WILL BANKING REFORMS SOLVE OR DEEPEN IRAQ’S ECONOMIC CRISIS?
Will reforming the banking system change the fate of the Iraqi economy?
The financial advisor to the Iraqi Prime Minister, Dr. Mazhar Mohammed Salih, confirmed that reforming the banking system is one of the most important priorities of the government’s program, given its significant positive impact on various aspects of the Iraqi economy.
Saleh explained in his statements to “Al-Sabah”
that the government’s vision for economic reform focuses largely on improving the banking system, noting that the first steps of this reform have begun through Rafidain Bank.
Saleh explained that the government banking sector currently dominates more than 85% of the banking system’s assets in Iraq, noting that banking operations and activities of this sector represent almost the same percentage of the total deposits and bank credit in the country. This dominance reflects the size of the government banking sector’s great influence on the banking system as a whole.
In conclusion, Saleh stressed that the government is committed to implementing further banking reforms to improve economic performance and enhance financial stability in Iraq, a necessary step to support economic growth and achieve sustainable development.
FIREFLY:Bank friend saying all of this [US Treasury involved with Iraqi banks] would not be happening right now. All this would not cause our rate to be changing. It would be staying at 1310. Or if we were lopping none of this would be necessary.
It is insane that we are seeing this because a change to the rate is coming. The auctions are down to one bank and it was only around 7 million. You cannot run a country off of that. The auctions are being shut down.
FRANK: That's beautiful news.
FIREFLY:Iran has been using some of Iraq's banks to get around the sanctions and to profit off of the dollar. Now the US Treasury is here and stopping it. FRANK: Yeah, they are extremely angry because they lost their sugar daddy. They lost the CBI auctions...They will figure out other ways to steal... The power of the corrupt political people in your country is being suffocated. That power is dying. It is going from those corrupt people back to you Iraqi citizens through a monetary reform that will give you purchasing power..
(Mnt Goat: If you care to remember I told you that one of the factors in moving ahead with success of the currency reform as part of the banking reforms, was that the CBI and the GOI must work together and promised to work together. But this article is telling us three reasons why this is not now happening. This situation MUST change. The US Treasury in now parked in the CBI building and is not going anywhere until the dollar sales is controlled and the parallel rate matches (or is very close to) the dinar rate. I certainly hope they can fight this corruption. We should expect blow-back from the corrupt as they have had it way too good in stealing money all these years. Remember where the money is going and so expect the Iranian backed militias to act up and get crazy in the process. Yes, they will be bombings in retaliation. This is why these militia must be dealt with too. Iran cannot forcefully set policy for Iraq under gun point. But they are now and have been! ☹ This must change.)
Professor of International Economics, Nawar Al-Saadi, revealed today, Monday (August 5, 2024), that there are political motives behind the Central Bank’s ignoring of some decisions of Prime Minister Mohammed Shia Al-Sudani.
He explained that “the Central Bank of Iraq faces a set of obstacles that directly affect its ability to implement the Prime Minister’s directives.
1.The first is the great international pressure coming from the US Federal Reserve, which imposes sanctions on some Iraqi banks and places strict restrictions on the movement of the dollar. These pressures make it difficult for the Central Bank to take effective steps to manage the exchange rate independently.
2.The second is that the bank suffers from internal structural problems such as corruption and mismanagement, especially with regard to selling the dollar. These challenges make it difficult for the government to achieve its economic goals regarding the stability of the exchange rate, and increase the complexity of the Iraqi economic scene in general.”
Al-Saadi stressed that “these problems make it difficult to implement monetary policies effectively, as financial resources are used for illegal purposes or are wasted due to corruption.
3.Third, the influence of some banks owned by parties with great political and security influence plays a role in complicating matters, and these banks may be resistant to the changes imposed by the Central Bank, which limits the bank’s ability to impose the measures required to achieve financial and monetary stability.”
The professor of international economics continued, “There are political motives behind the Central Bank’s disregard for some of Al-Sudani’s decisions, and given the overlap between politics and economics in Iraq, this situation has become a syndrome in the Iraqi regime from after 2003 until now, as there is an influence from political interests that play a role in determining economic policies.”
(So now you hear once again why the US Treasury has set up shop inside the CBI and thus also these same reasons are why the currency reform is held up, at least for now. But remember this move by the US Treasury was to that they could move to the next step of the currency reform. So it is a very positive thing for us investors. Get it? The glass is half full… lol..lol..lol.. 😊)
...what is actually occurring between the CBI, the Feds and the US Treasury. If you read the headlines today you might begin to panic...you might say things are looking really bad for Iraq. But I assure you that this is all actually VERY GOOD news for us investors... this recent move by the US Treasury was made for the benefit of the currency reform process so that they could move to the next step of the currency reform once these issues are fixed...
----
US TREASURY TAKES CONTROL OF IRAQ’S CENTRAL BANK TO COMBAT MONEY LAUNDERING
Three informed sources close to the political and parliamentary decision-making process in Baghdad revealed extremely dangerous information confirming that the US Treasury Department has taken a permanent headquarters in the Central Bank of Iraq building.
They considered that this step came as a result of the great pressures on the Iraqi banking system with the aim of limiting money laundering and dollar smuggling, as
the governor of the Central Bank was forced to allocate an entire floor for US Treasury departments to monitor money transfers and prevent any illegal activities.
The three sources confirmed that a team of American employees is working permanently at the Central Bank of Iraq,as part of intensive efforts to ensure Iraq’s commitment to international standards for combating money laundering and terrorist financing.
Shafaq News / The Iraqi Trade Bank on Wednesday invited all licensed exchange companies to participate in the cash dollar sale window to travelers.
In a statement today, the bank called on all exchange companies for the two categories (A, B) licensed by the Central Bank of Iraq to review its branches to open a special bank account to participate into the window of buying and selling foreign currency for the cash dollar for travelers.
It is noteworthy that on July 4, 2024, the Central Bank of Iraq decided to start selling the dollar to passengers, exclusively through corporate outlets and banks at international airports.
Meanwhile, the central bank has decided to give A-B-class exchange companies the ability to register internal and external remittance activities via the FITR platform.