KTFA Members "News and Views" Wednesday 7-26-2023
KTFA:
Clare: After Baghdad .. Sulaymaniyah is a second station for the international financial center of Iraq
7/26/2023
Today, Wednesday, Al-Madina International Center for Finance and Business held a meeting in the city of Sulaymaniyah, Kurdistan Region, in the presence of a number of businessmen and specialists in economic affairs to convey its financial vision.
A member of the committee supervising the establishment of the city center, Sherwan Anwar, said in an interview with Shafaq News Agency, "With the aim of transferring the vision of the center from the capital, Baghdad, to Sulaymaniyah, and then to some Iraqi governorates to secure a safe economic environment, this expanded meeting was held today, in the presence of members of the Securities Commission and the Stock Exchange. Iraq Securities.
Anwar added, "The city center for money and business was established with the vision of the governor of the Central Bank of Iraq, who presented it more than two months ago at the recent banking conference in Baghdad, after which business and money men held several meetings to transfer the vision of the center to the city of Sulaymaniyah."
And he indicated that "the center will provide banking and financial services, and it will include financial services companies and brokerage companies, in addition to other supportive services and business incubators."
Anwar pointed out that "the three pillars of money management, consisting of the Central Bank of Iraq, the stock market, and business incubators, can secure a safe economic and financial environment in the country, especially when there is coordination between these pillars, and when they are spread in a disciplined manner," noting that "the center It will provide the workforce that will serve the community, especially those who want to expand their projects, and it will also create an environment for training and developing youth through business incubators." LINK
Turk182: That's all Fine & Good. Nice Pictures, glad to see everyone smiling and having a Good Time. All this means NOTHING with Iraq having a useless, toilet paper currency. How long ago was the 2023, 2024 & 2025 Budget Approved/Ratified & Printed in the Gazette?
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Clare: The dollar passes 155,000 amid protests in front of the Central Bank of Iraq.. Pictures
7/26/2023
The exchange rates of the US dollar against the Iraqi dinar rose today, Wednesday, in the markets of Baghdad, and in Erbil, the capital of Kurdistan Region, to reach more than 155,000 dinars.
Shafaq News agency reporter said that the central Al-Kifah and Al-Harithiya stock exchanges in Baghdad recorded, at 11 am, an exchange rate of 155,200 Iraqi dinars for every 100 US dollars, while the prices recorded in the morning for the opening were 154,300 dinars for 100 dollars.
As for the dollar prices in exchange shops in the local markets in Baghdad, they rose, as the selling price reached 156,500 dinars, while the purchase price reached 154,500 dinars for every 100 dollars.
In Erbil, the capital of the Kurdistan Region, the stock market also recorded an increase, as the selling price reached 155,200 dinars, and the purchase price was 155,150 dinars for 100 dollars.
In addition, dozens of angry protesters gathered in front of the Central Bank of Iraq building in the center of the capital, Baghdad, to protest against the high exchange rate of the dollar.
The demonstrators raised Iraqi flags and banners calling for swift measures to curb the continuous rise in exchange rates. LINK
Jeffrey: Someone answer this We have been taught that this hasn't happened yet because of Iran stealing dollars and the black market destroying the rate. Imo, if they just changed the rate Iran would no longer want the dollar they would want the more powerful dinar and there would be no more black market. To me, the above doesn't sound like a good reason for it not to have gone when smarter people know that the above problems would immediately disappear if they just changed the rate. Am I wrong? Anybody?
DoTalkToMe: I wonder if Iraq is waiting to see if BRICS takes launch in August and survey their oppertunities at that time, or a long after that time or who knows, there is always a reason why it has not happened yet. We have also been told Iraq can fund an RI many times over because they are filthy rich. I see no reason for inaction. RI the IQD and USD becomes nothing. Iraqis want there money, not USD. The Iran excuse is also a cop out. Kuwait did it with pencils and paper, no electricity.
there is absolutely no excuse for this not happening a long time ago. Just incompetent people. I like Sundial but he's got lead in his pants.
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Clare: An economist told NINA: The rise in the dollar exchange rate raised inflation rates
7/26/2023
The specialist in the economic affairs, Dergham Muhammad Ali, confirmed that the rise in the uncontrolled dollar price, despite the fixation of the exchange rate, caused economic damage without effective treatments and caused large inflation.
Dergham Muhammad Ali said in a statement to the National Iraqi News Agency ( NINA ) that "all the solutions developed by the Central Bank to control exchange rates did not bear fruit," indicating that increasing the ceiling of cash sales to approved banks is not the solution, but rather enabling the citizen to obtain dollars without intermediaries. through automated teller machines.
And Muhammad Ali stressed, "The need to follow the course of the dollar in the market and not to be a monopoly by specific banks that sell it at the price it imposes on the citizen, considering that inflation rates have risen due to the depreciation of the local currency against the dollar and that the citizen has moved away from adopting it as a store of value because it is unstable and in decline." LINK
Papito: the US Treasury OFAC Sanctions might have something to do with the Dinar but the audits that has affected Major Iraqi Banks might be influencing it.
