Government confirmation that the Iraqi economic path is moving in the right development direction, 15 JAN

 Government confirmation that the Iraqi economic path is moving in the right development direction

Mawazine News – Economy

The Prime Minister’s Advisor for Financial Affairs, Mazhar Mohammed Saleh, confirmed on Wednesday that Iraq’s economic path is progressing properly towards development for the coming years, noting that economic growth in 2024 is a motivation for the expansion of economic activities in the country.

Saleh said in a statement to the official agency that “there is a principle in the economy called the economic accelerator, which means that the growth in non-oil GDP, which reached 6% in 2024, will reflect positively on the strength of national investment in 2025.”

He added that “the Iraqi economy will witness a high investment renaissance in 2025 thanks to the economic accelerator in the investment field, in addition to the high positive growth effects of national income in 2024.”

Saleh pointed out that “business companies and investors are affected by the results of the basic idea behind the economic accelerator, which indicates that any increase in demand for goods and services as a result of national income growth in 2024 can lead to increased investment in capital such as machinery, equipment and labor in 2025.”

He added that “companies and business activities need to expand their productive capacity to meet the growing demand for goods and services, which will lead to a positive accumulation in the productive capacities of the national economy in 2025,” he stressed that this can be positively expected, especially if it is accompanied by a good agricultural season and a wet year in the coming months.

In conclusion, the Prime Minister’s Advisor pointed out that “Iraq’s economic path is moving in the right development direction for the coming years, thanks to the continuous cooperation between the private and public sectors.”

https://www.mawazin.net/Details.aspx?jimare=258626

TIDBIT FROM SANDY INGRAM, 15 JAN

 Sandy Ingram 

 At the present time, January 2025 the Central Bank of Iraq has severe limitations on trading the IQD on the markets.

  We are not sure if the limitations are because of U.S. sanctions, the Islamic faith or both...One of the fundamental tenants of Islamic finance is the prohibition of gharar, or excessive uncertainty and maysir or gambling both of which are deemed detrimental to individual and societal well-being...

The foreign exchange market presents a challenging ethical dilemma for Muslims.  While forex trading is a legitimate global financial practice, its nature and mechanisms often raise questions...

Gambling or maysir, is unequivocally prohibited in Islam...However some scholars suggest forex trading can be permissible if conducted in a manner that avoids speculation, interest and excessive risk.  

MZ:The best time to do this was between 11PM est & 2AM est on a Saturday night into a Sunday Morning

 

IMPORTANT IRAQ NEWS: FORMER MP: IRAQ IS FACING AN ECONOMIC DISASTER AND THE SOLUTION LIES IN TWO URGENT STEPS , 15 JAN

 FORMER MP: IRAQ IS FACING AN ECONOMIC DISASTER AND THE SOLUTION LIES IN TWO URGENT STEPS 

(from a VERY conservative former politician and not even an economists)

Former MP Ahmed Al-Hajj called on the government and parliament on Sunday to take urgent measures to prevent an imminent economic disaster that Iraq may face. 

Al-Hajj said in an interview with Al-Maalouma Agency, “Iraq is facing a financial crisis whose signs have appeared in the past few days and have affected the state’s financial obligations towards its employees and other groups. This crisis is caused by:

1.the decline in oil prices, which represent the most important source of financial resources for the state,

2.as well as the gap between revenues and expenditures that has widened in recent years.” 

He indicated that “many warnings have been issued in the past that the country is heading towards such a crisis unless appropriate solutions are put in place.” 

He added, “The government must quickly adopt administrative streamlining and not inflate the financial budget due to the demands of some political parties that benefit from the budget as an investment or as a source of income,” indicating that “administrative streamlining leads to a decrease in government expenditures and we avoid the disaster that Iraq faces if oil prices and the quantity of exported oil do not decrease.” 

It is noteworthy that the Parliamentary Finance Committee hosted, on Monday, the Minister of Finance, Taif Sami, to discuss amending the budget law for the current year, while the head of the Rights Bloc, MP Hussein Mounes, called after the hosting to reduce spending and maximize revenues.

DINAR GURUS UPDATE, 15 JAN

 DINAR GURUS UPDATE

Highlights

• 📈 Speculative Timeline for Revaluation: Mark Z indicates a potential revaluation of the Iraqi Dinar could occur between now and January 22nd.
• 🔒 Security and Stability: Frank 26 emphasizes that security and stability are crucial for the introduction of a new exchange rate.
• 🌍 Global Banking Integration: Jeff highlights the need for an internationally convertible currency to access global banking markets.
• ⚖️ Islamic Finance Concerns: Sandy Ingram discusses the limitations on trading the IQD, linked to Islamic financial principles and potential sanctions.
• 📜 Legislative Progress: Recent legislative changes, including amendments to the passport law and budget law, have been made to support economic reforms.
• 💰 Purchasing Power Promises: Iraqi officials, including Sedani, have promised to enhance the purchasing power of the Dinar, which is reportedly more valuable than the dollar within Iraq.
• 🏦 Transition to Asset-Backed Currency: Mark Z mentions that financial institutions recognize a shift toward an asset-backed currency system, incorporating gold.

