His financial advisor: The dollar exchange rate in the parallel market is gradually approaching the official one
hmmmmm I guess they mean it this time?
Today, Thursday, Adviser to the Prime Minister for Financial Affairs, Mazhar Muhammad Saleh, explained the dangers of the exchange rate fluctuations in the event that demands for floating the dinar are met, while confirming that the dollar exchange rate in the parallel market is gradually approaching the official one.
The video for this blog post is below here:
Saleh said to the official agency, followed by Mawazine News, that “calls for floating the dinar to end the gap between the official exchange rate and the parallel market may be possible in an economy in which the free market alone influences the movement of the balance of payments, and not in an economy in which the rentier government sector is dominant and generates currency reserves.” Foreign currency, as the monetary authority alone is the main source of supply of foreign currency that meets the desired demand for foreign exchange in the money market, to provide stability in this market and achieve a desired and homogeneous exchange rate through the interventionist role played by monetary policy.
He added, "Claims for flotation mean in all cases adopting the prevailing exchange rate in the parallel market to achieve the goal of stability and balance in the official exchange rate itself at a new point reached by the market at the end of the supposed flotation policy and returning to stability again. Also, the flotation scenario means in all cases the withdrawal of the authority." Cash from being an essential central supply of foreign currency, to be replaced by new forces supplying foreign currency from free market makers, which only have a weak, limited supply of foreign exchange, and at the same time they carry an uncontrolled package of inflationary expectations and are called in economic literature the forces generating expectations. "inflationary".
He continued, "The hypothetical new supply forces for foreign exchange adopted by the exchange market in that scenario will mean the dominance of supply forces from speculators with very limited quantities of foreign exchange available for supply in the parallel market, matched by an open demand for foreign currency on the part of the market that undoubtedly exceeds that limited parallel supply." of foreign exchange, perhaps by more than 10 times at least in our estimation, and such a policy of floating to achieve a homogeneous equilibrium exchange rate would be an open and perhaps unruly situation, as long as the central government supply of foreign currency would be absent from the market, and we would not then obtain any equilibrium point in the exchange rate. An exchange rate that is sought to float except with a widespread deterioration of the exchange rate as long as it is controlled by forces that generate inflationary expectations, as we noted in a highly unilateral rentier economy, and it is an exchange rate whose mechanisms will move in a market that is incomplete in terms of production in its compensation for the required supply of goods and services.
Saleh warned, “Then no one knows how much the new exchange rate resulting from the flotation will be, which will undoubtedly be accompanied by a prior wave of inflationary expectations, which is a dangerous wave whose directions are difficult to control, which may force monetary policy according to this floating scenario by intervening with foreign reserves.” It is an unjustified extravagance in foreign exchange to impose a state of stability in the general level of prices again just to adopt it when exchange rates reach low rates, and no one knows how much they will reach.”
He pointed out that "the difference in the two prices currently, in which the parallel market is gradually approaching the official market, did not come about due to the short supply of foreign exchange at the Monetary Authority, but rather came about due to a sudden external factor imposed by the compliance platform and administrative audit restrictions on external transfer movements, which is a matter related to the deficit in the authority's reserves." Cash is about bringing the two prices closer in light of a very high level of foreign reserves. The commercial efficiency of those reserves is the highest in Iraq’s financial history, and they are covered in foreign currency that touches more than 16 months of imports compared to the global standard of three months of imports.
Al-Sudani directs to take new measures regarding the electronic payment system in Iraq
A government source said, today, Thursday, that Prime Minister Muhammad Shiaa Al-Sudani directed several executive measures related to the electronic payment system and electronic points of sale (POS).
According to the source in his statement to Shafaq News Agency, this directive aims to enhance the use of electronic payment in Iraq and facilitate and monitor financial and commercial operations carried out through this system.
The source summarized the most important main measures that Al-Sudani directed, which are as follows:
1- Determine the tax wages that can be paid in cash in the amount of (500 thousand dinars) and what is more than that is settled via electronic payment.
2- Forming a joint committee between the Central Bank of Iraq, the Communications and Media Commission, and representatives of the private sector who are specialists in this field, which will do the following:
A- Proposing mechanisms to reduce fees for telephone messages related to electronic payment operations.
