DINAR REVALUATION REPORT: Central Bank of Iraq Delegation Visits US to Discuss Banking Sector Challenges, 30 AUGUST

 Central Bank of Iraq Delegation Visits US to Discuss Banking Sector Challenges

A high-level delegation from the Central Bank of Iraq (CBI), led by Governor Ali al-Alaq, has arrived in the United States to engage in crucial discussions regarding the state of Iraq's banking sector. The visit, which commenced on August 26, aims to address the evolving challenges within the industry, particularly the restrictions imposed on the use of the US dollar by numerous private Iraqi banks.

Background and Context

Iraq's banking sector has faced significant challenges in recent years, including a shortage of liquidity, limited access to credit, and a lack of confidence in the banking system. The country's economy has also been impacted by the COVID-19 pandemic, which has exacerbated existing issues. The CBI has been working to implement reforms and strengthen the banking sector, but the restrictions on using the US dollar have posed a significant obstacle.

Key Issues to be Discussed

The CBI delegation is expected to discuss several key issues with US officials, including:

• Restrictions on US dollar usage: The delegation will likely seek to address the restrictions imposed on private Iraqi banks, which have limited their ability to conduct transactions in US dollars. This has had a significant impact on trade and commerce in the country.
• Banking sector reforms: The CBI has been working to implement reforms aimed at strengthening the banking sector and improving its stability. The delegation may discuss these reforms with US officials and seek guidance on best practices.
• Anti-money laundering and combating the financing of terrorism (AML/CFT): Iraq has been working to improve its AML/CFT framework, and the delegation may discuss progress in this area with US officials.

Implications and Expectations

The visit by the CBI delegation is seen as a positive step towards addressing the challenges facing Iraq's banking sector. The discussions with US officials are expected to provide valuable insights and guidance on how to overcome these challenges. The outcome of the visit may have significant implications for the Iraqi economy, including:

• Improved access to credit: Easing restrictions on US dollar usage could improve access to credit for Iraqi businesses and individuals.
• Increased confidence in the banking system: Strengthening the banking sector and improving its stability could increase confidence in the system and encourage more people to use banking services.
• Enhanced economic growth: A stronger banking sector could contribute to enhanced economic growth in Iraq, which has been impacted by years of conflict and instability.

The visit by the CBI delegation is a crucial step towards addressing the challenges facing Iraq's banking sector. The discussions with US officials are expected to provide valuable insights and guidance on how to overcome these challenges and promote economic growth in the country.