Ever since Sudani came back from Washington DC the government of Iraq...has been in the process of making...videos, commercials, advertising. Sudani has been doing this on behalf of the executive level of all the private banks...These videos will soon be released and shown on Iraqi television
and the big screens. Suandi and the GOI are making these videos with the executive branch of each bank to teach the Iraqi citizens about the new national currency...and the process of the new exchange rate..
There will be a primary video, a spearhead video. The videos will be with the head of the private banks, the governor of the Central Bank of Iraq, the whole of the board members, the government of Iraq, Sudani himself, the Minister of Planning, the Minister of Finance, the Minister of Oil. It will encompass all of the GOI of Sudani because the GOI encompasses the entire executive branch...These videos will explain to the Iraqi citizens the process of the monetary reform and where it is at that moment...
THE DOLLAR IS REELING FROM A FATAL BLOW AND THERE ARE FEARS OF A COLLAPSE OF THE DINAR
(First of all, let me say with 1000% certainty the dinar is NOT going to collapse. Yes, just unjustified fears.)
The fluctuation in dollar prices and the rise in gold prices has significantly affected the contraction of the commercial market in terms of imports and purchases of goods, amid confusion in opinions between the return of the rise in green and its decline to the official price set by the state of 1,320 dinars per dollar.
The price of the dollar in the parallel market is currently 1,460 dinars, whether higher or lower than this rate. The Central Bank of Iraq’s cancellation of the currency {auction} window at the end of 2024 and Washington’s sanctions on Iraqi banks have opened a door of doubts that will end up placing the dollar in the face of speculation, which will make it vulnerable to demand after the recovery of the Iraqi dinar with government orders that limited dealing in the dinar to restrict the movement of the dollar.
While officials find that the establishment of the electronic platform and the level of regularity of the flow of external remittances responsible for financing private sector trade and the escalation of financing rates have reached very high rates through the compliance platform of banks active in this regard, and the rise in gold prices is not considered a direct impact on the improvement of the exchange rate.
This was confirmed by the Prime Minister’s Advisor for Financial and Economic Affairs, Mazhar Muhammad Salih {to Al-Furat News}, saying: “Active positive factors have affected the recovery of the Iraqi dinar in the secondary exchange market, foremost of which is the high level of regular flow of foreign remittances responsible for financing private sector trade and the escalation of Financing rates are very high through the compliance platform of active banks in this regard.”
He explained, “What this means is that the demand for foreign currency through official external transfer operations, which is responsible for 90% of the total desired demand for foreign currency, as most of it is now met at the official exchange rate of 1,320 dinars per one dollar, which gave the official market dominance over the parallel market to the exchange.”
Saleh stated, “As for the developments taking place in the gold commodity market or gold filigree, especially the sudden price developments therein, up and down, they are not considered an alternative directly affecting the improvement of the exchange rate because they are limited in impact and impact on the movements of the parallel exchange market, and that the main gold trade is financed as foreign trade through transfers from the banking system and the official exchange market.
Contrary to the government opinion, the Parliamentary Finance Committee supported the theory of doubts and confirmed that the dollar would reach {200} thousand dinars with the cancellation of the currency auction. Deputy Chairman of the Parliamentary Finance Committee, Ahmed Mazhar Al-Janabi, said {to Al-Furat News} that “the Central Bank’s decision to cancel the currency auction at the end of the year will open space for exploitation and a problem will occur. If the auction is canceled and ends, the exchange rate in the markets may double, and if the Central Bank goes towards this option, the dollar exchange will “It will reach 200 thousand dinars,” according to his opinion
.
(Yes, just an opinion, just an article and so how many times have these people been correct? How many times have they told us already it would reach 200 thousand dinars and yet the CBI always counters it with a plan to maintain it)
I am certain that “it will open space for speculators to exploit the matter. The current price is higher than the official price, despite the sale of approximately $250 million per day. So what if the auction stops?”
In light of this, economists expected that the demand for the dollar would continue to exceed supply, thus leading to a re-depreciation of the dinar, due to the central bank’s limited ability to provide coverage. Economist Manar Al-Obaidi said in a statement, “The demand for the dollar depends primarily on commercial transactions and covering imports. The greater the demand for imports, the higher the demand for the dollar, and with the Central Bank’s limited ability to cover this demand as a result of the set limits, it is expected that it will continue.” Demand is greater than supply and thus leads to a decline in the price of the dinar against the dollar.”
He added, “An observer of the exports of the main countries exporting to Iraq notices an increase in the value of these countries’ exports, as the value of Turkish exports to Iraq increased by 30% in the first quarter, while Chinese exports to Iraq increased by 20% in the first quarter, as well as the exports of other countries such as the Emirates, India, Iran, and Brazil.”
Al-Obaidi attributed the reasons for this increase to five basic factors: 1- The rise in global inflation, which led to an increase in the values of various commodities in various exporting countries. 2- Inflation of invoices, as some merchants agree with the processing party to inflate invoices to obtain transfers in higher amounts. In order to resell the converted dollar in those markets 3- The change in the consumption pattern of the Iraqi citizen and the high population growth rates that increase the demand for various commodities, which increases demand 4- The increase in government agreement as a result of the increase in operational and investment expenses 5- The lack of a capable local industry To compete with the imported product as a result of high costs.
