Finance Minister: The former dollar exchange rate distorted and damaged the economy ("the 2021 budget adopted an exchange rate of 1450 dinars per dollar")

by **RamblerNash** Fri Dec 18, 2020 11:15 am

Finance Minister Ali Abdul Amir Allawi "Internet"

12/18/2020

Economy News - Baghdad

The Minister of Finance, Ali Allawi, announced that the dollar exchange rate of 1182 dinars per dollar distorted and damaged the Iraqi economy, indicating that next year's budget will impose new taxes.

Allawi said in a statement on the 2021 budget seen by "Al-Eqtisad News", that the 2021 budget adopted an exchange rate of 1450 dinars per dollar, because the previously approved exchange rate of 1182 dinars per dollar is distorted and does not reflect the actual reality, stressing that the previous exchange rate hurt the Iraqi economy As a result, the goods are being paid from neighboring countries, which has negatively affected the local product.

He pointed out that the appropriate level of the exchange rate is a confusing question, but the Ministry of Finance believes that for multiple reasons, and after study and analysis, the exchange rate at the present time is 1450 dinars to one dollar, despite our belief that the floating and controlled exchange rate is better, but the best solution at the present time is the price. Above, as it serves the various economic sectors, as the economic competitiveness of Iraq has been seriously affected by the overestimation of the exchange rate, which affected the flow of foreign investments outside the oil sector, stressing that the exchange rate adjustment has a beneficial effect on the deficit and will put Iraq in a position that allows it to re-balance To economize on the background of the most competitive price.

He noted that the government of Mustafa Al-Kazemi, managed the financial crisis with very limited resources without any support from the international community, explaining that the failure to issue the Federal Budget Law for the year 2020 created additional burdens when preparing next year's budget, and the reason for not knowing the real numbers required in the spending, pointing to The rise in salaries and pensions has become worrisome, as they are now in the range of 120% of oil revenues.

Allawi stressed that we have started a process of serious treatment of the deficiencies in the customs and tax administrations, and these reforms will take some impact to show results, but it is expected to maximize these revenues in the year 2021, indicating that the spending was the main issue as the need to rationalize the salary and pension bill, as these rates increased. Year after year, at an alarming rate, it is far from critical levels.

The Minister of Finance pointed out that government support programs and subsidies have hit the economy, as subsidies have reached very high levels, and it has become difficult to change or reduce them, and the most subsidy is granted to the electricity sector, as the real economic costs of the electricity sector were estimated at 24 trillion dinars, as about 10% of the GDP The total, indicating that the subsidies to the agricultural sector cost the state 2.5 trillion dinars last year, as the Ministry of Agriculture buys wheat, rice and barley at prices much higher than international prices.

He indicated that the direct support for the ration card is still close to 2.5 trillion dinars, while next year's budget included maintaining and even increasing support for the poor and vulnerable segments of the country, as the Ministry of Finance is working with the World Bank and the Ministry of Planning to expand the scope of the Community Development Fund to more than one billion dollars.

He pointed out that the 2021 budget allocated an amount of 500 million dinars to increase the capital of state-owned banks, and these funds will be allocated to enhance the capital base and operational efficiency.

Allawi focused on the financial deficit in the budget next year, as he confirmed that it will reach 95 trillion dinars after approving the budget for all arrears and legal obligations to work and pensions, but after adjusting the dollar exchange rate, the deficit will reach 60 trillion dinars.

Allawi pointed to the addition of new sales taxes, in addition to the total salary being subject to tax, as we will achieve an additional revenue of 5.2 trillion dinars, noting that new traffic fees have been imposed on vehicles violating the issue of traffic registration and it is expected that they will collect revenues of up to one trillion dinars, explaining that the sale of oil Crude to refineries and oil companies at world prices.

https://economy-news.net/content.php?id=23193

by **claud39** Fri Dec 18, 2020 1:46 pm

A source for the Euphrates News: The Central Bank sets a new price for the dollar, starting from Sunday

12/18/2020

{Baghdad: Al Furat News} A private source revealed that the Central Bank of Iraq will soon set a new price for the dollar exchange in Iraq.

The source told {Al-Furat News} that "the central bank, starting next Sunday, will adopt a new price for the dollar at a value of 1450 dinars for one dollar {ie 145 thousand dinars for one hundred dollars}".
It is noteworthy that the Central Bank of Iraq is currently selling dollars for 1190 dinars.

The Parliamentary Finance Committee hosted, yesterday, the Governor of the Central Bank, Mustafa Ghaleb, to discuss the economic crisis and the implications of the high exchange rate of hard currency on the Iraqi market situation.

