Zig’s Place Chatroom News Sunday Late PM 12-19-21

Zig’s Place Chatroom News Sunday Late PM 12-19-21

Zig: Welcome to zig's place, a chat room for dinar speculators and others....discuss any topic that you wish here

NORV   Bobby Cahill The 2% rule is based off the official CBI rate (including fees) not street rate. Take the 1460 x .02 and you have the max street rate within the IMF rules. So 1489 is he rate. They must maintain this for 90 days or more in order for the IMF to accept their request to move to Article VIII.

NORV  The point being price stability. Cost of goods should not vary throughout the country (this is what MCP is) many gurus don't understand and think MCP is different currencies (like dinar and dollar).

Iraq will always have dollars in Iraq as long as they sell oil. For example. A new washing machine should cost 430,000 dinar in Baghdad +- 2% and same goes for Kurdistan. Iraq needs to prove they can maintain this stability before they can engage with the global financial system.

Bobby Cahill  NORV That's cool thanks. I was going off the IMF/LOI of 2016 where they mentioned "International Transactions"........The government will gradually remove remaining exchange restrictions and multiple currency practice (MCP) with a view to eliminating exchange rate distortions

Such a move towards acceptance of the obligations under Article VIII of the IMF’s Articles of Agreement will send a positive signal to the investment community that Iraq is committed to maintain an exchange system that is free of restrictions and MCP for current international transactions and thus facilitate creation of a favorable business climate.

Bobby Cahill   But either way we wait

NORV   When they are talking about exchange restrictions they are talking about access to foreign currency. The problem is, the more they liberalize access the more Iran steals to prop up their own banking system draining the CBI. But yes, the IMF does want them to liberalize foreign exchange.

Bobby Cahill   100%

NORV   Many people missunderstand that liberalizing foreign exchange does not have anything to do with dinar. It means foreign exchange (meaning access to dollars). And the 2% spread pertains to price stability of the dinar throughout Iraq. This is how the IMF wants Iraq to demonstrate they know what they are doing.

NORV   Eventually they will float. And end the auctions and therefore need to have another mechanism in place (such as international trading of the dinar)

NORV   The CBI will then buy/sell blocks of dinar on the international exchange (and make commission) like all other central banks do. This is how the CBI will make money and maintain stability of they dinar. How much the CBI interferes in the price is yet to be seen.

NORV  There are many articles out on the IMF transitions for emerging market countries. Here are few links...

NORV   https://www.imf.org/external/pubs/ft/op/256/op256.pdf

NORV   https://www.imf.org/external/pubs/ft/wp/2004/wp04126.pdf

NORV   https://www.imf.org/external/pubs/ft/issues/issues38/ei38.pdf

NORV   https://www.imf.org/external/pubs/ft/op/193/chap3.pdf

NORV   Enjoy!

NORV   FLOAT …. FLOAT …… FLOAT

Bobby Cahill   Thanks for those. While I still have doubts, I don't think it has anything to do with the current atmosphere in Iraq and our end game, for now. Just reading thru the SBA's/ LOI's, I seem to come across things like this..... "(IMF) Maintain the exchange rate peg and step up the liberalization of the foreign exchange market (Status) Mostly done...

The authorities have removed most exchange rate restrictions subject to Article VIII, Section 2 (a)." Then later that year (2017) Alaq heads to Washington D.C at a Banking Conf and declares Iraq is free of all MCP's and Exchange Rate Restrictions. All that said I don't keep as close an eye on the street rates as I do the overall Monetary and Economic atmosphere of Iraq.

Bobby Cahill  For people that are following this, the reason the spreads are so important in Iraq goes along the lines of what Kap has said and that's the Banks profiting from these spreads, thus creating profits and cancelling out short and long term credits/loans to the public and economy. This is why the Banking Sector needs an overhaul away from Political interference

butterfly   Iraq is sixth in the Arab world in terms of public debt

Sunday 19 December 2021 22:50 Iraq ranked sixth among the Arab countries in the volume of the general central government debt as a percentage of the gross domestic product for the year 2020.

