Al-Alaq: 20 Iraqi banks practice direct transfer operations
Economy News – Baghdad
The Governor of the Central Bank, Ali Al-Alaq, confirmed today, Tuesday, that there are 20 Iraqi banks that practice direct transfer operations in 8 foreign currencies.
MILITIAMAN CC HIGHLIGHTS NOTES
In this video, the host discusses the ongoing digital transformation in Iraq, focusing on the integration of digital currencies and the shift towards a cashless society.
The significance of upcoming events, such as the first White House crypto summit, is highlighted, alongside Iraq’s efforts in controlling the sale of the dollar and enhancing the transparency of its banking system. The host emphasizes the importance of Iraq’s economic diversification, moving beyond oil reliance, and the associated increase in gold reserves, which bolster the country’s financial stability.
Furthermore, the video touches upon the International Monetary Fund (IMF)'s support for Iraq in developing its financial policies and the significance of recent agreements to facilitate foreign trade.
The host also discusses the crucial role of digitization in modern banking and the expected outcomes of ongoing negotiations regarding oil exports and salaries in the Kurdistan region. Throughout the discussion, the potential future value of the Iraqi dinar is considered, highlighting its impact on international financial transactions.
📊 The Importance of Digital Integration: The push towards a cashless society in Iraq signifies a broader global trend in financial digitization. By integrating digital currencies and banking practices, Iraq aims to modernize its economy, increase transaction efficiency, and improve transparency. This transformation will not only attract foreign investment but also enhance economic stability, especially important for a country recovering from years of instability.
💵 Dollar Control Measures: Iraq’s achievement in controlling the sale of the dollar represents a significant shift in its economic strategy. The transparency and accuracy in the dollar transaction process help to build confidence in the Iraqi banking sector. However, the host warns of potential backlash from factions reliant on the parallel market, emphasizing that a stabilized exchange rate is crucial for future economic growth.
⛏️ Gold Reserves as Economic Security: The substantial increase in Iraq’s gold reserves serves as a critical buffer against economic volatility. The 45.1% growth in the fourth quarter of 2024 highlights the central bank’s strategy to enhance financial stability. Gold purchasing by central banks generally leads to price increases in the market, reinforcing the notion that gold is still seen as a reliable store of value.
🌐 IMF’s Role in Iraq’s Recovery: The collaboration between the Iraqi government and the IMF is pivotal for the country’s economic recovery. The IMF’s support in developing financial policies and enhancing the banking sector facilitates Iraq’s transition towards a more stable and diversified economy. The backing of international financial institutions is crucial for bolstering investor confidence and optimizing economic growth.
🚧 Transitioning Away from the Parallel Market: The Iraqi government’s commitment to moving away from informal currency trading channels is crucial in stabilizing the dinar. By enhancing the use of official banking channels and reducing reliance on the parallel market, Iraq aims to ensure more consistent financial practices, which will ultimately contribute to a healthier economy.
🚀 Advancements in Trade Operations: Iraq’s successful entry into the international land transport system marks a significant milestone in enhancing cross-border trade. This achievement is expected to facilitate smoother operations in international trade, providing a boost to Iraq’s economy. The successful implementation of these trade systems will likely enhance regional relationships and foster economic growth.
🔍 Focus on Economic Diversification: The emphasis on diversifying Iraq’s economy beyond oil is crucial for its long-term sustainability. By investing in sectors such as tourism and agriculture, Iraq can create a more resilient economic framework. This diversification will not only stabilize the dinar but also create job opportunities and reduce vulnerability to global oil price fluctuations.
As Iraq continues its journey towards economic recovery and modernization, the integration of digital technologies and the establishment of transparent financial practices remain key to its success. The host reinforces the need for ongoing vigilance and adaptability in navigating the complexities of global finance and regional dynamics.
Baghdad – Mil
The Governor of the Central Bank, Ali Al-Alak, on Tuesday, confirmed the financial transformation and the stages of transition from a “window” to the “platform” and then to the correspondent banks, which is the first of its kind in Iraq, which is security and transparent and has received international praise, stressing that there are no new sanctions or changes with regard to Iraqi banks.
