast Asia. This is Việt Nam’s highest position to date. He added: “Logistics is also one of the fastest-growing and most stable industries of Việt Nam with an average growth rate of 14-16 per cent per year, contributing to GDP from 4-5 per cent.”
He calculated the whole country has about 30,000 enterprises operating in the field of logistics, with about 5,000 professional enterprises so far. However, while Europe and America are major trade partners of Việt Nam, congestion on container transport routes, especially in transport routes, as well as a large shortage of empty containers continuing from 2020, has seriously affected the export of goods to these markets.
Roger Wu, Business Development Manager of the Port of Long Beach, California (USA) said that the pandemic created an unprecedented situation, adding the current bottlenecks were mostly in the United States. According to the analysis from 2021, congestion in ports will increase by 6 per cent while cargo shipments have been shifted to ports from air services under the Government’s blockade measures in the past.
Bùi Huy Sơn, Vietnamese Trade Counselor in the US, said that the congestion of sea routes had influenced a shift to road and air, while the increase in e-commerce activities for smaller orders has greatly affected normal export activities. Sơn said: “Congestion in the US has a direct impact on costs and makes businesses passive when accessing the market, especially seasonal products such as apparel, footwear, agricultural products, electronics, and consumer goods.” He added in the first ten months of 2021, the total export turnover of these commodities to the US reached US$24.8 billion, accounting for 32.8 per cent of the total export turnover of Việt Nam to the US. If these businesses continue to face difficulties in logistics in the long run, they will lose their direct link with the transport chain and have to depend on other businesses.
Seafood was one of Việt Nam’s main exports to Europe and America, said Nguyễn Hoài Nam, Deputy General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP). Nam expressed concerns about the increased logistics costs and freight rates, causing difficulties for seafood exporters.
Nam said though it was the peak time of the year for the export of seafood, the enterprises faced an increase in all parts of the chain such as fees, shipping time, booking for containers, number of delay days at the port and fees for docking there. Nam said before November 2020, the highest cost to transport to Europe and the US was $3,000 per container. Now it is $17,000 for the East Coast, $13,000-14,000 for the West Coast and $12,000-14,000 for European ports. It was less than $1,500 per container to the Middle East; now it is $10,000 -$11,000, said Nam.
Hans Kerstens, Deputy Head of Transport and Logistics Sub-Committee of Eurocham, said the logistics companies were trying to find solutions to avoid congestion such as having their own ships and empty containers. “Transporting goods from Việt Nam to Europe also needs to be adjusted, not only depending on sea transport but also diversifying modes of transport, to ensure that the goods arrive at the right place and at the right time,” Hans Kerstens shared.
Around 90 per cent of exports from Việt Nam depend on foreign shipping companies. A participant of the conference suggested that Việt Nam should develop its own logistic routes, adding that a local company like Hòa Phát could produce the empty containers.
As a response, Lê Quang Trung, deputy general director of the Việt Nam Maritime Corporation (VIMC) said VIMC had deployed such a team for a shorter route from Việt Nam to India. In the future, Trung said VIMC would develop more international routes to serve demand.
At the conference, participants also mentioned the rapid development of e-commerce, and more consumers’ habits of e-buying had developed an e-logistics system so that Vietnamese enterprises could promptly seize opportunities for export development through cross-border e-commerce.
According to the conference, the Asia-Pacific region currently dominated the global logistics market with a significant market share thanks to the increased import and export activities, and growing demand from urbanisation.
With signed free trade agreements and policies and the trend that American and European companies are shifting to Việt Nam, the local logistic industry is of great potential to become “the world’s cargo transhipment centre, not only the seaport but for all kinds of logistics.” LINK