B- Coordination with the National Cybersecurity Committee and providing it with the risks that it indicates for the purpose of addressing them by the relevant sectoral authorities.
3- Instructing the competent authorities, including the General Directorate of Organized Crime in the Ministry of Interior and the National Security Service, to take their role regarding the observed violations and fraudulent operations regarding electronic payment operations.
4- Instructing the concerned authorities not to renew the license of educational and medical institutions, hotels, restaurants, and all other professions except after presenting the contract for using electronic payment to those authorities.
5- Assigning the Central Bank of Iraq to set specific standards to be used in government departments and institutions to activate electronic payment operations. Through those standards, the Federal Integrity Commission can monitor and measure the work of government departments in a manner consistent with those standards, and is accompanied by organizing training workshops on those standards between the Integrity Commission and the bank. Iraqi Central Bank.
6- Instructing the relevant authorities, including government institutions, private sector institutions, and banks, to increase the number of electronic payment devices and other self-services, which contributes to the development of electronic payment services in the country.
7- Assigning the Central Bank to formulate a proposal with the minimum requirements that are available in contracts for electronic wallets.
hmmmm where's number 8?
9- Forming a joint work team between the General Authority for Taxes, the National Security Service, and the Ministry of Interior/General Directorate for Combating Organized Crime, which will undertake the task of conducting inspection tours of various commercial areas to ensure the provision of trade names, tax identification, and electronic payment points.
In October 2023, the Iraqi Council of Ministers issued several executive measures related to the electronic payment system and electronic points of sale (POS), and said at the time in a statement that they “aim to enhance the use of electronic payment in Iraq and facilitate financial and commercial operations.”
Revealing the latest developments in changing the exchange rate and the barrel of oil in the 2024 budget
link i don't like that
Deputy Chairman of the Parliamentary Planning Committee, Muhammad Karim, confirmed today, Thursday, that the current year’s budget will proceed after completing the changes in its schedules for allocations for governorate and ministries projects only.
Karim told Mawazine News, “The exchange rate of the dollar, the barrel of oil, and the quantity exported will remain the same according to what was proven in last year’s budget.”
He pointed out that "the tripartite budget approved by the Sudanese government and approved by the House of Representatives allowed the government to make changes and amendments imposed by the impact after the parliament's vote."
He pointed out that "the changes to the schedules will include projects of ministries and governorates in accordance with the requirements of the government program."
First Iraqi Bank (FIB) pioneers digital transformation in Iraq's banking sector
Through its cutting-edge mobile banking app, FIB empowers users to conduct transactions directly from their devices, eliminating the hassle of physical bank visits while ensuring robust cyber-security measures to safeguard customer data.
First Iraqi Bank (FIB) is at the forefront of revolutionizing Iraq's banking landscape, setting new standards for ease, innovation, and customer experience.
Through its cutting-edge mobile banking app, FIB empowers users to conduct transactions directly from their devices, eliminating the hassle of physical bank visits while ensuring robust cyber-security measures to safeguard customer data.
FIB's commitment to modernization extends to its array of payment solutions, including online payment and gateway solutions, in-store payments via POS machines and QR codes, and versatile bank accounts with external transfer capabilities.
Additionally, the bank offers a suite of advanced card services such as Virtual, Signature, and Platinum Cards, catering to the evolving needs of businesses and corporations, thereby enhancing operational efficiency.
The bank's digital infrastructure is strategically designed to support the growth of startups and SMEs, thereby bolstering Iraq's economy and GDP. By streamlining corporate banking processes, FIB enhances profitability for enterprises while championing corporate social responsibility initiatives to foster community development.
FIB's vision aligns with the creation of a cashless society, transcending reliance on traditional cash-based transactions. To realize this vision, FIB is expanding its digital services to encompass more inclusive financial products in partnership with institutions like the International Student Identity Card (ISIC).
Furthermore, the bank is harnessing emerging technologies such as IoT and AI to anticipate customer needs and refine service offerings, ensuring that the future of banking with FIB is not only digital and inclusive but also secure and efficient.