“The recent quarterly meetings with the US Federal Bank and the Treasury Department held in Dubai were very positive, as the steps taken by the Central Bank in improving the external transfer system and converting operations to international practices were safely, transparently and highly organized,” Al-Alak told the official agency.
Al-Alak added that “this transformation is the first of its kind in Iraq, which witnessed transitional stages from (window) to (the platform) and then to correspondent banks.”
“Today, there are 20 Iraqi banks practicing direct transfers with international correspondents in eight foreign currencies within the new regime,” he said.
Al-Alak explained that “other banks that are still outside this framework are now working to qualify them according to specific criteria, in cooperation with an international consulting company, to apply the necessary standards that qualify them to join external transfers.”
He stressed, “There are no new sanctions or changes, but on the contrary, there is praise and appreciation from international bodies, especially with regard to the mechanism of selling the dollar in cash.”
Al-Alak stressed “the need to focus on these successes to show a positive image of the transformations in the Iraqi banking sector, which reflects positively on the dealings of international financial institutions with Iraqi banks.”
“Coffee With MarkZ” Tuesday Morning Chat 3-4-2025
Thank you MarkZ for all your time, and encouragement daily….. PDK
MarkZ Update- Some highlights by PDK-Not verbatim
MarkZ Disclaimer: Please consider everything on this call as my opinion. People who take notes do not catch everything and its best to watch the video so that you get everything in context. Be sure to consult a professional for any financial decisions
Member: Good Morning and Happy Fat Tuesday and Mardi Gras
Member: March 4 1861, 164 years since Lincoln was inaugurated...
Member: Today is supposed to be a big day…..watching and waiting for big news.
Member: Sending love & Tuesday blessings! Let's pray that today is everything that they are anticipating!!
MZ: We only have a little bit out of Iraq today. There are a number of people that are supposed to be traveling to Zurich….right now…..as we speak. Including representatives from the US Treasury. We are waiting to see who hits the ground there. Its 4 or 5 o’clock over there right now so surprised I have not heard anything yet.
MZ: I have a number of contacts traveling along with attorneys and paymasters (as we speak) to Europe. So far I have identified 6 or 7 historic bond groups that are traveling for final contracts. All of this is happening today.
MZ: Watching for updates. But I don’t have anything from groups today. They are in place right now…but no update.
Member: what is the difference between groups and bond holders when you speak about them. Sorry if I sound dumb
Member: There are bond holders in groups like Historic German Bonds, Chinese railroad bonds, and many others . Then there are currency groups…..folks who have already turned in their currency to the groups and have received SKR’s (safe keeping receipts) in exchange…..those are supposedly in tier 4a. Many are big church groups. Like the Mormon church ect…..
MZ: “Central Bank: We adopt a secure and reliable transfer system internationally and no new sanctions” This system is safe and transparent and has won international praise.
MZ: I do have some reports saying oil is flowing in the pipeline now. Waiting for articles to confirm.
MZ: So we have oil flowing, Banks are safe now and bond people traveling for final contracts so far today.
Member: What does “final contracts” mean?
MZ: It means when they get paid in fiat dollars for the first portion …at least the first 10% is fiat. Then when they flip the trigger it will turn to gold backed.
Member: What’s your take on No auctions in Iraq since last Wednesday?
MZ: My take is we are crossing the finish line. Just like Al-Alaq said…no sanctions and transparency is what they needed in their white papers monetary reforms to increase the purchasing power of the Iraqi dinar for all Iraqi’s. And return the rate to its former glory.
Member: The Nasdaq, S&P & DOW taking another beating today in early trading
Member: DOW now down more than 500 points
Member: Asian market got hammered last night
Member: So, what are we expecting with Trumps big speech tonight ????
Member: Don’t expect anything major but a wrap up of his first 100 days
Member: Trumps speech tonight "The Renewal Of The America Dream" Not "The State Of The Union" let's do this!!
