Iraq's Central Bank disproves Reuters report, affirms accuracy of dollar deposits policy, 5 OCT

Iraq's Central Bank disproves Reuters report, affirms accuracy of dollar deposits policy, 5 OCT 

Shafaq News/ The Central Bank of Iraq emphasized that citizens' deposits in U.S. dollars within Iraqi banks are a guaranteed right. This assurance followed recent reports that raised uncertainties about the safety of these deposits.

In a statement, the Central Bank clarified that certain remarks attributed to Mazen Sabah Ahmed, director-general of investment and remittances at the Iraqi Central Bank (CBI), in a Reuters report, were inaccurately presented. 

According to Ahmed, "The Central Bank guarantees dollar deposits. Citizens who have deposited their money in U.S. dollars with any Iraqi bank, whether previously or by 2024, have an inherent right to receive these amounts in cash and U.S. dollars."

Contrary to some media interpretations, the statement reiterated that there was no indication of an anticipated exchange rate reaching 1,700. Ahmed clarified that the Central Bank has practical tools to minimize differences between exchange rates. Furthermore, he revealed that ongoing measures are being implemented to reduce these discrepancies, ensuring a more stable financial environment.

Ahmed highlighted the ongoing reforms and stressed that the Central Bank's initiatives align with international compliance standards. These reforms aim to prevent the unauthorized acquisition or speculative use of the U.S. dollar while enhancing the transparency and integrity of the Iraqi banking system.

Ahmed specified that the announcement of January 1, 2024, as the date for ceasing cash withdrawals, pertains exclusively to transfers received from outside Iraq under specific arrangements. This measure is designed to ensure the sustainability of business operations and does not impact citizens' dollar balances in any way.

Earlier, Reuters reported that Iraq will ban cash withdrawals and transactions in U.S. dollars as of January 1, 2024, in the latest push to curb the misuse of its hard currency reserves in financial crimes and the evasion of U.S. sanctions on Iran, a top Iraqi central bank official said.

Reuters quoted Ahmed as saying that the move aims to stamp out the illicit use of some 50% of the $10 billion that Iraq imports in cash from the New York Federal Reserve each year.

"You want to transfer? Transfer. You want a card in dollars? Here you go; you can use the card inside Iraq at the official rate, or if you want to withdraw cash, you can at the official rate in dinars…But don't talk to me about cash dollars anymore." Reuters quoted Ahmed saying.