Economist: floating the currency will lead Iraq to 4 negatives at the same time

1,782 Economie 2020/11/30 21:34

Baghdad Today – Baghdad

The economic expert, Rasim al-Akidi, identified 4 negatives that would arise at the same time if the Iraqi government went to float the dollar.

Al-Aqidi said in an interview with (Baghdad Today), “The float of the dollar, or what is known as liberalizing the exchange rate, takes place through two methods, the first is pure or free, and the second is the controlled or controlled method, and in both cases the price of the dollar will rise against the Iraqi dinar and will lead to the withdrawal of a large amount of the monetary block.” in the markets”.

He added, “Withdrawing a large cash block is offset by 4 disadvantages at the same time, and the affected will be large segments, including the increase in prices in the markets in addition to the factories’ reluctance to produce because the value of profits will decrease in front of costs in addition to the absorption of per capita income and the increase in rental prices, so the interest will be limited by analogy. Other damages. ”

Al-Aqidi pointed out that “Iraq needs an economic rescue plan that starts from maximizing non-oil revenues, which are many, and keeping the influential parties away from them, because a large part of the financial resources does not go to the state treasury, and this is part of the causes of the current financial crisis in the country.”

Economists ’opinions differed on the” floating of the dinar “in front of the dollar exchange to face the deficit crisis that the financial budget suffers from.

One party believes that the measure will serve the Iraqi economy in the medium term by activating the sectors of industry and agriculture, but another party believes that it will eliminate the poor and middle classes.

The Iraqi Central Bank rejected the idea of “floating the dinar” during the next stage to increase government revenues and be able to pay employees’ salaries in the coming days, citing its fear of increasing prices and harming the vulnerable classes.

The estimated budget for 2020 suffers from a large deficit of 50 trillion dinars. Observers expected the deficit to rise with the oil market losing about 50% of its prices.

Central Bank Governor Ali Al-Alaq said, in a study published on the Central Bank’s website, that “the devaluation of the Iraqi currency stems from an attempt to reduce the budget deficit due to growing expenditures at unprecedented rates. Prices of imported materials and goods in light of the weakness of institutions and the general turmoil.

Al-Alaq added that “Iraq’s exports are limited to crude oil, and therefore the devaluation does not affect its exports, nor does a significant additional value materialize,” noting that “Iraq’s local industry is weak and unable to compensate for imports.” He revealed that the number of employees, retirees, and those covered by social care reach 6 million, and that they will be negatively affected by this measure.

The Governor of the Central Bank of Iraq confirmed that “the external debt of Iraq will rise after the devaluation of the currency, so the amount of 5.9 trillion dinars will become 7.1 trillion dinars, while the domestic debt remains unchanged.”

“The devaluation of the currency will undermine confidence in the national currency as a result of the absence of reforms and the general instability, and the demand for the dollar will increase, as well as the weak demand for deposits in local currency and conversion to foreign currency,” Al-Alaq added.

A preliminary date to distribute the salaries of Kurdistan’s employees and a deputy confirms: Negotiations with Baghdad did not take place

560 Policy 2020/11/30 12:00 am

Baghdad today – Kurdistan

A member of the Finance Committee in the House of Representatives, MP for the National Union, Sherwan Mirza, confirmed today, Monday (November 30, 2020) that there is no indication so far that Baghdad will send 320 billion dinars to the Kurdistan region.

Mirza said in an interview with (Baghdad Today), “The federal government, after the parliament voted on the deficit financing law, was waiting for the regional government to send a delegation to Baghdad, for the purpose of discussion and negotiation, but that did not happen.”

He added, “The available indicators indicate that there is no sending of the sums during the current week, unless new negotiations take place between the two governments.”

In turn, a government source revealed, “If the federal government sends an amount of 320 billion as expected next week, it will distribute salaries immediately and at a deduction rate of 18%.”

The source added in his speech to (Baghdad Today): “In the event that the sums are not sent by Baghdad, the regional government will depend on its available financial revenues, and salaries will be distributed according to a deduction system of 40%.”

The spokesman for the Kurdistan Regional Government, Jotiar Adel, had stated that his government would distribute the salaries of its employees in the coming days, whether Baghdad sent the money or not.

German Siemens reveals the reasons for not implementing the agreed “road map” strategy in Iraq

1,454 Sweeteners 11/30/2020 09:23 ha

Baghdad today – Baghdad

The German company Siemens confirmed, Monday (November 30, 2020), to proceed with the “road map” strategy that it agreed to implement in Iraq with previous governments, while expressing its hope to consolidate cooperation with Iraq and work to meet the country’s need for electricity during the coming period.

The company’s executive director, Musab Al-Khatib, said in a press statement, “The company has previously submitted an integrated strategy to provide electric power to Iraq in the name of (the Road Map), which included achieving self-sufficiency within four years. However, there are challenges to meet the requirements of the electricity sector, including the lack of The provision of adequate quantities of fuel affected the continuation of this plan. ”

He pointed out that “you can benefit from the associated gas to feed the power stations, and from its derivatives to support the general budget through these precious extracted materials.”

