Mawazine News-Baghdad
Once again, the Central Bank, Jordanian banks, grants licenses to deal in dollars and limit foreign transfers to their hands, which economists see as a “big mistake” that will contribute to losing control of the banking system that will remain in the hands of the United States and Jordanian banks, warning against exploiting this file politically in the future.
A source familiar with the informed, to Mawazine News, reveals that “the Central Bank of Iraq granted during the current period four new licenses to Jordanian banks, namely the Union Banks, Housing, Jordan and the Arab Banks.”
The source adds, “The Jordan Capital Bank and the Bank of Cairo Amman, have strengthened their control over the National Bank of Iraq, by acquiring approximately 72 percent of the bank’s shares, where the share of the first is 61.85 percent, and the other’s share is 9.90 percent,” pointing out that “the Palestinian stake of Arcadia LLC is 5 percent, so that the total number of non-Iraqi shares is about 77 percent, and this is a very big violation of the Iraqi investment law that specified foreign ownership by 49 percent of any Iraqi company.”
He reveals that “the endeavors of the Jordan Housing Bank also recently began to acquire the shares of Al-Mansour Bank of Iraq, which is controlled by the Qatar National Bank by 54 percent,” noting that “Iraq has a bad experience of entering foreign banks, as it previously entered Iranian banks and all of them stopped because of the sanctions, as well as the Lebanese banks that declared bankruptcy and seized Iraqi deposits estimated at 20 billion dollars.”
The National Bank of Iraq accounts for a third of foreign currency sales, which is the main source of the Iraqi economy.
Since the US Treasury imposed sanctions on Iraqi banks, as a result of smuggling the dollar to Iran, foreign banks have dominated the financial arena, as an Arab bank controlled a large percentage of dollar sales in Iraq.
For his part, the expert in banking affairs Ahmed Al-Tamimi believes that “the Central Bank of Iraq made a lot of mistake when it worked on the delivery of Jordanian banks the dollar owned in Iraq, and limited the handling of external transfers through those banks at the beginning of next year in accordance with the directions of the US Treasury.”
Al-Tamimi states, “Dollar transactions by Iraqi banks will be non-existent during the new year, and it will be limited to the Iraqi Bank for Trade and Jordanian banks, and this means that all Iraqi banks will be prevented from any dealing in dollars, which gives Jordanian banks a precedence at the expense of the Iraqi banking system.”
The expert in the banking affairs calls on the Central Bank of Iraq to “negotiate sooner and before the end of the current year, in order to reach an understanding with the US Treasury to grant exceptions to some Iraqi banks, and not to limit dealing in dollars to Jordanian banks, under the pretext of not having accounts in correspondent international banks.”
Al-Tamimi warns that “the Central Bank of Iraq, according to this American decision, will lose control of the banking system, and the system will continue to be managed by the Americans and Jordanian banks, and this file may exploit a political future by the Americans or even Jordanians because foreign transfers will be in their hands exclusively, and Iraq has no income in it, except supervision and follow-up.”
The number of banks in Iraq reached 81 banks, while the branches of foreign banks in Iraq amounted to 21 branches, most of which are from Turkey, Jordan, Iran and the UAE.
The Central Bank of Iraq pumps the dollar to banks through the currency sale window, which it says has several functions, the first of which is to achieve stability at the exchange rate and the second is to meet the requirements of foreign trade, because “the Iraqi commodity sector is unable to provide the requirements of the local market,” according to the bank, which pointed out that “the window meets 87 percent of the requirements of the commodity import of Iraq.”
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