Member: I think he will announce new financial system as the restored American dream
Member: I expect a recap of all his administrations accomplishment’s . I would love to see an announcement of Asset backed currency…..but doubt it
Member: Nesara would be a good Pres. Trump announcement.
Member: Just a thought ..are we seeing a slow gradual NESARA already?
Member: State of the Union Address 9PM Eastern
Member: This has been the longest roller coaster ride of our lives, hopefully we're pulling in and about to debark from this ride! It's time to find another ride to occupy our time.
Member: Really will be glad to see an end to this “movie”
MZ: I think they are about to run the credits.
Member: Thanks Mark and Mods…See everyone tonight at 7 pm est for news…..Then the SOTU speech watch party tonight .
THE CONTENT IN THIS PODCAST IS FOR GENERAL & EDUCATIONAL PURPOSES ONLY&NOT INTENDED TO PROVIDE ANY PROFESSIONAL, FINANCIAL OR LEGAL ADVICE. PLEASE CONSIDER EVERYTHING DISCUSSED IN MARKZ’S OPINION ONLY
In a move “aimed at confronting the liquidity crisis,”
This step comes in response to “growing challenges in traditional cash management”, amid a global trend towards financial digitization, but it raises many questions in the Iraqi street “Will this digital currency be the perfect solution to end the liquidity crisis? And how will it affect banking and the future of the economy?”
The Governor of the Central Bank, Ali Al-Alak, revealed earlier last week, the trend to create a digital banking currency, to replace banknotes.
Al-Alak said, in a speech during the ninth Finance and Banking Services Conference and Exhibition, that “the financial and banking system will witness fundamental transformations, including the decline of paper currencies to be replaced by digital payments to central banks,” noting that “the Central Bank is moving to create its own digital currency, to gradually replace the paper process as is done in some central banks in the world.”
The Iraqi government faces challenges in managing cash liquidity in dinars, as it suffers from a chronic shortage of this currency, which affects its ability to meet its financial obligations to pay employees’ salaries, pay debts and finance projects.
Currency benefits from a government perspective
In this regard, the Economic Advisor to the Prime Minister, Mazhar Mohamed Saleh, says that “the issuance of a national digital currency will represent a fundamental transformation in the financial system, as it will contribute to the development of the digital payments system and enhance financial transparency.”
Saleh pointed out during his speech to the “Al-Jabal” platform that “this step will lead to several essential benefits, including (reducing cash leakage from the economy and controlling financial flows, limiting the circulation of paper currency outside the banking system, which enhances financial inclusion, reducing the need to print money frequently, which reduces the operational costs of producing and distributing it, strengthening financial control through the possibility of tracking liquidity flows and spending trends, and improving control over capital and external transfers, which supports efforts to combat money laundering and terrorist financing.”
Saleh adds that “cryptocurrencies will enhance financial inclusion, especially for non-banked categories, which contributes to promoting economic and social integration,” explaining that “the successful transition to a digital monetary system requires an advanced technical infrastructure, including (strong and secure Internet networks, advanced cyber security systems to protect financial transactions, and enhancing community acceptance of digital currencies, starting from government institutions through their use in letion and official transactions.”
According to Saleh, Digital Cash will maintain its traditional functions as an account, payment and savings unit, while making it available for use via the Internet and smartphones, which contributes to building a more stable and efficient financial environment.
But on December 16, 2024, the Central Bank of Iraq announced that it would not be granted a license to companies trading stocks, metals and cryptocurrencies, stressing that it was proceeding with all legal measures against fictitious companies, amid warnings of the existence of fictitious companies for electronic trading in shares claiming to be licensed by the bank.
Benefits and benefits of digital currency
The world’s first digital currency was issued in 2009, Bitcoin, and came in response to the global financial crisis that initially paralyzed the American banking system and then moved to the global financial system, where the founder of the currency claimed that “this currency works away from central banks.”
Earlier this year, the American magazine “CEO world” said that “Iraq is one of ten countries in the world that ban the dealing of cryptocurrencies,” stressing that despite the global rise of cryptocurrencies, many countries continue to impose strict regulations or an outright ban, and while some governments cite financial stability and fraud prevention, other governments raise concerns about money laundering and economic control.