Al-Obaidi added, “These four reasons are mostly due to the loss of tools to control the state’s financial policy (taxes + customs + control of expenditures). In order to control this significant rise in the value of imports, which leads to an increase in demand for the dollar, customs and tax policy must be changed.” “For many sectors, there is a need to possess the tools capable of implementing these policies in a more effective and productive manner.”
Al-Obaidi added, “Continuing the import bill will lead to an increase in demand for the dollar and thus an increase in its price in the parallel market, which is what many of those who benefit from the low official price are looking for. The inability to control imports and the loss of control over financial policy tools will put the state in front of a single solution.” There is no second option, which is the use of monetary policy, which is something that many economic specialists do not favor, and they prefer to always focus on controlling financial policy.”
As the Hajj season approached, the Central Bank stopped selling the dollar to travelers, and to find out its reasons, the former director of the Financial Supervision Bureau, financial expert, Salah Nouri, said {to Al-Furat News} that “the recent Financial Supervision Bureau report, which was covered by satellite channels, about violations in the sale of the dollar to travelers, is a major reason to review the procedures and address them.” The defect in the transfer system, and stopping until the situation is corrected.”
In the same context, the economic expert, Safwan Qusay, revealed the leakage of travelers’ dollars to the parallel market.
Qusay said {to Al-Furat News}, “The current policy of the Central Bank of Iraq is towards auditing the cash dollar, which was marred by many failures in the first periods, especially its leakage through travelers to the irregular market, and this issue needs a new and clear mechanism.”
He added, “It is assumed that travelers are dealt with through tourism and airline companies, and the travel ticket is not allowed to be canceled unless the traveler returns the amount he purchased from exchange outlets or banks.”
Qusay stressed that “this measure will restore confidence in the cash dollar and the possibility of facilitating the mission of real tourists and filling the gaps that accompanied the process of establishing the electronic platform for the cash sale of foreign currencies.”
He stated that “the Central Bank will not hesitate to provide the dollar to those entitled to it, whether at the level of Hajj or other windows,” noting that “the Central Bank’s emphasis on procedures for granting citizens the cash dollar ensures that it reaches those who need it.”
Meanwhile, travelers expressed their surprise at the Central Bank’s decisions to prevent government banks from selling dollars to travelers.
Travelers said, via {Al-Furat News}: “We are surprised by the Central Bank’s decisions to prevent government banks from selling the dollar to travelers and monopolizing it only with financial transfer and exchange companies.” Travelers called on Parliament and members of the Parliamentary Finance Committee to “intervene and solve the problem and allow government banks to carry out the process of selling the dollar, especially in conjunction with the delegation of pilgrims to the Holy House of God, and they need to buy the dollar at the official price.”
FIREFLY: Ever since Sudani came back from Washington DC he has been talking to us about metal coins and paper fils. He said the coins are both silver and gold...
FRANK: The monetary reform education is being presented to the Iraqi citizens...
FIREFLY: International Development Bank opens in Erbil.
FRANK: Notice how they are preparing your banks in many ways to receive the new exchange rate when Sudani releases it. They talked to you about the float...the basket... the lower notes...the old lower notes, your history...Now they're going to tell you Iraqi citizens about your banks...they are educating you on the many services that your banks will be offering you once this exchange rate is released.
FIREFLY: Television says Iraq is now producing 1 million liters of gasoline on a daily basis with the new refineries...They are saying we will have enough gasoline for our self sufficiency of our county and also for global trading on the market..
FIREFLY: They said our success is from the visit to the United States of America because it lifted almost all sanctions on our banks and others are close to being lifted too.
The mission, headquartered in Baghdad’s (formally) heavily fortified Green Zone, was set up with a wide mandate to help develop Iraqi institutions, support political dialogue and elections, and promote human rights.
Prime Minister Mohammed Shia al-Sudani said Iraq wanted to deepen cooperation with other U.N. organizations but there was no longer a need for the political work of the U.N. assistance mission, known as UNAMI.
The mission’s head in Iraq often shuttles between top political, judicial and security officials in work that supporters see as important to preventing and resolving conflicts
but critics have often described as interference.
“Iraq has managed to take important steps in many fields, especially those that fall under UNAMI’s mandate,” Sudani said in a letter to U.N. Secretary-General Antonio Guterres.
Iraq’s government has since 2023 moved to end several international missions, including the U.S.-led coalition created in 2014 to fight Islamic State and the U.N.’s mission established to help promote accountability for the jihadist group’s crimes.
Iraqi officials say the country has come a long way from the sectarian bloodletting after the U.S.-led invasion and Islamic State’s attempt to establish a caliphate, and that it no longer needs so much international help.
Some critics worry about the stability of the young democracy, given recurring conflict and the presence of many heavily armed military-political groups that have often battled on the streets, the last time in 2022.
Some diplomats and U.N. officials also worry about human rights and accountability in a country that frequently ranks among the world’s most corrupt and where activists say freedom of expression has been curtailed in recent years. Iraq’s government says it is working to fight corruption and denies there is less room for free expression.
Somalia’s government also requested the termination of a U.N. political mission this week. In a letter to the Security Council, the country’s foreign minister called for the departure of the Nations Assistance Mission in Somalia (UNSOM), which has advised the government on peace-building, security reforms and democracy for over a decade. He provided no reason.