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Iraq suspends banking transactions in Chinese yuan
Amr Salem July 24, 2024 457 3 min
The Central Bank of Iraq. Photo: AFP
Baghdad (IraqiNews.com) – Member of the parliamentary finance committee, Moeen Al-Kadhimi, revealed that Iraq has chosen to discontinue using the Chinese yuan in financial transactions.
Al-Kadhimi told Al-Forat News that the decision was made due to worries about potential manipulation and other difficulties with certain transfers.
Iraq has been ordered by the US Federal Reserve to stop trading in Chinese yuan, citing discrepancies and specific issues with transactions, according to Al-Kadhimi.
The Iraqi lawmaker clarified that the US Federal Reserve receives $3.5 million generated from Iraq’s daily oil exports, noting that the money is regulated through transfers that the Central Bank of Iraq (CBI) authorizes.
Before transferring cash to the specified Iraqi organizations, the Federal Reserve has to authorize these transfers and the related commercial activities.
In order to provide the CBI and Iraqi businesses additional alternatives, Al-Kadhimi added that the parliamentary finance committee will push the CBI to address this problem and diversify its currency basket.
In February 2023, the CBI announced that the financing of foreign trade with China will be regulated directly in the Chinese yuan through two options.
The first option includes strengthening the balances of Iraqi banks that have accounts with Chinese banks in the Chinese yuan, while the
second option includes strengthening the balances of Iraqi banks through the accounts of the CBI, in the Chinese yuan, with the J.P. Morgan bank, and the Development Bank in Singapore.
Later in 2023, Iraq enhanced its balances in the yuan currency through the Singapore Development Bank to finance the country’s trade with China by about $12 billion annually.
Baghdad also increased its assets in UAE dirham and was negotiating to increase its balances in euros to finance trade with the European Union.
https://www.iraqinews.com/iraq/iraq-suspends-banking-transactions-in-chinese-yuan/
Amr Salem July 24, 2024 457 3 min
The Central Bank of Iraq. Photo: AFP
Baghdad (IraqiNews.com) – Member of the parliamentary finance committee, Moeen Al-Kadhimi, revealed that Iraq has chosen to discontinue using the Chinese yuan in financial transactions.
Al-Kadhimi told Al-Forat News that the decision was made due to worries about potential manipulation and other difficulties with certain transfers.
Iraq has been ordered by the US Federal Reserve to stop trading in Chinese yuan, citing discrepancies and specific issues with transactions, according to Al-Kadhimi.
The Iraqi lawmaker clarified that the US Federal Reserve receives $3.5 million generated from Iraq’s daily oil exports, noting that the money is regulated through transfers that the Central Bank of Iraq (CBI) authorizes.
Before transferring cash to the specified Iraqi organizations, the Federal Reserve has to authorize these transfers and the related commercial activities.
In order to provide the CBI and Iraqi businesses additional alternatives, Al-Kadhimi added that the parliamentary finance committee will push the CBI to address this problem and diversify its currency basket.
In February 2023, the CBI announced that the financing of foreign trade with China will be regulated directly in the Chinese yuan through two options.
The first option includes strengthening the balances of Iraqi banks that have accounts with Chinese banks in the Chinese yuan, while the
second option includes strengthening the balances of Iraqi banks through the accounts of the CBI, in the Chinese yuan, with the J.P. Morgan bank, and the Development Bank in Singapore.
Later in 2023, Iraq enhanced its balances in the yuan currency through the Singapore Development Bank to finance the country’s trade with China by about $12 billion annually.
Baghdad also increased its assets in UAE dirham and was negotiating to increase its balances in euros to finance trade with the European Union.
https://www.iraqinews.com/iraq/iraq-suspends-banking-transactions-in-chinese-yuan/
