Iran to Remove Four Zeros from National Currency

by **claud39** Wed Jul 31, 2019 9:25 am

[size=41]Iran to Remove Four Zeros from National Currency[/size]

July 31, 2019

Iran to Remove Four Zeros from National Currency Photo_2018-09-15_12-47-41

The government of Iranian President Hassan Rouhani approved on Wednesday a plan to lop off four zeros from the country’s national currency in a bid to help the Iranian rial regain its value in the face of the US sanctions.

The motion, proposed by the Central Bank of Iran, was ratified during a cabinet session.
The plan will be proposed to the Parliament as a double-urgent motion, the government spokesman Ali Rabiei said.
To be signed into law, the bill needs to be ratified by the lawmakers and the Guardian Council.
The CBI says its governor, Abdolnasser Hemmati, has already made it clear for the lawmakers at a parliamentary commission meeting that the Central Bank has full control over the foreign currency market and administers the situation to maintain the balance of currency rate with prudence and with regard to the market factors.
Proposals to remove four zeros from the currency have been floated since 2008, but the idea has gained strength as the rial lost more than 60 percent of its value in 2018 despite a recent recovery in defiance of US sanctions.
The currency was trading at about 119,000 rials per US dollar on the unofficial market on Wednesday, according to foreign exchange websites.
Rial weakness disrupted Iran’s foreign trade last year and helped boost annual inflation fourfold to nearly 40 percent in November.
In December 2016, Iranian President Hassan Rouhani’s cabinet had approved a motion put forward by the Central Bank to change the national currency from rial to toman, leading to a ten-fold decrease in banknote denomination.
Toman has been long used as the unofficial unit of money in Iran, while rial and dinar have been the country’s formal currency and non-decimal currency, respectively.

https://ifpnews.com/exclusive/iran-to-remove-four-zeros-from-national-currency/

by **claud39** Wed Jul 31, 2019 9:27 am

Iran to delete 4 zeroes from the national currency

31/07/2019

Iran to Remove Four Zeros from National Currency 1034508878-696x377

BAGHDAD - The
Council of Ministers of Iran in its meeting Wednesday, a proposal to delete 4 zeros from the national currency Riyal.
The governor of the Central Bank of Iran, Nasser Hamati, is due to present details of the new government decision later.
The official price of the US dollar is 42,000 riyals. Ending / 25

https://www.almaalomah.com/2019/07/31/420949/

by **claud39** Wed Jul 31, 2019 9:29 am

Review Article Open Access

DELETING ZEROES FROM NATIONAL CURRENCY Investigation and Analysis of Removing Zeroes from Iran’s National Currency

Seyed Valiollah MirHosseini 1 * , Reza Zare Rad 2
[size=11]1Assistant Professor, Social & Economic Department, Payame Noor University, 19395-4697 Tehran, I.R.of IRAN,
2Expert of Yazd power generation management co.
*Corresponding Author:Seyed Valiollah MirHosseini
Assistant Professor
Social & Economic Department
Payame Noor University
19395-4697 Tehran, I.R.of IRAN
E-mail: vmir9123@yahoo.com
Visit for more related articles at International Journal of Economics & Management Sciences
[/size]

View PDF Download PDF

[size]

Abstract

Not only money is the means of having economic exchanges, it also leaves influences on the national identity of people and the national authority of governments and therefore it can be used as a tool to strengthen national and political identity of different nations. In other words, the value of national currency can affect the perspectives of people towards their economic situation as well as the national identity of their country. If people always expect the devaluation of their currency, this will be a cause of concern for governmental authorities. Hence, it falls upon the governments to boost people’s confidence in their national currency by maintaining its value and thus preventing the phenomenon of “currency replacement”, i.e. taking refuge in foreign currencies. This article first attempt to investigate governments’ aim behind deleting zeroes from national currencies and then presents the conditions and requirements for this undertaking. Then, it will review the experiences of other countries and the history of removing zeroes from national currencies. Finally, the advantages and disadvantages of removing zeros from national currency will be explored.

Keywords

Currency, Removing Zeroes from National Currency, Value of National Currency, Rial, Inflation

1.0 INTRODUCTION

The value of national currency of each country depends on a myriad of factors among them economic situation of the country in the world, efficiency of the government and securing the costs, political, legal and judicial stability for attracting foreign investments, observing the international law and regulation and being in line with international changes, etc. Devaluation of national currency results in many social and psychological impacts. When national currency is being devalued, people feel a sort of humiliation in relation to other strong currencies. In addition, changes in the value of currency and in its volume, which is the result of such changes, brings about many hygienic impacts.
The phenomenon of “currency replacement” occurs when along with devaluation of national currency, people show a tendency to use foreign currencies for their daily exchange. The most significant use of deleting zeroes in economy is maintaining the value of national currency. Removing zeroes from national currency is more a political measure from the governments rather than an expert and technical one and is considered to be part of the package of economic reforms.
Removing zeroes from national currency is a tool for governments’ support of the strength of currency policies. This measure has an important role in boosting public confidence in governments. In democratic regimes, removing zeroes from national currency can play a significant role in re-election of a particular party. In contrast, if people lose their confidence in national currency, they will start using foreign currencies, particularly as they have more prestige, and this leaves enormous economic and psychological pressures on governments. Therefore, the economic policies of governments will be influenced by international financial markets and foreign central banks will affect the economic policies of the country in question. Therefore, removing zeroes will prevent the penetration of foreign currencies in the economy and the consequences.