The central bank governor explained to the committee, according to a statement that "the bank is preparing to launch a package of measures that will achieve a comfortable balance in the exchange rate for the year 2021, including launching an initiative in the amount of 3 trillion to support low-income people, doubling the provision of hard currency in the market, and increasing interest rates on the Iraqi currency deposited in Banks. "

According to the leaked draft of the federal budget law for 2021, it included fixing the exchange rate of the dollar against the Iraqi dinar on the basis of {1450} and a deficit that exceeded 58 trillion Iraqi dinars. The estimated revenues from exporting crude oil were also calculated on the basis of the price of 42 dollars per barrel, and the rate of exporting 3 million And 250 thousand barrels per day, including 250 thousand barrels exported from the Kurdistan region.

The former Undersecretary of the Ministry of Finance, Fadel Nabi, attributed the decline in the value of the Iraqi currency against the dollar to banks and currency dealers who are working to raise the price of the dollar in order to achieve profits.

The leakage of the draft budget to the media and social networking sites caused widespread controversy and turmoil in the foreign currency market in Baghdad, as the exchange rate of the dollar rose in the local market in a frenzy and exceeded 1340 dinars before it fell to 132 thousand dinars after government and parliamentary assurances that the draft is not final and subject to modification.

Ammar Al-Masoudi

https://alforatnews.com/news/%D9%85%D8%B5%D8%AF%D8%B1-%D9%84%D9%84%D9%81%D8%B1%D8%A7%D8%AA-%D9%86%D9%8A%D9%88%D8%B2-%D8%A7%D9%84%D8%A8%D9%86%D9%83-%D8%A7%D9%84%D9%85%D8%B1%D9%83%D8%B2%D9%8A-%D9%8A%D8%AD%D8%AF%D8%AF-%D8%B3%D8%B9%D8%B1%D8%A7%D9%8B-%D8%AC%D8%AF%D9%8A%D8%AF%D8%A7%D9%8B-%D9%84%D9%84%D8%AF%D9%88%D9%84%D8%A7%D8%B1-%D8%A8%D8%AF%D8%A1%D8%A7%D9%8B-%D9%85%D9%86-%D8%A7%D9%84%D8%A3%D8%AD%D8%AF

by **claud39** Fri Dec 18, 2020 1:48 pm

Najib: The government is able to stabilize the price of the old dollar .. but?

12/18/2020

(Baghdad: Al-Furat News) Former member of the Parliamentary Investment and Economy Committee, Najiba Najib, confirmed, on Friday, that "the government is able to fix the old dollar exchange rate if there is no real will for it."

Najeeb told Al-Furat News Agency that "the Iraqi citizen is the victim of raising the dollar, and he is the victim," pointing out that "the government has many other options and must return the money seized by entities in the state, and what the country lacks is the real will to put it on the right path."

And confirmed that "the Central Bank confirmed during its hosting of the Finance Committee that the dollar will be traded, starting from Sunday, 145 thousand, and they are able to maintain the stability of the old price if it wants to look at the interest of the citizen."

Regarding the crisis with the region, she said, "The problem now is imports are not fixed, and that the agreement obtained approvals, and the region showed its willingness to implement it, but disagreements prevented the implementation of the agreement," indicating that "the employees only received 5 salaries despite the difficult circumstances, and that there is certainly great manipulation The currency auction and suspicions of corruption led to this rise. "

Raghad Daham

https://alforatnews.com/news/%D9%86%D8%AC%D9%8A%D8%A8-%D8%A7%D9%84%D8%AD%D9%83%D9%88%D9%85%D8%A9-%D9%82%D8%A7%D8%AF%D8%B1%D8%A9-%D8%B9%D9%84%D9%89-%D8%AA%D8%AB%D8%A8%D9%8A%D8%AA-%D8%B3%D8%B9%D8%B1-%D8%A7%D9%84%D8%AF%D9%88%D9%84%D8%A7%D8%B1%D8%A7%D9%84%D9%82%D8%AF%D9%8A%D9%85-%D9%88%D9%84%D9%83%D9%86%D8%9F

by **claud39** Fri Dec 18, 2020 1:53 pm

[size=36]Representative Finance: The Central Bank will take measures regarding the dollar exchange rate[/size]

Today, 17:50

Follow-up - IQ

A member of the Parliamentary Finance Committee, Ahmed Al-Saffar, said Friday (December 18, 2020) that the Central Bank of Iraq will take measures regarding the price of the US dollar against the Iraqi dinar .

