Sunday, October 1, 2023
Bank of Jordan and Central Bank of Iraq Forge Economic Partnership, Paving Way for Regional Digital Transformation, 1 OCT
Bank of Jordan and Central Bank of Iraq Forge Economic Partnership, Paving Way for Regional Digital Transformation, 1 OCT
The Bank of Jordan and the Central Bank of Iraq have recently inked a partnership, signaling a significant development in the economic ties between the two nations. This collaboration is set to bring about an array of economic benefits for both countries, reinforcing regional stability and growth.
Strengthening Bonds and Fostering Economic Growth
The partnership stems from a meeting between the Governor of the Bank of Jordan and the Governor of the Central Bank of Iraq, Ali Al-Alaq, in the Jordanian capital. This collaboration is a testament to the increasing economic rapport between the two nations and their joint commitment to foster regional economic development. The agreement is expected to unlock a myriad of economic opportunities, potentially paving the way for increased investments, job creation, and economic stability in the region.
The Second Digital Mashreq Forum: A Step Towards Digital Transformation
On February 24, 2022, Iraq, Jordan, and Lebanon reconfirmed their commitment to the digital transformation of their economies, during the Second Digital Mashreq Forum. Organized by the World Bank Group, the event served as a platform for high-level officials, private sector representatives, entrepreneurs, investors, and business executives to discuss digital reforms, regional collaboration, and opportunities in the post-COVID-19 recovery phase. The forum emphasized the importance of digitizing government services, expanding broadband access, and fostering digital literacy among citizens and public service employees.
Saroj Kumar Jha, World Bank Mashreq Regional Director, highlighted the potential of digital transformation in promoting accountability, transparency, and regional cooperation. He stated, “The digitization of government, digital payments, and expanding broadband access in the three countries will offer opportunities for additional investments, more job creation, more stability, and more peace in this region.”
Bank of Jordan’s Expansion in the Region
The Bank of Jordan recently announced the commencement of its operations in Iraq with the inauguration of its first branch in Baghdad. Shaker Fakhouri, Chairman of the Board at the Bank of Jordan, expressed that this move is a part of the bank’s strategy to expand its business operations where markets are witnessing substantial growth and promising opportunities.
Fakhouri added, “Our decision to establish a branch in Iraq serves to boost our regional presence and exemplifies the strategy adopted by the Bank, namely expanding its business operations in the region. This is expected to reflect positively on the services offered to both our current and prospective clients. Furthermore, we strive to develop our banking scheme in a manner that reflects the Royal visions of boosting investments and achieving economic coordination and collaboration between the two states, thus consolidating our robust economic and historical relations with Iraq.”
Future Prospects: Towards a Regional Digital Economy Hub
These recent developments, coupled with the commitment to digital transformation, reveal a promising future for the region. With an explosive bandwidth capacity growth reaching 35 percent yearly, the Mashreq region has the potential to become a regional digital hub, given a conducive enabling environment. This will necessitate a fair and proportionate regulatory framework that encourages competition and facilitates access to widespread and inclusive cloud-based services.
The ongoing efforts towards digital transformation also underscore the importance of digital financial services. Jordan, for instance, has witnessed significant progress, with 1.8 million mobile wallet users. The adoption of digital payment methods and the emergence of cryptocurrencies signal the inevitable digital disruption in the financial sector, necessitating further work on regulation, infrastructure, and acceptance networks.
As the region gears up for these significant transformations, it’s crucial to ensure that digital upskilling for workers remains a priority to keep pace with the evolving job market. The partnership between the Bank of Jordan and the Central Bank of Iraq marks a significant step in this direction, setting a precedent for other nations in the region to follow suit.
“Development Road Project”: A Strategic Initiative to Link the Middle East and Europe, 1 OCT
“Development Road Project”: A Strategic Initiative to Link the Middle East and Europe"
Prime Minister Muhammad Shi’a Al -Sudani recently met with the Turkish Minister of Transport to discuss the Development Road Project, a significant strategic initiative for the government. The project’s primary goal is to connect the Middle East to the European continent, acting as a vital, cost-effective transportation, and transit corridor.
Strengthening Regional Ties
The Prime Minister emphasized the project’s importance in bolstering relations between Iraq, Turkey, and the rest of the region. The Development Road Project is envisioned to serve as a key platform for fostering regional integration and economic growth. The scheme is seen as a strategic step in enhancing the region’s connectivity, promoting economic development, and facilitating trade and commerce.
During the meeting, the Prime Minister expressed his appreciation for Turkey’s eagerness to participate in the project. He underscored the necessity for continued technical dialogues between the two nations, ensuring the project’s success and sustainability. The Prime Minister’s endorsement of Turkey’s involvement signals a collaborative approach to regional development, underscoring the importance of joint efforts in achieving shared goals.
