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Samson:  Including Iraq .. 5 Arab countries are threatened with famine due to the collapse of the currency

3/03/2021 14:03:28

 The residents of 5 Arab countries (Syria, Lebanon, Iraq, Yemen and Sudan) are under the influence of a gradual deterioration of the local currency against the dollar, which contributes to high commodity prices and threatens a famine that crushes the poor classes

Iraq is trying to control the exchange rate of the dollar, without changing that from the poor living reality that was affected of course, as the dollar recorded 1,462.5 dinars. 

And the Iraqi government decided at the end of 2020, to raise the value of the dollar against the Iraqi dinar from 1200 dinars per dollar to 1450, to cover the deficit in the 2021 budget that has not yet been approved. The government decision from the Central Bank has contributed specifically to high prices, especially foodstuffs, as Iraq depends on imports to secure its goods.

On Tuesday, the Lebanese currency plunged to 10,000 pounds against one dollar, at an unprecedented level for the currency that was damaged by a financial collapse that caused chaos and turmoil.

The Syrian pound also recorded a new record deterioration in its value in the parallel market, reaching the threshold of four thousand against one dollar in a country where the conflict this month enters its tenth year.

In Sudan, the dollar recorded 376 pounds, as the floatation of the Sudanese pound during the last two weeks caused a frightening deterioration in the exchange rate of the dollar over the past six months from 150 pounds in August, until it reached 376 pounds on Wednesday, which led to an insane rise in the prices of consumer goods. This was reflected in the lives of citizens and led to many demonstrations due to high inflation.

As for Yemen, the Yemeni Prime Minister, Maeen Abdul Malik, warned that the continued collapse of his country's currency heralded a "famine", as the dollar recorded 250 Yemeni riyals. Abdul-Malik reviewed with United Nations Secretary-General Antonio Guterres the difficult economic and humanitarian conditions Yemen is experiencing, and the urgent needs required to support the economy and stabilize the national currency, and warned that the continued collapse of the currency heralds the occurrence of a "famine". Efforts should be combined to quickly rectify it.   LINK

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Samson:  A Financial Mechanism That Adopts Two Prices To Exchange The Dollar Against The Iraqi Dinar

3rd March, 2021

The economic expert, Rasim al-Akidi, proposed a financial mechanism that adopts two prices for the exchange of the US dollar against the Iraqi dinar, and confirmed that adopting two rates to exchange the dollar in the import file will protect millions of poor people in the country.

Al-Aqidi said that during the past years, import operations in Iraq were mostly conducted with unnecessary materials and others produced at home, which led to severe damage to large industrial sectors, and pushed thousands to unemployment. He added that the import process mainly relies on old mechanisms in light of the presence of influential parties, forces and armed wings, all of which made it difficult to follow up and monitor, especially in ports and outlets, pointing out that the dollar used to go out for import, but in fact the bulk of it was fleeing.

He explained that the state, after its decision to adopt the new exchange rate for the dollar at 1450, can adopt two exchange rates, the first for luxury items and according to the new price, while the other price for food and medicine can be done through a clear and uncomplicated mechanism, where the dollar is sold to merchants and companies. That intends to import food and medicine at the current exchange rate.

The economist added that after the arrival of the materials and the completion of all procedures, including examination and payment of customs, the difference between the old and new dollar prices will be returned, which remains as trusts with the state until the import of the imported materials is verified and the rest of the other obligations are completed.

He continued, that the adoption of a mechanism for dealing with food or drug dealers through what we call the food or medicinal dollar, will ensure the arrival of materials at very reasonable prices, because they will focus on basic materials, thus protecting millions of poor people in Iraq from high prices, and ensuring that the state continues within the framework withdrawing the dinar and increasing its dollar balance.

Al-Akidi stressed that this process indicates a very important matter, which is creating competition in importing food and medicine, to prevent their monopoly and raise their prices.   LINK

Samson:  A good aspect of the obelisk: the white paper calls for sustainable development and minimizing economic shocks

3rd March, 2021

Advisor to the Prime Minister Mazhar Muhammad Salih said on Wednesday, March 3, 2021 that Iraq is entering the stage of economic recovery after high oil prices and economic reforms.

