Central Bank: We are undergoing a major transformation in organizing foreign trade
this format is easier on the eyes imo
The Governor of the Central Bank, Ali Al-Alaq, said today, Wednesday, that the financial situation in Iraq is proceeding according to what was planned, and while he confirmed - in an interview with the Iraqi News Agency (INA) - that financing foreign trade is being carried out smoothly for large and medium-sized companies, he spoke about a new mechanism to regulate transfer operations for small traders, and revealed an upcoming meeting in New York to discuss the file of the sanctioned banks, and indicated at the same time that the official exchange rate covers foreign trade that meets the needs of citizens, and confirmed on the other hand the existence of a government trend to increase the capital of the Real Estate Bank and the Housing Fund
Financial situation in Iraq
Al-Alaq said in an interview with the Iraqi News Agency (INA): "There are external and local challenges, but in general the financial situation in Iraq is still proceeding within what is planned in the state's general budget," indicating that "there is high coordination between the Central Bank, the Prime Minister and the Ministry of Finance in standing on the
financial side for its continuity, stability and sustainability."
The video for this blogpost is below here:
“We are currently working closely and almost daily with the Ministry of Finance to implement the financial plan drawn up in the general budget, in a way that ensures coverage of its objectives, programmes and existing needs,” he added, noting that “for the first time, by virtue of the new budget and financial management law, the allocations of governorates and ministries are being rotated, so there is broad coverage of the needs of the financial side, and for the first time the size of the balances available to ministries and governorates is large enough to enable them to perform their role.”
Foreign trade
He stated that "the Central Bank is undergoing a major transformation process in reorganizing foreign trade in a way that secures several goals at once, and among these goals is the transparency of foreign transfer operations that start from the transfer process and the transferee to the final beneficiary and to the source through all data, documents and information that enhance and match reality," explaining that "this process is being conducted for the first time in the history of Iraq and international auditing institutions participate in it and audit the information before it reaches the implementation stage, as the process meets all local conditions and standards represented by the Anti-Money Laundering and Terrorism Financing Law or international standards, then the transfer operations proceed, but if there is any deficiency, defect or suspicion in it, it is rejected immediately and returned."
He stated that "the previous audit process was carried out but with a subsequent process and the audit processes may remain for years, but now the process does not proceed unless it is sound in its aspects, parties, documentation, reinforcements and the facts on which it is based," explaining that "any transformation process requires time and understanding between all parties and also acceptance."
He stressed that "the level of acceptance of this new system has been engaged in by large and medium-sized importing companies, thus securing all their imports with high fluidity, and this is very necessary," noting that "the problem of small traders, some of whom have entered this process and others are still hesitant to enter or are looking for other means to cover their foreign trade, either to escape tax or customs accountability or the procedures required by the process of opening accounts."
He explained that "what we are focusing on in the current and upcoming phase is to make everyone involved in the sound fundamental channels," noting that "the presence of these small traders outside the system puts pressure on the dollar money market and causes it to rise."
He pointed out that "there are solutions that we are working on with international and financial institutions in order to organize the operations of small traders," explaining that "a meeting was held yesterday in this regard as a continuation of previous meetings, and we need some time to organize this remaining process of foreign trade."
Other international currencies stopped
Regarding other currencies, Al-Alaq confirmed that “the Central Bank opened channels for the Chinese, Turkish, Indian and Emirati currencies, which are currencies that represent a significant weight in foreign trade, as there was a halt for a period due to a new regulation that aims to provide sufficient control over these operations; because we discovered in the previous formula that there was some fraud in the use of these channels, whether for unrealistic sources or the return of amounts from one country to another,” explaining that “a new audit mechanism has been put in place by an international company and we have finished organizing this process and it is now in the process of being launched again.”
He pointed out that "commercial foreign transfer operations are subject to review by the specialized international company, which is an intermediary between Iraqi banks and the correspondent bank, so that the correspondent bank can be assured that these operations are sound and audited," noting that "some banks have correspondent banks and others do not have internationally accredited correspondent banks, and now they are seeking to do so, but they have been very late, and the Central Bank has continuously urged the opening of relations with correspondent banks, because the Iraqi bank without having external correspondents is considered a local bank and cannot open up to the world."
He stressed that "after our banks got to know the banks and realized the importance of these relationships, they started to move towards those banks, and the Central Bank, for its part, supports this trend and helps with it."
The difference between the market and the official price
Al-Alaq stressed that "in light of the new organization of the external transfer process, the real price at which the Central Bank sells more than $250 million daily at the official price should be considered, meaning that the bank covers foreign trade and this explains why there is no inflation or rise in prices and other legitimate demands of individuals with all their needs, and the parallel market is a market for those who do not want to go towards the fundamental methods of transfer and it is illegal trade or trade escaping from fundamental procedures or other illegal operations such as drug trafficking or human trafficking or corruption money and others," explaining that "the Prime Minister confirmed that we do not provide the official dollar for illegal operations."
