Iraqi Minister Of Finance: Economic Recovery Is Underway Amid The Return Of Commercial Financing To Normal
Economy Iraq Minister of Finance 2023-12-18 03:04 Shafaq News/ Minister of Finance, Taif Sami Muhammad, said on Monday that economic recovery is underway in the country amid the return of commercial financing to normal.
This came during his participation, along with a delegation of advanced staff in the Ministry of Finance, and a number of representatives of ministries and the Central Bank of Iraq, in the meetings of the International Monetary Fund expert visiting mission held in the Kingdom of Jordan for the period from 14-17/12/2023.
The meeting discussed
priorities for correcting public finances through structural reforms, represented by
encouraging foreign trade payments to commercial banks and
reducing reliance on cash, in addition to
expanding the use of point-of-sale devices and electronic payments, and
accelerating the completion of the restructuring of government banks.
On the other hand, the meeting discussed the
actual expenses and revenues until September 2023, the
expected ones for the end of this year, and in addition to the
spending ceilings for the year 2024,
appointments file contained in Budget Law No. (13) of 2023,
financial reforms,
bank structuring,
customs and tax automation, the
unified treasury account, and the
comprehensive banking system. Implementing the POS electronic payment system for the purpose of maximizing revenues.
Support for funds for which allocations were made in the general budget was also discussed, in addition to
structural reforms to support private sector development,
increase job opportunities,
reforms to the retirement system, the
social protection network,
higher revenues and exports,
higher economic growth,
banking and electricity sector reforms,
strengthening governance and
reducing... From corruption
The meeting also touched on the role of the Central Bank of Iraq in tightening monetary policy appropriately with the aim of alleviating inflationary pressures by continuing to enhance liquidity management.
A statement issued by the Iraqi Ministry of Finance stated that the Central Bank has made good progress in implementing technical assistance recommendations for managing local liquidity and bridging the time gap between auctions of bank instruments to ensure continuity of liquidity absorption. Minister Taif said during the meeting that economic recovery is underway amid the return of commercial financing to normal and the large financial expansion, maintaining economic stability and the importance of coordination between monetary and financial policy and ensuring the sustainability of the need to gradually renew financial policy while maintaining spending on the necessary infrastructure and social spending needs and controlling... Wage bill and increased non-oil tax revenues.
Association Of Banks: The Battle With Dollar Speculators Has Reached Its Final Round
Economy 12-15-2023, Baghdad – IA The Iraqi Private Banks Association said today, Friday, that the battle with dollar speculators has reached its final round, and
while it praised the Central Bank’s measures to regulate the movement of funds to achieve financial and bank reform, it confirmed that it will contribute to reclassifying banks, increasing their capital and raising the level of services provided. For citizens.
The economic and banking advisor to the association, Samir Al-Nusairi, told the Iraqi News Agency (INA):
“The Central Bank’s measures and efforts that have been made since the beginning of 2023 and with the support of the government have yielded results and begun to give results according to what was lanned, and the so-called parallel (black) dollar has begun to die and has been besieged.”
Speculators who deal in it to harm the national economy, and currently the battle is with them in the final round.” He added,
“This is what was stated in detailed procedures and administrative, technical and negotiating steps with the US Federal Bank and the US Department of the Treasury and the understandings related to regulating foreign trade financing by approving the opening of accounts for Iraqi banks in American, Chinese, Emirati and Turkish correspondent banks to deal directly with them for foreign transfers in the currencies of these countries, which... It includes the dollar, the euro, the Chinese yuan, the Indian rupee, the Emirati dirham, and the Turkish lira,
leaving the electronic platform in the year 2024, and importing the dollar and foreign currencies into Iraq from Iraqi bank accounts at correspondent banks or abroad. Al-Nusairi confirmed,
“Reaching agreements to open 40 accounts for Iraqi banks in correspondent banks for foreign trade,” noting that “the Central Bank’s new strategy to reform the banking sector will adopt the reclassification of banks and increase their capital to the ceiling set by the Central Bank in accordance with the specified time frames until the end of 2024,
which will lead to... Raising the capabilities of our banks to provide the best banking products and services to customers,
which will reflect positively on the movement of the economy, investment, development and the transition to comprehensive digital transformation.” He added,
“Since the beginning of the year 2023, financial policies have been reconsidered according to a new vision for banking reform that complies with the requirements of the global financial system, and
a new strategy has begun to be implemented with mechanisms based on studying and diagnosing the causes of the imbalance and determining the road map, steps, and executive procedures that have been and will be applied at the level of the central bank’s departments and banks.” And the bodies supporting banking work and government agencies related to comprehensive economic reform, as
the Central Bank had previously issued new instructions for external transfers for the year 2023 and three procedural packages to facilitate and control the circulation of foreign currency in the monetary and commercial market. Al-Nusairi continued,
“In August of this year, the Central Bank issued its important statement in which it defined its new strategy for organizing the financing of foreign trade according to new foundations that will move Iraq to the stage of regularity in the global financial system, and
in which it clarified the executive procedures to control the stability of the exchange rate, and the most prominent of its contents are:
Adopting the electronic platform exclusively for foreign remittance transactions,
controlling illicit trade through official and unofficial border crossings,
stopping trading and transactions in dollars on the black market,
preventing all websites and media television channels from publishing exchange rates on the black market due to their violation of the law, and having importers prove that all their imports were made through the platform and at the price.
