[via PDK] Article: “Iraq pushes to shift away from dollar dependency” they are going to need a currency- one that works internationally and carries a value…. They are telling us…we are just frustrated it’s taken so long. We know their de-dollarization goal is Jan 1st.
The big news is the article and report...from the IMF...where they quite literally say that Iraq has a fantastic year ahead and much of that is due because of the passing of the exchange rate revaluation. The IMF released an actual bulletin discussing how well their meetings went with Iraqi officials…they talk about all the things Iraq did right and what the world is going to be…
they even mention that part of what will make their economy so successful in 2024 is the exchange rate revaluation...I asked an Iraqi contact in government/finance his thoughts about if the revaluation they mention was the one in Feb where the dinar went from 1562 to about 1300 dinar per one dollar. …He said NO this is not what they are referencing. …so this is exiting straight from the IMF itself. Now we just need to cross the finish line.
An Economic Vision On Linking The Dinar To The US Dollar: A Weak Point For Iraq
Today 19:40 Information/private.. Today, Wednesday, the economic expert, Diaa Al-Mohsen, considered the link of the Iraqi economy to the dollar currency a “weak point” for the country, while indicating the “optimal” way to overcome this problem.
Al-Mohsen said, in an interview with the Maalouma Agency, that “pegging the local currency to the US dollar represents a state of weakness for the country’s economy, because the green currency changes depending on changes in the US economy, such as raising the interest rate by the Federal Bank, which will cause the value of the dollar to rise, and so on.”
He added, "Relying all purchases on the dollar could have a negative or positive impact," pointing out that "this issue can be overcome when there is a basket of currencies, that is, when the value of a particular currency is low, the government can move toward another currency." The economic expert explained, "This happens when Iraq has a sufficient balance of these currencies, which gives it smooth conversion to the euro, the Russian ruble, and the Chinese yuan."
Earlier, the head of the Diyala Chamber of Commerce, Muhammad Al-Tamimi, confirmed that Washington used the dollar 4 times during 2023 to pressure Baghdad to achieve a political agenda, which led to provoking crises and raising prices at rates of up to 10%, especially for basic materials, due to the impact of the dollar’s liquidity and its control by about 90%. of transactions directly.
The United States of America continues to impose its influence on Iraq in many vital files, including depositing the money from the sale of Iraqi oil in the US Federal Bank, amid clear blackmail by passing many files, most notably the dollar bill, which puts great pressure on the government. End 25/R
FIREFLY:TV special saying we are seeking monetary sovereignty over the dollar.
FRANK: When they say the word monetary, they are talking about your currency. And when they say sovereignty they're talking about you only using your currency the Iraqi dinar and not suing any other currency like the American dollar. That's why the dollar is going down in value.
That's how your dinar is gaining value. Sudani said it clearly, I am adding value to our currency. They want the American dollar to go down. They want your currency to dominate...
FIREFLY: Bank guy said the dinar inside our country has steadily being established with stability...Because of these efforts the dollar is dropping every day this whole week. It had a major decline...the dollar will continue to drop. Start the new year with no dollar actions allowed anywhere.
FRANK: ...I believe somewhere around the first they have no choice but to give you value.
“FROM THE IMF, FROM THE HORSE’S MOUTH… GIVES PERMISSION TO PULL THE FINANCIAL LYNCHPIN ON THE GRENADE OF THE MONETARY REFORM !!! !!! !!!”…………F26
IMF Staff Concludes Staff Visit with Iraq
December 19, 2023
End-of-Mission press releases include statements of IMF staff teams that convey preliminary findings after a visit to a country. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board.
Economic activity is recovering, although oil production cuts are weighing on overall growth, and at the same time inflation has declined.
The large fiscal expansion in the three-year budget law poses significant risks to fiscal and external sustainability over the medium term.
Fiscal prudence and structural reforms are critical to safeguard macroeconomic stability, ensure sustainability, and achieve durable and more inclusive growth.
Washington, DC: A staff team of the International Monetary Fund (IMF) led by Jean-Guillaume Poulain met with the Iraqi authorities in Amman, Jordan during Dec 12-17 to discuss recent economic developments and outlook as well as policy plans.
