Central Bank: From now on, the dollar is subject to strict supervision
The Governor of the Central Bank of Iraq, Ali Al-Alaq, announced that all transfers are subject to auditing, noting that the decline in oil prices has nothing to do with the rise in the exchange rate.
Al-Alaq said in a press comment, “The Central Bank provides the dollar at the official price to all commercial and personal channels, travelers, and all types of operations that represent legitimate activities, operations, and requests.”
He explained, "Any price outside the country is a price that only indicates the presence of abnormal operations that are trying to get out of the official and legal system and the correct fundamental channels."
He stressed the importance of focusing on the amount of sales made by the Central Bank at the official price and those seeking the dollar, whether they are traders, importers, individuals or travelers. He explained that “the decline in the price of oil has nothing to do with the rise in the exchange rate.” link
Member: Does anybody think the RV could happen before the election?
MZ: I still think it could. The world needs this badly. What do you all think?
Member: I do not think it will……This election season is too volatile….I am digging in to wait.
Member: I think RV before, Nesara after!
Member: The 27th is a targeted day for something BIG. I believe it will all be before the end of this month
Member: I think we will see it in the next 10 days
MZ: 90% of my sources agree with you.
Member: I’m watching Oct 1st, for the new fiscal year
Member: I personally think it's done. All in the timing. Before the end of the year for sure.
Member: I have a feeling it could be anyday
MZ: I have that same feeling.
Member: Doesn’t the new currency and a new gold backed system have to happen first????
Member: The system is broken. Once a vase is cracked it never holds water. We need a restart; an overhaul and an ethical cleaning
Member: Sadly it will go when whoever is in charge is ready. What happens to the ones on the front lines ( us people) are over looked. Sadly so many are struggling and suffering.
Member: Any money moving yet Mark?
MZ: Yes. But I can’t make heads or tails out of what it means for us timing wise. But some money has absolutely been moving. We have been able to track it. It’s just not playing out the way that we thought it would…But we are definitely seeing real money in real people’s hands.
Member: Wait bonds have been paid??? Cash in hand???
MZ: We do have a facilitator get some money. But the big bond news we were expecting since last evening has not happened yet. Many bond holders have finished final paperwork and expect their funds on Saturday now.
MZ: I know there are a lot of others who say its happening today or tonight….But, I cannot find anyone on my banking crew who agrees with that. But they do believe its close.
Warnings Against Relying On The “Rentier Economy”: Use Effective Systems And Digital Infrastructure - Urgent
Economy | Yesterday, 14:59 | Baghdad today – Baghdad Today, Wednesday (September 18, 2024), the specialist in economic and financial affairs, Nawar Al-Saadi,
warned of the danger of Iraq’s continuation of the rentier economy, while giving solutions to overcome the danger of this matter. Al-Saadi told “Baghdad Today” that
“the Iraqi economy is considered a rentier economy par excellence, as
the state depends up to 90% on oil revenues to finance its general budget,” noting that
“this type of economy is very natural and is exposed to severe danger when oil prices decline.” In global markets,
which prompts the government to search for additional sources of income to avoid future financial crises, and imposing taxes is considered a step within the government’s attempts to create new sources of income from non-oil sectors, and
this is in line with the reforms proposed by the government in the recent period with the aim of diversifying the Iraqi economy.”. He added,
"The government's success in implementing these policies remains dependent on the ability to confront the main challenges that hinder economic reforms,
the most important of which is the widespread corruption in many government sectors, and the bureaucracy that burdens the reform process," stressing that
"the government needs to develop effective systems for collecting taxes from sectors." New, in addition to providing the digital infrastructure necessary to support this transformation.” Al-Saadi stated,
“In the long term, if the government succeeds in
overcoming these challenges and
develops effective and sustainable strategies to collect taxes from various sectors,
it may be able to create sustainable sources of income that help reduce excessive dependence on oil,
which contributes to the stability of the Iraqi economy, but the matter is
“It requires strong political commitment and comprehensive institutional reforms to achieve this.”
Economist Nabil Al-Marsoumi confirmed on Wednesday (September 11, 2024) that the
fair price of oil is the one that achieves the interests of producers and consumers together.
Al-Marsoumi said on his Facebook platform, followed by “Baghdad Today”, that
“the fair price for oil is the one that achieves the interests of producers and consumers together, that is, the price that achieves good financial revenues for producers that enable them to return part of it to renew and increase oil production capacities.” He added:
“It also enables consumers to obtain oil at reasonable costs that facilitate economic growth,” explaining:
“The price can be set in the seventies as the fair price for both parties,
but when the price falls below $70, it fulfills the interests of consumers because it enables them to obtain energy at a cost.” Cheap, thus reducing the prices of production inputs and increasing the competitiveness of their produced goods.” He continued:
“But on the other hand, it is harmful to producing countries because it reduces their oil revenues and frustrates investment in developing oil production, and vice versa, when the price is $80 and rising, this price is harmful to economic growth in consuming countries.