The Customs Authority and the General Tax Authority implement proposals and treatments for small merchants to enter the platform in accordance with the rules, and
this is consistent with the government’s initiative to launch the national project to control prohibited imports. He continued,
“As we are in the final days of 2023, the Central Bank’s strategy for banking reform in all its axes has become clear for the coming year 2024 and the following years, and
it is an embodiment of what it specified in the road map that it clarified in cooperation with the government in accordance with what was stated in the government’s curriculum in Axis 12 (Financial and Banking Reform) Paragraph 7 thereof, which is concerned with developing and enabling banks to contribute to development and investment. He explained,
“Here we can summarize the Central Bank’s plan, which it is currently working to implement accurately, as follows:-
First - Providing a stable financial system lies in accompanying financial electronic systems.
Second: Commitment to establishing the rules of compliance, risk management, transparency, and soundness of financial operations.
Third - The transition from the cash economy to the digital economy and what is called the fourth revolution and the accompanying measures that achieved a qualitative shift in the dealings between the government and the central bank.
Fourth - Implementing the financial and banking reform plan, which is characterized by international standards that keep pace with global developments in the field of the financial digital economy.
Fifth - Working to strengthen international relations, including establishing a network of relations with foreign correspondent banks.
Sixth - Establishing Riyada Bank in line with the Prime Minister’s initiative and redirecting work on initiatives to finance small and medium enterprises according to specific standards.
Seventh: Preparing and launching a financial inclusion strategy and putting it into effect in coordination with the relevant authorities.
Eighth - Launching the national lending strategy, relying on the banks’ own financial capabilities to attract deposits and invest them in providing the best banking products to customers and contributing to development. https://www.ina.iq/199327--.html
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Quote: "The Central Bank stated in a statement...that Central Bank Governor Ali Mohsen Al-Alaq met in Dubai with the Chairman of the First Abu Dhabi Bank Group, Hana Al Rostamani, indicating that during the meeting it was agreed to launch financial transfer operations between the two countries and finance trade and imports between them. Iraq and the United Arab Emirates in the UAE dirham currency through First Abu Dhabi Bank "
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Article: " Government source: Starting to implement the banking arrangements agreement with Türkiye”
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BANK STORY PERSON: I'm a pastor south of Nashville...yesterday I thought I'm gonna do my due diligence and reach out to some of the banks in my area...The Franklin/Brentwood area south of Nashville is the richest county in the United States...The first bank was a Pinnacle Bank...the oldest bank in Nashville...I talked to the branch manager and she knew nothing...
She knew zero about it...I walked over to the Wells Fargo...I said I'm curious if you guys verify and exchange foreign currency her eyes lit up. She said, which currency have you got? I said the Iraqi dinar. She said, sir we do not and the reason we do not is because there have been several times Wells Fargo has got burned by bad currency...
I thanked her for her time and I thought ok two strikes let's try Chase which is 50 yards away. I walk into Chase in Franklin, Tennessee, asked for the branch manager...I said sir do you do anything with foreign currency?He said yes we do. He said which currency have you got. I said the Iraqi dinar. He said absolutely yes. He was very excited about it. We were standing right there in the middle of the lobby and he didn't try to hold back his facial expression,
language or anything. He said, yes, we would love to do business with you.
FRANK: Did he say anything else like yeah, we know or we're in preparation, we're getting ready?
Bank Story Man: I said, how are you aware of that. He said, we've been waiting for this to transpire...
I said, depending on the amount dinar our group brings in to you, can you work with us on the transaction fee or even eliminate it?He said sorry sir we are not...The way Chase has got it established...they have it baked in. That was his exact words, baked in transaction fee into the rate...He can't change it. I said so no matter what outlet...location or the amount of dinar? He said that's right, it will not change.
FRANK: What was that fee did he say?
