Bondlady’s Corner – Iraq Economic News and Points to Ponder Tuesday Evening 2-6-24

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Iraq Economic News and Points to Ponder Tuesday Evening 2-6-24

Tlm724 Administrator Bondlady’s Corner

The Governor Of The Central Bank Announces The Imminent Launch Of A Mechanism For Selling The Dollar

 06/02/2024   2480 views  The Governor of the Central Bank, Ali Al-Alaq, confirmed today, Tuesday, that the electronic payment file is a high government priority, and while he indicated a significant decrease in inflation compared to the beginning of 2023, he announced the  imminent launch of a special mechanism for selling the dollar to ensure that it reaches real travelers only. Al-Alaq said,

 “The Central Bank and the government give high priority to the issue of electronic payment because of its important economic repercussions and raising the level of transactions away from excessive use of cash,” noting that

“the Iraqi economy is a cash economy par excellence and the electronic payment process aims to significantly reduce the degree of economic cash cash.”. He added,

 “The Prime Minister is very supportive of the process of converting to electronic payment and holds successive and continuous meetings in order to strengthen the procedures related to this issue.

 We have made important progress in arranging electronic payment at the level of collection and payment in state institutions, in addition to that the Council of Ministers approved a number of important packages and decisions.” Which facilitates this process and does not burden the citizen with the resulting commissions.”

He stated that  “the Central Bank has a broad strategy in the electronic payment file and has developed the infrastructure and covers any type of electronic payment, whether by cards, via mobile phone, or other means,” indicating that “the Central Bank is also working on a strategy of financial inclusion and increasing users of financial services.”.

He continued, “There are direct decisions issued to support the use of electronic payment, including obliging government agencies to make payment and receipt through cards, and

also linking the process of renewing licenses in stores and approving them in buying and selling operations with the incentives granted, especially the government decision to bear 50%, which will make it marginal.” At the same time, Al-Alaq stressed that  “the Central Bank is working to complete the establishment of Riyada Bank, which will focus on supporting small projects by relying on the use of financial services away from cash dealing.”

He stated that  “the indicator of the success of monetary policy in any country is controlling the general level of prices and reducing inflation,” explaining that

“inflation has now decreased significantly compared to the beginning of 2023, which indicates, as the US Treasury Assistant stated a few days ago, that  

the low level of inflation indicates… Foreign trade is covered by the official rate, and foreign financing operations take place smoothly, and all importers and traders can obtain and control the dollar at the official rate.”

He pointed out,  “The Central Bank’s adherence to the rules and principles of external transfer in accordance with the conditions and requirements it set and its insistence on implementing them is what prompted many hesitant merchants to enter the platform for selling foreign currency, especially since using it is easy and safe and it provides them with the dollar at the official rate.”

Al-Alaq pointed out,  “The Central Bank confirms the possibility of meeting all requests for the dollar, whether personal, commercial, or any kind, as long as they are valid and legitimate, and

this is strongly supported by the size of the foreign reserves present at the Central Bank.” He pointed out,    “The Central Bank has no problem with offering or selling the dollar, and  it does not place restrictions on sales operations at all.

 It has never specified for the bank how much it can buy a dollar, nor has it set an upper or lower limit for a merchant, importer, or user of the dollar, or any other limit.”

 This gave the impression that there was no problem in responding to demand for the dollar and that speculation was useless because the rules for this speculation were not available and incorrect.” He added,

 “Some groups are still trying, from here and there, to stay away from the platform for various reasons, whether to evade taxes, customs, etc., or for the presence of illegal trade, as the drug dealer cannot transfer it through the central bank, or if it is corruption money, it cannot be transferred.” Through the Central Bank.

He pointed out that  “the Central Bank is in a comfortable position to respond to requests to buy the dollar and we have sufficient reserves.

 On the other hand, there are some countries that do not have sufficient reserves to respond to demand, and thus they have a large difference in the price between the parallel and the official price.”

 Regarding providing the dollar to travelers, Al-Alaq said,

 “After the experience we had in how to sell the dollar to travelers and citizens, we found many observations, including that it is difficult for the real traveler to obtain the dollar, and therefore we had a meeting in this regard, and we will finalize a new mechanism after developing its programs related to this.” The subject, according to which only the real traveler will receive the dollar.”

