New Conditions From The Iraqi Central Bank For Buying And Selling Foreign Currencies, 24 DEC

 New Conditions From The Iraqi Central Bank For Buying And Selling Foreign Currencies

 
December 23, 2024  Baghdad/Iraq Observer  Today, Monday, the Central Bank of Iraq set new conditions for buying and selling foreign currencies.   Below is the document:  
 
https://observeriraq.net/wp-content/uploads/2024/12/IMG_9748.jpeg   
 
https://observeriraq.net/شروط-جديدة-من-المركزي-العراقي-لبيع-وشر/   

 
DATE:  2024/12/22  Electronic payment companies / two accessories
Exchange and mediation companies selling and selling foreign currencies
5 / Digital payment providers
 
Due to the availability of all the requirements for appointing the agent mentioned in (Chapter Two /
First / The Requirements of the Agent) from controls
The work of the providers of digital payment services for a year 2020 and the fact that exchange companies are my category (A,B) and the mediation companies by selling and selling
Foreign currencies Venice (C) licensed from this bank and is subject to its supervision and monitoring; The following decides:
 
1- Allowing exchange companies Vinte (A,B) and mediation companies to buy and sell foreign currencies (C) Digital payment services / accessories to provide cash withdrawal service (POC) according to the following conditions:
 
1- The agency/ executor in the name of the company should be limited and not owned by natural people.
 
A- The agency's services are provided inside the company’s headquarters and its branches exclusively.
 
B- The company informs this bank when contracting with the digital payment service and providing it with a copy of the signed contract The two parties.
 
C- Closing the agency / port in the event that this bank withdraws the company's leave.
 
D- The agency's domestic payment service for the agency took a written pledge from the company wishing to contract with him not to own any
A shareholder / executive and operating outside the exchange of the exchange or mediation company.
 
2- In the event that one of the shareholders or director of the exchange and mediation companies has an agency / port in his name and works outside the headquarters

The company can integrate the agency / port with the company and allow it to transfer its ownership in the name of the company in exclusivity and inform this bank that
An exception to the blindness of this bank number (114/10/9) on 2/22/2022, which includes not transferring the ownership of agents/withdrawals outlets POC; In the event that the agent / the perpetrator wants to leave the work, the digital payment companies must end the contract and take
The appropriate procedures for them not to sell the agency's ownership and its transmission.
 
With appreciation.  https://observeriraq.net/شروط-جديدة-من-المركزي-العراقي-لبيع-وشر/   

MILITIAMAN CC HIGHLIGHTS NOTES, 24 DEC

 MILITIAMAN CC HIGHLIGHTS NOTES

Summary

Highlights

• ⚖️ Rule of Law: Prime Minister Al Sudani reaffirms the government’s support for the Federal Supreme Court’s efforts to strengthen the rule of law.
• 🌍 Economic Diversification: Emphasis on moving away from an oil-dependent economy by boosting tourism, with references to Iraq’s rich cultural heritage.
• 🏦 Banking Reforms: Introduction of an electronic passport system and transition to a cashless economy are highlighted as steps toward modernization.
• 🌐 International Partnerships: The government is actively fostering international partnerships to bolster Iraq’s economy and attract foreign investment.
• 💱 Currency and Exchange Rate: Discussions surrounding the potential for a new exchange rate system and the implications of the Central Bank’s reforms.
• 🔄 Digital Transformation: Focus on the importance of a digital economy and compliance with international financial standards as a means to reduce corruption and improve financial operations.

Key Insights

• 📜 Government Support for Rule of Law: The government’s backing of the Federal Supreme Court signifies a commitment to legal reforms, which are crucial for establishing a stable political and economic environment. This move is expected to enhance investor confidence and facilitate the implementation of new laws that support economic development.

• 🌐 Tourism as an Economic Driver: Al Sudani’s focus on tourism highlights the government’s strategy to diversify Iraq’s economy. By promoting its ancient civilization and archaeological sites, Iraq aims to attract tourists, which could generate significant revenue and reduce dependence on oil exports.

• 📊 Shift Towards Digital Economy: The introduction of the electronic passport system and the transition to a cashless economy are indicative of Iraq’s efforts to modernize its public services. These initiatives are expected to streamline operations, improve efficiency, and reduce corruption, thereby fostering a more transparent and accountable government.

