The Office of Anti-Money Laundering and the Financing of Terrorism revealed that Iraq is far from being included in the gray list.
“After the completion of the international mutual evaluation by the recent 14-month team of international experts to which Iraq was recently subjected, the technical compliance with the legal framework, regulations, instructions and controls against money laundering and the financing of terrorism was assessed,” said the office representative at the Central Bank, Hussein Al-Maqraqr.
“The effectiveness of anti-money laundering and terrorist financing systems was also assessed, by providing statistics, in addition to practical cases, to demonstrate the extent to which the legislative framework has been applied, as well as the field visit,” he added.
Saleh's Discussion on Raising the Value of the Iraqi Dinar in August 2024
Financial advisor to the prime minister, Saleh, appeared on television in August 2024, addressing the Iraqi public about the strategies to bolster the value of the Iraqi Dinar (IQD).
The Case for Currency Strengthening
Saleh's televised address highlighted the government's commitment to enhancing the dinar's worth, emphasizing the potential benefits of a stronger currency for the national economy. He discussed various economic measures, including export capacity and market management, as integral to currency valuation.
Managed Float Consideration
During the broadcast, Saleh gave his opinion on the best approach to manage the IQD's value, suggesting that a managed float could be more appropriate than a free-floating or fixed exchange rate system. This managed float would allow the central bank to intervene in the market to stabilize the currency while still allowing it to adjust to market conditions.
Economic Reforms and Purchasing Power
Saleh's discussion also touched upon the ongoing economic reforms in Iraq, which include the deletion of zeros from the currency and the introduction of a new currency, aimed at enhancing the dinar's purchasing power.
These reforms are expected to contribute significantly to the currency's stability and value.
International Relations and Compliance
The conversation also delved into Iraq's international relations and the country's efforts to align its banking system with global standards. This includes scrutinizing foreign transfers and ensuring compliance with international banking regulations, which could positively influence the dinar's value in the global market.
Public Education and Market Confidence
Saleh's appearance on television was part of a series of educational efforts aimed at increasing public understanding and confidence in the currency reform process. The broadcasts, which have been ongoing for several weeks, are designed to prepare the Iraqi public for the changes and to reassure them about the future stability and purchasing power of the dinar.
Conclusion
Saleh's televised discussion in August 2024 underscores the Iraqi government's commitment to enhancing the value of the dinar through a managed float, economic reforms, and international compliance. These measures are expected to strengthen the currency and boost confidence among the Iraqi public and international investors.
Shafaq News/ Member of the Parliamentary Finance Committee, Mustafa Al-Karaawi, revealed on Monday that a request was submitted to the Presidency of the Council of Representatives to set a date to question the Governor of the Central Bank of Iraq regarding several files, most notably the exchange rate of the dollar against the local currency.
Al-Karawi told Shafaq News Agency, “Members of the Parliamentary Finance Committee had previously submitted a request to the Speaker of the House of Representatives to question the Governor of the Central Bank, Ali Al-Alaq.”
He added, “The interrogation relates to several files, the most important of which are the dollar exchange rate, its sale to travelers, the currency buying and selling window, financial transfers abroad, cash financing, US sanctions, and negotiations with the US Federal Reserve.”
He stressed, “We were previously seeking to host the Governor of the Central Bank, but then a request was submitted by some members of the House of Representatives to question the Governor in the House according to legal procedures and to activate the oversight role to question government officials.”
Al-Karawi said, “After the Arbaeen visit, there will be a move to the Presidency of the House of Representatives to set a date to question the Governor of the Central Bank in Parliament.”
On August 8, Hadi Al-Salami, a member of the Parliamentary Integrity Committee, revealed that his committee had been following up for more than a year on the file of terminating the assignment of the Central Bank Governor, Ali Al-Alaq, from his position.
Al-Salami explained to Shafaq News Agency that the committee addressed the Prime Minister several times to pressure him to end Al-Alaq’s assignment, due to the existence of many violations against him.
