IMPORTANT IRAQ NEWS: AL-NUSAIRI: EXPLAINS THE NEW MECHANISM FOR EXTERNAL TRANSFERS AFTER THE PLATFORM IS CLOSED, 10 JAN

 AL-NUSAIRI: EXPLAINS THE NEW MECHANISM FOR EXTERNAL TRANSFERS AFTER THE PLATFORM IS CLOSED

Economic and banking advisor Samir Al-Nusairi explained that closing the electronic platform on 12/31/2024, which was used by the Central Bank for prior auditing and controlling the transparency of foreign transfers and ensuring their arrival to the final beneficiary and overcoming suspicions of money laundering and terrorist financing, is not, as some believe, closing the platform is a closure of foreign transfers, but rather a change in the mechanisms to achieve fluidity and speed by reducing the links.

Al-Nusairi said in a televised interview that it is not normal for the Central Bank or the US Federal Reserve to carry out executive procedures, but rather the task of central banks is supervision and control, and the electronic platform was a stage in this direction, and now we have reached the stage that is practiced in the countries of the world according to international banking standards through the direct relationship between local banks and correspondent banks.

He added that transfers in other currencies will enable Iraqi banks that do not have correspondents in American banks to conduct their transfers through correspondent banks in other countries such as China, Turkey, the United Arab Emirates, India, Europe, Jordan and Saudi Arabia. This will lead to expanding the number of Iraqi banks that participate in foreign transfers and reduce pressure on other banks.

He stressed that the exchange rate announced as the parallel rate does not reflect the price reality, firstly because Iraq does not have the parallel market situation, which is only achieved when it has sources of dollars and currencies other than the Central Bank, such as private sector exports, remittances from residents abroad, tourism, etc., so it has exchange rates that correspond to the official exchange rate at the Central Bank, and that speculation in dollars on the black market is punishable by law.

Secondly, limiting the sale of cash dollars to travelers and through a strict mechanism has made cash dollar sales at a minimum level, and therefore what is in circulation is what remains with travelers. We should look at the price at which the Central Bank covers all external operations, including imports and personal transfers for the purposes of study and treatment abroad and legitimate purposes, which explains the stability of prices in light of the current inflation rate, which is about 3.1% less than the inflation rates in Arab, regional and neighboring countries. This means that the Central Bank has achieved a basic objective of monetary policy.

Al-Nusairi expressed his surprise that some people calculate the banks’ revenues from selling the dollar by measuring the difference between the market price and the official price, which is a big mistake because the banks do not transfer at the market price but at the official price monitored by the Central Bank. He explained that the foreign currency selling window is dedicated to securing the Iraqi dinar for the purposes of the Ministry of Finance’s operating budget and to enhance the banks’ balances in foreign currencies for external transfers and to cover the cash dollar for travelers and for other legitimate needs of citizens.