Al-Alaq wondered, "Why would any party go to buy the dollar at a higher price when the official price is available to them? Unless they have an illegitimate purpose or something that is not fundamentalist," noting that "the view that the dollar price has risen or fallen is not a correct indicator, as one must look at what and how much the Central Bank sells at the official price to liquidate various needs."
low inflation
He pointed out that "the main objective of the Central Bank is to maintain the general level of prices and limit inflation, and this is supposed to be the measure of the success of monetary policy, which has succeeded in controlling this aspect and the level of inflation compared to other countries and even in previous years is much lower, and within the target, and this means that foreign trade, on which Iraq depends mainly to meet the needs of citizens, is covered by the official price."
Cooperation with the US Treasury
Al-Alaq continued, "There is great praise in all meetings with international organizations, including the International Monetary Fund, the Federal Reserve, and the US Treasury, for the transformations, management, and organization of the foreign transfer process in the Central Bank of Iraq at the present time," explaining that "the Assistant Undersecretary of the US Treasury mentioned in his meeting with the Prime Minister the need to celebrate the achievements made in the foreign transfer process and the stages that the Central Bank of Iraq has moved through, including the electronic platform that went through stages and difficulties and then settled to a situation where the rejection rate for operations at times reached 80 percent and now does not exceed 5 percent."
He stressed that "the platform formula burdens the Central Bank and external parties, including the Federal Bank, which we, as central banks, should not be preoccupied with entering into the details of transfer operations. Therefore, what we have done is a gradual shift from the electronic platform to creating a direct relationship between the Iraqi bank and the correspondent without going through the Central Bank or the Federal Reserve," noting that "we have reached a completion rate of about 85% in the external transfer process without going through the US Federal Reserve, and this is what international organizations say is something to be celebrated."
He explained, "Our plan until the end of the year will reach 100%, with foreign transfers between Iraqi banks and correspondent banks, without going through the US Federal Reserve. At that point, the role of the Central Bank will be normal, such as supervision, control, follow-up, and looking at the progress of operations without entering into detailed daily executive procedures."
Upcoming meeting in New York
Al-Alaq explained that "there will be meetings with the Federal Bank and the US Treasury Department at the end of August to review all aspects related to foreign transfer operations and discuss sanctions on some banks," noting that "what appeared in terms of talk, interpretations and additions to what happened in the previous meeting in Washington was not in fact the quarterly meeting and we did not meet with the Federal Bank, but rather we attended other meetings and there was a visit on this occasion to the US Assistant Secretary of the Treasury and a normal meeting that discussed general matters and during which he confirmed the success of the Central Bank in leading the steps it is taking, whether with regard to foreign transfers or the cash sale of the dollar, which has also been developed to ensure that the traveler obtains the dollar, indicating that previous operations in granting dollars to travelers were hindered by many problems and speculators tried to enter these operations by various means, which negatively affected the dollar as well as the use of other people's passports."
He pointed out that "the new mechanism ensures the elimination of these methods, as the dollar is not given to the traveler until after the departure stamp," explaining that "the process began a few days ago, but in general it is proceeding smoothly with some observations, and there are teams present at the airports to monitor the process and obstacles, and this will ensure 100% in achieving our goals, which is to reach the real traveler, as we started in Baghdad, then Basra, then Najaf, and now the procedures are based on opening the outlets at the airports of Erbil, Sulaymaniyah, and Kirkuk."
Lifting restrictions on banks
Al-Alaq explained that “lifting restrictions on some banks is receiving the attention of the Central Bank, which has come close to resolving the problems and developing appropriate solutions to ensure stability and growth for the banking sector,” indicating that “several meetings were held on the issue of lifting restrictions on some banks, and through them we reached a plan that will ensure stable results for the future.”
He continued, "The plan related to reforming the banks that are subject to restrictions and lifting them from them includes two axes: the first is related to conducting an audit of previous operations that were suspected by an independent external audit office, and some of them have been completed while we are waiting for the completion of the audit of others so that we can stand on the overall picture and classify the nature of these problems and how procedures will be carried out regarding them later."
He pointed out that "the second axis of the plan is receiving international acclaim through the Central Bank contracting with an international consulting firm to work on developing a strategy for the banking sector in the future, determining the size of the existing problem, placing it in an independent framework, preventing its recurrence, and reformulating the banking sector," noting that this plan is based on an inventory of the size of the banking sector in Iraq, the number of banks required to be in Iraq, the size and activity of these banks, and what are the rules, policies, and procedures that they adopt in order to be stable and accepted locally and internationally.
