Sunday, December 29, 2024
In numbers.. The decline in the value of the Iraqi dinar, 29 DEC
In numbers.. The decline in the value of the Iraqi dinar
Today, Friday (December 27, 2024), the economic expert, Manar Al-Abidi, determined how much the Iraqi dinar has lost in value.
Al-Obaidi explained in a tweet followed by "Baghdad Today" that "the value of any currency is determined based on two basic factors, which are the amount of currency issued, which is the total cash pumped by the central bank, and the size of reserves, which includes foreign currencies, investments, and gold held by the central bank."
He explained that "the situation at the end of 2023, the amount of currency issued reached 101 trillion dinars, and the value of official reserves reached 145 trillion Iraqi dinars."
Al-Obaidi added, "As for the situation at the end of 2024, the amount of currency issued remained at the same level of 101 trillion Iraqi dinars, and the value of official reserves decreased to 139.7 trillion Iraqi dinars."
He pointed out, "The impact on the value of the Iraqi dinar, despite the stability of the issued monetary mass, the decrease in the value of official reserves by 5.3 trillion Iraqi dinars led to a decline in the purchasing power of the dinar, and as a result of this decrease in reserves, the actual value of the Iraqi dinar decreased by 5.3%."
Al-Ubaidi pointed out that "the continued decline in the actual value of the dinar will lead at some point to an increase in inflation as a result of the decline in the strength of the dinar compared to reserves alone. All this while the average price of Iraqi oil was high, so how will things turn out in the event of a decline in oil prices?" link
MILITIAMAN CC HIGHLIGHTS NOTES, 29 DEC
MILITIAMAN CC HIGHLIGHTS NOTES
Summary
In this video, the speaker discusses significant developments in Iraq’s financial and economic landscape, emphasizing the role of digital transformation and demographic advantages in fostering economic growth.
The Parliamentary Finance Committee has confirmed that financial digital transformation is pivotal in eliminating corruption and money laundering, indicating a shift towards blockchain technologies.
The speaker highlights the importance of automating customs procedures and enhancing the banking system to ensure financial sustainability and diversification of the economy.
Moreover, the demographic profile of Iraq, characterized by a young population, presents an opportunity to become a global economic power, especially with support from the United States.
The speaker stresses the need for Iraqi leadership to effectively utilize this demographic gift to prevent unemployment and instability.
The video also touches on the challenges posed by the parallel market for dollars and the implications of the Central Bank of Iraq’s new policies on currency issuance and banking practices. Overall, the discussion underscores the importance of adapting to digital financial systems and the potential for Iraq to emerge as a significant player on the global economic stage.
Highlights
- 🌐 Digital Transformation: The Parliamentary Finance Committee confirms that financial digital transformation can eliminate corruption and money laundering in Iraq.
- 🚀 Economic Paradigm Shift: The push for automation in customs and banking systems aims to secure financial sustainability and job opportunities.
- 👶 Demographic Advantage: With 60% of the population being young, Iraq is positioned to leverage this demographic for economic growth.
- 🤝 U.S. Support: The United States is set to play a crucial role in helping Iraq exploit its demographic potential for investment and economic development.
- 📈 Rising Currency Expectations: Anticipations of a rise in the dollar exchange rate in the parallel market signal ongoing confusion among businesses.
- 💳 New Banking Policies: The Central Bank of Iraq is shifting from dollar auctions to a currency window, aiming to stabilize the economy.
- 🎉 Issuance Celebration: The Central Bank’s annual celebration of its issuance and treasury department hints at significant plans for currency management and economic strategy.
Key Insights
🌍 Global Digitalization Trends: The speaker emphasizes that Iraq is not alone in its digital transformation efforts; various countries are embracing blockchain and other technologies to combat corruption and promote transparency. This trend aligns with a global push towards digital economies, demonstrating that Iraq’s initiatives are part of a broader movement.
🔄 Sustainable Economic Growth: The speaker highlights the necessity of transitioning towards a sustainable economic model through digital financial systems. The automation of customs and banking serves not only to enhance efficiency but also to mitigate corruption—a fundamental issue that has plagued Iraq for years. This transformation could lead to increased foreign investment and greater economic stability.
