MilitiaMan "If This Doesn't Make One Smile, Nothing Will!" 10-2-2021
KTFA:
MilitiaMan: Adviser to the Prime Minister clarifies the bonds of {construction} and their objectives
10/1/2021 15:13:07
The financial and economic advisor to the Prime Minister, Mutahar Muhammad Salih, clarified the {construction} bonds launched by the Ministry of Finance today, Friday.
"The issuance of construction bonds supports public finances by borrowing from the public's financial surpluses," Saleh told {Euphrates News}. And that "this step will be either putting these funds into the investment budget or reconstruction and strengthening the capital of government banks, especially the real estate and housing banks, to raise the lending capacity of citizens."
He stressed that the decision "supports the renaissance of construction, which is the process of recycling savings and converting them into investments, which is a positive step that supports citizens and moves stagnant funds."
The Ministry of Finance / Public Debt Department announced today, in cooperation with the Central Bank of Iraq, the issuance of construction bonds tradable in the stock market, with the guarantee of the Ministry of Finance. And Finance published the categories of bonds offered for trading, which are {a bond of 500 thousand dinars with an annual interest of 6% for two years, and a bond of a category of one million dinars with an interest of 7% for a period of 4 years}.
The ministry pointed out that "the public wishing to purchase can submit their requests through authorized banks," calling "all investors and citizens to take advantage of this investment opportunity, because of its returns in favor of the borrower (the investor) and for the entire national economy." She pointed out that "the process of trading these bonds comes in accordance with the plans and mechanisms of the financial sustainability process and its improvement, in addition to the positive economic effects of raising the levels of economic activities for various sectors and enhancing the provision of broad development opportunities and within the framework of implementing the paragraphs of comprehensive financial and economic reform plans within the adoptions of the white paper, and in implementation of programs Developing fiscal and monetary policy in Iraq. LINK
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MilitiaMan: There is loads of talk about monetary policy lately. There is a focus on Bonds to jump start the private sector. The theme is to create opportunity to reduce the money supply on the street by using bonds with interest decent interest rates attached for time, as an instrument or incentive to entice citizens and investor money into the bonds which reduce the money supply.
Reducing the money supply creates value by a supply and demand basis. The opposite is true too, when increasing the money supply reduces value, as noted in the last devaluation.
We have an article that talks about foreign currency exchange and timing.
They use a term in respect to the underlying and historical context of the health of the economic situations in Iraq and neighboring countries with respect to currency exchange rates.
When the war effort in 2003 was underway the IQD devalued and created a contagion in the region to the neighboring country currencies, that are still infected today.
I find where the use of epidemiological models are used not only in health and medical related terms but to finance models, as well. Hence, I'll show where that is true with the present circumstances we have before us, see below. imo ~ MM.
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"In order for the economic analyzes to be accurate and not extreme of the reality of monetary stability in Iraq and the effects of the expected economic, epidemiological and expected shocks on the exchange rate of the Iraqi dinar".
"We do not forget here how the dollar devoured the local currencies of neighboring and regional countries, which suffered from a circumstance similar to that of Iraq, such as Iran, Turkey, Lebanon and Syria, where their local currency collapsed in very large proportions. While the Iraqi dinar exchange rate stabilized within the target rate of the Central Bank, despite the speculation in the market.
https://academic.oup.com/jpubhealth/article/36/1/13/1573211
MilitiaMan: Lets keep in mind now that there is a new system called "BUNA" owned by the Arab Monetary Fund that is to be used for International, regional and local currencies with cross border settlements and payments digitally.
Once the IQD is cleared Internationally it will be fully Article 8 compliant with the IMF and International Standards. That will require a Real Effective Exchange Rate (REER).
The Bonds for reconstruction to enhance the Private Sector to support Iraq away from just oil revenues will require it too. Imo. There is data that supports yesterday that the Bonds will trade on the ISX.
It is my understanding that the ISX was closed yesterday and won't open until Monday, next. Regardless, there is an effort to trade bonds in the very short term that will require international exposure and standards to apply. ~ MM
"The Ministry of Finance / Public Debt Department, in cooperation with the Central Bank of Iraq, announced today, Friday, the issuance of construction bonds tradable in the stock market, with the guarantee of the Ministry of Finance."