2. LITERATURE REVIEW

2.1 The Objectives behind Removing Zeroes from National Currency
There are different reasons behind one country’s decision to change the national currency; among them one can mention the following:
1. Obtaining international credit
2. Regaining national identity and national confidence
3. Controlling the currency market
4. Decreasing the inflation pressures
5. Preventing currency replacement with foreign currencies
Investigations indicate that deleting zeroes from national currency can be effective only when
A. The domain of macro-economy posses stability
B. Inflation is on the decline
C. Currency rate is stable
D. Government refrains from excessive expenditure
E. There is great confidence in the society in government’s policies
If a government only suffices to remove zeroes from national currency and does not execute comprehensive and sweeping economic reforms, not only the policy of removing zeroes from national currency will not be effective, but also value changes of the currency are doomed to happen soon.
2.2 History and Background of Removing Zeroes from Currencies in the World and in Iran
The solution of removing zeroes from national currencies is usually used in the countries in which the national currency has too many zeroes. Since 1960, in 71 cases developing governments have been forced to remove a number of zeroes from their national currencies.
Removing zeroes from national currencies was first carried out in Germany and after World War II. Under the economic pressures of World War II and the remained damage, this country experienced a huge inflation that forced economic policy-makers of the country to remove zeroes from deutschmark. During the last 50 years, 19 countries have removed zeroes from their national currencies and 10 countries have done this twice. Zeroes have been shed from national currencies 4 times in Argentina, 5 times in former Yugoslavia, 6 times in Brazil, two times in Bolivia 3 times in Ukraine, Russia, Poland and Belgium, and once in Turkey, Island, Korea, and Ghana.
2.2.1 Brazil: Holding the Record of Deleting Zeroes
Brazil suffered from one of the heaviest inflations of the time in 1960s and 1970s in a way that the county’s currency was being devalued between 30 to 40 per cent each month. Before that, Brazil’s national currency had changed its name twice between 1930 and 1942. In 1967, three zeroes were removed from Brazilian national currency, called Cruzeiro, and the currency was re-named as New Cruzeiro. However, Brazil failed to control the inflation and inflation reached 151 per cent in 1981, during which time Brazil removed three other zeroes from national currency. In 1989, the inflation increased again and reached 1431%, forcing the country to remove zeroes and change the name of the currency. In 1993, when inflation was about 2000%, another 3 zeroes were shed. This time, the government managed to control the inflation. Meanwhile, Brazil is still considered one of the most expensive Latin America’s countries. From 1930 to now, 18 zeroes have been removed from Brazilian national currency in 6 times and the currency has been re-named 8 times.
2.2.2 Netherlands, Developed Experience
Dutch Disease is now a familiar term in economic literature. The appearance of sudden revenue resources from exploitation of gas resulted in an unpredictable inflation in Netherland in 1060s. The government was forced to publish large bills in order to satisfy people’s needs in daily exchanges. Meanwhile, the inflation went above 100%. In fact, the government did not last so long. The government started severe policies in currency policies and managed to control the volume of money. In addition, 4 zeroes were removed from the bills of the country. Netherland is a great example, showing the success of the policy of deleting zeroes when it is accompanied by other policies which control liquidity.
2.2.3 Turkey, Successful Experience
Turkey is a European country while having the grounds that are similar to developing countries. It suddenly removed 6 zeroes from its currency in 2005. Inflation started in Turkey in early 1980s and gathered momentum.
Each US dollar was traded with 1422 Turkish old Lira in 1988, and it reached more than 5.1 million Liras in 2003. Each sandwich was being sold for 3 million old Liras in Turkey. Since 1981, the need for having larger notes was being felt every two years.
In a 25-year cycle, the largest Turkish bill turned from 5000 Lira to one million Liras. The large number of zeroes in economic items and exchanges, which sometimes reached multi trillion Liras, had created many problems for people and had made life difficult for those living in this country. According to reports, people had to pay multi-million Liras for buying a piece of bread in the early 2000s in Turkey.
On first of January 2004, the instruction for removing 6 zeros from Turkish Lira was presented and its execution was postponed to early 2005. One the first of January 2005, new bills and coins, called New Lira, entered the market. Execution of this initiative, provided the grounds for economic growth however, the key to its success should be sought in the policies that resulted in this growth.
The economic experts of International Money Fund (IMF) consider Turkey’s success in combating inflation the reason behind the effectiveness of the policy of removing zeroes from national currency. According to the report provided by IMF, Turkey managed to fully control the inflation and reduce the inflation rate to single-digit figures before removing zeroes from its currency. Meanwhile reforming currency market helped the economy to set the grounds for economic growth.
2.2.4 Zimbabwe: a Total Failure
Zimbabwe’s government decided to remove three zeroes from the national currency when inflation reached 1000% in 2003. However, the government had practically done nothing in regard to controlling the inflation and was only thinking of the psychological effect of deleting zeroes. It is axiomatic that the efficiency of removing zeroes lasted for a short time. The rising inflation eventually ruined the country’s economy and Zimbabwe’s dollar diminished.
The inflation in the African country went above 11 million per cent and the government was forced to issue 100 million dollar bills in order to provide people with the required bills. The new bills could not solve any problems and they even resulted in many problems in trade and in accounting. The high volume of money in this country posed many problems for people in Zimbabwe. Meanwhile the central bank of the country announced that there was not enough bill paper available to issue the required amount of bills.
2.2.5 Iran
Removing zeroes from Iran’s national currency goes back to 16 years ago. The idea was first proposed by the Central Bank in 1993 was marginalized. In 2007, one of the members of economic Commission in the Iranian Parliament asked for further investigations. Thus a special commission was formed and it has been under investigation until now. The related commission first reviewed deleting 3 and then deleting 4 zeroes from the national currency. Iran has faced 10 percent inflation since 1974 and this has encouraged many experts to affirm the necessity of changing the conditions of the national currency.
The present head of Central Bank has already announced that this policy is definite; explaining that although removing 3 zeroes from the national currency is certain, this initiative requires further time and will be kept on hold for now. With a decrease in inflation rate, this initiative will be executed.
2.2.5.1 Reasons for Removing Zeroes from the currency
1. Problems related to having large figures in the daily exchanges
2. Problems related to accounting and calculations
3. Insecurities in carrying large amount of money for daily exchanges
4. Long waits at bank lines due to the problem of counting huge amounts of money
5. Changing national currency from Rial to Taman due to large amounts of money
6. The necessity to use Iran checks with regard to the legal problems associated with it.
7. The high cost of issuing and destroying inflow bills considering the high volume of bills
8. The high rate of bill destruction due to its high volume and thus difficulty of holding them
2.2.5.2 The advantages of removing zeros from national currency
1. reducing the volume of bills
2. reducing the costs of issuing and destroying bills in the country
3. having simpler trades and financial balances
4. strengthening national currency and its value in comparison to other currencies
5. positive psychological effects in the society
6. increasing its efficiency
7. Easier transfer of money
8. Possibility of having more valuable coins after deleting three zeroes by the government
2.2.5.3 Disadvantages and Problems of Removing Three Zeroes from the National Currency
The risks and problems of removing zeroes can be divided as follows:
1. The inflation effect resulting from rounding off the prices to higher amounts
2. Menu cost
3. Psychological effect of the decrease in salaried
4. The risk of sending the capitals abroad and the investors’ wait to see the result of the initiative
5. The return of deleted zeroes
6. Costs of re-issuing bills and minting new coins
7. Problems in determining the prices in short terms
8. People’s confusion in the short run and the society’s confusion until being adapted to the new condition
9. Devaluation of bills and appearance of inflation
10. Lack of relationship between number of zeroes and the value of national currency
11. Lack of changes in the economic process
12. Devaluation and loss of some bills and small coins in the daily exchanges between people
13. The project’s failure in case of not being supported by people
14. Decrease in exports as the result of increase in the value of national currency
When deleting zeroes from the national currency is not accompanied by providing the necessary infrastructures and in a sudden manner, it will leave very unpleasant effects on people’s power of purchase.
If removing zeroes occurs when economic reforms have proved to be ineffective or when the economic stability policies are just in the mid way, no desirable results will be gained by changing the national currency.

3. DISCUSSION AND CONCLUSION

It should be noted that deleting zeroes from national currency can only be effective when it is accompanied by anti-inflation policies and austerity measures in the realm of financial policies, financial regularities of the government as well as attempts to get rid of long-lasting budget deficits and reliance of oil revenues. Otherwise, removing zeroes will soon lose its psychological effect and the zeroes will return with even more strength. In other words, the best solution to combat the rising inflation and to execute the economic stability program is independence of Central Bank from the government and removing the problem-making economic policies. Deleting the zeroes can help to decrease the inflation and execute economic stability programs in two ways. First, removing zeroes from the national currency can be done at the end of economic stability program so to provide people and private agencies the confidence that the era of high inflation has passed. Removing zeroes in such a condition is totally symbolic because inflation has been controlled due to other factors and thus removing zeroes will not lead to decreasing the inflation on its own. Second, it will gain the trust of foreign investors and thus attracting more foreign investment, facilitating the process of economic growth for the countries. Finally, in order to increase the value of national currency, economic power needs to be increased as well. This is due to the fact that with the help of powerful economy, the value of national currency can be strengthened and then with controlling the inflation, positive measures would be taken in the long term.