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Clare: Finance" criticizes a decision that caused the dollar to rise, and does not rule out imposing sanctions on the Iraqi Central Bank
7/26/2023
The Parliamentary Finance Committee criticized, on Wednesday, the recent decision of the Central Bank of Iraq to allow exchange companies to sell dollars to citizens wishing to travel, while it did not rule out that this would lead to new US sanctions on the country.
The deputy head of the committee, Ahmed Mazhar, told Shafaq News agency, "The Central Bank took a wrong decision when it allowed exchange companies to sell dollars directly to citizens wishing to travel outside Iraq."
Mazhar asked, "We do not know how the central bank administration made such a decision?", Noting that "this decision may clash with the policy of the US Treasury, and new sanctions may be issued that may affect the central bank if the situation continues as it is now."
He pointed out that "the sanctions issued by the US Treasury reflected negatively on the market, and the exchange rate of the dollar against the Iraqi dinar will continue to rise further."
Yesterday, Monday, the Central Bank of Iraq decided, according to Shafaq News Agency, to "facilitate cash sales in US dollars for travelers. It was decided to allow exchange companies of categories (A and B) wishing to open accounts with this bank in both dinar and dollar currencies for the purpose of participating in a sale window and buying foreign currency. LINK
Paulette: IMO.....As I stated......"......and force the CBI to institute the currency reform project."
However, this move by the CBI is congruent with the rest of the world...... and needed to be in place after the official acknowledgement by the IMF that Iraq has been Article 8 compliant....
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Clare: Alaq: the rise in the exchange rate "my time" and the project to delete zeros still exists
Baghdad
The governor of the Central Bank, Ali Al-Alaq, considered, on Wednesday, that the rise in the exchange rate of the dollar in the market was temporary, and while he indicated that there was no indication or indication from the American side to include new banks within the sanctions, he confirmed that the project to delete zeros from the currency still exists.
Al-Alaq said, in an interview with the official news agency, that "the central bank continues to provide the dollar at the official rate and cover all legitimate transactions for the purchase request, such as transfers and credits for various imports," adding that "what is being talked about in terms of a rise in the exchange rate does not mean that there is a rise in the official price that It is still the same, but the rise in the cash price circulating in the market is caused by the reluctance of some merchants to enter the electronic platform, which is the official channel for sale required by the new system.
He added, "Merchants, in addition to other categories, cannot enter the platform because they do not practice legitimate activities and operations, and our role in the Central Bank is to push everyone who needs to buy dollars to enter the legal and correct way, and the process today is in fact a process of reorganizing the movement of trade and funds, which makes these operations Subject to local and international controls and standards, which leads to an effective implementation of the Anti-Money Laundering and Terrorist Financing Law No. 39 of 2015.
Al-Alaq pointed out that “the process of implementing the new system in reorganizing the movement of trade and funds requires the cooperation of multiple parties, and we expected that the issue would receive support, implementation, and interaction from the official and popular parties to support the Central Bank in achieving the goal of this system to make the movement of funds proceed in legal contexts and correct standards to avoid any internal or external risks.
He stressed, "The international financial system is integrated, coherent, and interdependent, in which some influence others, and all financial institutions in the world deal with the movement of funds with caution within an accurate assessment of risks and verification of the sources of funds and their beneficiaries. Iraq is part of this system, and we must achieve a high degree of compliance with the standards." The international financial system to ensure the integrity of our financial system, and this, as we indicated, requires great support for the Central Bank, and for each party to take its role.
And the Governor of the Central Bank stated, “Regulating foreign trade falls outside the control of the Central Bank and requires the cooperation of multiple parties concerned with this file, such as the Ministry of Commerce, the Border Crossings Authority, the Customs Authority, the security services, and other parties, and what we do serves all parties, the country’s economy and its general situation, and therefore there must be solidarity.” Collaboration and interdependence between everyone with the Central Bank to achieve the goal of the system.
He pointed out that "we often hear remarks about the process of selling the dollar and the movement of the currency, and today when the Central Bank assumed this great responsibility to reorganize it and put it in its correct contexts, the issue cost a great effort of human resources to monitor the process and ensure its safety with the application of electronic programs that cost the bank large sums of money." investments, and we seek the assistance of an international auditing firm to review operations and verify their validity, and here there must be support and backing to achieve the primary goal.”
He pointed out that "there are parties that do not want the correct standards to be adopted, and some of them are trying to take advantage of this situation to jump on the market and withdraw the cash assets in it to achieve special benefits and speculations. Directly from Prime Minister Mohamed Shia Al-Sudani, who gave this issue great attention.
Al-Alaq explained that “what the Central Bank announces of daily sales of foreign currency are not the operations actually in effect, but rather the requests that the Central Bank transfers externally to conduct import transactions, and what is implemented is less than what is announced in terms of numbers, because there are transactions that have notes, deficiencies, or lack thereof.” Conditions are met and rejected, and the daily sales rate actually executed daily reaches $155 million.”
He added, "The failure to meet all requests is caused by merchants not entering the electronic platform, so they go to the market to buy dollars in cash, and the supply is what citizens circulate for the purposes of treatment, study, etc., and the current problem in Iraq is not related to a lack of cash reserves in it, as happens in a number of countries, but rather we have a large reserve." He can respond to requests and there are no restrictions."