At the end of the mission, Mr. Poulain issued the following statement:
“Against the background of a large fiscal expansion, non-oil GDP is expected to grow by 5 percent in 2023. Continued budget execution should help sustain strong non-oil growth in 2024. However, lower oil production, following the closure of the Iraq-Turkey pipeline and OPEC+ production cuts, will reduce overall GDP growth in 2023 and 2024.
Inflation has declined from its January peak and is projected to stabilize in the coming months—helped by the Central Bank of Iraq’s (CBI) tighter monetary policy, passthrough from the exchange rate revaluation, lower international food prices, and normalization of trade finance as compliance to the new anti-money laundering/combating the financing of terrorism (AML/CFT) [GM1] framework improved.
“The three-year budget approved in June 2023 marked a shift in Iraq’s budgeting practice, envisaged to improve fiscal planning and continue important development projects over the medium term. Despite a late start of budget implementation, the fiscal balance is expected to shift from a large surplus in 2022 to a deficit in 2023. Staff projects that the deficit would widen further in 2024 reflecting the full year impact of recent measures. The large fiscal expansion, including a substantial increase in public hiring and pensions creates permanent spending that will put pressure on public finances over the medium term.
“Ensuring fiscal sustainability, in context of uncertain outlook for oil prices, requires gradually tightening the fiscal policy stance while safeguarding critical infrastructure and social spending needs. This would require mobilizing additional non-oil revenues, containing the large government wage bill, and reforming the pension system. These measures should be supported by moving toward a more targeted social safety net that better protects the vulnerable.
“The mission welcomed the government’s plans to strengthen public financial management including steps towards the establishment of the Treasury Single Account. In this context, the mission reiterated the importance of adhering to the framework for managing government guarantees.
“The CBI has appropriately tightened its monetary policy, including by increasing its policy rate and reserve requirement. The mission welcomed the progress in strengthening the domestic liquidity management framework and encouraged continued efforts to mop up excess liquidity and develop an interbank market to strengthen monetary policy transmission.
“Structural reforms to spur private sector led economic diversification and job creation remains pivotal for sustainable and inclusive growth. Priorities include creating a level playing field for the private sector through banking and electricity sector reforms, reducing distortions in the labor market, and continuing efforts to enhance governance and reduce corruption.
“The IMF staff team stands ready to support the authorities in their reform efforts and would like to thank them for candid and productive discussions during this mission.”
The Governor Of The Central Bank Sets The Conditions For Engaging In The Digital Technical Revolution
Wednesday 20, December 2023 14:40 | Economical Number of readings: 329 Baghdad / NINA / Today, Wednesday, the Governor of the Central Bank, Ali Al-Alaq, set the conditions for engaging in the digital technical revolution. While he pointed out that purging state institutions of corruption is fundamentally linked to the use of information technology, he stressed that providing data and information at the state level maximizes state revenues.
Al-Alaq said at the annual international scientific conference held under the auspices of the Minister of Finance: “The Financial and Accounting Training Center continues its efforts to cover basic and important aspects that represent the most important framework in aspects related to economic issues, especially in public finance and monetary policy,” indicating that “we are now in the midst of the fourth revolution.” Which was called at the Davos Conference in 2016 after the first, second and third industrial revolutions.
He added, “This fourth revolution is based on the pillars produced by the third revolution, which was represented by digitization and the use of the Internet in various fields, which changed many aspects of practices at all levels,” noting that “the fourth revolution is a revolution at the individual and societal levels, and it takes on broad dimensions that change everything.”
Today, many practices and trends are heading towards another world, through ministries without papers and without visitors, digital transformation in health, education and various sectors, and the transition to artificial intelligence, robotics, smart cities and other aspects that are expanding every day.”
He stressed that “reality indicates that we are far from the fourth revolution, and in the beginnings of engagement in the third revolution due to all the circumstances that the country has gone through and is going through,” pointing out that “the third revolution is a digital, technical revolution that has dimensions in organizing various aspects, and has broad economic and social effects.” ‘
And great, we are still finding the way for this revolution to take on its technical fields in agriculture, industry, trade, environment, education, health and other aspects that require a technical dimension that can carry out the process of managing these matters and these fields and sectors in another way.”