4. SUGGESTIONS

In the country’s economy, we need to move towards electronic trade and transfer through bank systems, ATMs, checks and the like so that transfer of money is moved towards electronic banking and de-motivate people from carrying bills.
1. Importance of Cultural Development
In order to implement this project, the necessary grounds need to be provided. Removing three zeroes can result in some sort of confusion between the former and the new data in journals, data banks, and financial statements. Such a problem can be minimized by proper cultural development and providing a correct definition of old currency and new currency.
2. The Importance of Supervising the price exchanges
While implementing the project of removing zeroes from the national currency, the prices might witness some inflation. In other words, some people might try to increase the price of their goods along with the change in the national currency. Meanwhile, decreasing the basic currency might result in the necessity to round off the prices in order to get rid of small coins, thus leading to inflation. This problem could be minimized by proper supervision and provision of necessary information in order to prevent tangible impacts on the country’s economy.
3. Encouraging People to Use Electronic Transfer and Electronic Banking
In the country’s economy, we need to move towards electronic trade and transfer through bank systems, ATMs, checks and the like so that transfer of money is moved towards electronic banking and de-motivate people from carrying bills.
4. The time of implementing the project of removing zeroes from national currency needs to be postponed to the time that it will have the highest amount of effectiveness in the country’s economy. If implementation of this project does not occur in the appropriate time and as part of the package for reforming financial and banking system of the country, it will lose part of its effects.

REFERENCES

Bakhshi, Mohammad Ali. Removing Zeroes from National Currency (Analysis and Investigation of Removing 3 or 4 Zeroes from Iranian Rial), Mofid University. (In Persian)
Pazhoyan, Jamshid (2008). Money, Currency, and Banking. Tehran: Payam Noor Publication. (In Persian)
Ghobadi, Farokh, and Raeis Dana, Fariborz. (1989). Money and Inflation. Tehran: Pishbord Publications. (In Persian)
Nahidi, Ahmad (1995). Money and Modern Banking. Tehran: Danesh Emrooz Publication. (In Persian)
Insurance and Development Journal, 4th year- issue 13 and 14. (In Persian)
http://www.bbc.co
http://www.rajanews.com/detail.asp
http://irna.ir/NewsShow
http://rahetosee.blogfa.com
http://eghtesadna.com
http://www.donya-e- eqtesad.com
http://www.iranpress.ir/jahaneghtesad
http://ussoa.loxblog.com
www.hamshahrionline.ir/news
www.hamshahri.org/news
www.sarmaye.com

https://www.omicsonline.org/open-access/deleting-zeroes-from-national-currencyinvestigation-and-analysis-of-removing-zeroes-from-irans-national-currency-.php?aid=13519
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by **Sam I Am** Wed Jul 31, 2019 12:15 pm

Zimbabwe, Turkey Brazil, Netherlands .... they all lopped zeros off of their currencies and it was always a neutral exchange. Nobody ever got rich by holding the currency that was replaced, and if Iraq ever gets around to doing it the results will be no different. So this article pretty much confirms what we've been saying all along. Deleting the zeros means redenomination or "lop".

by Suasponte Wed Jul 31, 2019 9:22 pm

Sam, provide fact based information. Why would Iraq go through 3 years of IMF oversight, all of the financial laws and stress on the Iraq citizens to just lop? They could have done that 10 times over. We don’t want to here your opinion, we want fact based discussion. So, in your opinion, with fact based articles, how do you draw this conclusion? If you can’t back up your statement, you are just like the Guru’s. Total BS.

by Suasponte Wed Jul 31, 2019 9:28 pm

It’s almost like you are the anti-Christ with your opinions. Present fact based articles or shut the hell up. I can get opinions all day....I am about facts. Where have you read that conclusion, seen documented proof, or who is your source and what position do they hold in the GOI. Don’t just speculate like the Guru’s, prove it with facts. If you can’t, then all respect for your opinion is mute.

by Suasponte Wed Jul 31, 2019 9:46 pm

Where are the articles stating that Iraq plans to lop?

by **RamblerNash** Wed Jul 31, 2019 11:43 pm

Iran changes its currency from the riyal to the tuman and removes 4 zeros from it

Iran to Remove Four Zeros from National Currency Doc-P-313466-637001601063719317

Iran to Remove Four Zeros from National Currency Doc-P-313466-637001601063719317

2019-07-31 04:51

The Iranian presidency has approved the deletion of four zeros from the national currency and the replacement of the riyal by the Toman.

"The deletion of four zeros from the country's national currency has been approved and the national currency will be replaced from the riyal to the tuman, because the toman is the most popular in the internal exchanges," said Iranian President Mahmoud Wazee , head of the Iranian presidential office .

"The president of the Central Bank will provide more information on the subject next Sunday," he said.

In turn, the agency "Fars" Iran, "This proposal aims to maintain the effectiveness of the national currency and facilitate and modernize tools of cash payments in local transactions, along with reducing the cost of printing banknotes and reduce the huge problems in the daily exchange, and the burden of counting currency and cash coins and carry large amounts Of which".

The official price of the US dollar is 42,000 Iranian riyals.

LINK

by **RamblerNash** Wed Jul 31, 2019 11:53 pm

ANALYSIS OF LOPPING ZEROS FROM NATIONAL CURRENCY OF IRAN AND SOME OTHER COUNTRIES

Seyed Valiollah MirHosseini*

Assistant Professor, Department of Social & Economic, Payame Noor University, 19395-3697 Tehran, I.R. of IRAN

*Corresponding Author:Seyed Valiollah MirHosseini
Assistant Professor
Department of Social & Economic
Payame Noor University
19395-3697 Tehran
I.R. of IRAN
E-mail: vmir9123@yahoo.com

Visit for more related articles at International Journal of Economics & Management Sciences

View PDF Download PDF

Keywords

Currency, Removing Zeroes from National Currency, Value of National Currency, Rial

INTRODUCTION

The value of national currency of each country depends on a myriad of factors among them economic situation of the country in the world, efficiency of the government and securing the costs, political, legal and judicial stability for attracting foreign investments, observing the international law and regulation and being in line with international changes, etc.

Devaluation of national currency results in many social and psychological impacts. When national currency is being devalued, people feel a sort of humiliation in relation to other strong currencies. In addition, a change in the value of currency and in its volume, which is the result of such changes, brings about many hygienic impacts. The phenomenon of “currency replacement” occurs when along with devaluation of national currency, people show a tendency to use foreign currencies for their daily exchange.

The most significant use of deleting zeroes in economy is maintaining the value of national currency. Removing zeroes from national currency is more a political measure from the governments rather than an expert and technical one and is considered to be part of the package of economic reforms.

Removing zeroes from national currency is a tool for governments’ support of the strength of currency policies. This measure has an important role in boosting public confidence in governments. In democratic regimes, removing zeroes from national currency can play a significant role in re-election of a particular party. In contrast, if people lose their confidence in national currency, they will start using foreign currencies, particularly as they have more prestige, and this leaves enormous economic and psychological pressures on governments. Therefore, the economic policies of governments will be influenced by international financial markets and foreign central banks will affect the economic policies of the country in question. Therefore, removing zeroes will prevent the penetration of foreign currencies in the economy and the consequences.

Why governments remove zeros from their national currency?