Key Insights

• 📅 Speculation vs. Reality: The speculative nature of predictions regarding the Dinar revaluation raises questions about reliability. Although Mark Z’s timeline provides a sense of urgency and excitement, such forecasts often lack concrete evidence and could mislead investors. Understanding the broader economic context and waiting for official announcements might yield better insight into the actual timing of any changes.

• 🔒 Foundation of Stability: Frank 26’s assertion about the necessity of security and stability for currency reform underscores a critical factor in economic growth. Without a secure environment, financial markets struggle to thrive. This point suggests that for Iraq to effectively transition to a new exchange rate, both political stability and overall security must be prioritized, potentially requiring international support and investment.

• 🌐 International Recognition: Jeff’s focus on the need for an internationally recognized currency highlights a significant barrier for Iraq’s economic development. The implications of not having a convertible currency include limited access to foreign investments and challenges in engaging with global markets. The path to recognition may involve comprehensive economic reforms and increased transparency in Iraq’s financial systems.

• ⚖️ Ethical Considerations in Trading: Sandy Ingram’s discussion regarding the limitations on trading the IQD due to Islamic finance principles emphasizes the complexities of integrating modern financial practices with traditional values. This aspect of finance could create challenges for both local investors and international entities looking to engage with Iraq, necessitating tailored approaches that respect cultural values while fostering economic growth.

• 📜 Legislative Framework: The mention of legislative changes, such as amendments to the passport law and budget law, reflects a proactive stance by the Iraqi government towards economic reform. These changes may facilitate smoother economic operations and enhance investor confidence. A stable legislative environment is vital for fostering trust among both domestic and international stakeholders.

• 💵 Purchasing Power Dynamics: The assertion that the Iraqi Dinar is currently more valuable than the US dollar within Iraq raises intriguing questions about local economic conditions. If true, this could signal a substantial shift in economic dynamics, potentially positioning the Dinar as a stronger currency in the region. However, the sustainability of this purchasing power will depend on various internal and external factors, including inflation rates and international trade policies.

• 🏦 Shift to Asset-Backed Currency: Mark Z’s commentary on the transition to an asset-backed currency system aligns with global trends in financial markets that seek stability and trust through tangible assets. This shift could enhance the Dinar’s credibility, attract foreign investments, and stabilize Iraq’s economy. However, successful implementation would require robust regulatory frameworks and transparency to ensure the backing assets are managed effectively.

WALKINGSTICK: IRAQI BANK FRIEND AKI : THEY'RE DE-DOLLARIZING THE WHOME MIDDLE EAST! @DINARREVALUATION

 

IMPORTANT IRAQ NEWS: BIRTH OF A NEW BANKING ENTITY IN IRAQ., 15 JAN

 BIRTH OF A NEW BANKING ENTITY IN IRAQ.. A GOVERNMENT ADVISOR REVEALS THE DETAILS TO {EUPHRATES NEWS}

The financial advisor to the Prime Minister, Mazhar Muhammad Salih, revealed a study being conducted by a global consulting firm, commissioned by the state, to restructure Rafidain and Rashid Banks, which constitute 85% of the banking market in the country.

Saleh explained to Al Furat News Agency that “the two banks suffer from a historical legacy of challenges, which requires a comprehensive reform plan to reposition them within the map of effective and efficient banking work.”

Saleh added, “The study aims to establish a new banking entity specializing in government banking operations, to meet the government’s needs exclusively. This entity will contribute to achieving the goals of the unified treasury account, which is a crucial tool for regulating cash flows for public finances.”

He pointed out that “the study focuses on evaluating the legal status of the two banks, including property rights, evaluating assets and liabilities, and studying the requirements of a strategic partner if necessary, with a focus on developing the two entities to operate according to advanced financial technology that meets the requirements of the national banking market.”

He stressed that “the structural reform also aims to enhance the integration of the two banks into the national banking market and enable them to expand into global financial markets, especially in the areas of trade and investment financing for the private sector.”

He added that “the two potential entities will rely on modern systems in compliance, governance and risk management, with a focus on digital payments.”

He concluded by saying: “The study is expected to be submitted to the higher official authorities in the coming months, within the framework of implementing the government’s financial and banking reform program, which aims to achieve a comprehensive economic renaissance and build modern financial institutions.”

Earlier today, Thursday, Prime Minister Mohammed Shia Al-Sudani chaired a special meeting to discuss developing the work of government banks, in the presence of representatives of Ernst & Young for auditing and financial consulting.

The Prime Minister explained that the percentage of completion of the project to restructure Rafidain Bank has reached its final stages, stressing that it will enter into force within the next few days, within the framework of a plan that has been studied and implemented according to the established standards and specifications.