He explained that "this plan was initiated by the Central Bank through the consulting company and will take time to determine the scope of work and the goals we want to achieve," indicating that alongside this plan, another plan is being implemented to reform the government banking sector.
Al-Alaq pointed out that "the Prime Minister holds monthly meetings with the international consulting company concerned with reforming the government banking sector," noting that "the continuous follow-up by the Prime Minister has given momentum to the progress of reform operations, whether at the government or private levels, and that deciding the fate of these banks will be based on clear foundations, not patchwork treatments or ill-considered reactions."
Al-Alaq pledged to reach a real, stable banking sector that is consistent with what is required at the national economic level, and to prevent some banks from remaining marginal and not representing a real addition to the Iraqi economy, and to gain external acceptance through an agreement to implement international policies, procedures and standards.
Al-Alaq explained that “the Central Bank did not specify a share for foreign transfers for banks, and they can submit whatever foreign transfer transactions they can attract, and the Central Bank does not interfere in customers’ choices, and the banks that carry out this process rely on their capabilities to attract their customers.”
He pointed out the Central Bank's efforts to strengthen and support the role of the Trade Bank of Iraq to assume a greater role in the foreign trade process, denying any talk of reconsidering the issue of the exchange rate.
Housing Initiative
The Governor of the Central Bank revealed that there is a government trend that has been fixed in the budget to increase the capital supporting this file through the Real Estate Bank and the Housing Fund.
Al-Alaq said: “Although the task of financing the housing sector is the responsibility of the banks or the Real Estate Bank and the Housing Fund, the Central Bank’s initiatives played an exceptional role in an attempt to fill the housing deficit.”
He added, "The natural and required role called for by the Central Bank was to increase the capital of the Real Estate Bank and the Housing Fund, so that it could perform the task assigned to it, especially since the capital falls short of the requirements and large and broad needs to finance this aspect."
He added, "The government was expected to increase the capital of the Real Estate Bank and the Housing Fund to support the population sector, and it seems that this has been achieved and included in the budget, but it has not been implemented yet."
He explained, "When we visited the Real Estate Bank, we went into the details of the situation in order to determine the real need for the required financing, and we found that the requests available to the Real Estate Bank are divided into two sections, one of which relates to purchasing residential units outside the complexes in all governorates, and these are mostly old requests. We asked the Real Estate Bank to provide statistics on all these requests, and we will try to cover them all in order to close this file."
He added, "The second aspect is related to residential complexes, as we were financing the Real Estate Bank with amounts to be distributed to complexes in the governorates regardless of priorities because we do not want the Central Bank's financing to be an alternative to the investor's own obligations in financing the project."
He continued, "Therefore, and as part of the Central Bank's move, the Real Estate Bank was directed, in order to encourage the investor to complete the project and deliver the units, to direct it to make the completion rate the basis for financing, as we start with the complexes that have ready or semi-ready units at rates ranging between 80-90% to achieve two goals: the goal of pushing investors to complete these complexes, providing job opportunities, supporting market movement, and meeting the needs of citizens as quickly as possible."
Currency auction, smuggling and the age of the governor are the main reasons for hosting Al-Alaq under the dome of Parliament
Member of the Parliamentary Integrity Committee, Hadi Al-Salami, revealed today, Tuesday (August 6, 2024), the reasons for hosting the Governor of the Central Bank, Ali Al-Alaq, in the Iraqi Council of Representatives.
Al-Salami told Baghdad Today, "The lack of transparency and the announcement of the daily bulletin for selling the dollar to know the parties that buy millions of dollars daily are the main reasons for hosting the governor of the Central Bank."
He explained that "answering the oral question is the lowest level of interrogation, provided that the governor is present inside the council hall to answer, and approval was obtained for this a few days ago, although the request was submitted more than a year ago, that is, when Mohammed al-Halbousi was the Speaker of Parliament."
He added, "There is a failure in the work of the governor of the Central Bank in many files, and his age has reached the retirement stage, in addition to many comments on the currency auction and others, especially with the executive authority's admissions regarding the existence of currency smuggling operations, which will be discussed with the governor when he attends the House of Representatives in the coming days."
A document issued at the end of last July showed a notification from the House of Representatives to the Governor of the Central Bank to attend under the dome of Parliament to answer an oral question submitted by MP Hadi Al-Salami.
Rafidain announces the implementation of the comprehensive banking system in 37 branches
Rafidain Bank announced today, Wednesday, the implementation of the comprehensive banking system in 37 branches.