The ministry called on all investors and citizens to "take advantage of this investment opportunity, because of its returns for the benefit of the borrower (the investor) and for the entire national economy," noting that "the process of trading these bonds comes in accordance with the plans and mechanisms of the financial sustainability process and its improvement, in addition to the positive economic effects represented in By raising the levels of economic activities for various sectors and enhancing the availability of broad development opportunities.
MilitiaMan: They go on an in depth about the Bonds and what it means directly and supports the above aforementioned reasoning in the below, as follows. ~ MM :
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Updated cash sterilization is a process by which monetary authorities ensure that foreign exchange flows from abroad do not affect the monetary basis, as the monetary basis is one of the components of the overall money supply.
Many countries are trying to influence the value of their local currency in the foreign exchange market, through the operations of buying and selling that currency against the foreign currency. If the monetary authority sells the local currency, which was not in circulation before, this measure will expand the local monetary base (increase), and the same is true if the monetary authority buys more of its local currency, and does not enter that currency into circulation, the effect here will be deflationary (declining) on a monetary basis.
In Iraq, the circulating monetary sterilization is the window for selling foreign currency by withdrawing the Iraqi dinar from the market in exchange for providing the market with foreign currency, which is (the dollar). As for the new monetary policy mechanism, which is the updated monetary sterilization by offering national bonds with the first two issues in the amount of (500,000) Dinar with annual interest (6%) for two years, and the second issue in the amount of (1,000,000) dinars and annual interest (7%) for four years, for the purpose of withdrawing liquidity from the public through banks and at the same time called building bonds.
Public requests are submitted through all banks, and then the bank pays these requests to the Central Bank of Iraq, for the purpose of providing the bank with the required bonds. During the other banking operations carried out by the banks, in addition to the fact that the banks did not focus only on the foreign currency sale window, but rather moved the other goals undertaken by the banks.
In my opinion, it is called (the updated monetary sterilization), as the Central Bank of Iraq continues to achieve its development goals towards a sustainable economy, as well as being the only lung of the Iraqi economy in all crises, starting from 2015 until now.
In conclusion, the Ministry of Finance should direct its government banks (Al-Rafidain, Al-Rasheed, Al-Iraqi Trade) to support this method carried out by the Central Bank towards achieving development goals, as well as reducing the financial deficit, based on the Federal General Budget Law of the Republic of Iraq No. (23) of 2021 / Article II - Deficit / Paragraph 2 - A - 2, which authorized the issuance of national bonds to the public, in support of the budget, and we should not forget that there are national bonds issued in 2021 with an amount of (8.5) trillion Iraqi dinars, which is part of the sources of financing the planned deficit in the 2021 budget. LINK
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MilitiaMan: Now lets take a look at the Digital Clearing side of things to come from a regional and global perspective. The BUNA owned by the AMF has recently not only cleared major currencies they are now to a lesser extent clearing smaller local and European currencies in digitized cross border payments with the likes of Italy (EUR) and Jordan's (JOD) respective currency issues.
The interesting thing about this link below it doesn't show the whole story. There were many major global entities in the room if you will.
In fact they only allowed us to see who for a very short period of time. This link is still found, but, what is posted below it has been pulled off their AMF website.. Interesting of in of it self, but, the line up I will post below it..
It is profound imo and supports we are going to see a big move soon. I am not sure why something so important is no longer available, but, one can clearly see below I didn't make it up.. lol WOW!!! imo ~ MM
Banca D'Italia and Arpcso announce Buna-Tips experiment delivering successful cross-border, cross-currency, cross-system instant payments.