Turkey’s Commitment to the Project
The Turkish Minister of Transport reiterated his country’s intent to actively contribute to the project. The Minister’s affirmation supports the project’s collaborative spirit, highlighting Turkey’s commitment to regional development and cooperation.
Turkey’s commitment to the Development Road Project is significant given its strategic location at the crossroads of Europe, Asia, and the Middle East. Turkey’s participation in the project could potentially enhance the country’s role as a critical transit hub, bolstering its economic and geopolitical standing.
The Development Road Project: A Cost-Effective Transit Corridor
The Development Road Project is designed to be a cost-effective transit corridor, linking the Middle East to the European continent. The project’s strategic significance lies in its potential to streamline transport and logistics operations across the region, reducing costs and enhancing efficiency.
By providing a direct and efficient route for the transport of goods and passengers, the Development Road Project could potentially stimulate economic development across the region. It could also facilitate increased trade and commerce, fostering closer economic ties between the countries involved.
Conclusion
The Development Road Project is a testament to the importance of regional cooperation and integration in promoting economic growth and development. With the backing of key regional players such as Iraq and Turkey, the project holds great promise for enhancing connectivity, fostering economic development, and strengthening regional ties. Despite the challenges that lie ahead, the Development Road Project represents a significant step forward in the drive towards regional integration and shared prosperity.
"RV UPDATE" BY MNT GOAT, 1 OCT
Mnt Goat
About the WTO accession, the articles told us months ago they were in the final stages and so they are all ready to go.
They only want a currency that can be international prior to making the final move.
They don’t need the currency to revalue only reinstate to be in the WTO, but we know they will revalue when they do reinstate it and go international...
I repeat, they DO NOT have to RV (no mandate for the WTO says they do) only need to reinstate for the WTO, but they are choosing to significantly revalue when they do reinstate it. So we are good…
Question: Holiday in Iraq on October 3...their Independence Day. ...October 4 is Iraq finally a member of World Trade Organization...Can Iraq still continue with the program rate of 1132 until the end of the year? Or will CBI release the new small category notes before October 4?
Mnt Goat Answer: ...As you know they will not give out any dates only a window when they plan to do it. I was told October for the re-education and them they should follow closely with the newer lower notes.
Question: Will there be a cap limit on the dinar when exchanging?
Mnt Goat Answer: Yes, the IMF will place the dinar initially on a managed float and I was told around a $9 cap but that was years ago and things have changed...I wouldn’t be surprised if we witness up to $12 before they cut it off.
Dr Shabibi told us in 2011 that the dinar back then could sustain a rate of $16...They are now pumping 2/3 more oil and have agriculture exports now and also 132 tons of gold...They are filthy rich! I am seeing a constant rate of about USD $3.80 - $4.25 range on the back screens at the bank right now...
Dollar’s Rise Against Iraqi Dinar: A Seismic Shift in Iraq’s Economy, 1 OCT
Dollar’s Rise Against Iraqi Dinar: A Seismic Shift in Iraq’s Economy, 1 OCT
As Iraq grapples with political and economic turmoil, the U.S. dollar has seen a significant increase in its exchange rate against the Iraqi dinar. The surge has been witnessed in both Baghdad’s central forex markets as well as in the Kurdistan region, signaling a seismic shift in the country’s economy. This development has fueled concerns over the potential impact on ordinary Iraqis, already burdened by a fragile economy, and has brought into sharp focus the country’s financial dealings with neighboring Iran.
The Escalating Exchange Rate
The dollar’s exchange rate against the Iraqi dinar has experienced an upward trend in recent times. In Baghdad’s al-Kifah and al-Harithiya Central Exchanges, the dollar was traded at a rate of 155,700 IQD for 100 dollars, marking a 300 IQD increase from the previous rate. In parallel markets in Baghdad, the selling and buying rates of the dollar were pegged at 156,750 and 154,750 IQD for 100 dollars, respectively. Similarly, in the capital of the Kurdistan region, the dollar’s selling and buying rates were at 155,500 and 155,450 IQD for 100 dollars, respectively.
Underlying Factors
The rise in the dollar price began shortly after the new government assumed office in late October of last year. During the previous regime, the rate was stable at between 1,450 to 1,470 dinars to the dollar. The sudden surge has been attributed to the smuggling of U.S. dollars or illegal transfers from Iraq to Iran during the term of the new government, which is primarily composed of militias and political groups close to Iran. These allegations have been raised on several occasions by U.S. officials with Prime Minister Muhammad Shia al Sudani.
Iran, currently grappling with a severe economic crisis due to sanctions, has seen the U.S. dollar’s value against the Iranian rial reach an all-time high. Iraq’s regular imports of gas and electricity from Iran, exempt from U.S. sanctions, are paid in Iraqi dinars to accounts in Iraqi banks owned by Iranians.
Given the present circumstances, Iran needs U.S. dollars to control rising prices and stabilize its economy, which has resulted in the illegal trafficking of U.S. dollars.