• 🏦 Reform of the Banking Sector: The Central Bank of Iraq’s reforms, including the establishment of correspondent banking relationships, are essential for integrating Iraq into the global financial system. These changes will facilitate foreign currency transactions and improve the overall efficiency of the banking sector.

• 📈 Potential for New Exchange Rate System: The discussion around a new exchange rate system reflects the Central Bank’s intentions to stabilize the economy. The anticipated adjustments may help mitigate inflationary pressures and restore confidence among investors and the public.

• 🤝 International Financing Support: The interest expressed by major international banks like JP Morgan to support Iraqi trade financing operations is a significant endorsement of Iraq’s economic potential. This relationship is expected to enhance Iraq’s access to global markets and investment opportunities.

• 🔄 Adapting to International Standards: Iraq’s commitment to aligning its banking practices with international standards is crucial for attracting foreign investments. By adhering to compliance regulations set by global financial institutions, Iraq aims to enhance its credibility and operational efficiency, ultimately leading to economic growth and stability.

FIREFLY: CHECKMATE!! : IRAQ MUST ADD VALUE TO THE DINAR ONCE STOPS THE CURRENCY AUCTION #iqd

 

An expected rise in the dollar...a “temporary shock” awaiting the Iraqi market, 24 dec

 An expected rise in the dollar...a “temporary shock” awaiting the Iraqi market

 
Economy | Yesterday, 19:49 |
Baghdad today - Baghdad
 
Today, Monday (December 23, 2024), the "Future Iraq" Foundation for Economic Studies and Consultations expected a rise in the dollar exchange rate during the next few days, following the Central Bank of Iraq's announcement of stopping the currency conversion window platform.
 
The head of the institution, Manar Al-Obaidi, said in a statement to “Baghdad Today” that
 
“stopping the Central Bank’s currency transfer platform, which was officially announced on 12/23/2024, will lead to a temporary rise in the dollar exchange rate in the market as a result of the prevailing state of fear.”

However, things will return to normal at the beginning of the new year.” Al-Obaidi added,
 
"This decision had been previously announced by the Central Bank,
 
but such measures, when implemented, cause a shock in the market, leading to a temporary rise in the exchange rate, before the shock is gradually absorbed." He explained that
 
"the difference between the official and parallel market will remain, but it will shrink as the situation stabilizes."
 
On Tuesday (December 17, 2024), economic affairs specialist Nasser Al-Tamimi warned of a rise in the dollar exchange rates in Iraq in the coming days. Al-Tamimi told “Baghdad Today” that
 
 “there are real fears in the Iraqi market about the continued rise in dollar exchange rates after the platform was suspended by the Central Bank of Iraq,” noting that
 
“this matter will constitute a shock, especially at the beginning of the implementation of the decision and will push for a rise.” The dollar, to increase demand for it in the parallel market.” He added,
 
"After stopping the platform, most merchants, especially small ones, will depend on the parallel market to finance their foreign trade, while continuing to finance trade with Iran and Turkey with dollars, in illegal ways," pointing out that
 
"this is what will push the rise and  that is why practical steps must be taken to prevent This is done by the monetary authority in the country, and urgently.”
 
On Wednesday (September 4, 2024), the Central Bank of Iraq revealed the mechanism for ending the electronic platform for external transfers, while
 
indicating that placing external transfer operations and meeting requests for the dollar is on sound paths and consistent with international practices and standards. 
 
https://baghdadtoday.news/264515-ارتفاع-مرتقب-للدولار.-صدمة-مؤقتة-بانتظار-السوق-العراقي.html   

ARIEL: Iraqi Dinar Update, Strategic Window, 24 DEC

 ARIEL

Iraqi Dinar Update

I can understand why this would be the case for the Central Bank of Iraq and determine a cohesive strategy for their new exchange rate.

 As we know speculation can run wild once they reinstate their currency. Releasing a new exchange rate during a period when markets are closed or less active, such as during Christmas, could indeed provide a strategic window.

This timing allows for adjustments in the currency valuation without the immediate pressure or volatility that might come from active trading.

 This could minimize the risk of speculative attacks or undue market reactions. Introducing the new rate just before the weekend gives the Forex markets time to adjust over a couple of days before the new week starts.

This buffer can be useful for banks, traders, and the financial systems to recalibrate without the intensity of a full trading week’s pressure right away. Will everything go according to this plan? Not sure but it does make perfect sense. As we know others are saying they could delay it to July 2025 because of the digital transformation. Which I highly disagree with.