The official agency quoted Al-Saffar as saying, and IQ NEWS followed it , that "the leaked budget project is unofficial, and no one knows who is behind its leakage, what is the purpose of its diversion, and what is meant by the leakage, and this affected the market situation and the citizen's psyche." .

He added that his committee “met with the governor of the Central Bank (Mustafa Ghaleb), and that there are some measures that the governor will take,” noting that the Parliamentary Finance Committee “continues to follow up the matter, and is awaiting the arrival of the draft budget (to Parliament) so that it has its own opinion on this. Affair. "

For his part, a member of the same committee, MP Naji Al-Saeedi, said in a statement to the official agency as well, that “the governor of the Central Bank, during his hosting by the committee regarding the repercussions of the high exchange rates of the dollar towards the Iraqi dinar, indicated that this rise was caused by the government, not the Central Bank. The dollar comes from Iraqi oil sales that go into the Development Fund for Iraq in the United States of America.

He continued, "The real owner of the dollar is the Ministry of Finance, which sells the dollar to the Central Bank as the government accountant," indicating that the ministry "and two months ago refrained from selling the dollar in order to raise its price towards the Iraqi dinar to bridge the general budget deficit and achieve some developmental operations according to what The government believes, and therefore, the central bank’s justifications that the rise in the exchange rate is a government decision, and it was not a decision issued by the Central Bank.

Al-Saeedi pointed out that "until this moment, the Council of Ministers has not voted on the general budget, and that the Finance Committee has not received anything official from the government in this regard."

He stressed, "It is not possible to deduct twice from the employee, as the first deduction will be through the rise in the exchange rate of the dollar towards the Iraqi dinar, and the second deduction is the allocations of state employees and I think in economic terms this is absolutely untrue," pointing out that "the Finance Committee and Parliament have the authority Amending, deleting or adding what he deems appropriate during this period.

According to the initial draft of the 2021 budget, which was circulated by the media yesterday, Thursday, the exchange rate of the dollar will stabilize in the 2021 budget at 1450, or 145 thousand dinars for the 100 dollar category .

The leakage of the draft budget for 2021 led to confusion in the exchange rate of the dinar after the leaked draft determined an exchange rate of 1450 dinars to the dollar, which caused a rapid rise in the price of the dollar, which jumped to more than 1,350, up from a margin between 1280 and 1320 in the past days .

A member of the Parliamentary Finance Committee, Abd al-Hadi al-Saadawi, said that the Governor of the Central Bank, Mustafa Ghaleb Mukhaif, informed the committee that the Central Bank will raise the exchange rate of one hundred dollars to 145 thousand dinars as of tomorrow, Sunday.

https://www.iqiraq.news/economy/6525--.html

by **claud39** Fri Dec 18, 2020 2:06 pm

[size=47]Iraq: Who is responsible for the collapse of the dinar price?[/size]

December 18, 2020

Finance Minister: The former dollar exchange rate distorted and damaged the economy ("the 2021 budget adopted an exchange rate of 1450 dinars per dollar") 1209877352

With the continued deterioration of the Iraqi dinar's exchange rate against the dollar , and the turmoil it causes in the prices of goods and goods in the local market, political forces are pitting accusations of responsibility for this, amid a parliamentary tendency to question the central bank governor about that.

The rise in the price of the dollar, today afternoon, reached 132 thousand dinars compared to 100 dollars, after rising to 137 thousand yesterday, Thursday, to fall to 130 thousand in the afternoon, and return to rise to 132 thousand dinars, and it was at the beginning of the month 123 thousand Iraqi dinars for the 100 dollars.

The "State of Law" coalition led by Nuri Al-Maliki accused the government of Mustafa Al-Kazemi of being responsible for that, saying that it "deliberately raised the price of the dollar" as part of its procedures.

The deputy of the coalition, Abdul Hadi al-Saadawi, said, "The governor of the Central Bank informed the Finance Committee in Parliament that the bank will raise the exchange rate of 100 dollars to 145 thousand Iraqi dinars," indicating in a televised statement that "previous meetings with the government were to divide the rise into two phases, and it is not surprising." , Where it is in two steps, the first to 130 thousand dinars and then to 145 thousand, but the government decided to go to the issue of 145 thousand dinars.

The deputy, who is a member of the Parliamentary Finance Committee, stated that "the governor of the central bank informed the Finance Committee, officially, that after tomorrow, Sunday, the dollar exchange rate will be 145 thousand dinars in the local market."

The "victory coalition", led by Haider al-Abadi, confirmed the parliamentary approach to questioning the governor of the Central Bank regarding this file, stressing that the exchange rate hike was "intentional." "The reason for the high selling price of the dollar is the result of political interference in the currency auction," said coalition MP Nada Shaker. She explained that "speculative companies led by political parties are behind the increase in selling the dollar in the local markets, and that the rise is an intentional matter and political parties stand behind it."