He stated,  “One of the things that helped calm and reassure the market is the stability of the exchange rate and the  central bank’s provision of payment options after currencies such as the euro, the dirham, the Turkish lira, and the Indian rupee, which are expanding.”   https://www.nrttv.com/ar/detail3/23091

Iran Downplays The Impact Of Canceling The Operating Licenses Of Three Of Its Banks In Iraq: It Harms Baghdad

Economy    Iraq    Iran    breaking     Drains    Cancellation of license  2024-02-05 Shafaq News/, Monday, Iran reduced the news that talked about stopping dealing with three of its banks in Iraq, and

while it indicated that two of those banks had their operating licenses originally canceled two years ago, one Iranian expert described the commercial situation in Iraq as “without law.” Some tribes have more power than the government.”

 The Iranian Eqtisad News website said in a report translated by Shafaq News Agency, that the head of the Joint Iranian-Iraqi Chamber of Commerce, Yahya Ali Ishaq, touched on the issue of canceling Bank Melli’s license in Iraq, saying,

 “In Iraq, we had three banks, namely Bank Melli, the Parsian Bank, and the Islamic Cooperative Bank.””.

The report pointed out that  “Bank Melli and Parsian Bank have not had any currency transfers and transactions for two years, and  therefore such news now would not affect the relations between the two sides and the currency market.”

 The head of the Joint Iranian-Iraqi Chamber of Commerce, Al Ishaq, added,  “As a result, this issue is not a new matter, and will not affect the financial transactions of businessmen, and there is no need to worry.” Al-Ishaq concluded his speech by saying,

 “It appears that the news that was published in cyberspace about the cancellation of Bank Melli’s activities in Iraq is nothing but the work of exploiters and brokers to stop the trend of decline in the exchange rate that began at the beginning of this week.”

For his part, an Iranian trade expert confirmed that   “canceling the National Bank’s license has no impact on trade between the two countries,” noting that  “commercial exchanges between Iran and Iraq take place in different ways.”

 Muhammad Ali Nadib said in a statement to the Iranian Bazaar website and translated by Shafaq News Agency,  “It cannot be said that canceling the bank’s license could have a special impact on Iran’s trade with this country.”

 Pointing out that Iraq does not have a clear commercial law, Nadib said,  “The government is not strong in this country and some tribes have greater authority than the government, and  for this reason the commercial path of this country is different from other countries,” stressing that

 “with this news, there will be no There is a change in trade with this country, and it will not happen, even if there is a problem for one of the two countries in trade, that country will be Iraq, not Iran,” he said.

The Iranian trade expert in Iraq stated that  “most of Iran and Iraq’s exports are made through the Emirates,” stressing that  “this news did not have a negative impact on the trade of the two countries, and exchanges between the two countries continue as before, and

 therefore the exaggeration of this news came to increase the price of the dollar because this The news is baseless and has been exaggerated by beneficial people.” The Iranian expert concluded his speech by saying,

“This news has no special impact on trade or the currency market, but the price of the dollar has been affected by political tensions in the past few months,” pointing out that

“the Iranian government’s handling of the situation and reducing tensions has contributed, since the beginning of the week, to the improvement in the trend.” Towards a decline in exchange rates.

https://www.shafaq.com/ar/اقتصـاد/يران-تقلل-من-ت-ثير-لغا-رخص-عمل-ثلاثة-من-مصارفها-في-العراق-يضر-بغداد

An International Consensus To Support The Iraqi Government’s Efforts To Maintain Stability And Complete Reforms

local    Yesterday, Baghdad – IA   The speeches of the representatives of the member states of the United Nations Security Council unanimously supported the government’s efforts to enhance the security and stability of Iraq and complete reforms in all fields, in the Council’s session on Iraq.

Britain:

Britain’s representative in the UN Security Council said,

“We value the Iraqi government’s reform steps in the areas of economy, security and investment, and we support Iraq’s sovereignty and reject the threat to its security and stability.” He continued,

“We encourage all political forces to support the government in supporting stability, and we also hope to settle the problems with Erbil.”

Algeria

In turn, the representative of Algeria affirmed in his speech that, “For the first time in 10 years, the Iraqi government has succeeded in conducting local elections. We praise the government’s efforts in holding local elections in Kirkuk for the first time since 2005, and we support Iraq’s security and stability.”