The media office of Rafidain Bank stated in a statement received by the Iraqi News Agency (INA), that "in implementation of the government program to move from paper transactions to electronic ones to provide the best services to citizens, the comprehensive banking system was applied in the Al-Amir neighborhood branch in Najaf and the Kut branch, thus joining the branches in which the comprehensive system was activated in Baghdad and the governorates in addition to the branches of the border crossings (Zurbatiya - Safwan - Arar - Trebil) so that the number of branches in effect and completed for the system becomes (37) branches."
He added, "This important step came to strengthen the banking system, meet its requirements, and move away from paper work and towards completely electronic systems."
He added that "the plan for digital transformation and adoption of the comprehensive banking system is proceeding according to the set timetables to include all bank branches in implementing the system, especially since the priorities and adoptions of the government program include electronic transformation in financial transactions, reducing the circles of routine for citizens, shortening time, simplifying procedures, overcoming obstacles, and intensifying efforts to improve the level of services provided to customers and completing their transactions."
Finance seeks to improve financial performance and enhance spending efficiency
Finance Minister Taif Sami chaired a meeting of the Ministry's Opinion Board on Tuesday, where it discussed the measures taken to improve the ministry's financial performance and enhance the efficiency of public spending.
The ministry said in a statement received by the Iraqi News Agency (INA): "The Minister of Finance chaired the meeting of the Ministry's Opinion Board, attended by all its members, to discuss a number of important financial and economic topics."
The statement added, "The attendees discussed the current financial policies and procedures and ways to develop them to achieve the ministry's strategic goals and follow up on the implementation of the financial plan for the current year and the challenges it faces."
It continued, "The future directions of financial policies were also discussed in light of local economic variables and the measures taken to improve the ministry's financial performance and enhance the efficiency of public spending."
The meeting stressed - according to the statement - the importance of "continuous coordination between various relevant parties to ensure the achievement of the desired goals."
Trade Bank of Iraq invites exchange companies to participate in the dollar selling window
The Trade Bank of Iraq called on Wednesday all licensed exchange companies to participate in the cash dollar selling window for travelers.
In a statement today, the bank called on all exchange companies of categories (A, B) licensed by the Central Bank of Iraq to visit its branches to open a special bank account to participate in entering the window for buying and selling foreign currency for cash dollars for travelers.
It is noteworthy that the Central Bank of Iraq decided on July 4, 2024 to start selling dollars to travelers, exclusively through corporate and banking outlets at international airports.
Meanwhile, the Central Bank decided to grant exchange companies of category “AB” the ability to register internal and external remittance activities via the FITR platform.
A government bank manager replaces Al-Alaq: Will the new option be controversial?
The representative of exchange companies, Diaa Al-Taie, revealed today, Wednesday, his expectations regarding the possible alternative to the Governor of the Central Bank, Ali Al-Alaq, highlighting a set of necessary qualities that should be available in the new governor.
Al-Taie explained in his statements that “the expected replacement for the governor of the Central Bank, Ali Al-Alaq, will be the director of a government bank,” adding that this director has negative indicators according to informed sources. These expectations come amidst reports that Al-Alaq has submitted a request to Prime Minister Mohammed Al-Sudani to relieve him of his position, based on a number of issues and problems in the Iraqi financial and banking sector, and the inability to control the dollar exchange rate on the black market.
Al-Taie pointed out that the new governor must have four basic qualities to ensure the effectiveness and success of the Central Bank’s work. He explained that “the new governor of the Central Bank must be non-controversial, professional, honest, and acceptable domestically and internationally.” These qualities are essential to ensure the stability of the financial sector and achieve the desired economic goals.
These developments come at a critical time when Iraq is facing significant economic challenges, including controlling exchange rates and strengthening confidence in the banking system. The selection of a new governor for the Central Bank is a crucial step in addressing these challenges and ensuring the stability of the national economy.
Expanding the circle of demands to dismiss the governor of the Central Bank
Demands continue to dismiss the Governor of the Central Bank, Ali Al-Alaq, due to his lack of control over the exchange rate of the US dollar in local markets and the direct impact and harm this issue has on the lives of citizens and their daily sustenance.
In this regard, the leader of the Al-Fatah Alliance, Ali Al-Fatlawi, called on the governor of the Central Bank to submit his resignation if he is unable to reach a solution to the problem of fluctuations in the dollar price.
Al-Fatlawi told Iraq Observer, “There is a problem in the Iraqi economic system, which is the lack of control over the exchange rate, which has recently witnessed continuous increases, for reasons, the first of which is the control over the Iraqi dollar, which the United States of America has tightened its grip on.”
He added, "Secondly, the failure to find a real solution, despite the fact that the rise is fluctuating between rising and falling, Iraq needs a real mechanism to stabilize the dollar, especially since Prime Minister Mohammed Shia al-Sudani has confirmed on more than one occasion that the Iraqi dinar is stronger than the dollar, so the governor of the Central Bank must find an appropriate solution to this fluctuation between falling below fifty and rising above it."
