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Council of Ministers looking reasons for low exchange rate of the dinar
Date: Monday 30/04/2012 18:38
Baghdad: Naseer Ahmed
Chaired by Deputy Prime Minister Ruz Nuri Shaways today, the ministerial committee charged with studying the fluctuation of the exchange rate of the Iraqi dinar. The meeting was attended by ministers of finance, oil and Planning, Commerce and Agriculture and the Governor of the Central Bank of Iraq and Secretary General of the Council of Ministers and his assistant and head of the National Investment Commission and Advisor to the Prime Minister for Legal Affairs and the Chancellor's economic advisory board and Dr. Ali Abdul-Amir Allawi, the economic expert, Dr. Ahmed Bureihi financial expert. The Committee examined the causes of fluctuation of the exchange rate of the dinar Iraq in return for foreign currencies, where she presented the advisers in the Prime Minister presented to the merits of the issue also said the Governor of the Central Bank of dimensions, after the gentlemen responsible debates extensively on the subject. This Committee will hold a second meeting to get to the recommendations that would assist in the stability of the dinar.
For his part, Central Bank of Iraq for the cause of decline in the Iraqi dinar against the U.S. dollar, is having a crisis were deliberately inside Iraq, run by chambers of regional strategies for the withdrawal of monetary growth achieved by following the mechanism of double pumping of goods inside. It is noteworthy that the Iraqi dinar has recently seen a slight decrease in value against foreign currencies, particularly the U.S. dollar, as the volume decline of more than 4 points, and after that the price of the dinar exchange 1118 dinars / USD is now a 1226 dinars / dollars. According to the Central Bank amounted to Iraq's imports during the past year more than $ 45 billion thirds of the amount record for the sector Iraqi private trade and the remaining government transactions, while the total trade volume with Turkey $ 14 billion and with 7 billion Iran and with Syria 4 billion, and the remaining with the Gulf States, China, Europe, America and others.
Many observers and government officials and members of Parliament attributed the reasons to the intervention of both Iran and Syria in the market selling currencies on Iraqi state, and deliberately withdrawing large amounts of dollar to Hvazam on the value of national currencies, which was hit and after the application of economic sanctions, setting back strong and lost half its value from what they were before and during the sanctions after just a few months.
Deputy Governor of the Central Bank of Iraq d. The appearance of Mohammed Saleh affirmed that "the crisis in Iraq now is a crisis exporter in from outside the border, and there are points of planning conspiracies business has created a so-called gaps between supply and demand within the Central Bank auction." He said the aim behind these plots is the emptying Iraq of its reserves of foreign currency, using the economic freedom to manage the interests of free trade is like any commodity dumping, and thus we found a Nye blocks cash in hard currency to find its way out under the commodity trade. "
Salih stressed that after follow up on these financial movements with the outside, we found that there is a policy to undermine the development in Iraq, and what happened, we supported the conversion C for with the private sector for the development of trade, and our involvement as a banker is to maintain the stability of the dinar and the liquidation Dinars through a policy (sterilization) for pumping the dollar, which supposed to be used for goods and services and tend to trade merchants of Foreign Affairs, and we discovered that part of the money shift, but not to finance the import exaggerated. accused the benefit of regional countries are numerous and beyond the war of attrition against Iraq, noting that the conspiracy involved some Gulf states, particularly the ends of the Gulf region and ending in western Anatolia is added to Iran and Syria. He stressed that the Iraqi Trade Foreign Affairs, 75 per cent are rooted within the region do not come with the countries of origin, but through intermediaries trading, coincided with that most countries of the region is currently experiencing an economic crisis, both in the UAE, Qatar, Iran, Syria, Jordan and Turkey, especially the economy is Turkish continues to deteriorate after hitting its interests in the Arab countries after the crisis of Arab spring, and international financial crises and economic sanctions on other countries. Salih stressed that the only country in the region, which is immune to financial crises, and is pursuing now a strategic comprehensive economic development, is Iraq, and here would be the best policy for cash is the mass of attrition over-importation of Iraq and will conclude here Foaúdah of financial interests and the establishment of financial and economic borders. and that the attacks began and ended with currency attacks attacks are poured on a commercial auction. And on the sides of Interior involved, Saleh said that the Trade Bank of Iraq government and also Bank of Iraq some responsibility have become tools for the implementation of this plot, in contrast stands the Iraqi public spectators because it was unaware of the conspiracy, people are worried about the exchange rate and not on the future of his country and its resources, and I assure that the dinar is strong very and the economy is strong, but the power of face weakness now and drain. and some promote the idea that the value of the dinar has deteriorated, and this line, but there is a way use them to hit the cash reserves of foreign currency, there are those who want to keep Iraq in a cycle will last for ten years to come, and the freezing of its development, because they are afraid of development strategy followed by the Iraq or five-year plan ending in 2017. He said the auction currency has since its inception in 2004 until today to transfer more than $ 200 billion out of Iraq for the benefit of customers or the so-called system of foreign remittances, noting that the year 2011 saw the conversion of almost $ 39 billion, we expect this year despite the application of system demanding customer documents the reasons to convert to this amount and the transferee, high amounts of amounts transferred the equivalent amount of growth in the general budget. He noted the Deputy Governor of the Central Bank that the reserves of his bank's foreign currency increased recently from $ 52 billion to more than $ 63 billion, a numbers on the rise and not the reverse has also promoted other. "and Iraq's parliament approved the budget year 2012 the total amount of over $ 100 billion, a rate increase from the previous year's budget reached $ 18 billion. It is noteworthy that the Iraqi Central Bank has the power to separate, according to a law passed in 2004 granted broad powers to manage monetary policy in the country away from any effects, and enables the central bank and through a policy of Auction currency appreciation of the dinar, which was in 2003, equivalent to 2400 dinars / dollars, to levels that it is now. and contributes to the auction of private banks and companies, money transfer where the transformation Okiem oil sold in global markets to the Development Fund of Iraq, then the auction to be sold against the Iraqi dinar and turned to the state treasury funding of the budget, while the banks financing foreign trade operations and meet the needs of the market of foreign exchange. For its part, revealed a member of the Economic Commission parliamentary Nora Albjara (l citizen) that the mechanism of control of the exchange rate according to the current practice is possible and it is difficult for the central bank alone to control this important sector, the central bank is able to manage the increased currency but control the movement of funds between Iraq and abroad could have been is the responsibility of other parties more familiar with this matter. It showed that the cause of the crisis is having a growing demand for the dollar in the Iraqi market and the reason known to all is that this demand for external, not internal, and here will be the price difference between the auction price and the markets are a group of speculators who sough to increase their assets at the expense of their country's economy . She should start state of the electronic regulatory system would follow the movement of money and increased controls on foreign trade
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