Behind the scenes of an exciting session of merchants and restaurant owners who “invested” in the exchange rate difference in Iraq, 19 JUNE

 Behind the scenes of an exciting session of merchants and restaurant owners who “invested” in the exchange rate difference in Iraq

A lengthy report by the American newspaper “The National” reviewed the scenes of investing in the exchange rate difference in Iraq, where businessmen, merchants, and restaurant owners benefited by operating their money in this trade, by withdrawing the dollar from the central bank and selling it on the black market, which achieved huge and rapid profits in this way, However, the recent actions of the Central Bank caused problems between these partners due to losses.

The report, translated by “Baghdad Today,” says, “Despite recent efforts for reforms, challenges remain, and well-connected businessmen are still exploiting loopholes in the foreign currency sales window managed by the Central Bank of Iraq to make obscene amounts of money.” From the margin between the official exchange rate and the black market rate.

The National spoke to dozens of businessmen who said the strict measures had helped simplify the import process and forced many to formalize their transactions, but they said there was still room for manipulation.

One of the businessmen said: “There are still ways to circumvent the procedures,” adding that  “falsifying invoices and arrangements at border crossings and manipulating the prices of goods by setting inflated prices by exporters are among the common methods.”

In a room decorated with intricate tapestries and ornate tapestries, The National attended a tense meeting of businessmen, their faces etched with a mixture of frustration and resignation.

They have banded together to resolve a months-long financial crisis that has escalated beyond the bounds of legality, plunging them into the murky waters of clan diplomacy.

By accessing a government-run platform offering US dollars at the official rate, a businessman lured other traders with a deal promising them huge profits from the spread between official and black market rates, sources involved told The National.

With hundreds of millions of Iraqi dinars in circulation, traders received unexpected cash gains. But as the days and months passed, the businessman found himself unable to pay his debts, leaving the merchants in a precarious situation.

No official complaint was filed against him, and the businessman did not face any trial.

“It is clear that we have reached an impasse,” a representative of the businessman who lives in a neighboring country told the audience, who exchanged wary glances. "We can't continue down this path. It's time to cut our losses."

His proposal hung in the air, and was met with hesitant votes of approval.

Giving up half of the two billion Iraqi dinars was a bitter pill to swallow, but it seemed the only viable option in the face of mounting losses and uncertainty.

The owner of a famous restaurant chain in Baghdad told The National newspaper after the meeting: “We say that whoever loses half his money is not a loser.”

“At least I have half my capital in my hands – better than nothing,” he said.

“There is no business that allows you to hit the jackpot like taking advantage of the exchange rate margin in a short period of time, which is why we invested heavily with him.

He added: "Over the past months, he has been paying us on time, but it seems that he has been having problems recently."  link