When the value of money is preserved by public trust in lieu of gold and silver, the governments begin to feel heavier responsibility to conserve either value or position of their national currency. Inflation is enumerated as a cause for removing zeros from the national currencies. Both liquidity growth and increased money supply fuel inflation growth and the government may eliminate rising inflation by slashing zeros from its national currency. In other words, countries suffering from massive inflation rate and depreciated national currency have embarked on lopping zero(s) from their bills in order to simplify economic and commercial transactions as well as to decrease costs of banknote printing process. Most economists, however, come to believe that only removing zeros from banknotes does not affect the economic indicators as well as demand & supply parity, but its impact is just restricted into psychological effects upon the society. Therefore, cutting off zeros can be effective only when it is accompanied with other restrictive measures such as monetary policies and fiscal discipline of the governments, otherwise the psychological effects caused by the departed zeros will be nullified very soon and they will come back stronger than ever.

History of removing zeros from the national currency of certain countries

The solution of removing zeroes from national currencies is usually used in the countries in which the national currency has too many zeroes. Since 1960, in 71 cases developing governments have been forced to remove a number of zeroes from their national currencies.

Removing zeroes from national currencies was first carried out in Germany and after World War II. Under the economic pressures of World War II and the remained damage, this country experienced a huge inflation that forced economic policy-makers of the country to remove zeroes from deutschmark. During the last 50 years, 19 countries have removed zeroes from their national currencies and 10 countries have done this twice. Zeroes have been shed from national currencies 4 times in Argentina, 5 times in former Yugoslavia, 6 times in Brazil, two times in Bolivia 3 times in Ukraine, Russia, Poland and Belgium, and once in Turkey, Island, Korea, and Ghana.

Lopping zeros from Argentina’s national currency

Economic downturns in Argentina depreciated its national currency considerably and brought about dollar crisis there in 1992. Thus, the Argentine government had to undertake the economic reforms with a priority to cut zeros from its national currency in order to prevent from sharp rise in inflation. In 1960, 1100 to 3500 Argentina pesos equaled 1 USD. By removing two zeros from its currency, Argentina fixed its peso value to dollar value. In the early 1980’s, each USD was exchanged for 18,000 to 180,000 pesos. The Argentine government slashed 4 zeros from its bills in 1983 but it was useless because confining into removing zeros from the national currency without applying all-embracing economic reforms will be fruitless; thus, subsequent to monetary, financial and reformative policies in the early 1990’s, removing 4 zeros from the national currency of Argentina was resulted in a desired outcomes and it declined inflation rate drastically there.

Brazil: Holding the Record of Deleting Zeroes

Brazil suffered from one of the heaviest inflations of the time in 1960s and 1970s in a way that the county’s currency was being devalued between 30 to 40 per cent each month. Before that, Brazil’s national currency had changed its name twice between 1930 and 1942. In 1967, three zeroes were removed from Brazilian national currency, called Cruzeiro, and the currency was re-named as New Cruzeiro. However, Brazil failed to control the inflation and inflation reached 151 per cent in 1981, during which time Brazil removed three other zeroes from national currency. In 1989, the inflation increased again and reached 1431%, forcing the country to remove zeroes and change the name of the currency. In 1993, when inflation was about 2000%, another 3 zeroes were shed. This time, the government managed to control the inflation. Meanwhile, Brazil is still considered one of the most expensive Latin America’s countries. From 1930 to now, 18 zeroes have been removed from Brazilian national currency in 6 times and the currency has been re-named 8 times.

Netherlands, Developed Experience

Dutch Disease is now a familiar term in economic literature. The appearance of sudden revenue resources from exploitation of gas resulted in an unpredictable inflation in Netherland in 1060s. The government was forced to publish large bills in order to satisfy people’s needs in daily exchanges. Meanwhile, the inflation went above 100%. In fact, the government did not last so long. The government started severe policies in currency policies and managed to control the volume of money. In addition, 4 zeroes were removed from the bills of the country. Netherland is a great example, showing the success of the policy of deleting zeroes when it is accompanied by other policies which control liquidity.

Turkey, Successful Experience

Turkey is a European country while having the grounds that are similar to developing countries. It suddenly removed 6 zeroes from its currency in 2005. Inflation started in Turkey in early 1980s and gathered momentum. Each US dollar was traded with 1422 Turkish old Lira in 1988, and it reached more than 5.1 million Liras in 2003. Each sandwich was being sold for 3 million old Liras in Turkey. Since 1981, the need for having larger notes was being felt every two years.

In a 25-year cycle, the largest Turkish bill turned from 5000 Lira to one million Liras. The large number of zeroes in economic items and exchanges, which sometimes reached multi trillion Liras, had created many problems for people and had made life difficult for those living in this country. According to reports, people had to pay multi-million Liras for buying a piece of bread in the early 2000s in Turkey.

On first of January 2004, the instruction for removing 6 zeros from Turkish Lira was presented and its execution was postponed to early 2005. One the first of January 2005, new bills and coins, called New Lira, entered the market. Execution of this initiative, provided the grounds for economic growth however, the key to its success should be sought in the policies that resulted in this growth.

The economic experts of International Money Fund (IMF) consider Turkey’s success in combating inflation the reason behind the effectiveness of the policy of removing zeroes from national currency. According to the report provided by IMF, Turkey managed to fully control the inflation and reduce the inflation rate to single-digit figures before removing zeroes from its currency. Meanwhile reforming currency market helped the economy to set the grounds for economic growth.

Removing zero from Turkey’s currency became concurrent with full inhibition of the inflation using diverse economic tools. As a result, the new lira became able to meet its responsibility as a new exchange unit and to pave the grounds for economic growth of the country.

Turkey performed reformative and mitigating measures for more than two decades. Some of the inflation volatilities in Turkey were results of its mitigating plans. Turkish mitigating plans were implemented as a political package. The chronological sequence of plans was observed and finally Turkey followed the realization of its central bank independence via reforming its banking system. Adherence to a disciplined budget by the government even was associated with budget surplus for some years in Turkey. Keeping the parity at monetary and price-based changes of the country is considered as one of the fundamental properties of mitigating and establishing plans of Turkey. Therefore, lopping some zeros from its national currency was not resulted in negative distributional/allocative effects, but has improved economic allocation mechanisms in turn through taking public confidence and gaining reputation for the government.

Zimbabwe: a Total Failure

Zimbabwe’s government decided to remove three zeroes from the national currency when inflation reached 1000% in 2003. However, the government had practically done nothing in regard to controlling the inflation and was only thinking of the psychological effect of deleting zeroes. It is axiomatic that the efficiency of removing zeroes lasted for a short time. The rising inflation eventually ruined the country’s economy and Zimbabwe’s dollar diminished.

The inflation in the African country went above 11 million per cent and the government was forced to issue 100 million dollar bills in order to provide people with the required bills. The new bills could not solve any problems and they even resulted in many problems in trade and in accounting. The high volume of money in this country posed many problems for people in Zimbabwe. Meanwhile the central bank of the country announced that there was not enough bill paper available to issue the required amount of bills.