He stated, "We are still in the simple framework of digitization, which attempts to set the rules for work frameworks in their technical form, as this description and identification of what we are is very necessary in drawing the necessary steps and procedures to take the correct path," explaining that "engaging in the technical digital revolution requires a number of... Among the conditions that must be worked on and established in our reality so that we can actually be part of these transformations, including:
First : eradicating technical illiteracy, in which we need to increase technical awareness and expand its fields, starting with education in all its stages to a higher level in our various institutions and sectors.
State institutions are making progress in engaging in this trend, as we undoubtedly have a broad government and large authorities and agencies that include many formations dealing with different fields and are crowded with human resources. Therefore, institutions must be a model and role model in using these technologies to the highest possible degree, especially since they complain There are many negative phenomena in the performance of its work, in the organization of its activities, in its efficiency, and in its outputs, and it has solutions, which are technical solutions.”
He continued, "Cleansing state institutions of corruption is largely and fundamentally linked to the use of techniques and information technology to reshape the relationship between the institution, society, and the individual, which removes many areas that are the cause of institutional confusion, performance, corruption processes, weakness, or delay in the various procedures related to what these institutions provide." Institutions,” explaining that “employing information technology in state institutions is very necessary.”
Third: It is necessary to provide the infrastructure for this transformation, especially within the framework of communications, in terms of speed, cost, and service availability at the best possible, because it is a necessary condition for the success of technological work. Fourth:
Allocating financial and human resources to stimulate innovation in this framework, which is described as not being a focus area. In general planning, this is observed in the state’s general budget and elsewhere, while what is required is for this aspect to have an exceptional focus and sufficient allocations.”
He stated that “when the government structure was reconsidered years ago, two important ministries were abolished at the time, namely the Ministry of Science and Technology and the Ministry of Environment,” explaining that “the Ministry of Environment was restored, but the abolition of the Ministry of Science and Technology contradicts the developments and desired goals of focusing on this aspect and embracing all energies.” that can work in this direction.
He continued, "The companies that operate within this framework are the most profitable in the world, and we have human resources and young energies that deserve to have a role in stimulating and developing this important aspect."
Fifth: Coordination between state institutions within an integrated framework of information and data. The outputs of each institution must be transformed into inputs for another institution to integrate data and information to benefit from them with correct planning.
He stated that "providing data and information at the state level represents the sound and correct basis for planning, organizing, and controlling the economic sectors that contribute to increasing gross domestic production and maximizing state revenues," pointing out that "the non-oil deficit exceeds 80 percent."
He stressed that "the Central Bank is the institution that most uses and benefits from modern and digital technologies," stressing "the necessity of stimulating and developing the development of these trends to regulate the work of the Central Bank."/https://ninanews.com/Website/News/Details?key=1096454
Will agreements with international banks contribute to solving the monetary problem in Iraq?
12/16/2023 Follow-ups|..
Economic researcher, Ziad Al-Hashemi, confirmed on Friday that the agreements with the banks of the Emirati First Gulf, Turkish Labor, Singaporean Development and others will not end the monetary problem in Iraq.
Al-Hashemi said in a post on the “X” platform followed by “Newspaper”, that “it is expected that these agreements will provide multiple cash alternatives that will help the merchant.” Iraqis can transfer their trade funds quickly and flexibly and reduce dependence on the dollar in foreign transactions.”
He explained, “These agreements will also help reduce the demand for the parallel dollar by attracting the segment of merchants who previously turned to the parallel dollar in search of quick transfers away from the platform, its complications, and delayed approvals.”
He added, “However, the demand for the cash dollar will remain high, and the official dollar will continue to be withdrawn and converted into a parallel dollar by powerful parties that own huge amounts of dinars, and have no relation to regular or official commercial work, and will continue to put pressure on the Iraqi economy to obtain the dollar in all ways and means.”
He continued, “This fact was confirmed by the exchange rates during this period, which maintained their high levels and did not decline despite these agreements and despite hundreds of millions of (imported dollars). This is what makes the exchange rates ready to rise at any moment and with any new event.”
He stated, “Despite the Federal Reserve’s tightenings and the Central Bank’s attempts, it is expected that the problem of the cash dollar, the parallel dollar, and the imbalance in exchange rates will continue with us during the coming year, and we are waiting for more stringent, serious, and courageous solutions to end this problem from its roots.” LINK