He added that the government program announced by the Prime Minister when forming the government includes the necessity of ending the management of positions by proxy after six months of forming the government, noting that Al-Alaq is still managing the position by proxy without any action to cancel his assignment so far.
Al-Salami pointed out that there are many files and violations related to the Central Bank, which have been referred to the Integrity Commission and the Public Prosecution, indicating that these violations include issues related to the lack of control over the exchange rate in the market, in addition to millions of dollars and interest received by Arab and foreign banks, including Jordanian banks.
The adviser to the Prime Minister for Finance Affairs, Mazhar Mohammed Saleh, confirmed on Saturday that the expected visit of the Governor of the Central Bank Ali Al-Alaq to New York will support the protection and stability of the banking system, while he pointed out that the file of punishing banks requires negotiation because of the possibility of a mistake or over-issuing a decision to punish them.
Saleh said in a statement reported by the official news agency, seen by “Economy News”, that “the Central Bank is a strategic institution that works to support the value and stability of the dinar and build balances in the Iraqi balance of payments and the regularity of payments and international reserves supporting Iraq’s foreign trade.”
“Because of the economy’s rid, the central bank and its reserves have become a nutritious and financial for foreign trade for the private sector,” he added.
He pointed out that “Iraqi oil sales in dollars, and deposited with the US Reserve Bank through an open account in the name of the Central Bank managed by the bank on behalf of the Iraqi government.”
He continued, “The expected visit of the Governor of the Central Bank Ali Al-Alaq to New York City in the United States of America comes to protect the Iraqi banking system and support its stability.”
He explained, “The Central Bank, by virtue of its work and responsibility, to maintain the financial system of Iraq, must negotiate with the American side on the file of banks to mitigate the deprivation against banks, as perhaps there is a mistake or exaggeration that has already been punished by the American side,” stressing that “there is determination and communication from the Central Bank of Iraq in a good and positive way to protect the Iraqi banking system.”
Earlier, Central Bank Governor Ali Al-Alaq confirmed in an interview with the Iraqi News Agency (IAI), that “there are meetings to be held with the Federal Bank and the US Treasury Department at the end of August to review aspects related to external transformation processes and discuss sanctions on some banks.”
Government Advisor Discusses Using Dinar Instead of Dollar for Oil Sales
On August 20, 2024, a government advisor has explained the possibility of using the dinar instead of the US dollar in oil sales. The discussion comes within the context of regional monetary policies and the broader implications of global economic shifts.
Regional Monetary Policies
In the Middle East, many countries have traditionally pegged their currencies to the US dollar, including Jordan, which has been doing so since 1995.
The decision to peg the Jordanian dinar to the dollar was made in response to political volatility and economic challenges in the region. However, the feasibility of this strategy has been debated, especially considering the impact of a falling dollar on import values and export performance.
Global Economic Shifts
Recent economic data from the US has revealed moderating inflation and strong retail spending, shifting the market sentiment from recession concerns to renewed confidence in economic growth. This shift has bolstered expectations for Federal Reserve interest rate cuts, with traders anticipating that the Fed will lower borrowing costs from a 23-year high next month. As central bankers prepare to meet this week, the potential for rate cuts has led to discussions about the implications for currencies pegged to the dollar.
Oil Market Dynamics
Despite recent online claims, there is no credible evidence that Saudi Arabia intends to stop using the US dollar for oil sales. Experts have noted that the US dollar remains the preferred currency for oil trading due to its global use and stability.
Iraq's Dinar Performance
In Iraq, despite government measures, the dinar has continued to fall against the US dollar. This highlights the complex dynamics at play in the regional currency markets and the challenges of maintaining currency value amidst global economic uncertainties.
Conclusion
The discussion around using the dinar instead of the dollar in oil sales reflects broader debates on regional monetary policies and the impacts of global economic shifts.
While the US dollar remains dominant in oil trading, the potential implications of changing monetary strategies in the Middle East continue to be a topic of significant interest and analysis.