It also reduces demand for oil in the long term, even though it achieves large revenues.” For oil producing countries.
AI research reveals Iraq’s 2024 budget is incomplete, pending a supplementary budget for reforms and development, with significant focus on digitization and infrastructure.
Highlights
📈 Iraq’s 2024 budget is approved but incomplete due to missing supplementary funds.
🏗️ The government is prioritizing infrastructure and social services through a 5-year development plan.
💻 Digitization efforts, including QR codes in healthcare, are being emphasized.
🗓️ Key decisions about the budget are expected around October 2024.
🌍 Iraq is progressing towards international economic reforms and potential currency revaluation.
💡 AI research suggests Iraq’s economic reforms may be more advanced than publicly disclosed.
📊 The supplementary budget is crucial for financing large-scale projects and ensuring stability.
Key Insights
📊 The Iraqi government has already approved the 2024 budget but needs to finalize the supplementary portion, indicating ongoing reform efforts. This suggests a commitment to economic stability and development.
🌱 The focus on a 5-year development plan highlights Iraq’s intention to invest in infrastructure and social services, essential for long-term growth and modernizing the economy.
🔗 Digitization initiatives, such as QR codes in healthcare, show Iraq’s commitment to modernizing its systems, which can enhance efficiency and transparency.
⏳ The timing of budget decisions around October 2024 could align with significant economic reforms and potential currency adjustments, signaling a strategic approach to economic management.
🌐 Iraq’s steps towards international reforms and cooperation indicate a desire for greater economic integration, which may bolster investor confidence and attract foreign investment.
🔍 AI analysis suggests Iraq may be further along in its economic plans than publicly acknowledged, indicating potential for a controlled currency revaluation to enhance purchasing power.
📅 The supplementary budget’s role in financing critical infrastructure projects demonstrates the government’s focus on both immediate and long-term economic stability.
Government's Initiative to Modernize Banking Sector
Iraqi Banks: A Classic Mentality That Prevents Keeping Pace With Global Development
As of September 19, 2024, Iraqi banks continue to struggle with a classic mentality that hinders their ability to align with global financial standards. This resistance to change is rooted in a preference for the "government" over "national" development, a mindset that has persisted despite Iraq's need for a robust banking sector to support its economy.
In a significant step toward addressing these challenges, Prime Minister Mohammed Shia Al-Sudani announced the establishment of a high-level committee aimed at aligning Iraqi banks with international financial requirements. The committee's formation reflects the government's commitment to economic reforms and the recognition that Iraq needs strong domestic banks adhering to financial standards to play a key role in the country's development.
Challenges and Opportunities
The Iraqi banking sector faces significant challenges, including corruption, a lack of basic services, and a feeble private sector and foreign direct investments (FDIs). Despite these hurdles, there are opportunities for growth, as evidenced by the interest of several Arab and international banks in cooperating with the Iraqi government on developmental plans.
Economic Dependency on Oil
Iraq's economy remains heavily dependent on oil, with oil revenues accounting for over 99% of exports, 85% of the government's budget, and 42% of gross domestic product (GDP). This overreliance on oil exposes the country to macroeconomic volatility and restricts fiscal space for countercyclical policy.
Diversification Efforts
Under Al Sudani's leadership, the Iraqi government is increasingly exploring public-private partnerships (PPPs) to finance major development projects.
Strategies include diversification efforts to reduce reliance on oil revenues and foster infrastructure development, partnerships for sustainable growth, and economic and financial sector reforms to attract foreign investments.
Budgeting Challenges
The recent passage of the 2023, 2024, and 2025 federal budgets marks a significant milestone, but the economy's heavy dependence on oil sales and the volatility of the global oil market remain major concerns.
