DINARLAND UPDATE!! WOW IRAQ WILL RV SOON !! ‪@DINARREVALUATION‬

 

FRANK26: THE REFORM REPORTS", 16 DEC

 KTFA

FRANK26: THE REFORM REPORTS"......F26

Prospects for the Iraqi Economy: Challenges and Opportunities to 2025 and Beyond

12/12/2024

 

Researcher Shaza Khalil*

The International Monetary Fund (IMF) provided a detailed assessment of the Iraqi economy, pointing to the challenges and opportunities that lie ahead for Iraq. According to the Fund, the Iraqi economy contracted by 2.2% in 2022, but the forecasts for 2024 and 2025 are more optimistic. The Fund expects the economy to grow by 1.4% in 2024 and 5.3% in 2025. However, the Fund warns that Iraq’s fiscal position remains worrisome, with the budget deficit expected to widen to 7.6% of GDP in 2024, compared to 1.3% in 2023. It also expects government debt to reach 48.2% of GDP in 2024 and 54.6% in 2025.

Domestic Stability and Recovery
Despite these fiscal concerns, Iraq has seen significant improvements in domestic stability. The IMF notes that domestic stability has improved since the new government took office in October 2022, creating an environment conducive to economic reforms. This stability was a key factor in the approval of Iraq’s first three-year budget, which, despite its fiscal expansion, has helped drive a strong recovery in the non-oil economy.

In addition, Iraq has been largely immune to regional conflicts, especially the ongoing conflicts between Israel and the Gaza Strip. This relative stability, combined with the recovery of the non-oil economy, has allowed Iraq to focus on internal economic adjustments.

Inflation and Fiscal Imbalance
One of the positive aspects of Iraq’s recent economic performance is the decline in domestic inflation, which fell to 4% by the end of 2023. This improvement is attributed to lower global food prices, the currency revaluation in February 2023, and the return of trade finance to normal.

However, the IMF warns that Iraq’s fiscal expansion, coupled with lower oil prices, could exacerbate economic imbalances. While the expected fiscal expansion in 2024 is expected to stimulate growth, it could lead to a further deterioration in fiscal and external accounts. Iraq remains vulnerable to oil price volatility, which accounts for a significant portion of its revenues.

Without urgent policy adjustment, the Fund warns that Iraq could face medium-term sovereign debt stress and external stability risks. These concerns are heightened by global uncertainties, such as the possibility of a sharp decline in oil prices or an escalation of conflict in the Middle East.

Fiscal and structural reforms
to stabilize the economy and reduce financial vulnerability The IMF stresses the need for significant fiscal adjustments. Iraq needs gradual but impactful fiscal policy reforms to stabilize debt over the medium term and rebuild financial buffers. The Fund recommends focusing on controlling the public wage bill, gradually eliminating mandatory employment policies, and enhancing non-oil revenue mobilization. In addition, better-targeted social support programs can help alleviate poverty and strengthen public finances.

The Fund also stresses the importance of implementing key structural reforms to support long-term economic development. Iraq’s priorities include strengthening the tax and revenue system, and implementing the “single treasury account” and reducing the use of extra-budgetary funds are critical steps in achieving effective fiscal consolidation. Other reforms include reducing cash financing, reforming the pension system, improving governance, and combating corruption.

Strengthening the financial sector
The Central Bank of Iraq has made efforts to improve monetary policy and strengthen liquidity management, and the IMF has commended these efforts. However, the Fund highlights the need for better coordination between fiscal and monetary operations to manage excess liquidity and improve the effectiveness of monetary policy.

Furthermore, the Fund sees restructuring large state-owned banks as essential to improving the efficiency of the financial sector. The Fund urges continued modernization of the private banking sector by facilitating correspondent banking relationships, reducing regulatory uncertainty, and increasing competition among private banks.

Unleashing the potential of the private sector
The future of the Iraqi economy depends largely on transforming its still underdeveloped private sector. The IMF recommends structural reforms to unleash the potential of the private sector, with a focus on creating equal opportunities between public and private sector jobs, increasing women’s participation in the labor market, and reforming education and labor laws to meet the needs of the modern economy.

In addition, Iraq needs to improve its governance systems, address efficiencies in public procurement, and address challenges in critical sectors such as electricity. These reforms are essential to creating a more sustainable and diversified economy. The Fund also noted Iraq’s renewed efforts to join the World Trade Organization (WTO), a move that could help Iraq integrate into the global economy and attract foreign investment.

Outlook 2025 and Beyond
By 2025, the Iraqi economy is expected to begin a significant recovery, with strong growth in its non-oil sector and increased investment in areas such as technology and infrastructure. If the required fiscal and structural reforms are implemented, Iraq may be able to reduce its dependence on oil and strengthen its private sector.