👩👧👦 Youth as Economic Drivers: With a significant portion of the Iraqi population being young, there is a pressing need for policies that encourage entrepreneurship and job creation. The speaker draws parallels with other countries that have successfully harnessed their youth demographic to achieve economic miracles. This potential must be tapped into through effective governance and strategic investments.
🇺🇸 Strategic Partnerships: The video outlines the critical role of U.S. support in Iraq’s economic development. It indicates that Washington’s backing will be essential for implementing reforms and attracting foreign investments. The speaker suggests that the U.S. has vested interests in ensuring Iraq’s stability and growth, which could foster a more favorable investment climate.
💵 Implications of Currency Changes: The discussion around the Central Bank of Iraq’s policy changes—specifically the transition from dollar auctions to a currency window—highlights the complexities of currency management. The speaker indicates that this shift could lead to a more stable economy by reducing reliance on the parallel market, which has previously been a source of volatility.
⚖️ Risks of Poor Management: The speaker warns that failing to properly invest in Iraq’s demographic advantages could lead to dire consequences, including high unemployment and political instability. This serves as a call to action for Iraqi leaders to prioritize economic reforms and effectively manage their resources to capitalize on the opportunities presented by a youthful population.
🎊 Cultural Shifts in Banking: The celebration of the Central Bank of Iraq’s issuance and treasury department underscores a cultural shift towards recognizing the importance of currency management and economic strategy. This event reflects a growing understanding of the role of the banking system in fostering economic growth, signifying a maturation of Iraq’s financial institutions.
Overall, the insights drawn from the video suggest a pivotal moment for Iraq as it navigates through challenges and opportunities in its economic landscape. The emphasis on digital transformation, youth empowerment, and strategic partnerships highlights the multifaceted approach required to achieve sustainable growth and stability.
124 Trillion Dinars Iraq's Revenues In 10 Months And An Expert Warns Of "Oil", 29 DEC
124 Trillion Dinars Iraq's Revenues In 10 Months And An Expert Warns Of "Oil"
2024-12-29 Shafaq News/ The Iraqi Ministry of Finance revealed on Sunday that the size of revenues in the federal budget during ten months exceeded 124 trillion dinars, while an economic expert considered that the "excessive" dependence on oil may expose the country to economic fluctuations.
Shafaq News Agency followed the data and tables issued by the Ministry of Finance in December of this year for ten months starting from January until October of the current fiscal year, which showed that the revenues from oil decreased slightly to 88%, but it still constitutes the main resource for the general budget, indicating that the rentier economy is the basis of the country's budget.
The financial tables indicated that the total revenues for ten months of the current year amounted to 124 trillion, 659 billion, 47 million, 830 thousand, and 362 dinars, indicating that the total advances amounted to 18 trillion, 74 billion, 75 million, 887 thousand, and 751 dinars.
According to the tables, oil revenues amounted to 110 trillion, 220 billion, 945 million, and 501 thousand dinars, which constitute 88% of the general budget, while non-oil revenues amounted to 14 trillion, 438 billion, 778 million, and 884 thousand dinars, which constitute 12% of Iraq’s general budget.
For his part, economic expert Mohammed Al-Hasani said in an interview with Shafak News Agency, "This excessive reliance on oil will expose the country to macroeconomic fluctuations, and will limit any opportunity to develop policies to confront expected fluctuations."
He added, "Iraq needs to raise growth rates in the non-oil sector in order to absorb the shocks of oil prices when they decline," indicating that "in order to reduce dependence on oil, a major adjustment of the public financial situation is required based on increasing non-oil revenues, reducing current spending, and reviewing the customs tariff structure."
In March 2021, the Prime Minister's advisor for financial affairs, Mazhar Muhammad Salih, confirmed in an interview with Shafaq News Agency that the reasons for the economy remaining rentier are due to the wars and the imposition of an economic blockade on Iraq during the past era and the political conflicts we are witnessing today, which led to the dispersion of economic resources.
The continued reliance of the Iraqi state on oil as the sole source of the general budget puts Iraq at risk from global crises that occur from time to time due to the impact of oil, which makes the country turn every time to cover the deficit through borrowing from abroad or domestically, which thus indicates the inability to manage the state’s funds effectively, and the inability to find alternative financing solutions. LINK
Subscribe to:
Posts (Atom)