Al-Fatlawi expressed his belief that “if the Governor of the Central Bank, Ali Al-Alaq, is unable to reach a solution to this fluctuation in the dollar price, he must resign from his position.”
He added, "Prime Minister Mohammed Shia al-Sudani has the wisdom to find a real mechanism to support the Iraqi economy, stabilize the dollar, and improve the Iraqi economic reality in terms of investment and attracting countries, whether Arab or European, for the purpose of investment, which helps Iraq's renaissance and economic stability."
He pointed out that “although inflation in Iraq is not at the level of other countries such as Lebanon, Syria and Iran, which are subject to American influence, as the exchange rate in Iraq was in 2020 at around 120 by parliamentary decision and then rose to 145 and is still between 145 and 150, i.e. it did not exceed 5 thousand Iraqi dinars, it is not considered financial inflation as much as it is uncontrolled, but Iraq currently needs the exchange rate to be equal to the dinar or there be a slight difference between them.”
Member of the Parliamentary Integrity Committee Hadi Al-Salami previously explained that there had been a request to end the assignment of the Governor of the Central Bank of Iraq six months ago and the term had expired.
Al-Salami told Iraq Observer that “the Integrity Committee has oral questions directed to the Governor of the Central Bank and is waiting for a date to be set by the Presidency of the Council of Representatives to direct these questions at the level of accountability and questioning to the Governor of the Central Bank.”
He added, "Some members of the Parliamentary Finance Committee today collected signatures to question the Governor of the Central Bank, and this is one of the most important oversight roles that the parliamentary committees exercise to guarantee the rights of the Iraqi people."
He added, "Among the oral questions that are expected to relate to the parallel and real exchange rate and the bulletin price, as there was a global bulletin for the amount of money sold to banks and companies, but it has now become confidential."
A number of members of the Finance Committee had previously requested the Parliament Presidency to host the Central Bank in the next session, in accordance with the applicable articles of the Constitution and the internal regulations.
The representatives confirmed that the reason for requesting the interrogation was the existence of a major defect in the management of the Central Bank, which is why the Central Bank Governor was requested to be interrogated.
For 3 reasons.. Changing the relationship is “not enough” to improve the performance of the Central Bank
Economic consultant, Ziad Al-Hashemi, confirmed today, Wednesday, that changing the governor of the Central Bank, Ali Al-Alaq, will not be sufficient alone to bring about the required change and improvement in the performance of the Central Bank, but rather the issue requires a broad and large screening and development of its work style, updating its management structure, and giving it the independence it needs, like other central banks.
Al-Hashemi told Al-Jarida, “The Central Bank of Iraq suffers from several major and fundamental problems, the first of which is that there is a defect in the structure of the Central Bank of Iraq, and this defect is clear in the method and style of the bank’s work. There is also weakness in the performance of the administrative system within the Central Bank as a whole, and there is also weakness in the independence of the Central Bank.”
He explained that “these factors of administrative weakness, structural defects, and weakness in the independence of the Central Bank mean that any change at the level of the leadership as individuals will not make a significant difference in bringing about a qualitative shift or positive development in the performance of the Central Bank as a whole.”
He stressed that “the Central Bank needs a broad and extensive screening, developing its work model, updating its management structure, and giving it the independence it needs, just like other central banks, to work comfortably, make its decisions, manage, implement, and monitor monetary policies with complete independence, without political interference or interference from any other party.”
Al-Hashemi concluded by saying, “Changing the governor of the Central Bank will not be enough alone to bring about the required change and improvement in the performance of the Central Bank, but rather the issue requires other requirements.”
Rentier economy dominates: Only 11% non-oil revenues in Iraq’s mid-term budget
The Iraqi Ministry of Finance revealed today, Wednesday, the revenue data in the federal budget, explaining that the volume of revenues during the first six months of the current fiscal year exceeded 65 trillion dinars, while stressing that the oil contribution to the budget still dominates by 89%.
According to the data published by the Ministry of Finance, the total revenues for the first half of the year amounted to 65 trillion, 921 billion, 901 million, 657 thousand, and 850 dinars. It added that the total advances amounted to 15 trillion, 954 billion, 981 million, 637 thousand, and 865 dinars.
It is worth noting that oil revenues constituted 89% of total revenues, while non-oil revenues amounted to 7 trillion, 118 billion, 703 million and 763 thousand dinars.
This distribution indicates that the Iraqi economy is still heavily dependent on oil as the main source of revenue, reflecting the continued rentier economy in the country.