The proportion of this debt in Iraq during the past year was 84.21%.

Sudan ranked first with the highest debt ratio with 272.92%, while Kuwait had the lowest ratio with 11.71. https://ninanews.com/Website/News/Details?key=945796

butterfly   US Embassy: We provided more than $60 million to support Iraq

Sunday 19 December 2021 19:59 The US Embassy in Baghdad announced the size of its donations to Iraq to support it to confront the Corona pandemic, during a memorial ceremony at Ibn Al-Khatib Hospital complex, in memory of the victims of the fire that occurred last April.

The embassy said in a statement, "The US ambassador to Iraq, Matthew Tueller, attended a memorial service at the Ibn Al-Khatib Hospital complex, in memory of the victims of the tragic fire that occurred in April 2021."

Since the fire, the US Agency for International Development (USAID) Iraqi Community Resilience Initiative has partnered with the American Medical Students Association - Iraq Chapter to provide equipment and help rehabilitate facilities through a $560,000 grant from the US Agency for International Development. .

The rehabilitation project is the latest in a series of initiatives launched by the United States to support Iraq in dealing with the Corona pandemic. According to the statement.

And about the amount of funds that the embassy has provided to Iraq since the beginning of the pandemic, it indicated that it is “more than 60 million dollars to support Iraq to combat the Corona crisis. For example, we provided support to the Iraqi people with our contribution of more than 4 million dollars to help renovate and equip Iraqi public health laboratories, in a month In August, the United States donated 500,000 doses of Pfizer vaccine to Iraq.

The embassy statement indicated that "the Centers for Disease Control and Prevention will launch a program to support the Iraqi Ministry of Health's response to the pandemic by supporting cadres and providing technical assistance."

butterfly   She stressed that the United States is committed to its enduring partnership with Iraq, and "we will continue to search for ways to deepen our cooperation in the field of health care and epidemic response, as well as other priority issues for the Iraqi people." https://ninanews.com/Website/News/Details?key=945772

butterfly   The United States announces its support for the Kurdistan region in "difficult times"

Sunday 19 December 2021 22:30 The US Consulate General in Erbil expressed today, Sunday, its condolences and sympathy to the families of the flood victims and those affected by it, declaring its support for the people of Kurdistan in difficult times.

In a statement, the US Consulate in Erbil stated that it had received with great sadness and sorrow the news of casualties in the floods that swept Erbil.

The statement indicated that the loss of lives and the destruction of property and livelihood is devastating, and its condolences go out to the families of the victims and those affected by them.

The statement stressed that the United States stands with the people of the Kurdistan region in difficult times, as the statement put it.

During the past two days, Erbil witnessed unprecedented rains, torrential rains and floods that caused the death of at least ten people, the loss of two people, one of whom was a baby and the other a shepherd, and dozens of others were injured, with great losses in public and private property. https://ninanews.com/Website/News/Details?key=945790

sandyf   @Bobby Cahill Good stuff Kap. The 2% has been a head scratcher for me because I also see this written by the IMF on Exchange Restrictions and Multi Currency Practices...... It was around 2011/12 that the remaining MCP was identified. It was found that invoices from various countries(hence multi currency) were being paid at a rate that deviated by more than 2% from the CBI official rate. Iraq has never positively addressed this issue. Vietnam had exactly the same problem and they introduced legislation that companies could only use the official rate in the accounts, any profit/loss had to be shown separately. The MCP has morphed into various interpretations over the years.

butterfly   Hi sandyf hope all is well with you and your family.

butterfly   Darn, I found this quite funny but not sure how to show the image so just click on the url https://pbs.twimg.com/media/FHA9mNaVcAAkZP2?format=jpg&name=900x900

Sheila   butterfly use www.imgbb.com - Doug_W told me about this site for posting images.

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