The Iraqi Central Bank Cancels The Operation Of The Largest Iranian Bank In The Country
The Central Bank of Iraq has canceled the operating license of the largest Iranian bank in Iraq, the National Bank of Iran (Milli), due to international sanctions and the bank’s limited operations in Iraq, according to what Reuters reported on Thursday.
Reuters said that this decision was contained in a document of the Central Bank of Iraq dated January 31, 2024.
The document stated, “In light of the losses incurred by your branch in Iraq, its limited activities, its inability to implement or expand banking activities, and…its inclusion in international sanctions, it has been decided to cancel your license.”
In 2018, the US Treasury Department imposed sanctions on Bank Melli, claiming that the Iranian Revolutionary Guard is using it to “distribute funds to Iraqi Shiite armed groups, and that Bank Melli’s presence in Iraq is part of this scheme.”
Iraq, which has reserves of more than $100 billion in the United States, is counting heavily on Washington’s goodwill to ensure that its access to oil revenues and money is not blocked.
Iraq recently banned eight local commercial banks from conducting transactions in US dollars and took measures to reduce fraud, money laundering and other illegal uses of the US currency in a move welcomed by the US Treasury Department.
According to Iraqi and American officials, Iraq prevented 14 banks in July 2023 from conducting dollar transactions as part of a broader campaign aimed at reducing the smuggling of dollars into Iran through the Iraqi banking system after a request from Washington, according to Reuters.
AN INTERNATIONAL EXPERT SUGGESTS SEVERAL POINTS TO GET RID OF THE DOMINANCE OF THE “DOLLAR” OVER THE IRAQI ECONOMY
Former United Nations expert Majeed Al-Nashi proposed on Saturday several points to get rid of the dollar’s dominance over the Iraqi economy, stressing the necessity of not relying on oil as a primary source of revenue.
Al-Nashi said in a press statement received by Earth News, “The Parliamentary Finance Committee called on the government to take quick measures to get rid of the dominance of the dollar by diversifying our cash reserves to other foreign currencies.” I also proposed obliging the Ministry of Oil to sell Iraqi oil in other foreign currencies.
He added, “All economic and energy experts in Iraq are aware of the economic and monetary reality of Iraq, especially since all the Iraqi money that Iraq obtains is the proceeds of Iraq’s sale of oil, which constitutes more than 90% of Iraq’s budget, and this money has been mortgaged to the US Federal Reserve Bank in New York since 2003.”
According to the Security Council resolution during Bremer’s rule for Iraq, Resolution No. 1483 issued in 2003, which required the establishment of the Development Fund for Iraq (DFI), according to which all Iraqi funds are deposited in the US Federal Reserve Bank, and withdrawals are made from this fund according to conditions that Iraq agreed to at the time, in order to protect Iraqi funds from claims and consequences. Finance is arranged according to the previous system.”
He pointed out that “the recent initiatives that were launched, such as the Live on Dignity initiative and heading to international courts to settle cases related to Iraq’s right, in preparation for freedom from dependence on the United States to protect Iraqi oil funds from any seizure decisions that may affect them due to the actions of the previous regime and others, are considered a good thing.” In liberating Iraqi money from the dominance of the dollar.
He stated, “In order to implement what was stated in the Finance Committee’s statement, the matter requires practical solutions, including accelerating the withdrawal of Iraqi funds from the American Bank and ending this dominance, and agreeing with companies and countries importing Iraqi oil on a new payment systemdetermined by SOMO in accordance with the requirements of the Iraqi economy and in coordination with Central Bank of Iraq.
(OOPS… 😊 there it is again “importing oil on a new payment system” meaning away from the petro-dollar,)
He continued, “Economic and banking discussions should also begin with China and other countries, including opening accounts for Iraqi funds resulting from the export of oil in different currencies, and conducting most import operations, especially from China, in Chinese yuan, as well as using currencies of other countries such as the Emirati dirham, the Saudi riyal, and the Indian rupee in transactions, whether by selling oil or importing goods.”
He pointed out the necessity of “organizing and modernizing the Iraqi banking system to keep pace with developments in the field of completing transactions, using modern technology, and enhancing the strength of the Iraqi dinar by activating and supporting the private sector, not relying on ((oil)) as the primary source of foreign currency, and encouraging the export of Iraqi products.”
(So we see the heart of where the problem stems. How can Iraq pay for goods and service from imports with foreign currencies. Where is their reserves of these other currencies to use to pay for them? Where do they come from if 90% of the revenue generated is paid in US dollars. Do you see it now, the dilemma? So either they have to grow their economy to a huge point and generate all kinds of exports paid to Iraq in foreign currencies (this will take decades to do) or they can switch from the sole petro-dollars for oil to other foreign currencies for oil revenue. Do you think the US is going to let them do this?)
Mawazine News – Baghdad A member of the parliamentary foreign relations committee, MP Amer Al-Fayez, stressed on Wednesday the move of Iraqi diplomacy towards moving away from the policy of engaging in any crisis. Al-Fayez said in an interview with Mozine News, “The genocide in Gaza has created a crisis and tensions in the Middle East that can explode in an uncontrollable way, and this is what worries all parties without exception, including Al-Iraqiya, because part of the events and tensions began to cast a shadow on the country through bombing and violations of the atmosphere.” He added, “Baghdad has already begun to make moves in 3 directions, which are direct dialogue with the capitals of neighboring countries and international organizations, and openness to making preliminary agreements that contribute to their basic content the distance of Iraq from international and regional conflicts and that it does not be the arena of settling accounts.”
.... the CBI still has their goals to rebuild the economy of Iraq, see the White Paper. In this document it clearly states the “Pillars of Iraqi Financial Reform” for Iraq and how they plan to affect each of them to get where they want to go. It’s no secret. So, what comes first the chicken or the egg.
REFORMS FIRST: In other words, Iraq will never be able to rebuild its economy unless it completes these financial reforms first.
But in reality, under Dr. Shabibi he knew damned well the necessity of getting back their currency (liberate it) and then use it to impact the growth of the economy.
So, we are witnessing firsthand the mistake made way back in 2012-2013 in not following the plan of Dr. Shabibi. This is really what all the ruckus is about with this parallel rate and the inability to manage it.