Commenting on the figures, economic expert Mohammed Al-Hasani warned that continued reliance on oil without real activation of the private sector and the introduction of deep structural reforms could lead to the risk of an inevitable economic collapse.
Al-Hasani stressed that failure to make fundamental adjustments to spending levels could lead to the state being unable to meet its expenses within a few years, threatening the risk of bankruptcy.
For his part, the Prime Minister's advisor for financial affairs, Mazhar Mohammed Salih, confirmed in previous statements that the economy remains rentier due to wars, economic blockades, and political conflicts that have affected the stability of the Iraqi economy.
Continued reliance on oil as the sole source of the general budget is considered dangerous, as it exposes Iraq to global crises and their effects on oil prices, which forces the country to borrow to cover the deficit and reflects the inability to manage resources effectively or find alternative financing solutions.
Parliamentary Oil and Gas Committee reveals reasons for continued halt in regional oil exports
The Oil and Gas Committee of the Iraqi Parliament revealed, on Wednesday, the reasons for the continued obstacles to resuming the export of Kurdistan Region oil via the Turkish Ceyhan pipeline.
The deputy head of the committee, Nehru Mahmoud, said in a statement followed by "Al-Eqtisad News", "Some political parties and some individuals in the federal Ministry of Oil are not serious about resuming the export of Kurdistan Region oil through the Turkish Ceyhan pipeline for many reasons."
Since the Kurdistan Region's oil exports stopped on 3/24/2024, the Federal Ministry of Oil has compensated for the region's oil, amounting to 400,000 barrels, from the southern governorates, to maintain the OPEC oil export ceiling, according to Mahmoud.
According to OPEC, Iraq has the right to export 3.5 million barrels of oil per day, which means that the region’s oil was compensated for by the southern provinces and did not affect Iraqi oil exports, according to the deputy head of the parliamentary committee.
Mahmoud explained that, "If an agreement is reached between the federal and regional governments to export Kurdistan oil, the federal government must reduce 400,000 barrels of southern oil in order to export it from the region's oil."
He pointed out that "the federal and regional governments have not yet reached the cost of producing one barrel of oil for the oil extraction companies in the Kurdistan Region, and this is another file that hinders the resumption of Kurdistan's oil exports."
US official invites us to celebrate the achievements of the dollar platform - Governor of the Central Bank
We accomplished 85% without the Fed.
The Governor of the Central Bank of Iraq, Ali Al-Alaq, conveyed today, Wednesday, part of the talk of the Assistant Undersecretary of the US Treasury during his meeting with the Prime Minister, indicating that the US official called on us to celebrate the achievements made in the external transfer process and the stages through which the Central Bank of Iraq moved from it to the electronic platform, stressing that the percentage of completion of work on the electronic platform reached about 85% in the external transfer process without going through the US Federal Reserve.
Al-Alaq stated in an interview with the official agency, followed by the 964 network , that “there is great praise in all meetings with international organizations, including the International Monetary Fund, the Federal Bank and the US Treasury, for the transformations, management and organization of the foreign transfer process in the Central Bank of Iraq at the present time,” explaining that “the Assistant Undersecretary of the US Treasury mentioned in his meeting with the Prime Minister the necessity of celebrating the achievements made in the foreign transfer process and the stages through which the Central Bank of Iraq moved, including the electronic platform that went through stages and difficulties and then settled to a situation where the rejection rate for operations at times reached 80 percent and now does not exceed 5%.”
He stressed that “the platform formula burdens the Central Bank and external parties, including the Federal Bank, which we, as central banks, should not be preoccupied with entering into the details of transfer operations. Therefore, what we have done is a gradual shift from the electronic platform to creating a direct relationship between the Iraqi bank and the correspondent without going through the Central Bank or the Federal Reserve,” noting that “we have reached an achievement rate of about 85% in the process of external transfers without going through the US Federal Reserve, and this is what international organizations say is something that should be celebrated.”
He explained that “our plan until the end of the year is to reach 100%, with foreign transfers between Iraqi banks and correspondent banks, without going through the US Federal Reserve, and then the role of the Central Bank will be normal, such as supervision, control, follow-up and looking at the progress of operations without entering into the detailed daily executive procedures.”
Al-Alaq downplays dollar prices: Not a valid indicator, but watch inflation
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Citizen's needs at the official price
The Governor of the Central Bank, Ali Al-Alaq, downplayed the difference in the dollar exchange rate between the official and parallel rates on Wednesday, noting that the view that the dollar price has risen or fallen is not a correct indicator, citing the absence of inflation or price increases and legitimate demands of individuals with all their needs, noting that maintaining the general level of prices and limiting inflation is supposed to be the measure of the success of monetary policy.