Lessons from other countries’ experiences for economy of Iran

What is concluded from the experiences of the other countries is that in confrontation with the short-term hyperinflation caused by wars or with massive and destabilizing inflations during economic transition periods, the mentioned countries have involved in reforming or changing their national currency and they intended to signal the society that the destabilizing condition has been wrapped up by commencement of the stabilizing and trust era created by the stabilizing measures; sometimes during confrontation with high inflations and sovereignty of the unstable expectations, they have used this strategy (changing currency) as a tool to stabilize inflationary expectations or to complete their monetary and economic policies. Their experiences show that the actual position of changing currency is the effect and not the cause. By following this policy, In other words, governments only turn their back to the unstable condition and to resort the stability by way of the monetary, actual and substantial reforms, so it is a signaler and final complementary policy. Similarly, any proceeding to change the national currency is doomed whenever the economy has not been stabilized by stabilizing policies, actual and substantial measures; so the inflation remains and is converted to a kind of condition by which changing national currency is repeated many times. The Turkish case is a successful sample of changing national currency policy. After applying reformative, substantial policies and some successful social changes in order to pave the grounds for joining to EU, Turkey has embarked on removing 6 zeros from its currency in 2005 and it was very successful as the last complementary ring of the previous fundamental actual and monetary measures.

Another case is unsuccessful experience of Argentina in lopping zeros from its national currency for several times. It has changed its national currency several consecutive times. Initially, in1979 i.e. in the thick of its inflation years, Argentina has removed two zeros from its currency, but it remained sterile and again the inflation was accelerated and the value of its currency continued a depreciative pace. This country in another affectless decision cut 4 zeros off of its currency in 1983 but both inflation and instability remained high, so, in 1985 it removed another three zeros from peso which finalized with a similar result. These experiences indicate that removing zeros from the national currency per se will not lead to desired outcomes. However, in response to monetary, fiscal and reformative policies of the early 1990’s, slashing 4 zeros from peso of Argentina has resulted in desired achievements and it decreased drastically inflation rate.

Iranian status quo and removing zeros from its currency

The liquidity rate in Iran has been intensely instable during the past 40 years. The current facts and statistics show that according to the quantity theory of money a major part of monetary volume changes has been manifested in increasing general level of price and inflation. Such trend suggests a dynamic, self-reinforcing and complicated nature for liquidity and inflation. Inflation affects resource allocations and redistribution of incomes and also obscures economic outlooks. Analysis of Iranian economic and business environment and its monetary and inflationary condition entails analysis of how some of key variables of the economy e.g. “liquidity”, “GDP growth rate”, “GDP growth rate without oil”, “inflation” and “USD to rial ratio” have been changed since increased oil price in 1973 so far. Continuous growth of the liquidity during the past years has generated an instable monetary space for the economy of Iran. Also, price index continuously is being increased drastically. It suggests that the nominal values of price of products and services have been increased over time. The USD to rial ratio is an index by which the necessity to change the national currency is determined. These considerations show that our nominal variables have been enhanced considerably which in turn either has complicated transactions and calculations or has influenced the psychological atmosphere of the business environment.

Removing three zeros from the national currency has been posed by Iranian statesmen several times in recent years, but it has been put on the back burner for different reasons. At the present time, Iranian economy does not experience the condition in which other country changed their currency. At the same time, many nominal variables of the country and general level of prices have been grown during the three last decades. Accordingly, recording numbers and calculations has become more difficult in comparison with the last years. Anyway, large nominal numbers reinforce dynamicity of the inflation. Although, Iran has not experienced any hyperinflation during past years, permanent two-digit inflations, 15-30%, have been annoying all the time. Problems caused by eradication and reprinting bills and their innate costs are considerable as well. According to the classical theory of economics, if money is neutral in the economy and the relevant containers law is actually and completely true in the society, then removing three zeros from the national currency will not bring about any problem. The sole problem of the mentioned condition would be printing and minting fractional moneys and their associated costs which would be ended to simplification of calculations and accounting records. Hence, it decreases safety of the economic environment and adjusts the relation between national currency and foreign currency to fractional numbers which apparently was considered as an enhancement for the national currency; however, money neutrality subject is not a comprehensive issue in the developed countries and it is true somehow; however, the economic condition of Iran is completely different. During the two past decades, Iran has experienced economic mitigation plans which were failed because of lack of prerequisites, coordination, necessary preparations, and disregarding a chronological sequence. Monetary passivity aspects of money were boosted by high flux and growth of the liquidity, so, passive money to active money rate was elevated. Monetary passivity has made difficult management of both money and inflation in economy. Therefore, even if Iranian economic authorities determine to find a solution to stabilize the Iranian economy, then using nominal monetary and inflationary harbors comes be impossible. In other words, in the case of monetary passivity and high flexibility of cash flow, using money volume targeting is impossible for Iranian authorities and if they prefer to use the inflationary targeting then management of monetary adjustment will be nullified by the monetary passivity. The main root of the problem is hidden in lack of transparent budgetary performances, fiscal discipline, and an effective tax collection system, hence reiterative developments, modifications and changes are improper and instable in such space. As a result, price and nominal reforms are not only resulted in a desired outcome, but they will impose hefty costs on economy of the society unless a wise measure is taken to reform the above-mentioned affairs. Certainly, in this condition costs and damages caused by shock therapies are very higher than those caused by minifying monetary, nominal numbers and lopping zeros from the national currency; however, converting large money and nominal numbers into smaller ones has its own costs which would be troublesome, in turn.

Researchers who believe that removing some zeros from the national currency is completely safe in terms of distribution aspects and that it does not fuel the inflation, should suppose that there is not any desired pricing power in the society and prices are determined in deep and practical competitive markets. Also they should suppose that there is not any passive money in our monetary system and either money or liquidity in economy is active, manageable and controllable, as same as the countries that performed this policy successfully. When there is not a desirable pricing power in a society and the economic elements are not able to denominate prices but prices which are determined by the market mechanism and when there is not any monetary passivity, then none of nominal or actual changes are ended to improper change of prices and redistribution of incomes and re-allocation of resources. Therefore, removing three zeros from the national currency comes to be effective, but there is not any similar condition within Iran. There are several problems to conduct such operation. First, a great deal of our money is passive. Monetary passivity refers to a state in which the cash flow is increased or decreased because of disorders of the financial departments of the government, lack of transparency and supervision, lack of a proper taxation system, dependent budge of the government to oil incomes and unplanned decisions of the relevant authorities about increasing or decreasing money. Second, pricing power of economic elements is high and considerable in the Iranian economy which is explained by little (if any) deep and effective economic competitive markets there. Therefore, automatic mechanism of prices which performs the practical signaling is absent in the Iranian economy. Third, income rate of the cash flow is instable in the Iranian economy and shows flexibility drastically. Given the status quo suffering from a flexible cash flow, monetary policies may not be completely useful and hence monetary stabilization, as a preparative task for economic revolution, would be failed.

Advantages of lopping zeros from the Iranian national currency

1. Removing technical and operative problems caused by using money;
2. Decreasing costs of eradication and publication of banknotes;
3. Decreasing costs of the banking system and trading costs;
4. Facilitating and decreasing depreciation of ATMs ;
5. Easy and convenient transportation of money and decreasing risks due to transportation banknotes on a large scale;
6. Impeding influence of foreign currencies on domestic economy;
7. Paving the grounds for decreasing inflation rate in long term;
8. Increasing public confidence to the national currency and economy in response to increased value of money;
9. Simplifying banking affairs for people;
10. Increasing foreign investments in the country;
11. Removing technical and operative problems caused by application of large numbers in both financial statements and calculating machines;
12. Decreasing bill flow per capita and hence saving costs of publishing bills on a large scale;
13. Declining inflationary expectations across the society.