However, the Iraqi economy will remain vulnerable to global economic fluctuations, particularly with regard to oil prices. If oil prices continue to decline or if regional crises increase, Iraq may face challenges in sustaining its economic growth. In this context, it is essential for the Iraqi government to continue implementing reforms that enhance economic diversification, while emphasizing the building of strong financial reserves to protect the economy against future shocks.

Conclusion
The IMF’s assessment of Iraq’s economic outlook presents a mixed picture: while there are signs of recovery and positive growth projections for 2024 and 2025, significant challenges remain. The Iraqi economy remains highly dependent on oil revenues, making it vulnerable to price fluctuations. The Fund emphasizes the need for fiscal discipline, structural reforms, and a comprehensive plan to diversify the economy. If these challenges are addressed, Iraq has significant potential to lay the foundations for a more stable and prosperous economy in the coming years, especially after 2025.

Economic Studies Unit / North America Office

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TIDBIT FROM CLARE, 16 DEC

 Clare 

  Article:  "Blinken: I was amazed when I arrived in Baghdad by the construction in Iraq and the vitality of the capital"  

Quote:  "US Secretary of State Anthony Blinken expressed his astonishment today, Saturday, after his recent visit to Baghdad, at the construction in Iraq and the vitality in the capital, while indicating that the Iraqi people deserve this development."

 Article: "Why will Iraq become one of Trump's 'priorities' in the coming period? - Urgent"

 Quote “Trump is planning major changes in the Middle East region, and therefore the region is entering a new phase, and Iraq will be at the forefront of these changes in terms of the security and economic reality."

RV, Zim Bonds BY JULIAN ASSANGE: ' RATES ARE EXTREMELY HIGH" ‪@DINARREVALUATION

 

FRANK26: "ANSWER IS... 'HOW MANY DINARS DO YOU HAVE' ", 16 DEC

 KTFA

FRANK26: "ANSWER IS... 'HOW MANY DINARS DO YOU HAVE' "......F26

Why will Iraq become one of Trump's "priorities" in the coming period? - Urgent

 

12/13/2024

 

Baghdad

 

Political researcher Ahmed Al-Yasiri predicted, on Friday (December 13, 2024), that major changes will take place in the Middle East region after Donald Trump assumes the presidency of the United States of America.

Al-Yasiri said in an interview with Baghdad Today, “Trump is planning major changes in the Middle East region, and therefore the region is entering a new phase, and Iraq will be at the forefront of these changes in terms of the security and economic reality."

He added, "According to this change, Iraq will witness internal events, some of which will be difficult and related to the security aspect of the weapons file outside the control of the state. Trump is planning to significantly limit these weapons as part of the policy of trimming Iran's arms in the region."

Trump will assume his duties as US President on January 20, and since winning the presidential elections, he has been making provocative statements from time to time about developments in the region, including that if the detainees in Gaza are not released before his inauguration, there will be “hell” in the Middle East, he said.

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DINAR REVALUATION REPORT: IRAQ UPDATE, 16 DEC

 DINAR REVALUATION REPORT: IRAQ UPDATE

Summary

Iraq is witnessing significant economic changes, including a potential revaluation of the dinar, a shift to digital payments, and increased international investments.

Highlights

• 🚀 Prime Minister Sudani emphasizes economic growth and purchasing power.
• 💰 Speculation grows around the revaluation of the Iraqi dinar.
• 💳 Iraq is transitioning to digital payment systems, modernizing its economy.
• 🌍 Basra hosts a historic event with global leaders, showcasing investment potential.
• 🤝 Jordan’s Safwa Islamic Bank invests in the Iraqi Islamic Bank, boosting confidence.
• 🏡 The real estate market gains momentum, attracting international investment.
• 📈 Alaro Islamic Bank plans a capital increase to strengthen its position.

Key Insights

• 🌟 Sudani’s vision for economic growth signals a pivotal moment for Iraq, fostering optimism among citizens and investors alike.
• 💵 The potential revaluation of the dinar could significantly reshape Iraq’s financial landscape, attracting more foreign interest.
• 💻 The shift to digital payments indicates Iraq’s commitment to modernizing its financial infrastructure, which could streamline transactions and reduce reliance on cash.
• 🌐 The gathering in Basra demonstrates Iraq’s readiness to engage with the global community, potentially leading to increased international partnerships.
• 🏦 The investment by Jordan’s Safwa Islamic Bank reflects growing confidence in Iraq’s financial future and its strategic importance in the region.
• 🏘️ The real estate boom suggests a robust recovery and growth potential, making it an attractive prospect for international investors.
• 📊 Capital increases in banks like Alaro signpost the strengthening of Iraq’s financial institutions, essential for long-term economic stability.