However, the smuggling of currency is not confined to Iran, with Iraqi militias reportedly smuggling money to Syria and Turkey as well.
Policy Measures and Implications
To address this issue, the Iraqi central bank has prohibited four Iraqi banks from using U.S. dollars.
These include Al Ansari Islamic Bank for Investment and Finance, Al Qadhaf Islamic Bank for Finance and Investment, Asia Iraq Islamic Bank for Investment and Finance, and the Iraqi Middle East Investment Bank.
The central bank is also auditing several other banks and financial organizations in an attempt to stop the illegal use of dollars in Iraq. While aimed at curbing illicit financial activities, these measures might inadvertently affect the functioning of the Iraqi banking sector and the broader economy.
The escalating exchange rate has triggered protests in Iraq, with citizens demanding a reduction in the dollar price.
They argue that the rising dollar rate has led to an increase in the prices of commodities, including food products, thereby escalating the cost of living in Iraq.
The Iraqi government has responded by raising the value of the Iraqi dinar against the U.S. dollar to limit the impact of the dollar’s appreciation on Iraqi citizens.
However, the effectiveness of this measure remains to be seen.
Looking Ahead
The rising dollar’s exchange rate against the Iraqi dinar presents a complex challenge for Iraq’s economy. It underscores the need for stringent financial regulations to curb illegal activities and maintain economic stability.
At the same time, it highlights the importance of geopolitical considerations in the country’s economic affairs, particularly its financial dealings with Iran.
As Iraq navigates this economic conundrum, the government’s policy measures and their implications will be closely watched by domestic and international stakeholders.
Iran and Iraq Highlight Importance of Implementing Security Agreement, 1 OCT
Iran and Iraq Highlight Importance of Implementing Security Agreement, 1 OCT
The Secretary of Iran’s Supreme National Security Council, Ali Akbar Ahmadian, and the Iraqi National Security Advisor, Qasim al-Araji, recently held a meeting in Tehran emphasizing the importance of implementing the security agreement signed between Iran and Iraq. The agreement is seen as a critical roadmap to establish border security and eradicate elements causing insecurity in both countries and the broader West Asia region.
A Roadmap for Stability
In the meeting, Ahmadian described the recent security agreement between Iran and Iraq as the result of months of negotiations and joint efforts. He underscored the security pact as a roadmap for establishing stable security at the borders. Ahmadian stressed on Iran’s consistent support for governments based on the people’s determination, hinting at the democratic principles that guide Iran’s foreign policy. He urged the Iraqi government to ensure the security of the common borders with Iran as soon as possible within the framework of the agreement, thereby ending the presence of anti-revolution elements in the country.
Qasim al-Araji, on his part, affirmed the Iraqi government’s commitment to the security accord and expressed Iraq’s determination to interact with Iran in all fields. He emphasized Iraq’s commitment to the recent agreement with Iran, which is seen as an essential tool in managing the border security challenges faced by both nations.
Context of the Agreement
The 2023 Security Treaty between Iran and Iraq was signed on 19th March 2023 in Baghdad by representatives of Iran and Iraq. The agreement commits both nations to safeguarding the principles of good neighborliness and protecting the common border. One of the main purposes of the deal was to end the illegal presence of anti-Iranian armed groups and elements affiliated with the Zionist regime in the Iraqi areas adjacent to Iran’s northwestern border regions.
This agreement is seen as a strategic move to tighten the frontier with Iraq’s Kurdish region, where Tehran says armed Kurdish dissidents pose a threat to its security. The frontier has come under renewed focus following missile and drone attacks against Iranian Kurdish groups based in northern Iraq, launched by Iran’s Revolutionary Guards. These groups were accused of fomenting protests sparked by the death of an Iranian Kurdish woman while she was being held in police custody.
Potential for Enhanced Cooperation
During the meeting, Ahmadian pointed out the potential for improved cooperation in various fields, particularly economics. He noted that there exist ample opportunities for closer cooperation between the two neighbors, particularly in economic relations. The implementation of the security agreement opens up new avenues for strengthening economic ties and promoting shared prosperity.
Al-Araji reaffirmed Iraq’s determination to carry out the security deal with Iran and expressed Baghdad’s willingness to take every opportunity to strengthen relations with Tehran. He indicated that the Iraqi government and the national security body are determined to build on the security agreement to deepen cooperation in various sectors with Iran.
Future Implications
The security agreement between Iran and Iraq represents a significant step towards ensuring stability and security in the region. By committing to curb the activities of armed groups operating across the border regions, the two countries aim to create a safer environment conducive to economic growth and development. The accord also reflects the shared commitment of both nations to foster deeper relations based on mutual respect and shared interests.
The full and accurate implementation of the security agreement will be key to realizing these goals. As the two nations move forward, the continued commitment to the principles outlined in the security agreement will be critical in shaping the future trajectory of Iran-Iraq relations and the broader geopolitical dynamics of the region.