Ali Al-Friji, a specialist in finance, says that issuing a digital currency is an important step towards modernizing the financial system in Iraq economically and financially, as this step can contribute to enhancing financial inclusion and modernizing the payment system.
According to the International Monetary Fund, the digital currencies of central banks can enhance financial inclusion and payment efficiency in the Middle East, which may reduce transaction costs and increase the speed of remittances. However, it must be borne in mind that issuing a digital currency may not be the only solution to the crisis of cash scarcity resulting from wasteful uncontrolled or programmed spending.
According to Al-Freji, the potential benefits revolve around enhancing financial inclusion and improving the efficiency of the payments system, while the expected challenges go towards the unbalanced banking infrastructure, and cybersecurity because cryptocurrencies need advanced security systems to protect users, as well as financial awareness and education.
There are also many additional challenges expected, such as the public’s lack of confidence in the banking system, as the banking sector in Iraq suffers from a low level of trust among citizens, due to previous financial crises, delayed implementation of transactions, difficulty in withdrawing funds from some banks, and speaking to the Iraqi expert.
Al-Friji continued his speech by saying that “the United Nations Conference on Trade and Development (UNCTAD) pointed out that there are risks and challenges that must be taken into account before issuing a central bank digital currency, including improving access to digital infrastructure and addressing risks related to data privacy and financial safety,” adding that “a review of the figures of the Central Bank of Iraq showed that the volume of the issued monetary mass reached more than 102.6 trillion Iraqi dinars until the end of November 2023, while the volume of capital of banks operating in Iraq reached about 9.1 trillion Iraqi dinars at the end of 2023, which means that the percentage of funds deposited does not exceed 8.8% of the volume of the monetary mass Exported.”
Al-Fariji points out that “the monthly budget needs according to economic estimates, the Iraqi government need between 18 and 20 trillion dinars per month to cover budget expenses, with insufficient financial liquidity to meet this need,” adding that “these figures indicate that there are great challenges in providing the necessary cash liquidity to meet the needs of the budget and the financial system in Iraq.”
In 2018, the Kurdistan Regional Government’s Supreme Fatwa Authority issued a ruling against “One Coin”, which reinforced the country’s cautious attitude towards digital assets, but unofficial cryptocurrency trading continues in Iraq despite the restrictions imposed on it.
Issuing digital currency will not be accepted
The Iraqi government decided to change the exchange rate of the Iraqi dinar against the US dollar, in 2020, as the price was adjusted from 1182 dinars per dollar to 1,450 dinars per dollar.
This decision aroused widespread popular discontent, especially after the prices of food and all goods in the markets witnessed a significant rise, as this change in the federal budget approved by the Iraqi House of Representatives on March 31, 2021.
This step of the Central Bank on “electronic currencies” comes within the framework of keeping up with global developments in the financial system, as the state seeks to adopt digital currencies officially and systematically, similar to international currencies such as “Bitcoin”.
In this context, economic expert Abdel Adel Namel believes that “the digital currency, although it exists informally, will be more effective if applied within a legal framework and a tight financial system.”
“The Iraqi banking system is still in its early stages of development, especially after the adoption of salary localization and the expansion of the use of money transfers, ATMs and points of sale (POS),” Sofem said in a special interview with the mountain platform.
He talks softly about that “digital currency may be useful for some segments, but it will not enjoy wide vocacy and acceptance in Iraq at the moment, given the instability of the dollar exchange rate, and the critical economic conditions that the country is going through,” stressing that “it is not possible to completely replace the paper currency with digital currency in light of the current challenges.”
The Iraqi economist concluded his speech to the mountains by stressing “the need to strengthen the banking infrastructure before moving to this type of financial dealings.”
A few days ago, the banks of “Rafidain and Al-Rashid” warned against the use of electronic payment tools in the trading of “digital currencies and forex”, while stressing that the decision came in line with the directives of the Central Bank of Iraq, and called on customers to refrain from using electronic payment tools, including cards and electronic wallets.
https://aljeebal.com/posts/4055
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