As FIB continues to lead the charge in digital transformation within Iraq's banking sector, it stands poised to shape the future of finance in the region, ushering in an era of unparalleled convenience, accessibility, and reliability for its customers.
The European Union will finance 7 energy projects through the “Hydrogen Bank”
The European Commission has announced the financing of seven hydrogen production projects worth €720 million through the EU's "Hydrogen Bank", a new structure aimed at supporting "green" hydrogen in a still emerging market.
On its way to achieving carbon neutrality by 2050, the European Union aims to produce 10 million tons of renewable hydrogen annually on its territory by 2030, and import the same amount, to help remove carbon from heavy industries such as steel and cement, and from means of transportation.
The "Hydrogen Bank" initiative, which is not a financial institution, aims to boost hydrogen production by effectively reallocating available European funds, especially carbon market revenues.
Within the framework of the initiative, companies producing hydrogen through electricity generated by renewable energy sources will be able to request fixed financial assistance for each kilogram produced, depending on the targeted quantity and production conditions.
The amount of money that will be spent aims to bridge the gap between the cost of production and the price that “consumers are currently willing to pay,” as producing hydrogen from fossil fuels is significantly less expensive.
Thus, the idea aims to increase the ability of producers to predict their incomes and ensure the financial soundness of projects, which ultimately reduces investment costs.
Out of 132 files submitted by 17 countries, seven were selected (three in Spain, two in Portugal, one in Finland, and one in Norway, which is outside the European Union but in the European Economic Area). They will share about $720 million.
The European Commission said that the grants range from 8 million to 245 million euros, depending on the projects.
The Commission stressed that these projects “must begin producing renewable hydrogen within a maximum period of 5 years from signing the support agreement, and will receive support for a maximum period of 10 years.”
Parliamentary proposals to impose an economic blockade on Iraq
The representative of the Sadiqoun parliamentary bloc, Ali Turki, suggested that an economic war would take place against Iraq by the American side.
Turki said, in a televised interview followed by Mawazine News, that “there is a recognition or semi-admission by the Israeli side of targeting the Kalsu base, indicating that the government must act logically by revealing the identity of the aggressor against Iraq’s sovereignty.”
He added, "There is an economic war that will be imposed on Iraq just as it was imposed on Russia and Iran by the United States of America. This is because the Iraqi government is considered a rebellious government against American decisions and rejects foreign presence in any form."
He pointed out that "all the Sunni representatives tried to obstruct the passage of the anti-prostitution law out of fear and deterrence from the American side, pointing out that the Sunni blocs tried to use the file of selecting a speaker of parliament as a pressure card to vote on the prostitution law."
The Central Bank of Iraq organizes a celebration on the occasion of Financial Inclusion Week
The celebration reviewed the efforts of the Central Bank of Iraq in promoting and achieving the ideal environment for the success of financial inclusion in Iraq, encouraging savings and spreading banking culture.
His Excellency the Governor of the Central Bank, Mr. Ali Mohsen Al-Alaq, confirmed on the sidelines of the celebration that the steps achieved in financial inclusion that were accomplished today are accelerating and can close the gap that occurred during the past years as a result of the circumstances that Iraq went through.
His Excellency stated that the bank has ongoing meetings with the Iraqi government to expand the customer base in electronic payment methods and enhance financial inclusion, as we see a great response from various state institutions in the context of expanding the financial and banking culture in Iraq.
His Excellency believed that the factors that lead to the success and expansion of the role of financial inclusion are the citizen’s confidence in the institutions and tools available to him, as well as his vision of his interest in using them.
He continued, that the Central Bank has become at the forefront of global central banks using various financial technologies that provide speed and accuracy, revealing at the same time that the bank has received large preparations to establish digital banks and the relevant departments are working on the possibility of granting them a license to carry out their work in accordance with the controls and instructions issued by the bank.
His Excellency noted the “Riyada” Bank project, which will be an important project as we are in the advanced stages of establishing the bank and will constitute a qualitative leap in supporting and financing small and medium enterprises and providing job opportunities for wide segments of society. It will also have branches throughout Iraq.