Disadvantages of lopping zeros from Iranian national currency

1. Removing zeros from the national currency is led to occurrence of inflationary effects on some economic activities; it has psychological effects on the society as well;
2. Wasting people’s time in long queues of banks for changing their bills;
3. Costs caused by collecting and eradicating old bills and printing and publishing new ones;
4. The potential disorder between old and new data in information dissemination offices and bases as well as financial statements;
5. Inability to change all bills in the predefined time frame;
6. Public confusion during monetary dichotomy period;
7. Minting counterfeit monies because of people’s unawareness during changing currency units.

Tips about removing zeros from currency

• Removing zeros of the national currency only for controlling the inflation rate, it will impose inflationary effects on the economy in long term. It is why some countries do not slash zeros from their currency in spite of a high inflation rate.

• Of course removing zeros from the national currency is not a bad thing but it depends on reason and time of using this operation in the economy of any country.

• Independence of the central bank from the government is a key point which must be considered upon slashing zeros from the national currency.

• Removing zeros from the national currency is accompanied with numerous economic and political consequences.

• Before any activity, the government has to inform the public opinion about economic effects caused by removing zeros from the national currency.

• It is important to know that this change should meet both short and long term goals of a certain plan. Likewise, role and relation between economic growth (strength of GDP) and economic supports such as gold, currency, energy reservoirs etc. should be treated particularly as the critical factors on power and value of the national currency.

• The necessary considerations about minor units of better money are essential for eliminating inflationary effects caused by increased prices.

• Concerns of exporters should be imagined too, because increasing reasonably the value of the national currency will decrease the competiveness of exporters in the world markets and it will lead to falling exports; so by designing special support packages it can be controlled, if necessary.

Prerequisites of cutting zeros from the Iranian national currency

The following proceedings are necessary before implementing the zero deleting policy across the country, some of which are prerequisites of many reformatory activities:

1. Developing a competitive space and deepening markets;
2. Limiting pricing power of the economic elements;
3. Applying discipline and transparency in the governmental budget and its fiscal demeanor;
4. Reforming taxation system and decreasing economic and budgetary dependency of the country to oil incomes;
5. Restricting non-productive activities and stabilizing relevant and irrelevant transactions to GDP ratio;
6. Developing a price reform management system and controlling price changes upon shock therapy;
7. Monitoring credit awarding and reimbursing the arrears;
8. Monetary discipline.

These proceedings are categorized as prerequisites for many reformative measures and prosperity of each reformation depends on its appropriate application.

CONCLUSION AND PROPOSITION

Regarding experience of other countries to delete zeros from their national currency and regarding economic goals of Iran by 2025 and also given the current low position and value of Iranian rial in the routine trades, some people believe that Iran has to lop some zeros from its currency while performs other measures for economic development and scientific studies and researches, so, finally the main position of its national currency in the international markets will be saved along with decreasing inflation and increasing foreign investments.

Economic situation of the country should be scrutinized before any measure to remove zeros from the national currency. Please keep in mind that removing zeros without economic reformations would not be effective to suppress inflation and in most countries zero removing policy has been implemented subsequent to implementation of economic stabilizing policies. Anyway, it will be conducted after preparing the necessary executive infrastructures of the plan including the setting a coefficient to convert the new currency into small units of money, how to price micro products, considering apparently non-economic indices e.g. psychological dimensions of this procedure, people’s ability to use the new money and the public enthusiasm. Accordingly, before any task, the public opinion should be prepared in order to be accustomed with the new condition and money. In other words, the best way to guarantee success of this policy is pursuing transparency and giving opportunity to people to be adapted with the new condition and money. Thus, role of media, establishing the issue in schools and universities, testing the plan on micro scales before its formal implementation are very important in this process.

Others believe that countries that have removed zeros of their national currencies in an unsafe and instable condition without applying political and stabilizing reformations have failed to achieve their desirable results, but countries that paved the grounds for such changes after using reformative and stabilizing measures and that has used this policy as a complementary and final measure to send a signal to both market and people has reached their purpose. In the case of proper application of principle of the proportionality in Iran and a stable monetary and pricing trend, it would be resulted in the desired goals, but at the current situation it only fuels inflation and intensifies disproportions. Deleting zeros from the national currency should be conducted after conducting critical stabilizing and reformative proceedings, so, intense supervision and control are vital upon implementation of this policy.

REFERENCES

Bakhshi, Mohammad Ali. Removing Zeroes from National Currency (Analysis and Investigation of Removing 3 or 4 Zeroes from Iranian Rial), Mofid University. (In Persian)
Pazhoyan, Jamshid (2008). Money, Currency, and Banking. Tehran: Payam Noor Publication. (In Persian) Ghobadi, Farokh, and Ris Dana, Fariborz. (1989). Money and Inflation. Tehran: Pishbord Publications. (In Persian)
Nahidi, Ahmad (1995). Money and Modern Banking. Tehran: Danesh Emrooz Publication. (In Persian)
http://mehal51.blogsky.com
http://mastermanagers.blogfa.com
http://www.tejaratnews.com/news
http://www.cloob.com/club/article
http://www.acclearn.com
http://avajmodir.persianblog.ir

https://www.omicsonline.org/open-access/analysis-of-lopping-zeros-from-national-currency-of-iran-and-some-other-countries-.php?aid=17142

by **RamblerNash** Wed Jul 31, 2019 11:57 pm

Govt. agrees to slice four zeros off national currency

Iran to Remove Four Zeros from National Currency 3135819

TEHRAN, Jul. 31 (MNA) – The Iranian government has approved a plan to take four zeros off the national currency in a bid to curb the tide of liquidity and boost the rial again.

According to IRIB, the move was approved during the cabinet session on Wednesday.

The proposal should now go to the parliament to become law.

Further details will be released later by Central Bank of Iran Governor Abdolnaser Hemmati.

CBI has vowed to put every effort into action to make the redenomination of the rial, which currently stands at around 120,000 to the US dollar.

The plan to remove four zeros from the rial has been on the government agenda since it was proposed in the past by Central Bank of Iran as part of a broader plan to revisit the monetary system.

According to the government website dolat.ir, the measure calls for fundamental change to the national currency, including changing the name of the monetary unit from the official rial to the popularly used ‘toman’. It stipulates change in the nominal value and the face of bank notes and coins.

“The new national currency toman will be defined to substitute the rial. Each toman will be equivalent to 10,000 rials,” the website said.

Despite the fact that rial is the official currency, people use toman in informal transactions (1 toman = 10 rials).

MR/IRIB2489075

News Code 148294

https://en.mehrnews.com/news/148294/Govt-agrees-to-slice-four-zeros-off-national-currency

by **RamblerNash** Thu Aug 01, 2019 12:00 am

An investigating Zeros Elimination of the National Currency and Its Effect on National Economy (Case study in Iran)

http://www.imedpub.com/articles/an-investigating-zeros-elimination-of-the-national-currency-and-its-effect-on-national-economy-case-study-in-iran.pdf

by **RamblerNash** Thu Aug 01, 2019 12:02 am

Dropping Zeros, Gaining Credibility? Currency Redenomination in Developing Nations

https://www.researchgate.net/publication/229051710_Dropping_Zeros_Gaining_Credibility_Currency_Redenomination_in_Developing_Nations

by **RamblerNash** Thu Aug 01, 2019 12:06 am

Iran's central bank proposes slashing four zeros from falling currency - IRNA

JANUARY 6, 2019 / 3:09 AM

Iran to Remove Four Zeros from National Currency Scree360

A man buys Iranian rials from a seller of Iranian currency, before the start of the U.S. sanctions on Tehran, in Basra, Iraq November 3, 2018. Picture taken November 3, 2018. REUTERS/Essam al-Sudani

DUBAI (Reuters) - Iran’s central bank has proposed slashing four zeros from the rial, state news agency IRNA reported on Sunday, after the currency plunged in a year marked by an economic crisis fuelled by U.S. sanctions.