Iraqi Banks...A Classic Mentality That Prevents Keeping Pace With Global Development By Preferring The "Government" Over The "National"
Reports and analyses Central Bank US sanctions Iraqi banks Private banks 2024-09-17 01:44 -- Shafaq News/ Iraq is moving towards restructuring government banks, after this body has become unable to provide modern banking services and has become burdened with a deep legacy of accumulated burdens, credit defaults and other problems. The restructuring demands came after years of pressure and demands from the International Monetary Fund to restructure the Iraqi government banks, which hold most of the country's deposits, to develop its banking system and be able
to enter the global banking market and make it more compatible with the economy
Acquisition of government banks The Prime Minister’s Advisor for Economic Affairs, Mazhar Muhammad Saleh, said in an interview with Shafaq News Agency, “The structuring of the banks came in accordance with the government curriculum that outlined the features of comprehensive banking reform, as government banks dominate 88% of the banking system’s investments, and only 12% remains for the private banking system.” Of these investments, therefore, the competitive foundations of the banking market are considered incomplete unless government banks are placed on the rules of market operation in terms of efficiency, administrative governance, and developing levels of compliance similar to international banking,” noting that
“the reform will include private banks with the same standards.” He added, "The basics of reform in private banks are viewed from the perspective of what is called financial depth, and one of the most important indicators of that depth is (the ratio of cash credit granted to the total deposits in private banks), but in contrast, we find that the market share is no more than 63 private banks." These credit and creative operations still only account for 15%, despite the government banking system’s acquisition of 85% of the credit activity, deposits, and investment banking operations, which indicates the dominance of its assets or assets over the total assets of the banking system.” He pointed out that "the time has come to reform the banking sector, both governmental and private, in a way that achieves harmony, unity and high competitiveness in the banking market, as well as its governance and digital integration with the banking market in the world.
This is what the banking reform policy that the government is currently adopting is working on, in coordination with the stakeholders included." “With the reform steps and its current program in the government and private banking sectors.”
The process of studying the structure of Iraqi banks began after Prime Minister Muhammad Shiaa Al-Sudani met with a delegation from the international company Ernst & Young, where he directed, on 1/27/2023, the implementation of a plan to develop the performance of Rafidain Bank extending for eight months, through the international company. Difficulty in the structuring process The former director of the Central Bank of Iraq, Mahmoud Dagher, said in an interview with Shafaq News Agency, “Government banks and the process of restructuring and developing them and making them consistent with modern banking work is very difficult for several reasons, including that these banks have become more like a treasury for distributing salaries to state employees than they are banks for carrying out a process.” Banking". He continued that other reasons are that the technical level in these banks is almost non-existent. Indeed, these banks, especially Al-Rafidain and Al-Rashid Banks, had it not been for the electronic payment companies that support them, they would not have been able to complete any work. Therefore, they would not have worked without these companies, in addition to the huge number of their branches and the large number of employees present. This makes it difficult to change the reality of these banks.” He pointed out, “The presence of international sanctions and the presence of decisions of courts abroad, proving the creditors of some government banks, which are not resolved, and this is the reason for imposing international isolation on them, and therefore they cannot deal internationally,” stressing that “it is absurd to spend huge sums of money that do not lead to decisive results, as All the costs spent on these banks will not lead to restructuring in order to coordinate the work of government banks, especially Al-Rafidain, Al-Rashid, and some specialized public banks, in a way that parallels the work of modernization and technological development that took place in banks such as the Iraqi Trade Bank.” The Rafidain and Al-Rashid government banks were subjected to international sanctions during the nineties of the last century following the invasion of Kuwait by Saddam Hussein’s regime, and they are still imposed on it in international dealings with them, especially with regard to the issue of financial transfers.
Old banking system Economist Bassem Jamil Antoine said in an interview with Shafaq News Agency, “Government banks have for a long time been operating within an old banking system without modernization, and these banks must keep pace with international banks,” adding at the same time that “these banks are the safety valve.” He added, "These banks remain in need of development, eliminating administrative routine, and having employees undergo training courses to keep pace with developments that have occurred in international banks," noting that "banks are not stores of cash, but rather they must provide advanced credit banking services." He stressed that "the idea of restructuring banks has been proposed for twenty years, and ideas and studies were presented, but they were not adopted," stressing that "the bank needs security and administrative stability and independence in work." The Ministry of Finance owns six government banks: Al-Rafidain Bank, Al-Rasheed Bank, Al-Nahrain Islamic Bank, Agricultural Bank, Industrial Bank, and Iraqi Trade Bank. Al-Rafidain Bank is an Iraqi government bank, founded in Baghdad in 1941, as the first Iraqi commercial bank. It has 146 branches inside Iraq, and some other branches are spread outside it in Jordan, Egypt, the United Arab Emirates, Lebanon, Bahrain, and Yemen. Al-Rasheed Bank is an Iraqi government bank, founded in Baghdad in 1988, as an Iraqi commercial bank, with 162 branches spread inside Iraq. https://shafaq.com/ar/تقارير-وتحليلات/المصارف-العراقية-عقلية-كلاسيكية-تصد-مواكبة-التطور-العالمي-بتفضيل-الحكومي-على-ال-هلي