Tuesday, November 19, 2024
Al-Sudani: Iraqi openness to a comprehensive partnership with Turkey and the development of the trade balance, 19 NOV
Prime Minister Mohammed Shia Al-Sudani stressed on Monday the Iraqi government’s openness to strengthen relations with Turkey in various fields, stressing the importance of achieving a serious and real partnership that contributes to the development of the trade balance between the two countries.
The Sudanese media office said in a statement received by {Al-Furat News}, that “the latter received Turkish Trade Minister Omar Bolat, who is visiting Iraq at the head of a large delegation of about 150 businessmen from the Council of Exporters and the Turkish Contractors Union, on a working visit that includes the cities of Baghdad and Basra.”
During the meeting, the Sudanese stressed Iraq’s openness to building a serious and genuine partnership with Turkey in various fields, especially with the economic reforms carried out by the government recently, which contributed to creating a suitable investment environment inside the country. He also stressed the government’s desire to develop the trade balance between the two countries, in conjunction with the rapid growth of the Iraqi industry.
wo sides discussed preparations for the meeting of the Iraqi-Turkish Economic and Trade Committee scheduled to be held over the next two weeks.
For his part, Minister Bolat conveyed the greetings of Turkish President Recep Tayyip Erdogan to the Prime Minister, stressing the importance of growing relations between the two countries as an opportunity to strengthen cooperation, in line with the agreements reached during Mr. Erdogan’s recent visit to Iraq.
Bolat referred to the strategic development path project, stressing Turkey’s readiness to provide all necessary support to move forward in the implementation of this important project for the region and the world.
https://alforatnews.iq/news/السوداني-انفتاح-عراقي-لشراكة-شاملة-مع-تركيا-وتطوير-الميزان-التجاري
STATUS OF THE RV, PART. 1. BY MNT GOAT, 19 NOV
STATUS OF THE RV
Yes, it is mid-Nov already and so the RV choo choo train keeps moving down the tracks. I had an interesting conversation with my CBI contact yesterday, Wednesday. We talked about the new peg for the dinar.
The new peg is established and will finally take the place for IQD peg instead the sole de facto peg to the US dollar. I was told we will shortly see news articles on this subject matter as they educate the citizens.
This has been the problem for almost a decade now. Yes, the time had come to do this move but it was delayed and delayed. This, as I explained before, has caused a ripple effect with negative consequences and when crises hit like ISIS and the Covid pandemic, Iraq was not prepared to handle them.
😊In today’s news we read once again Iraq has all this GOLD reserves. WOW! So, today I want to review again why this is so important. Is it just because Iraq is thinking about joining BRICS? It goes deeper than this and in an article in today’s news titled “GOLD RESERVES BOOST CONFIDENCE IN NATIONAL CURRENCY” it explains more.
The article tells us that Gold plays a vital role in the monetary reserves of countries for several reasons related to financial stability, hedging against economic risks, enhancing confidence in the national currency, as well as being an effective tool for hedging against inflation.
This prompted the Central Bank of Iraq, on several occasions and in successive years, to increase its gold reserves. Now if you take the monetary mass of Iraq then do the math of the about 150 tons of acquired gold in their reserves, you can easily see that when they shrink the monetary mass, these reserves could cover the entire monetary mass of dinars in circulation.
WOW! Yes, it could potentially cover 100% not just a percentage of the dinars in circulation, if all goes according to plan. Besides this amount remember of reserves, there is still the sovereign funds and liquid cash in the DFI funds in U.S. Banks just sitting there.
Of course, this money needs to be released to Iraq at some point. If you talk in legal terms, it should have already been released. The UN has decreed it should be released since Chapter VII sanctions are released on Iraq. So, what are they waiting for? One issue for the holdup is creditor protection from the war. This protection will come with financial stability.
We are told the main reason for so much gold, is that acquiring gold is a haven for balance between other assets whose values are affected by the nature of the economic cycle (recession and inflation), noting that the price of gold decreases during recession and increases during inflation, reflecting its balancing role. Isn’t this then the financial “stability” that the CBI keeps telling us it needs to conduct the project to delete the zeros?
😊In another article the CBI is once again educating the citizens and merchants on how the new process will replace the currency auctions. In the article titled “PRIVATE BANKS ASSOCIATION: IRAQ TO ADOPT ADVANCED TRADE FINANCE SYSTEM BY END OF 2024” once again they explain how the new process will work.