The executive director of the German company said, “The fluctuation of global oil prices and the economic decline that resulted from the Corona pandemic have affected the pace of implementation of development projects in Iraq, and these challenges are not only faced by Iraq; but are part of the challenges that the world faces.”

He continued, “We are making progress in implementing our projects, and we are optimistic about the economic policies and reform programs announced by the government, and its desire to move forward in implementing the state’s infrastructure projects, in a way that supports levels of economic performance.”

An economist calls for deleting the three zeros from the dinar to strengthen the local currency

30 November 2020 | 1:19 PM

The Baghdad Post

Economic expert Raad Twig called , the central bank to delete the three zeros from the dinar to strengthen the local currency.

Twig said: It is known that the monetary mass in circulation is about 60 trillion dinars, which is not available with the Central Bank of Iraq, banks and the public, and it is a large monetary block compared to the economic transactions of the Iraqi economy and that a large proportion of this block suffers from compactness and therefore this does not help the Central Bank of Iraq in drawing a policy Effective cash calling on  the central bank to delete three zeros or gradual deletion of zeros to make the value of the dinar appear at a higher value and that the processes of evaluation and monetary balance will be formed quickly in the market economy. ”

He added: The monetary mass can become approximately 15 to 25 trillion dinars and the value of the new dinar converges to the value of the dollar, which facilitates the process of calculation and allows small and new denominations of cash to appear in the money market.

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Kurdistan government gives good news about paying salaries “soon”

Kurdistan Region



Staff salaries

2023-11-30 09:22

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Shafaq News / The Kurdistan Regional Government announced on Monday that the salaries of employees will be distributed soon, noting that political auctions are behind the delay in sending Baghdad of 320 billion dinars to the region.

Regional government spokesman Jutiar Adel said in a televised statement followed by Shafaq News, that Baghdad had to send an amount of 320 billion dinars to the region to distribute salaries according to the agreement concluded between the federal government and the Kurdistan Region.

He added, “Because of the political auctions, the money has not been sent yet.”

Adel pointed out that “Erbil is waiting to send the amount from Baghdad,” adding that “if it is not sent, Erbil will soon start distributing the salaries of employees and retirees according to another mechanism and through internal imports.”

He pointed out that according to the agreement between the Kurdistan Region and Baghdad, the latter was scheduled to send a monthly amount of 320 billion dinars for the last three months of the current year 2020 until the beginning of next year 2021, but the amount has not been sent yet.

US efforts to achieve ‘diplomatic victories’ in the region that precede Trump’s departure for the presidency

2023.11.30 – 16:27

Baghdad – People  

Later this week, Jared Kushner, US President Donald Trump’s son-in-law, will visit Saudi Arabia and Qatar in an effort to achieve “diplomatic victories” in the region before leaving the White House, according to media reports.  

The American Wall Street Journal quoted unnamed US and Gulf officials as saying that this visit will focus in particular on resolving the existing dispute between Qatar and the Saudi-led coalition, but there may be a number of other issues on the agenda.  

The newspaper said that Kushner will be accompanied by Avi Berkowitz, the president’s Middle East advisor, and Brian Hook, the former US envoy to Iran.  

The “Financial Times” newspaper quoted sources it described as “informed of the talks” (30 November 2020), that Saudi Arabia is currently intensifying its efforts to resolve the Gulf crisis, which has been going on for more than three years, after President Donald Trump’s defeat in the elections.  

The newspaper considered that this step to end the boycott of Qatar by three Gulf countries is seen as a Saudi attempt to win the friendship of the new administration of President-elect Joe Biden and bid farewell to Mr. Trump.  

The newspaper also believes that the next administration of President-elect Joe Biden, will necessarily be “much cooler” towards Saudi Arabia.  

The newspaper quoted an adviser to Saudi Arabia and the UAE describing the talks as “a gift to Biden.”  

That adviser added to the American newspaper that Saudi and Emirati leaders want to “de-escalate” the Arabic-language Al-Jazeera network and end its criticism of Saudi Arabia.  

It also quoted the Saudi analyst close to the royal court, Ali Al-Shehabi, as saying that Saudi leaders have been “open to resolving this issue” for several months, “and that they have” worked for some time to close many hot files and it is clear that this is one of them. ”  

According to the newspaper, the Trump administration fears that the dispute will weaken the Arab coalition that it sought to form against Iran, and it is also frustrated that Tehran has benefited financially since the situation, as it is imposed to prohibit flights to and from Qatar using Iranian airspace.  

The newspaper quoted a diplomat familiar with the talks as saying that “the recent talks that took place between the United States and Kuwait aimed to pave the way for direct negotiations between Riyadh and Doha.”  

According to the newspaper, Qatar wants to make sure that there are some preconditions before any bilateral talks, and it quoted the same diplomatic source as saying that these conditions could include “confidence-building” measures such as lifting the air embargo and allowing the free movement of Qatari citizens to and from the countries that imposed the ban, until If Doha wanted guarantees of their safety.  