Because for one Starting a new fiscal year with an adjusted rate would simplify financial reporting and economic planning for businesses and government entities. It allows for a clean slate where all financial transactions from January 1, 2025, would be based on the new rate, reducing confusion and making economic analysis more straightforward.

While full digitalization by July 2025 might be an ambitious goal, Iraq has already taken significant steps towards digital banking. The introduction of digital payment methods, mobile banking apps, and efforts to reduce cash reliance indicate a progressive move towards digital finance. 

This groundwork suggests that even if full digitalization isn’t complete, substantial progress has been made, potentially sufficient to handle a currency revaluation without needing to wait until July 2025.

NADER FROM MID EAST: I FEEL IT'S VERY VERY CLOSE!! @DINARREVALUATION #iraqidinarinvestor #iraqidinar

 

Stopping The Dollar Transfer Platform...A Calculated Step Or A Risky Adventure?, 24 dec

 Stopping The Dollar Transfer Platform...A Calculated Step Or A Risky Adventure?

 
December 23, 2024  Baghdad/Iraq Observer  The Central Bank of Iraq is scheduled to abandon the electronic platform for dollar transfers abroad at the end of this year,  which has raised questions about whether this decision indicates the abandonment of the Iraqi Central Bank and the US Federal Bank’s mechanisms for monitoring the movement of the dollar,
 
or is it a step towards adopting a new system that may It contributes to reducing sharp fluctuations in the exchange rate and returning it to its natural levels that are consistent with the requirements of the local market and the national economy.

The electronic platform was launched in early 2023 as a new mechanism aimed at auditing dollar transfers before they are implemented, replacing the previous system that relied on auditing by the US Federal Bank after the transfers were completed, which was considered a step to enhance transparency, improve control of the movement of funds, and ensure compliance with financial laws.
 
At that time, banks, companies and merchants in Iraq faced major challenges in adapting to the new mechanism, as it required time to understand the working mechanisms and ensure compliance with the requirements.
 
However, these entities were able to adapt gradually, especially after bank employees underwent extensive training courses on using the electronic platform, which contributed to achieving full compliance with the new work procedures and ensuring the smooth flow of financial operations.
 
According to the new transfer mechanism, banking operations in dollars will be limited to banks that have international banking relationships, or what are known as “correspondent banks.”
 
Concern and reassurance
 
Both the Central Bank of Iraq and the US Federal Reserve believe that this step will contribute to strengthening oversight of remittances in a more precise and specialized manner, by restricting transactions to a limited number of banks that have high banking standards and the ability to cooperate with international banks, which aims to reduce financial risks and ensure Compliance with international control s.
 
In turn, Mustafa Akram, a researcher in financial and banking affairs, said that
 
stopping work on the electronic platform (FITR) and restricting dollar transfers to a limited number of foreign banks may pose challenges to the local banking system, indicating that
 
“this step may raise concerns about the concentration of transactions in dollars.” “In a limited range, which may lead to effects on exchange rate stability.”

Akram added to “Iraq Observer” that  “there is a need for a deeper study of the impact of these measures on competitiveness in the Iraqi banking sector, while emphasizing the importance of preserving banking sovereignty and enhancing balance in the local market.”
 
Possible bounces
 
In light of these movements, news was raised about a trend towards making a new adjustment to the exchange rate, which raised concern among economists about the potential impact of this trend on the economic process in general.
 
Experts stressed that sudden changes in monetary policy may create additional confusion in the markets and weaken confidence in the financial system.
 
For his part, economic expert Uday Al-Alawi stressed that
 
“the biggest mistake the government can make is manipulating the dollar exchange rate through sudden decisions, because this has a direct impact on the national economy and undermines investors’ confidence in the financial system.” Al-Alawi added, in a press comment, that
 
“the government’s continued making of ill-considered decisions regarding the exchange rate will lead to the erosion of international and local confidence in the Iraqi economy, which will weaken the ability to attract the investments necessary to improve the economic reality.”
 
Economists fear the possibility of some banks not included in the transfers going to meet the requirements of their customers towards the parallel market, which could lead to a return to the rise of the dollar in Iraq.   https://observeriraq.net/إيقاف-منصة-تحويلات-الدولار-خطوة-محسوب/