It is noteworthy that the Financial Inclusion Department organized many different activities in the capital, Baghdad, and other governorates within the Financial Inclusion Week in Iraq, which began on April 27 and continued until May 2 of the current year.
Information Office
2 - May - 2024
How Iraq is rebuilding after the US invasion
https://www.youtube.com/watch?
at 2:06 they show people sitting down looking at large screen televisions
FRIDAY MAY 3 2024
Al-Sudani: We are working to create job opportunities
Prime Minister, Muhammad Shiaa Al-Sudani, said that Iraq has begun to move to the stage of production and infrastructure construction.
Al-Sudani added that the government is working to stimulate the economy, create job opportunities, confront challenges, and consolidate sovereignty.
Specialist: Floating the dinar is economic suicide
Economist Muhammad Hashem Helou confirmed that the central bank cannot float the dinar exchange rate.
Helu said, "The Central Bank of Iraq cannot think about floating the exchange rate because it will abandon its only influential tool in light of the weakness and disruption of other economic tools."
He added that the exchange rate is the nominal stabilizer of monetary policy in Iraq, and thinking about abandoning it is economic suicide, and the bank cannot even think about that.
He continued, adding that floating the exchange rate in the presence of a parallel market and large speculators, and the presence of people who own billions of dinars and others who own billions of dollars, will lead to a sharp decline in the value of the currency, high levels of inflation, and rising prices..
Economic: The fixed dollar exchange rate depletes Iraq's foreign currency reserves
Economist Manar Al-Obaidi confirmed that the fixed dollar exchange rate adopted by Iraq depletes the country's foreign currency reserves.
Al-Obaidi said, “The only thing that is completely under the control of the Iraqi state is the exchange rate, which forcefully drains all foreign reserves to maintain an imaginary fixed price that traders benefit from to increase their profit margin.”
He added, "I never called for following a free-float policy. Rather, I called for a start to follow a compensation policy managed with a small volatility factor and gradually work to increase it until complete liberalization is reached."
He continued, “The alternative to maintaining the fixed exchange rate is to continue depleting the reserves until they run out and the oil market is exposed to very expected future fluctuations. Then, will we be forced, not given the choice, to an absolute floatation of the currency or a shocking reduction in the exchange rate, as happened in 2020, and then the risks will be greater and greater?”
After a long wait... live in the finals of the summit of the new Central Bank building {photos}
The final curves of the building's top appeared, which distinguishes the design of the most important modern architectural icon in Iraq, which includes the highest glass facade in Baghdad, with a height of up to 170 meters.
It is worth noting that the façade, consisting of both UHPC panels, will cover an area exceeding 60,000 square meters, including 11,000 square meters of high-quality glass.
Head of the movement: The American embassy is plotting against Iraq
Today, Friday, the head of the Wojoud movement, Muhammad Abu Saeeda, accused the American embassy of targeting Iraq through the plans it stems from, indicating that this embassy is hatching conspiracies against Iraq.
Abu Saida told Al-Maalouma, “Laws that end the American presence in Iraq will be of no use unless there is government action with them.”
He added, "There are many laws that would eliminate the presence of any forces inside Iraq, but the reality of the situation is different, and the forces are still present on Iraqi soil despite the existence of special laws in this regard."
He added, "The American embassy and bases are still there and projects and plans targeting Iraq are still being launched from them, noting that there are 7,000 employees in the American embassy."
Al-Sudani: There is no alternative to upholding the state’s word, protecting the constitution, and enforcing the law in Iraq
Prime Minister Muhammad Shiaa Al-Sudani stressed, on Friday, the necessity of what he called “upholding the word of the state, protecting the constitution, and enforcing the law” in Iraq.
This came in a speech he delivered during the celebration held today in the capital, Baghdad, on the occasion of the anniversary of the founding of the Asaib Ahl al-Haq movement.
Al-Sudani said in the speech, “The government is moving, supported by broad parliamentary and popular will, towards achieving sustainable development.”
He added, “Our country is moving today to the stage of production, building infrastructure, stimulating the economy, creating job opportunities, confronting challenges, and consolidating sovereignty.”