Al-Alaq stated in an interview with the official agency, followed by the 964 network , that “in light of the new organization of the external transfer process, our view at the level should look at the real price at which the Central Bank sells more than 250 million dollars daily at the official price, which means that the bank covers foreign trade and this explains why there is no inflation or rise in prices and other legitimate requests of individuals with all their needs, and the parallel market becomes a market for those who do not want to go towards the fundamental methods of transfer and be an illegal trade or trade escaping from fundamental procedures or other illegal operations such as drug trafficking or human trafficking or corruption money and others,” explaining that “the Prime Minister confirmed that we do not provide the official dollar for illegal operations.”
Al-Alaq wondered, “Why would any party go to buy the dollar at a higher price when the official price is available to them? Unless they have an illegitimate purpose or something that is not fundamentalist,” noting that “the view that the dollar price has risen or fallen is not a correct indicator, as one must look at what and how much the Central Bank sells at the official price to settle various needs.”
He pointed out that “the main objective of the Central Bank is to maintain the general level of prices and limit inflation, and this is supposed to be the measure of the success of monetary policy, which has succeeded in controlling this aspect, and the level of inflation compared to other countries and even in previous years is much lower, and within the target, and this means that foreign trade, on which Iraq depends mainly to meet the needs of citizens, is covered by the official price.”
MILITARY
The Iranian News Agency reported that "Pezeshkian received a call from Macron regarding concerns about the escalation of tensions in the region following the assassination of the head of the political bureau of Hamas, Ismail Haniyeh, by the Zionist entity. Pezeshkian responded to Macron's request, which called on Iran to exercise restraint."
The Iranian president said, “His country has always played a pivotal role in establishing peace, stability and security in the region and the world, and in reducing escalation, security deterioration and war. However, the Zionist entity, in light of its criminal and terrorist acts against the oppressed and defenceless people of Gaza, as well as the assassination of Martyr Haniyeh, who was an official guest of Iran, is about to ignite fires and stir up strife in the region, and America and Western countries, instead of condemning this entity for committing crimes, genocide and assassination, are providing it with support.”
He stressed that "Iran reserves the right to respond appropriately to these measures and criticized the passive behavior of America and Western countries after the Zionist entity's attack on the embassy of the Islamic Republic of Iran in Damascus, as well as the assassination of the head of the Hamas political bureau in Tehran."
"America and Western countries, while adopting a contradictory and dual approach, are supporting an entity that does not abide by any international laws and conventions and has not hesitated to carry out any criminal act in the region. Unfortunately, they are calling on the countries that have become the target of such measures to exercise self-restraint," Pezeshkian continued.
He stressed that “as long as the Zionist entity continues, with political, financial, military and media support from America and Western countries, to commit genocide, crime and assassination with peace of mind, the region and the world will not enjoy stability, security and peace.” He added that if America and Western countries want to prevent the outbreak of war and the spread of security deterioration in the region, and to prove their claims, they must immediately stop arms sales and support to the Zionist entity and force this entity to stop genocide and attacks on Gaza and accept a ceasefire.
Pezeshkian pointed out that “Iran believes that avoiding war and working to establish international peace and security are part of its basic principles, but within the framework of international treaties and laws, it will never remain silent about aggression against its interests and security.”
Ain al-Assad" reduces restrictions.. The first "Chinook" flew two days ago and the cameras revealed the "threads" - Urgent
Security sources revealed, on Wednesday (August 7, 2024), that security restrictions at the Ain al-Assad base in western Iraq have been reduced, two days after it was targeted by a missile strike.
The sources said in an interview with "Baghdad Today", "Part of the security restrictions imposed by the American forces stationed in important parts of the Ain al-Assad base in western Iraq were lifted in the past hours, with the first Chinook aircraft being observed flying in the airspace in two days, and this is an indication of the return of transport operations and communication with the rest of the bases, especially in Syria."
She added, "The Apache flights have decreased, while the drones' activity remains in the airspace," noting that "lifting part of the security restrictions has raised question marks about the reasons, although the general situation is still tense and awaiting the expected Iranian strike on Tel Aviv."
The sources indicated that "the Iraqi security forces near the Ain al-Assad base have increased their deployment operations, and the investigation is still ongoing to uncover the identity of those targeting the base, especially with the presence of important clues revealed yesterday through some surveillance cameras."
On Monday (August 5, 2024), the Ain al-Assad air base, west of Anbar province, which includes American forces and international coalition advisors, was bombed by two missiles.
Meanwhile, an informed security source revealed that the operation to target the Ain al-Assad base was prepared with 5 missiles that were loaded on the launch platform on the wheel, but the platform failed to launch the remaining missiles.
Reuters quoted US officials as saying that at least five US soldiers were injured in an attack on a military base in Iraq on Monday.