Japan

Meanwhile, the representative of Japan affirmed in his speech, “We support the Iraqi government’s reform efforts, welcome the holding of Iraqi local elections, and hope that the Kurdistan region will hold its overdue elections.”

China

As for the Chinese representative, he stressed the necessity of supporting the Iraqi government’s vision in rationalizing human and financial resources and meeting the country’s aspirations.

Malta

The representative of Malta affirmed his country’s support for the security and stability of Iraq and the efforts of the Iraqi government to close displacement camps.

France

As for the representative of France, he affirmed his country’s support for the efforts of the Iraqi government to complete the reforms that the Iraqi people aspire to and called for the resumption of dialogue between Baghdad and Erbil to get rid of all related problems. With oil, gas and money.   https://www.ina.iq/202634–.html

Damage From External Loans

Articles    02-4-2024, 08:03  Bashir Khazal   The continuation of the mechanism of external borrowing from banks and international agencies for development purposes may appear, in its general context, as normal borrowing,  especially those in which a very easy and reduced interest rate is agreed upon,

but what the government must pay attention to is caution against agreements with conditions imposed by donors or lenders.

Because it may cause the country’s economic policy to be drawn up in a systematic manner in the long term, and restrict the economy in a way that is not proportionate to maintaining independence in the decisions of major strategic projects, or monopolizing one party over another.

The government usually borrows development loans from international agencies, some of which are old, such as the Madrid Agency.

For reconstruction, the Japanese Agency, the British Agency, the American Development Agency, the World Bank, and the International Monetary Fund, all of which are natural borrowings, which many countries resort to in order to implement projects that cannot be postponed, and as interest and installments,

 Iraq pays approximately ten trillion Iraqi dinars, which is equivalent to 7 billion dollars, which is A percentage that constitutes 12.5% of the gross domestic product, and

 it may appear in the eyes of specialists that this percentage constitutes a reduced amount of debt, and indicates the recovery of the Iraqi economy,

but the danger lies in the continuation of these loans and the rise in the interest rate with the change in the security situation in the region, Article 25 of the Constitution.

 It stipulates that (the state shall guarantee the reform of the Iraqi economy according to modern economic foundations), and the government is supposed to implement this text by relying on the state’s internal resources.

Any external loan entails interest over time, and it may sometimes be on conditions that harm the country’s sovereignty, and  there are economic and sovereign risks to Iraq as a result

 The use of external borrowing policy in light of a huge budget estimated at 198 trillion Iraqi dinars, in addition to the presence of articles in the 2023 budget that included paragraphs that depend on external borrowing and from several countries to cover projects that are described as strategic.

 The extent of the risk of these loans in the long term is not small, and may gradually cripple the Iraqi economy. With inevitable connections for many years,

 we have experiences of countries that suffered from borrowing measures from abroad, such as Greece, in which the debt ratio increased compared to the domestic product, which caused a major financial crisis, and  after a while, Greece was lent again under severe austerity conditions, until the public debt crisis increased by 175 percent. % in the year 2015, and the rest of the story of the Greek crisis is known to everyone, as well as

 Brazil, which borrowed from the International Monetary Fund, and became unable to repay the debt, and the cumulative interest began to exhaust its wealth and resources to repay the loans.

 There are investment opportunities, natural resources, and enormous wealth that Iraq has that spare it any need.

We are in need of loans from abroad, and it is not necessarily the urgency that calls for us to shackle the Iraqi economy with unnecessary financial loans.    https://www.ina.iq/202463–.html

To read more current and reliable Iraqi news please visit BondLady’s Corner: https://www.bondladyscorner.com/ 

Points To Ponder On Advice Quotes and Quotations   

Be frank and explicit. That is the right line to take when you wish to conceal your own mind and to confuse the minds of others.  – Benjamin Disraeli

We only make a dupe of the friend whose advice we ask, for we never tell him all; and it is usually what we have left unsaid that decides our conduct. – Diane de Poitiers

Advice is like snow; the softer it falls, the longer it dwells upon, and the deeper it sinks into, the mind.  – Samuel Taylor Coleridge

The true secret of giving advice is, after you have honestly given it, to be perfectly indifferent whether it is taken or not and never persist in trying to set people right.  – Hannah Whitall Smith

The advice of the elders to young men is very apt to be as unreal as a list of the hundred best books.  – Oliver Wendell Holmes

  http://famousquotesandauthors.com/topics/advice_quotes.html