Parliament sets next Thursday as the date for holding a session to vote on the budget
The House of Representatives has set next Thursday as the date for holding a voting session on the federal budget.
Below is the text of the document:
words :
Yasin al-Nawab (reading verses from the Holy Quran)
Arabic and international for affairs
First: Voting on the draft federal budget law for the Republic of Iraq for the fiscal years (2023, 2024, 2025). (Finance Committee, Strategic Planning and Federal Service Committee), (67) Article).
The session begins at one o'clock in the afternoon
The Iraqi dinar is falling again against the dollar... the dilemma of the "security mentality" and the continuation of smuggling
The value of the Iraqi dinar has returned to decline, after relative gains it achieved during the past months, mainly due to the increasing demand for the dollar and the lack of supply of it, and also due to problems in managing the financial process in Iraq, according to Iraqi officials and experts who spoke to Al-Hurra.
The value of the dollar rose to about 1480 dinars now, compared to 1380 dinars per dollar at the end of last April.
The instability in the price of the dollar causes economic and financial problems in the country, which manages a large part of its internal trade, and almost all of its foreign trade, in US dollars.
The Central Bank of Iraq raised the quantities of dollars sold in the market at the official rate, 1310 dinars per dollar, to 206 million dollars per day on the fifth of June, compared to 107 million at the same time last month, according to bank data .
However, the increase in the supply of dollars did not seem to lead to a decrease in its prices.
The government's economic advisor, Mazhar Muhammad Salih, says that there are two trends that have caused the recent increase in the volume of sales in the Central Bank's window.
Saleh adds to the "Al-Hurra" website that the first trend is caused by the re-submission of applications by banks that were previously rejected by the compliance platform due to deficiencies in the technical conditions for submission.
The instructions stipulate that the rejected banks are allowed to submit new applications after several months, which generated "high momentum in demand for the dollar," according to Saleh.
The second reason, according to the government advisor, is the "slowness in the movement of foreign transfers" due to external regulators.
Saleh says that the audit process takes a relatively long time, and this raises the momentum of requests for foreign currency.
government actions
Saleh says that the Iraqi monetary authorities are seeking to shorten the transfer time and strengthen bank balances with their correspondents from international banks after entering the window of the Central Bank to sell foreign currency, through continuous coordination with the compliance authorities in the US Federal Bank.
The government is also trying to control the movement of the dollar in the parallel markets, according to economist Mustafa Hantoush.
Hantoush says that the previous government "manipulated exchange rates" without an economic justification, which led to an increase in the value of the dollar in conjunction with the US Federal Bank's imposition of compliance measures that also caused a reduction in dollar sales in the markets, which led to an increase in its price.
While the current Iraqi government reduced the price of the dollar against the Iraqi dinar, in an effort to increase the strength of the Iraqi currency, its efforts apparently collided with the high demand for the dollar for internal transactions, and also because of currency smuggling.
According to economist Ali Hamid, "the dollar is sold in Iraq at a relatively cheap price, which makes the demand for it high to be sold in other countries."
Hamid adds to the "Al-Hurra" website that "the sanctions imposed on Syria, Iran and Lebanon have greatly reduced the arrival of the hard currency needed by those countries, which made the illegal currency trade flourish, and Iraq was the preferred interface for smugglers due to lax laws and the abundance of cheap currency."
Security mentality
Expert Hantoush says that the Iraqi authorities are trying to manage the financial file with a "security mentality" that relies on "arrests and signatures (pledges)" and other ill-conceived measures.
He adds that this method has led to a "liquidity crisis" in Iraq, as "smuggling to Iran and Syria continues" due to the lack of control over the smuggling file at the border crossings.
Hantoush added, "The security forces are supposed to control the border crossings and prevent smuggling," instead of "arresting those who trade dollars inside."
The security pursuits of dollar traders create a liquidity crisis because of "the high risk of trading, which means that sellers will try to achieve high returns to offset that risk," according to Hantoush, and the pursuit of traders means fewer dollars available in the market, and this in turn leads to an increase in the price of the dollar.
The government has not yet approved the 2023 budget, in which the dollar is supposed to be officially priced at 1,310 dinars, in an effort to calm demand for the dollar and reduce its prices.
Some economists believe that "the devaluation of the Iraqi currency" is positive, calling on the Iraqi government to think "with an open market mentality," according to economist Samer Abdul Majeed.
Abdel Majeed told Al-Hurra that "volatility in dollar prices hurts the market much more than a steady rise in its price."
Abdel Majeed agrees that the currency depreciation will hurt employees and those with limited incomes, but he says that this effect will be for a relatively short term in exchange for a long-term recovery in investment, tourism, agriculture and industry.
Iraq supports its currency by selling relatively cheap dollars and providing them for circulation, which causes financial losses in the millions of dollars daily, but this also ensures the provision of relative economic security for employees and people with limited income, while also causing an increase in the demand for currency smuggling.
Iraqi governments are trying to achieve a balance between demand for and supply of hard currency, but they have also been subject since last October to constant scrutiny by the US Federal Bank to ensure that currency is not smuggled to other countries, which reduces supply in the markets.
The Iraqi Trade Bank issues a notice to citizens
The bank’s media said in a statement received by Earth News, “Our dear customers, in order to avoid fraud and fraud, please keep your banking information confidential, as well as your electronic card information. Entities, websites, social media pages, and others who claim to trade in these currencies because they have been withdrawn from circulation.
He added, “We also stress that the Iraqi Trade Bank TBI does not deal with any entity or institution that adopts the promotion of advances and loans, but that loan transactions are promoted exclusively through its branches, and we also stress not to fill out any form through any website or electronic page that requires filling in the confidential information of your electronic card.” To avoid electronic fraud attempts.
And he continued, “In the event that unofficial websites claiming to be affiliated with our bank or bearing the name (Iraqi Trade Bank) have been viewed, please inform us by calling the following numbers: Customer
Baghdad and London are discussing "promising" investment opportunities in Iraq
Today, Monday, Finance Minister Taif Sami and the British Ambassador to Iraq, Mark Bryson Richardson, discussed the contribution of the private sector to the overall national economy.
The Ministry of Finance said in a statement, "Minister of Finance Taif Sami received today the UK Ambassador to Iraq, Mark Bryson Richardson, and his accompanying delegation."
Sami stressed, "the strength of the relations of cooperation between the Republic of Iraq and the United Kingdom, and the constant development and growth they are witnessing in various fields, especially in the field of finance, economy and investment."
The meeting witnessed, according to the statement, "they discussed the consolidation of bilateral relations between the two countries, through the development of mutual cooperation in the areas of developing the banking sector and the contribution of the private sector to the overall national economy, in addition to discussing the promising investment opportunities that Iraq abounds in."
Baghdad sends 400 billion new dinars to Kurdistan
Today, Monday, the representative of the Kurdistan Regional Government in Baghdad, Fares Issa, confirmed that if the budget is not approved in the coming days, Baghdad will send 400 billion new dinars to the region.
Issa told (Baghdad Today) that "the Kurdistan Regional Government has not yet released the salaries for the month of May for employees, due to the lack of sufficient financial liquidity, as a result of stopping oil exports and not approving the budget."
He added, "In the event of a delay in approving the budget, the federal government will send in the coming days an amount of 400 billion dinars as a loan that will be deducted from the region's share, so that the Kurdistan government can pay the salaries of its employees."
The Kurdistan region is witnessing a severe financial crisis that caused its inability to pay the salaries of employees after the decision to stop oil exports from the region to Turkey, which came after the Federal Ministry of Oil won a lawsuit in international courts.
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