“A bill to remove four zeros from the national currency was presented to the government by the central bank yesterday and I hope this matter can be concluded as soon as possible,” IRNA quoted central bank governor Abdolnaser Hemmati as saying.

Proposals to remove four zeros from the currency have been floated since 2008, but the idea has gained strength as the rial lost more than 60 percent of its value in 2018 despite a recent recovery engineered by the central bank in defiance of U.S. sanctions.

The currency was trading at about 110,000 rials per U.S. dollar on the unofficial market on Sunday, according to foreign exchange websites.

President Donald Trump reimposed U.S. sanctions on Iran last year after pulling out of world powers’ 2015 nuclear deal with Tehran. Washington has vowed “maximum pressure” on Iran’s economy to force it to accept tougher limits on its nuclear and missile programmes. Iran has ruled this out.

Rial weakness disrupted Iran’s foreign trade last year and helped boost annual inflation fourfold to nearly 40 percent in November. The weak currency and galloping inflation have been a complaint of sporadic street protests since late 2017.

After approval by the government, the proposed currency plan would have to be passed by parliament and approved by the clerical body that vets legislation before it takes effect.

https://www.reuters.com/article/uk-iran-currency/irans-central-bank-proposes-slashing-four-zeros-from-falling-currency-irna-idUSKCN1P008C

by **RamblerNash** Thu Aug 01, 2019 12:09 am

Sanctions-hit Iran to cut zeros and rename plunging currency

Iran to Remove Four Zeros from National Currency Fc9d7c34bcadbbaa705b4ea15a67162e5fa53d39

Iran to Remove Four Zeros from National Currency Fc9d7c34bcadbbaa705b4ea15a67162e5fa53d39

The zeros have piled up on Iranian banknotes but their purchasing power has plummeted, with the rial now changing hands at around 120,000 to the dollar (AFP Photo/Haidar MOHAMMED ALI)

Tehran (AFP) - The government in sanctions-hit Iran on Wednesday approved a plan to remove zeros from the rial and rename the currency -- something its people have long been doing to simplify transactions.

"The cabinet today agreed on a bill to eliminate four zeros from the currency and that 'toman' will be our national currency," government spokesman Ali Rabiei told reporters in Tehran.

The value of the Iranian rial has hit low after record low since last year.

The currency was trading at about 37,000 to the dollar three years ago, but it slumped to around 180,000 last year.

That was after US President Donald Trump announced the United States was unilaterally withdrawing from the 2015 Iran nuclear deal and reimposing biting sanctions.

At the time, long queues were seen outside exchange offices, before the Iranian government took drastic measures by arresting unlicenced dealers and freezing the accounts of speculators.

Currently the rial is trading at around 120,000 to the US dollar on the street, while the official rate is 42,000.

This means anyone without a bank card has had to virtually abandon coins and carry around thick wads of banknotes in their purses or wallets just to make everyday purchases.

In a bid to simplify transactions, Iranians have long referred to their currency as the toman and chopped off a zero -- a unique system that is a source of confusion for foreign visitors.

The Iranian government has now acknowledged this with its latest move, which needs to be forwarded to parliament for final approval.

"This will make the national currency more effective," said the spokesman Rabiei.

"It will be more in line with common practice in society... the rial is not used that much.

"Coins will once again come into circulation," he added.

The International Monetary Fund has forecast Iran's economy to shrink by 6.0 percent this year due to sanctions and rising instability in the Middle East.

https://news.yahoo.com/sanctions-hit-iran-cut-zeros-rename-plunging-currency-113443504.html

by **RamblerNash** Thu Aug 01, 2019 12:49 am

Sam I Am wrote:Zimbabwe, Turkey Brazil, Netherlands .... they all lopped zeros off of their currencies and it was always a neutral exchange. Nobody ever got rich by holding the currency that was replaced, and if Iraq ever gets around to doing it the results will be no different. So this article pretty much confirms what we've been saying all along. Deleting the zeros means redenomination or "lop".

cut, remove, slash, drop, eliminate, take off, slice, and finally lop are all terms to describe a redenomination, as been said for years.

Here's a bunch of articles above that use those terms.

The IMF 2019 Article IV Consultation doesn't have the words "float" or "balassa samuelson".

What is Kap going to say now? LOL

by **Sam I Am** Thu Aug 01, 2019 7:54 am

Suasponte wrote:Sam, provide fact based information. Why would Iraq go through 3 years of IMF oversight, all of the financial laws and stress on the Iraq citizens to just lop? They could have done that 10 times over. We don’t want to here your opinion, we want fact based discussion. So, in your opinion, with fact based articles, how do you draw this conclusion? If you can’t back up your statement, you are just like the Guru’s. Total BS.

They've gone through more than three years of IMF oversight. It's more like seven years since they started borrowing from the IMF, which requires them to submit to IMF oversight just like any bank has the right to monitor what you're doing with the money they loan you. As for the financial laws, every country with a developing economy passes financial laws to ensure stability and consistent progress. The fact is, every country that removes zeros from their currency has done so via redenomination. https://iraqcurrencywatch.com/deleting-the-zeros-i-6512/ Not once in history has any country removed zeros in a revaluation, so the question you need to answer is why would Iraq be the first to do that? And not only why but how? They're backing roughly 70 trillion dinar with $60 billion. If they were to suddenly increase the value of the IQD by 100,000% (the increase that would result from removing three zeros in a revaluation) they would only be backing their currency at .1% which would cause unprecedented hyperinflation. The BS is coming from the gurus who have duped the uninitiated into thinking that such a revaluation is doable in the real world.

by Suasponte Thu Aug 01, 2019 8:09 am

Again, you quote an article that apparently you penned from 2012. 9 years ago. What relevant article do you have that is current?

by Suasponte Thu Aug 01, 2019 8:21 am

In addition to cash reserves, Iraq also holds 96+ tons of gold. Each ton of gold based on a rate of $1,300 per once equals $41,795,975 per ton. Multiply that figure by 96.

by Suasponte Thu Aug 01, 2019 8:26 am

That’s $4,024,952,392.

by **claud39** Thu Aug 01, 2019 10:05 am

I would like to share with you an article dated the year 2012 on the exchange rate, and this comes from the Ministry of Planning directly, and read the last line which says this: 3. Estimate the modified exchange rate of the Iraqi dinar to use in technical and economic feasibility studies as well as for (1,134) dollar per dinar. This price should be approved for 3 years until the competent authorities re-evaluate it. this text tells me in this time there is 2012 for the parallel market, and not on the free market until the competent authorities decide to change the rate for the free market !! and I mention it I am not an economist, but someone who follows the news about Iraq! and to finish, and I maintain my point. they had a value before the sanctions, they will have a value when they are going to be back as on the wto for example, and I mention it that are supported by the United States for their return !! and look at this morning's article that I send to the forum with the economics specialist for the bank deprives the government to give the bank the chance to deprive them of providing support for the reconstruction, and the bank participation deprive on the Iraqi economy !! Have a lovely day everybody !!