I quote from the article “ “work on the foreign trade financing platform began at the beginning of 2023 and is witnessing significant development,” indicating that “it is expected that by the end of the year there will be a transition to another more advanced and accurate system to enhance control over foreign transfers related to trade.”
The article then goes on to say “the new system will depend on correspondent banks instead of the current mechanisms, as each bank will have the ability to conduct transfers according to its capabilities and possession of correspondent accounts, whether in American banks or other banks that provide transfer services in different currencies .”
The key words here are correspondent banks & different currencies meaning banks that made arrangement to conduct the currency exchanges from the IQD to the corresponding currency of the country that Iraq is conducting trade with. Meaing not just exchanging IQD for USD anymore but going directly to the currency of origin of the goods or services.
Is this not how regular international trade is conducted and so for a country not in sanctions this is business as usual anyway. Yes, Iraq is finally making that move out of the sanctioned process.
I also like this next statement in the article when He added, “This process will remain the same for the public and merchants wishing to transfer, as the requirements will not change significantly, but the accuracy of transfer operations will improve through the activation of control systems and regulations imposed by correspondent banks.”
Let me explain. Folks, they are finally ending the currency auctions as we know it today. The CBI will no longer by conducting the exchanges solely to the US dollar using the CBI reserves, money derived from oil sales. This will also create a demand for the IQD as when these foreign countries want to buy import products from Iraq they will have to pay in IQD.
We have read of the many existing products and new products that Iraq now produces. We read in my Tuesday Nov 12th Newsletter the completion of the Faw port and how it is the “gateway” to the greater Iraq. Come’on folks this is going to bring to reality the vision of Iraq as a super economic giant. This is just what secretary of state Hillary Clinton and others told us was coming for Iraq. Well… it’s here!
So, of course Iraq will have to do business with a variety of countries and not just middle eastern countries. Vast trade will also occur with China, India and European countries. Do you think the IQD is going to be much more valuable? I gave you a brief explanation of how a currency can hold its value in my last Newsletter too. Did you read it? Did you educate yourself. If you did, then you can connect the dots now when I talk about these things today.
In this article today the author also stressed that “this transformation will increase public confidence in the Iraqi banking sector, as local banks will adhere to the instructions and mechanisms of international correspondent banks, which will enhance work within strict international systems and agreements.” So, goodbye corruption and hello financial stability.
Have we not been waiting now for over a decade for this breakthrough on rebuilding the citizens confidence in the banking sector? It’s here now as another critical goal is accomplished.
We all have read the articles on how the accomplished this feat i.e. electronic mechanisms. Yes, it took over a decade. The important part for us investors is that this accomplishment was a critical step in transforming Iraq. Oh boy…. I luv that word “transformation”. Yes, a nice buzz word that rings RV to my ears….lol..lol..lol… Can you hear it too?
IMF PRAISES POSITIVE DEVELOPMENTS IN IRAQ IN FINANCIAL AND BANKING ASPECTS, 19 NOV
IMF PRAISES POSITIVE DEVELOPMENTS IN IRAQ IN FINANCIAL AND BANKING ASPECTS
The International Monetary Fund praised, on Wednesday, the positive developments witnessed by Iraq in the financial and banking aspects.
A statement by the Presidency of the Republic received by (Al-Rabia) stated that “President of the Republic, Abdul Latif Rashid, received today, Wednesday, at his residence in the Azerbaijani capital, Baku, the Director of the International Monetary Fund, Kristalina Georgieva, within the framework of His Excellency’s participation in the United Nations Climate Conference (COP29).”
He added, “During the meeting, the cooperation relations between Iraq and the International Monetary Fund and ways to enhance them in the context of supporting the development path in Iraq were reviewed. During the meeting, His Excellency the President of the Republic stressed Iraq’s endeavor to implement integrated programs and plans to stimulate the economy and support the financial and banking reform process.”
TIDBITS FROM MARKZ & MILITIAMAN, 19 NOV
MarkZ & Militia Man
[via PDK]
MarkZ: They need to finish out the 2024 budget – they have money they want spent over the next month. There is so much they are pushing for to make happen. So much good is going on right now
Militia Man: I totally agree. Look at the Port of Faw and the non oil revenue streams in Iraq. And currency transactions with Turkey…they would have to be Article 8 compliant.
And look at the Development road project. But Iraq still needs to show its people its REER (Real Effective Exchange Rate)
MarkZ: So many things are finally coming together.
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