And US National Security Adviser Robert O’Brien said this month that he hoped Qatar Airways would be able to fly over the blockading countries “within the next seventy days” before the end of Trump’s presidency.  

It is noteworthy that Saudi Arabia, the UAE, Egypt and Bahrain have imposed an air, sea and land embargo on Qatar since June 2017, accusing it of approaching Iran and supporting extremist Islamic groups, which Doha denies.  


The Ministry of Planning calls for sending a Kurdish delegation to Baghdad to resolve the oil problems

2023/11/30 11:18

The number of readings 45

Section : Iraq

Baghdad / Obelisk: The Ministry of Planning confirmed, Monday, November 30, 2020, that the 2021 budget will be present tomorrow, Tuesday, at the cabinet table, based on discussions and review of the Ministerial Council for the Economy, stressing the need for a Kurdish delegation to come to Baghdad to resolve the outstanding oil problems between the two parties .

Maher Hammad Joaan, Technical Undersecretary for the Ministry of Planning, said in a press release that was followed by Al-Masala, that the discussions of the Ministries of Finance and Planning regarding the draft federal budget bill for 2021 have reached their final stages.

He expected that the draft budget will be referred to the Ministerial Council for the Economy within the next few hours for review before presenting it to the Council of Ministers in the middle of this week.

He explained that the issue of presenting the draft federal budget at the cabinet meeting tomorrow, Tuesday, depends on the discussions and review that will be implemented by the Ministerial Council for the Economy, expressing its reservation on mentioning the size of the budget and its deficit and calculating the price of selling oil and all the numbers mentioned in the draft.

He stressed the need for a Kurdish delegation to come to Baghdad this week to resolve the outstanding oil problems between the two parties, in order to include the agreement in the draft budget bill.

And he indicated that the budget has not yet touched any clear text or writing referring to the region’s share, indicating that the Kurdish delegation that will arrive in Baghdad soon will agree with the federal government on the most accurate details to be included in the budget law.

He concluded by saying that time has begun to run over us, especially since Parliament has demanded the government to send the budget as soon as possible, adding that the government is keen to take the opinion of the parliamentary bodies concerned with the budget law to facilitate the process of passing it in Parliament sessions, indicating that the consultations between the executive and legislative authorities will be present soon.

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Al-Kazemi directs to send the 2021 budget to the Council of Ministers immediately

11/30/2020 09:27

The number of readings 108

Section : Iraq

Baghdad / Al-Masala: Prime Minister Mustafa Al-Kazemi directed, on Monday, November 30, 2020, to send the 2021 budget to the General Secretariat of the Council of Ministers immediately for the purpose of checking it.

The spokesman for the General Secretariat of the Council of Ministers, Haider Majeed, said in a press statement followed by Al-Masalla that Al-Kazemi directed the Ministries of Finance and Planning to send the 2021 budget immediately to the Cabinet Secretariat.

He added that the Prime Minister directed the Ministries of Finance and Planning to send the budget for the purpose of auditing it by the legal department in order to allocate an extraordinary session to discuss it and refer it to the House of Representatives for approval as soon as possible.

Majeed indicated that the government and the House of Representatives are unanimous on the need to expedite the approval of the 2021 budget.

Earlier, the financial advisor to the Prime Minister, Dr. The appearance of Muhammad Saleh, that the budget will secure the salaries of employees and retirees, social care and some investment projects.

A member of the Finance Committee, Sherwan Mirza, confirmed that the Finance Committee is awaiting the arrival of the 2021 budget bill, which is expected to arrive in Parliament next week, according to government promises.

He added that the Finance Committee will work upon the project’s arrival to prepare a detailed study on the budget’s items, address the gaps in it, if any, and know the value of the financial deficit.

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Representative Finance: The proposal for a “white paper” to replace the currency requires a lot of money


White paper

Financial Committee

Delete zeros

2023-11-30 06:24

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Shafaq News / The Parliamentary Finance Committee confirmed, on Monday, that the “white paper” submitted by the Prime Minister, Mustafa Al-Kazemi, includes a proposal to replace the currency, noting that this proposal requires a lot of funds to implement it.

It is noteworthy that the Iraqi Prime Minister, Mustafa Al-Kazemi, confirmed, last June, that the government had prepared a “white paper” for the upcoming reforms. According to the document, the proposed period for implementation is 3 years from 2021 to 2023.

Committee reporter Ahmed Al-Saffar told Shafaq News: That “the reform paper to address the financial crisis presented by the House of Representatives includes one of its points to review the exchange rate while studying the possibility of proceeding with steps to delete zeros, with the amendment of the mechanism of selling the currency and preserving the hard currency and the exchange rate of the dollar against the Iraqi dinar.”

He added that “the application of this proposal requires better economic possibility and conditions than the current situation with the availability of financial liquidity for the application,” noting that “currency exchange requires a lot of money to print currency abroad.”