She added that "Parliament began collecting signatures for the questioning of the governor of the Central Bank, to find out the details and hold the negligent accountable."

The path of the Iraqi dinar's decline within a month (Google Finance, The New Arab)

Member of the National Approach Bloc, MP Hussein Al-Oqabi, accused the government of not taking any measures to control the exchange rate of the dollar. He said in a statement that "the rise in the exchange rate of the dollar was employed by a number of intermediary banks, which are directly linked to the central bank, in order to achieve profits from the currency auction." The expense of depleting the money of merchants and market activists, and the sustenance of the citizens, and a livelihood on the state’s resources through that.

He stressed that "influential figures in the Iraqi state dominate the work of these banks, which causes a great loss to the Iraqi state and is in the interest of those parties." It by "making it clear."

The continuing rise in the exchange rate has cast a shadow over the local market, and has caused an increase in the prices of foodstuffs, medicines and other commodities, while specialists in economic affairs warned that the country is on the verge of a "disaster" if the dollar exchange rate is not controlled.

Economic expert Jamal al-Rubaie told Al-Arabi Al-Jadeed that "failure to take urgent governmental measures to control the exchange rate will cause a disaster in the local market, through a large rise in prices in general," indicating that "there is currently a state of confusion and paralysis in the local market." And that most of the goods recorded price jumps. "

He stressed that "the file is linked to many interventions, some of them political and others related to the influence of beneficial parties on the selling price of the currency, which seriously complicates the issue, and will have serious repercussions if the government does not take firm and swift measures."

This comes, in light of the difficult financial crisis that Iraq is going through, resulting from the drop in global oil prices, which was reflected in the possibility of approving the budget and providing salaries.

https://www.alaraby.co.uk/economy/%D8%A7%D9%84%D8%B9%D8%B1%D8%A7%D9%82-%D9%85%D9%86-%D8%A7%D9%84%D9%85%D8%B3%D8%A4%D9%88%D9%84-%D8%B9%D9%86-%D8%A7%D9%86%D9%87%D9%8A%D8%A7%D8%B1-%D8%B3%D8%B9%D8%B1-%D8%A7%D9%84%D8%AF%D9%8A%D9%86%D8%A7%D8%B1%D8%9F

by **claud39** Fri Dec 18, 2020 9:27 pm

Warning Against "Floating Currency" To Raise The Price Of The Dollar Against The Iraqi Dinar

On December 1, 2020

Al-Mustaqila / - The economist Rasim al-Akidi said that the floating of the dollar, or what is known as the liberalization of the exchange rate, takes place through two methods, the first is pure or free, and the second is the controlled or controlled method, and in both cases the price of the dollar will rise against the Iraqi dinar and will lead to the withdrawal of a large amount of the monetary mass in Markets.

Al-Akidi added that the withdrawal of a large cash block corresponds to 4 drawbacks at the same time, and the affected population will be large segments, including the increase in prices in the markets in addition to the factories ’reluctance to produce because the value of profits will decrease in front of the costs in addition to the absorption of per capita income and the increase in rental prices. Other damages.

According to Al-Aqidi, Iraq needs an economic rescue plan that starts from maximizing non-oil revenues, which are many, and keeping the influential parties away from them, because a large part of the financial resources does not go to the state treasury, and this is part of the causes of the current financial crisis in the country.

Economists ’opinions differed on the“ floating of the dinar ”in front of the dollar exchange to face the deficit crisis in the financial budget.

One party believes that the procedure will serve the Iraqi economy in the medium term by activating the industrial and agricultural sectors, but another party believes that it will eliminate the poor and middle classes.

The Central Bank of Iraq rejected the idea of "floating the dinar" during the next stage to increase government revenues and be able to pay employees' salaries during the coming days, citing its fear of increasing prices and harming the vulnerable classes.

The estimated budget for 2020 suffers from a large deficit of 50 trillion dinars. Observers expected the deficit to rise with the oil market losing about 50% of its prices.

https://mustaqila.com/%D8%A7%D9%84%D8%AA%D8%AD%D8%B0%D9%8A%D8%B1-%D9%85%D9%86-%D8%AA%D8%B9%D9%88%D9%8A%D9%85-%D8%A7%D9%84%D8%B9%D9%85%D9%84%D8%A9-%D9%84%D8%B1%D9%81%D8%B9-%D8%B3%D8%B9%D8%B1-%D8%A7%D9%84%D8%AF%D9%88/