Al-Sudani also stressed that “we all bear the task of enforcing the law, and building the edifice of justice, equality, and institutional stability,” stressing that “there is no alternative to upholding the word of the state, protecting the constitution, and enforcing the law in the country.”
In Financial Inclusion Week, Al-Rafidain encourages the use of electronic payment in citizens’ transactions
During the participation of its special pavilion in commercial centers, gatherings and other places, the bank reviewed its services and products, including opening bank accounts, adopting electronic payment and collection, encouraging the use of electronic cards to reduce cash transactions, and introducing the importance of citizens saving their money in the bank instead of hoarding it at home.
In addition to the presence of a specialized team to answer citizens’ inquiries about other services.
Participation aims to educate the public about the importance of financial inclusion and the spread of banking culture to the furthest reaches of the country to include all segments of society.
Parliamentary Oil: Political consensus is absent from the Oil and Gas Law
Member of the Parliamentary Oil and Natural Resources Committee, MP Kazem Al-Touki, confirmed the absence of political consensus regarding the oil and gas law.
Al-Touki told Al-Maalouma, “The obstacles that hinder the passage of the law are political and not technical, calling for their resolution through Baghdad, Erbil, and the oil-producing governorates to ensure the passage of the law.”
He added, "The law will not see the light of day because of political differences and obstacles that prevent it from being finalized and handed over to the House of Representatives for reading and passing."
He stated that "the outstanding oil issues between Baghdad and Erbil and the demands of the oil-producing governorates are all factors that prevented the government from completing the draft law."
He stressed the need for “political consensus to resolve the law.”
Washington: We are very close to a normalization agreement between Saudi Arabia and Israel
US State Department spokesman Matthew Miller said on Thursday (May 2, 2024) that the United States, Israel and Saudi Arabia are “very close” to reaching an agreement on the “bilateral parts” of a larger deal aimed at normalizing relations between Israel and Saudi Arabia.
“There are some details that we have to continue to work on, but we believe we can reach agreement on those details in a very short time,” Miller said, quoted by Sky News.
He added, "There is still more work to do on a separate part of the agreement, which is setting a path for the establishment of a Palestinian state, but we are discussing that closely with our counterparts in Saudi Arabia, just as we did with the broader group of Arab countries that the Secretary (Blinken) met with," he added. CNN reported.
He continued, "All aspects of the huge deal that the United States is working to mediate with the Kingdom of Saudi Arabia and Israel are linked to each other, and none of them will proceed without the other."
The US State Department spokesman explained: “In the potential normalization agreement, which we are talking about with Saudi Arabia, there are several components: the first component is a package of agreements between the United States and Saudi Arabia, the other component is the normalization of relations between Saudi Arabia and Israel, and the other package will be setting a path for a two-state solution from Yes, the Palestinian people."
The Times of Israel website quoted Miller as saying, "All of these components are linked to each other. None of them will pass without the other."
Miller said, “Even if an agreement is reached on the bilateral part of the deal, it will not move forward without other aspects such as a two-state solution,” adding, “We have been very clear, and Saudi Arabia has been very clear, that this is a comprehensive deal consisting of bilateral factors, and it also includes A path towards a two-state solution.
When asked why the United States was putting so much effort into this initiative when Israeli Prime Minister Benjamin Netanyahu would likely reject it, Miller said that the United States believes that a regional integration approach is in Israel's interest because it will provide broader security for the Jewish state, and isolate Iran in the region ( ...) and provide Israel with partners to help rebuild Gaza. "Ultimately, the government of Israel will have to choose what is in the interest of its people," he added.
Earlier on Monday, Saudi Foreign Minister Faisal bin Farhan said that it is expected “in the near future” to conclude bilateral agreements between the Kingdom and the United States, while answering a question about negotiations between the two countries on a security agreement.
He added during the World Economic Forum in Riyadh: “Most of the work has already been done. We have the broad outlines of what we think should happen on the Palestinian front.”
For his part, US Secretary of State Anthony Blinken said on the same occasion: “I believe that the work that the Kingdom of Saudi Arabia and the United States are doing together regarding our agreements may be very close to completion.”
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