And he continued, “The problem is in the request itself, as some of those who want to buy dollars do not adopt the correct methods by going to the electronic platform, and we at the Central Bank presented two proposals to the government to meet their requests: the first includes easing tax procedures and making their percentage simple and deposited directly in accounts without entering into complications.” taxation and tax accounting, and the second proposal, which is that the entry of any goods into Iraq should be through a new mechanism that includes the presence of evidence of its official transfer, and the first proposal was accepted by the government by taking advantage of what was stated in the budget law, Article 48, and now work is underway to determine the categories covered, and the second proposal is currently being studied from The government must document the entry of goods and disclose the source of funding, which is one of the requirements of the Anti-Money Laundering Law.”
He noted that "there is acceptance of the idea of taxation and benefiting from what was stated in the budget law in Article 48, and now work is underway to organize it and define the categories and tax," noting that "the rise in the exchange rate in the market is temporary and the fate of merchants who buy dollars from the market is entering the platform and transferring in a legal manner." Then there will be no pressure on the exchange rate in the market.
Al-Alaq added, however, by saying: “The penalties imposed on 14 local banks were not at the time of the current government, but rather at the time of the previous government, and the announcement of them a few days ago came after completing audits on all transfers and verifying their sources,” noting that “the phenomenon of speculators in the market who They spread radiation and create a crisis that leads to an increase in the price, and it does not change anything about the possibility of applicants for obtaining dollars from going to banks other than those that have sanctions.”
Al-Alaq confirmed, “There is no indication or indication from the American side of including new banks within the sanctions,” noting that “the central bank will follow up on the issue of banks that have been subject to deprivation of the dollar and will enter into the process of reviewing and verifying them.”
He revealed, "There are a number of proposals being developed to set up the trade process with the Iranian side and the payment mechanism within its framework, and work to provide means of payment through the Iraqi currency and prepare special cards for this issue."
And he noted that "the Central Bank continues to put forward regulatory packages to stabilize the market, and the most important measure taken by the bank is to open the largest number of channels to conduct transfers, and now we have opened a direct channel to conduct transfers with China in its currency without going through complex operations, and these transfers are conducted quickly and easily." He stressed, "The bank started transfer operations in the Chinese currency with one bank, and now the number of banks has reached more than 10 banks."
Al-Alaq announced "close dealings with European banks and in other countries in order to give transfer channels speed and help attract merchants."
Al-Alaq explained, "There are certain arrangements being worked on between the Iraqi government and Iran, and between the American side regarding the payment of gas supply dues."
He pointed out that "there are good efforts that are focused and escalating related to the campaign to support the Iraqi dinar," noting that "the strength of the Iraqi dinar derives not from the citizen, but from the capabilities of the country."
He continued, "Prime Minister Muhammad Shia al-Sudani personally is one of the main supporters of the campaign to support the Iraqi dinar."
Regarding the experience of generalizing electronic support, Al-Alaq explained that "the issue receives great interest from the Central Bank, and now a meeting has been completed with an international electronic payment company, and there is progress, but it depends on expanding the circle of culture in this aspect."
And he stated, "The experience of electronic payment for citizens against government institutions has begun to succeed, and there are many departments that have joined, and we are working on a very important step, which is conducting transactions by paying via mobile phone, that is, a person can pay as soon as the other party has a (code) where any A person holding this code can pass the code on the device and enter his account, which is an advanced step even from using cards.”
And on the size of Iraq's debts, Al-Alaq indicated, "The internal volume of Iraq's debts amounts to about 65 trillion, of which 46 trillion belongs to the Central Bank, and the rest belongs to government banks, and is paid in the form of payments, while the external debt is about 20 billion dollars, while the Iraqi reserve is more." Of 113 billion dollars,” noting that “the adequacy of the Iraqi reserves is high, and it guarantees foreign currencies and gold.”
Regarding the Riyada initiative, Al-Alaq said, "The Prime Minister launched a Riyada initiative to qualify young people and enter them into small projects, and to embrace their capabilities and innovations," pointing out that "the Central Bank entered as a financing party by launching a project to establish the Riyada Bank, in order to absorb and finance these capabilities."
And he indicated, “The Central Bank is in the process of establishing this bank, and there is great interest from us and private banks,” noting that “the bank has various initiatives, including financing small and medium projects and the ongoing housing lending initiative through the Real Estate and Housing Bank, as well as we have an initiative to support the use of solar energy, and there is An initiative for the displaced in partnership with the international institution, and we have financing previously funded industrial and agricultural projects, and the bank is working to complete its financing while it is re-studying the initiative related to the industrial sector.
He pointed out, "It was dismissed from printing the category of twenty thousand dinars because of the existence of a category of 25 thousand dinars, and we do not wish to expand the current categories, because the project to delete zeros still exists."
Regarding the structure of government banks, Al-Alaq said, "There is now coordination and focus on this file, and great interest from the Prime Minister personally, and periodic meetings in this field, and we have some ideas about these banks that we are working on implementing at the present time." LINK