Iraqi News Highlights and Points to Ponder Monday AM 12-18-23
French Report: Dollar Restrictions Confuse The Lives Of Iraqis Due To “Monetary Sovereignty”
Posted On12-17-2023 By Sotaliraq 2023-12-17 A French report highlighted the deficit in Iraqi citizens’ withdrawals of money transferred to them from outside the country, months ago, because it was sent to them in US dollars, after the authorities imposed new restrictions that complicate the use of hard currencies, in their attempt to control a black market for the exchange rate, in a measure considered… A paradox in a country rich in oil, which has huge hard currency reserves exceeding one hundred billion.
According to a report published by Agence France-Presse, and viewed by Shafaq News Agency, the emergence of a parallel exchange market, and the authorities’ imposition of restrictions within the framework of strengthening banking supervision in compliance with international rules imposed by Washington, have complicated the daily lives of residents.
The official exchange rate is 1,320 dinars to one dollar, but among money changers, the price of one dollar is equal to 1,500 dinars and may reach 1,600. Currency exchange offices have become very cautious with customers, after the arrest of dozens of money changers accused of manipulating prices, according to the report.
The Central Bank of Iraq announced in a previous statement that it had decided, as of January, “to limit all commercial and other transactions to the Iraqi dinar instead of the dollar” inside the country.
While the dollar can be withdrawn in cash from previously existing deposits in hard currency naturally, starting in 2024, it will become necessary to withdraw every money transfer from abroad in dinars exclusively, and according to the official exchange rate.
The Prime Minister’s Advisor for Financial Affairs, Mazhar Saleh, confirms that “this is the rule that is part of monetary sovereignty, but there are exceptions,” which especially include embassies.
He adds: “We are strengthening what is called monetary sovereignty… It is not possible to deal with two currencies within the national economy.” However, these restrictions raise controversy and hinder the daily life of Iraqis, according to Agence France-Presse.
Direct transfers outside banks have become impossible in dollars, and are limited to dinars at the official rate. The banking sector in Iraq has also adopted an electronic platform, the aim of which is to monitor the uses of the dollar and tighten control over a thriving informal economy, while tax evasion attracts some importers and traders.
The Prime Minister, Muhammad Shiaa Al-Sudani, acknowledged that with the new measures, the cash supply in hard currency available in the market has declined from “200 to 300 million dollars” per day to “30, 40, and 50 million dollars.”
Last September, Al-Sudani said that merchants who deal with Iran are forced to turn to the parallel market to obtain currency, given that Iran is a country “that has sanctions and is not allowed to conduct financial transfers.”
At the same time, he confirmed that the central banks of Iraq and Iran are discussing a “mechanism” to “regulate trade,” which would “split the back of the parallel market.”
Late last November, the government announced facilities to encourage importers of cigarettes, cars, gold, and mobile phones to obtain foreign currency through official channels.
As for bilateral exchanges, the authorities encourage banks and importers to use currencies other than the dollar, such as the euro, the UAE dirham, or the Chinese yuan.
The Prime Minister’s advisor, Mazhar Salih, defended the banking restrictions aimed at “verifying these transfers,” with the aim of reassuring “the international financial community, and also for reasons related to Iraqi society: Do these transfers actually go to finance Iraq’s trade?”
Saleh added: “What is happening has nothing to do with the strength of the Iraqi economy. Iraq today is at the highest levels of foreign reserves in its financial history.” Rather, “structural changes have occurred in issues of dealing with foreign currency.”
He also mentioned that in order to protect the country with a population of 43 million people from inflation, importers have access to the dollar and buy it at the official rate, which is more beneficial.
This concerns especially foodstuffs, medicines and building materials. Saleh believes that this “creates an atmosphere of stability, which is contrary to the parallel market.” LINK
On The Morning Of The Elections, A Noticeable Decline Occurred In The Price Of The Dollar In Baghdad
Economy | Baghdad today – Baghdad In conjunction with the opening of ballot doors for general voting in the provincial council elections, the prices of the dollar against the dinar recorded a noticeable decline today, Monday (December 18, 2023), in the local markets in the capital, Baghdad.
The “Baghdad Today” correspondent said that selling prices in money exchange shops in local markets in Baghdad amounted to 154,250 Iraqi dinars for every 100 US dollars. He pointed out that the purchase price amounted to 152,250 Iraqi dinars for every 100 US dollars. LINK
Parliamentary Economy: The Current World Budget Surplus Will Reduce Next Year’s Budget Deficit
Today Information / Baghdad.. Member of the Parliamentary Economy and Trade Committee, Yasser Al-Husseini, confirmed on Monday the contribution of the 2023 budget surplus to filling the deficit in the 2024-2025 budget.
Al-Husseini said in an interview with the Maalouma Agency, that ” The government has not yet funded 2023 projects, and therefore there will be financial accumulations to cover the deficit in next year’s budget.”
He added that ” The deficit in the budget this year, amounting to 64 trillion, will be filled from the surplus next year, “pointing out that the amounts and allocations made for the projects have not been spent yet, and therefore there will be a financial surplus that can be used in the upcoming budgets.”
Parliament approved the budget six months ago after a difficult struggle due to political controversy that disrupted the country’s economic interests. LINK
Provoking Points To Ponder on Money
Some people’s money is merited and other people’s is inherited. – Ogden Nash
There is only one thing for a man to do who is married to a woman who enjoys spending money, and that is to enjoy earning it. – Edgar Watson Howe
To be clever enough to get all that money, one must be stupid enough to want it. – G. K. Chesterton
Why is there so much month left at the end of the money? – Anonymous
Money is the poor people’s credit card. – Marshall McLuhan
A man is rich in proportion to the things he can afford to let alone. – Henry David Thoreau
Money is like a sixth sense, and you can’t make use of the other five without it. – W. Somerset Maugham
Money swore an oath that nobody who did not love it should ever have it. – Irish proverb
I’m so happy to be rich, I’m willing to take all the consequences. – Howard Ahmanson
I haven’t heard of anybody who wants to stop living on account of the cost. – Kin Hubbard
It isn’t enough for you to love money – it’s also necessary that money should love you. – Baron Rothschild
Philanthropist: a rich (and usually bald) old gentleman who has trained himself to grin while his conscience is picking his pocket. – Ambrose Bierce
The darkest hour of any man’s life is when he sits down to plan how to get money without earning it.
– Horace Greeley
The petty economies of the rich are just as amazing as the silly extravagances of the poor.
– William Feather
Money is human happiness in the abstract. – Arthur Schopenhauer
Money is the most egalitarian force in society. It confers power on whoever holds it. – Roger Starr