The Arab Monetary Fund organizes the twenty-third "remotely" periodic meeting of the Arab Committee for Payment and Settlement Systems
2021-09-30
Wednesday and Thursday 29-30 September 2021
The committee discusses:
Recent trends in the field of payment systems and financial infrastructure in light of the work of the Group of Twenty
A renewed view on the role of central banks in developing payment and settlement systems
Understand the risks associated with stablecoins and cross-border payments and contain them
Prospects and future of automated clearinghouses and their role in the era of rapid payments
Enhancing the role of payment-accepting intermediaries in commercial payment gateways and digital wallets
Current trends regarding the banking sector's use of (ISO20022) messages internationally, and the developments of "SWIFT" message models
Opportunities and risks of technology companies in financial services in the Arab region
Today, Wednesday, September 29, 2021, the twenty-third periodic meeting of the Arab Committee for Payment and Settlement Systems, which is being held “remotely” in light of the Corona pandemic crisis, will open. The meeting will be attended by the directors of the payment and settlement systems and financial infrastructure departments of the Arab central banks and monetary institutions.
The committee meeting will also be attended by representatives of regional institutions, including: the General Secretariat of the Cooperation Council for the Arab States of the Gulf, the Secretariat of the Financial Action Group for the Middle East and North Africa, the Union of Arab Securities Authorities, and the Union of Arab Banks. The meeting will also be attended by experts from a number of global central banks and international institutions, such as: the World Bank Group, the International Monetary Fund, the Bank for International Settlements, the International Committee on Payment Systems and Financial Infrastructure, the European Central Bank, the Bank of France, the Italian Central Bank, and the German Federal Supervisory Authority Banking, the Bank of England, the Eurocleor Foundation, the Swift Association, the German Agency for Development, and the Bill and Melinda Gates Foundation.
The committee aims to contribute to the development of payment and settlement systems in the Arab countries, and to enhance coordination, cooperation and exchange of experiences and expertise in this regard between central banks and Arab monetary institutions. Within the framework of its role as a technical secretariat for the Board of Governors of Arab Central Banks and Monetary Institutions, the Arab Monetary Fund assumes the secretariat of the Committee. His duties in this regard are based on preparing the agenda, contributing to the preparation of studies and reports issued by the committee, and following up on its recommendations.
In its two-day meeting, the committee will address a number of important topics, most notably recent trends in the field of payment systems and financial infrastructure in light of the work of the Group of Twenty. Payment and financial infrastructure around opening hours, access and connectivity requirements.
Committee members will also be able to view the latest developments in the services of the “Bunna” platform for Arab payments of the Regional Corporation for the Clearing and Settlement of Arab Payments, and discuss the role of central banks and Arab monetary institutions in encouraging the use of innovative services provided by the platform to the financial and banking sector in Arab countries.
The committee will also discuss a set of topics related to the risks associated with stable currencies and cross-border payments, and the risks and opportunities of large companies for technologies in financial services in the Arab region, in addition to discussing the renewed view on the role of central banks in developing payment and settlement systems, and current trends regarding the banking sector’s use of messages ( ISO20022) internationally, and developments in SWIFT messaging models. The topics of the meeting will also address the future of automated clearinghouses and their role in the era of rapid payments, commercial payment gateways and digital wallets, and the requirements for implementing the Legal Entity Identifier (LEI) in payments.
Finally, the committee will discuss participation in the international survey on payment systems and processes in which cooperation with the World Bank takes place, and discuss the possibility of issuing a regional report using the results of the survey.
On this occasion, His Excellency the Director-General and Chairman of the Board of Directors of the Arab Monetary Fund, Dr. Abdul Rahman bin Abdullah Al-Hamidi, praised the continuous development of the topics and issues discussed by the committee and their importance for Arab countries in enhancing the safety and efficiency of financial transactions and the flow of payments and transfers.
His Excellency expressed his happiness with the wide participation of the relevant regional and international institutions, which enhances the importance of the committee as a platform for dialogue and exchange of experiences and expertise in the issues of financial infrastructure systems. His Excellency stressed the need to pay attention to the issues of digital payments and instant payments, and that the committee should be proactive and proactive in enhancing knowledge to support the efforts of Arab countries in this regard.
His Excellency praised the great support and encouragement given by their Excellencies, governors of Arab central banks and monetary institutions, to the "Bunni" platform for Arab payments, and the great opportunities that the platform offers to develop the payment and settlement system in the Arab region and enhance regional financial integration and linkage with the global financial system, looking forward to support And the committee members’ contribution to introducing the platform and expanding the platform’s network of participating banks.
MilitiaMan: If that doesn't make one smile nothing will.. lol