Saleh told Al-Masalla that Iraq is on the verge of economic recovery because there is a tangible agricultural boom that will achieve a growth in non-oil GDP in 2021 by more than 4%, which is about one and a half times higher than the population growth. Energy in the world is a positive indicator that strengthens the country's public financial capacity.

Saleh calls for laying a foundation for sustainable development and minimizing economic shocks. He pointed out that the international community supporting Iraq through the International Financial Alliance team, which was established months ago, expressed its desire to support the established principles for the sustainability of growth in the national economy, as expressed in the white paper recently approved by the Council of Ministers by establishing a blueprint and an institutional entity for economic reform, which is the linchpin of this sustainability. Developmental.

He added that the formation of the Supreme Committee for Reform, which will have decisive and fundamental executive decisions to promote productive, investment and operational activity in the public and private sectors, will be supported by a large international presence represented by international multilateral financial institutions and the Group of Seven major industrialized countries.

The Prime Minister’s Adviser for Financial Affairs stated that the government will benefit from the high oil prices in strengthening the country's financial leverage.

Salih said that the breakeven point or balance in the budget requires that the average annual price of a barrel of oil exported abroad be at least 75-80 dollars per barrel, indicating that at that time the deficit gap will be closed completely, and the sources of borrowing to meet the budget deficit are mostly automatically canceled.

He added that the government benefits from the current high oil prices, which have reached more than what was written in the budget, especially with the country heading to closure again, stressing that this will lead to strengthening the country's financial leverage to face the problems of social need.  LINK

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Samson:  An unprecedented collapse of the Syrian currency: about 4 thousand pounds to one dollar

2nd March, 2021

On Tuesday, the value of the Syrian pound decreased to its lowest historical value against the US dollar and approached 4 thousand Syrian pounds against one dollar.

The exchange rate of the pound against the US dollar in the Damascus markets this evening was recorded at 3960 for sale, 3910 for purchase, while 3885 SYP were recorded for purchase in the Qamishli market in the Autonomous Administration region of northern and eastern Syria.

The price of the European euro rose to 4780 for sale and 4700 for purchase, while the Turkish lira recorded a price of 538 for sale and 526 for purchase. Gold continued to rise, and a gram of 21 recorded the price of 192,000 Syrian pounds, while a gram of 18-carat gold recorded a price of 164,000 pounds.

Anwar al-Lababidi, the owner of a store that sells electrical appliances in Damascus, told Shafaq News that most of the shops closed their doors this evening due to the rapid rise in the price of the dollar and the inability to match the exchange difference between wholesale purchase and sale. Al-Lababidi explained that "merchants and shopkeepers are exposed to great losses due to the instability of the exchange rate."

Masoud Halim, one of the money changers in the Qamishli market, told Shafaq News that the exchange rate of the dollar rose within one hour this evening by more than 200 SP, which caused chaos in the market and most of the money changers refused to sell or buy the dollar this evening.

The regions of Syria witness a difference in the exchange rate of foreign currencies against the Syrian pound, as the price differences in the areas of the Autonomous Administration and the opposition from the areas of the Syrian government reach nearly 100 SP, sometimes due to the Syrian government's tightening measures on foreign exchange circulation in its regions.

This new decline came amid expectations that the Syrian pound could reach the limits of 4000 pounds per dollar within a few days.   LINK

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Samson:  The Reason For The Decline Of The Lebanese Currency Again

3rd March, 2021

A Lebanese newspaper revealed, today, Wednesday, the reasons for the rise in the exchange rate of the dollar against the Lebanese pound to ten thousand pounds in one day.

 The Lebanese newspaper Al-Jumhuriya mentioned, citing informed sources, the main reasons for this move, which is the “initiative of some banks to“ suction ”(withdraw) dollars from the market to raise their capital, as requested by the Central Bank of Lebanon. In addition, the market reopened after the closing of the past weeks, and the need for traders to obtain dollars to buy new goods.

Likewise, all political outlets are blocked and people lack hope and safety, which prompts them to exchange their liras for dollars in anticipation of the unknown.

The circles considered that in addition to the impact of the new factors on the dollar, there are other reasons related to the structural crisis of the economy, with which the traditional treatments and the enthusiasm of some to return to the old economic "model" no longer work.

With the renewed popular protests in the street, a political reference was quoted as saying that he was very angry about what things had turned out to be, saying: “I am surprised how people are late to revolt, and how their resentment is still within these limits?”   LINK