One soldier was seriously wounded, the U.S. officials, who spoke to Reuters on condition of anonymity, said. The number of wounded was based on preliminary information and could change, they said.
The American website "VOX" stated that the recent attack on the Ain al-Assad base in Iraq, which injured 5 American soldiers and wounded two contractors, may have been an "isolated incident", but there are indications that it may also have been part of a broader escalation in the Middle East.
According to the American report, translated by Shafaq News Agency, the attack on Ain al-Assad came at a time when the wave of violence in the Middle East is escalating, while Israel continues its war on Gaza, and recently killed Hamas leader Ismail Haniyeh in Tehran and the military commander of the Lebanese Hezbollah, Fouad Shukr, in Beirut, while Iran is widely expected to take revenge, which has increased the chances of a wider conflict in the region.
However, the American report considered that it is unclear whether Iran had any connection to the Ain al-Assad attack, noting that no party has claimed responsibility for the attack, but it mentioned that there are Iraqi militias allied with Iran, such as Kataib Hezbollah, but none of them claimed responsibility for the attack.
He continued by saying that even if one of these groups was behind the attack, "this does not necessarily mean that it was on Iran's orders, as sometimes Iran's allies in Iraq act without explicit instructions from it."
However, the report said, "Whatever the calculations behind Monday's attacks, they serve as a reminder of how easily the conflict between Israel and Gaza can escalate out of control."
After the report recalled the announcement by Iraqi Prime Minister Mohammed Shia al-Sudani in January that he wanted to expel US forces from his country, and that those forces had recently targeted the Popular Mobilization Forces, which it accused of planning to launch drones, the report said that although Tehran funds and equips the militias in Iraq, the alliance of these militias is close to Iran, but it is not similar to the close alliance that links the Lebanese Hezbollah to it, as these militias have their own goals.
While the report said that the Popular Mobilization Forces sometimes carry out attacks that advance Iran's foreign policy goals, which are to defeat Israel and expel the Americans from the Middle East, it recalled that it has been carrying out such attacks since 2020 after the assassination of Iranian General Qassem Soleimani, and even before that in 2019.
He continued by saying that Monday's attack could therefore be considered a reciprocal response to the US attack in Jurf al-Sakhar last week, which killed four people.
He added that it is also possible that the Ain al-Assad attack was part of Iran's response to the assassination of Haniyeh and Shukr, noting that Haniyeh was killed on Iranian soil, which embarrassed this country and its security forces.
The report pointed out that although Iran held Israel responsible for the assassinations, Iranian leaders consider the United States complicit, due to the strength of the American-Israeli alliance.
The report quoted Colin Clark, a researcher at the American "Soufan Center", as saying that the question is whether Iran can respond in a way that convinces Israel and the United States to back down, rather than continuing the escalation.
"That's the challenge the Iranians face," Clark said, "is trying to get that needle in there where they respond in a way that doesn't show their complete helplessness and shows their weakness, but they also don't want to overdo it."
The report quoted Ali Faez, a researcher at the British International Crisis Group, as saying that “a strong response could lead to more violence from Israel, and perhaps the United States, exposing the world to the risk of a greater war. However, judging the ability of Israel and the United States to withstand an Iranian response has become more difficult.”
According to Faiz, “This is where the danger lies primarily, because Iran feels that without inflicting pain, it will not achieve the gains of deterrence, and Israel is not a country that will simply accept pain and not respond – even if the United States twists its arm.”
After the report wondered about what would happen next in the Middle East, it said that fears of a regional war began with Hamas’ attack on Israel, followed by regional powers engaging in what it called “missile diplomacy,” which is carefully targeted attacks in order to send a “message.”
The report quoted Fayez as saying that regarding the attack on Ain al-Assad, “the message could be that if the United States fails to rein in Israel after the Iranian response to the assassination of Haniyeh in Tehran, the United States will also find itself in the line of fire this time.”
The report considered that how Iran and its allies respond to the recent assassinations will determine the extent of the conflict, and whether the balance of violence in areas such as Lebanon has been disturbed, indicating that the Iranian response to the assassination of Haniyeh and Shukr is likely to include its regional partners overwhelming the Israeli "Iron Dome" system with rocket fire in a way that causes some real damage and perhaps even casualties.
The report quoted Clarke as saying that the Iranian response could lead to “the killing of large numbers of Israeli civilians, which is possible, if the Iron Dome is penetrated and disabled,” adding that “if they escalate too much, the Israelis, especially Netanyahu, will continue to pressure the United States to get more involved, which is not a good scenario for the Iranians.”
The report concluded by saying that under this scenario, it is likely that the strikes and counterattacks will continue, and the number of deaths will increase in Iran, among the groups allied with it, and perhaps in Israel as well.
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