BANK STORY MAN: He said around 4%.
FRANK: Wow, I've always said a fair rate is anything like 1%, 2% or 3%. I guess they decided to go one more percent. That's a lot of money.
BANK STORY MAN: He said I also I want you to be aware of something. He said when you come in to do your exchange, he said realize we can only do $5,000 increments at a time.
In a statement, the group added that, as friends and partners of Iraq, Canada, France, Germany, Italy, Japan, the European Union, the United Kingdom, the United States, and the World Bank commit to supporting Iraq in the implementation of a comprehensive and ambitious reform agenda, paving the way to sustainable and inclusive economic development.
Statement of the Iraq Economic Contact Group of the G7, European Union and World Bank
On December 12, the Iraq Economic Contact Group (IECG) held the final meeting of 2023, co-chaired by Italy and the United States. As friends and partners of Iraq, Canada, France, Germany, Italy, Japan, the European Union, the United Kingdom, the United States, and the World Bank commit to supporting Iraq in the implementation of a comprehensive and ambitious reform agenda, paving the way to sustainable and inclusive economic development.
The IECG is eager to strengthen its engagement with the Government of Iraq (GOI) through regular dialogue at both the political and technical level. This engagement is crucial to streamline cooperation between the two sides, identify and support common goals, and support the GOI's priority reform areas. The IECG commends Prime Minister Mohammed Shiaa al-Sudani for appointing business and economics experts within his office and looks forward to collaborating with them.
The IECG was encouraged by Prime Minister Sudani's announcement of new economic reform initiatives throughout 2023 and the passing of a historic three-year budget that laid the foundation for implementation of the government's reform agenda. In October, Iraq gained membership to the European Bank of Reconstruction and Development (EBRD) - a move strongly supported by the IECG as the first step to unlocking new sources of investment and enhanced cooperation with other multilateral and bilateral financial facilities.
In the past month, the government convened conferences on Public Private Partnerships (PPPs) and tax reform, including a new bank sector reform project with Rafidain Bank. Further, the GOI recently announced the establishment of the Iraq Fund for Development (IFD) alongside the Development Road project, and the Prime Minister strengthened economic ties with regional partners. The GOI's efforts to expand the use of digital platforms for financial transactions, with electronic payment and other e-commerce mechanisms, represent important steps to minimize the informal economy and reduce opportunities for corruption.
Looking ahead to next year, the IECG welcomes further cooperation in support of Iraq's economic and financial sector development, including Prime Minister Sudani's policies to strengthen the dinar and oversee monetary policy. Clear communication of new dinar policies during the transition period will help avoid adverse effects on Iraqi households and businesses as well as on development cooperation projects and foreign investments in Iraq.
The IECG also stands ready to support Iraq's next steps to becoming an EBRD Country of Operations, its journey toward World Trade Organization accession, and its potential partnership with the European Investment Bank (EIB). EIB's expertise in road, railroad, water and sanitation investments, climate action, environmental sustainability financing as well as urban transmission initiatives will accelerate key infrastructure measures and help facilitate a green transition.
The IECG urges further attention in 2024 to address the deficit and public sector wage bill, measures that would improve fiscal resilience. Timely budget execution will be critical to the GOI's ability to sustain important infrastructure investment, particularly in expanding domestic power generation, distribution, and expansion of green energy. Long-term sustainable economic development is contingent on a dedicated response to pressing climate and environmental challenges. Sustained investment in water management and infrastructure is critical to counteract the debilitating impacts of climate change.
To accelerate private sector growth, the IECG encourages government action to identify and address the challenges faced by domestic and international business, including efforts to promote transparent and predictable regulations. In this vein, we welcome further progress on the PPP, Companies, Industrial Investment, Customs, and Arbitration laws as well as timely implementation of the recommendations from the recent PPP and tax reform conferences.
On January 1, Italy and the United States proudly hand over the IECG to incoming co-chairs France and the United Kingdom. Under their leadership, the IECG will continue to support an ambitious reform agenda, promote sustainable economic development, and stand by Iraq's side as a reliable friend and partner in 2024. link
“The Basel Committee on Banking Supervision has issued a public consultation on proposed amendments to its standard on banks’ exposures to cryptoassets.” These proposed changes will flesh out the criteria needed to back stablecoins with reserve assets and require Banks to have an understanding of how these procedures work to ensure a sufficient understanding of their use.
These public comments and proposed amendments will become crypto asset standards for the next economy. The purpose of public consultation is to allow citizen input to inform policy design along with decision-making processes.
This will be an update to a process that has already taken place and will be due on March the 28th, 2024.