Claud (Moose)

The Exchange Rate of Foreign Currency in Economic Feasibility Studies

Below are the central controls related to the exchange rate of the foreign currency to convert the project inputs and outputs from foreign currency to its equivalent in the local currency, and that is by calculating the net discounted present value standard and the internal return on investments in economic analysis that governs investment projects that costs excess one million dinars.

Estimate the shadow price of foreign currency:

1. It is necessary to put central controls to amend the official exchange rate * to reflect the shadow price of the foreign currency, and that is considered one of the necessary requirements to implement the net discounted present value standard and the internal return rate on investment in the economic calculation stated in the instructions, paragraph nine.

The central controls for adjusting market prices distinguished a group of outputs and inputs traded internationally, where the projects production or usage of them is reflected on the abundance of foreign currency in the economy and thus project outputs or inputs used of such are considered purely foreign currency outputs or inputs.

* What is meant by exchange rate: the number of units of foreign currency, expressed in dollar per one dinar.
In particular the following outputs and inputs of foreign currency were distinguished:

·          Export-outputs.
·          Outputs marketed locally that substitute imports.
·          Imported inputs.
·          Inputs produced locally that usually go to exports.
·          Foreign labor.

According to the pricing rules the value of the output and input (traded) is calculated using export prices (FOB) and import prices (CIF), according to what is listed in the pricing rules.

In other words the pricing rules calculate what the project produces from foreign currency (quantity of exports multiplied by the export price (FOB) in foreign currency or the quantity of substitute imports multiplied by the import price (CIF) in foreign currency, as well as what the project uses from foreign currency and imported inputs multiplied by the import price (CIF) in foreign currency .... etc.).
In a later step, project outputs and inputs must be converted from the foreign currency to its equivalent in local currency (dinars) by using a specific exchange rate for the foreign currency.

[size]

2.      Justifications for exchange-rate adjustment: there are a number of important and powerful arguments which support the view that the official exchange rate reduces the real value of foreign currency for purposes of calculating the  economic national profitability for investment projects and hence for the purposes of investment planning. It is demonstrated in this context to call for assessing the dinar for less than (3.208) dollar (official exchange rate) when assessing project outputs and inputs of traded goods of exports, substitute imports and imports... etc.

The justifications to call for the use of an exchange rate that is lower than the official exchange rate are:

·          The use of an exchange rate that is lower than the official rate is the appropriate action at the investment planning level to translate the country’s economic strategy aiming at stimulating central investments in the sectors that encourage the development of non-oil exports, as well as sectors that encourage the expansion of domestic production base in order to reduce imports and compensate it with local commodities. This helps to reduce reliance on foreign exchange earnings from crude oil exports and increases the share of non-oil sectors in the local production.

·          The application of the amended exchange rate on project imported inputs will assist in directing investments away from aggregated sectors dependent on imported inputs and the preference of those sectors that rely on locally produced inputs.

·          The use of the amended exchange rate helps to correct the balance in favor of the traded goods sectors compared to non-traded goods.

·          The real exchange rate has declined rapidly since the early seventies, through rapid rise of the level of prices and local costs which led by the steadiness of the official exchange rate to change in prices and actual local rate costs that gave an advantage for imported goods at the expense of locally produced goods, meaning that it led to deterioration of the competitiveness of alternative replacement goods and export commodities.

·          This action shows that the official exchange rate overestimates the value of the dinar, compared to the foreign currency and from the promoting goods substituting imports and export commodities point of view of.

And in support to this view is the state’s utilization and in a broad approach to the customs and quantitative protection policies especially for consumer goods, as well as export subsidies that exports have through an amended export exchange rate.

3.      Estimate the amended exchange rate of the Iraqi dinar to be used in technical and economical feasibility studies and for (1.134) dollar per dinar. This price should be approved for 3 years until re-appreciation by the competent authorities.

[/size]

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MoP Iraq 2012
Powered by Synergy Portal from Iran to Remove Four Zeros from National Currency Logo_sis

Synergy International Systems

https://web.archive.org/web/20150213021830/http://www.mop.gov.iq/mop/index.jsp?sid=1&id=308&pid=295&lng=en

A last article that the project has been delayed by 5 years, is the time to improve the banking system in the financial inclusion of the country because of corruption, and the Islamic state this article is dated 2014 + 5 years = 2019 !!

[size=39]Iraqi Dinar revaluation postponed by Central Bank for 5 years says MP Noura al-Bajari[/size]
by

Amre SarhanOct 29, 2014, 11:54 pm

Iran to Remove Four Zeros from National Currency %D8%A7%D9%84%D9%86%D8%A7%D8%A6%D8%A8-%D8%B9%D9%86-%D8%A7%D9%84%D9%82%D8%A7%D8%A6%D9%85%D8%A9-%D8%A7%D9%84%D8%B9%D8%B1%D8%A7%D9%82%D9%8A%D8%A9-%D9%86%D9%88%D8%B1%D9%87-%D8%A7%D9%84%D8%A8%D8%AC%D8%A7%D8%B1%D9%8A

Iran to Remove Four Zeros from National Currency %D8%A7%D9%84%D9%86%D8%A7%D8%A6%D8%A8-%D8%B9%D9%86-%D8%A7%D9%84%D9%82%D8%A7%D8%A6%D9%85%D8%A9-%D8%A7%D9%84%D8%B9%D8%B1%D8%A7%D9%82%D9%8A%D8%A9-%D9%86%D9%88%D8%B1%D9%87-%D8%A7%D9%84%D8%A8%D8%AC%D8%A7%D8%B1%D9%8A

A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari.

Baghdad (IraqiNews.com) A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari, confirmed on Wednesday that the initiative to revalue and delete zeros from the Iraqi Dinar is ready for implementation by the Central Bank although it will be delayed by five years given the political and security situation of Iraq.
In an interview with IraqiNews.com al-Bajari said “The policy to delete zeros from the Iraqi currency is ready to be executed by the Central Bank, however, its implementation will be delayed by 5 years on the basis of the extreme security and political situation of the country.”
Al-Bajari said that the head of the Central Bank of Iraq had previously said that this policy from parliament was accepted and that the zeros will be deleted from the Iraqi currency in the next 5 years.
Related articles:

https://www.iraqinews.com/features/iraqi-dinars-project-postponed-5-years-says-central-bank/

Claud (Moose)

by **claud39** Thu Aug 01, 2019 10:12 am

Nusseiri: Calls on the government to activate its decisions to support private banks

01/08/2019

Economy of Iraq - Baghdad

The economic and banking adviser to the Association of Iraqi private banks, Samir Nusairi, on Thursday, to activate its decisions on government support for private banks, which issued earlier but did not implement what was intended by these decisions.

Al-Nusairi said in an interview with "Economy News" that the structure of the Iraqi banking sector consists of 7 government banks, which account for 86% of the total deposits of the government and the public and 78% of the total assets and private banks constitute 70 commercial and Islamic banks and invest 78% of the capital of the banking sector "He pointed out that the objectives set for the banking sector in the fourth axis (strengthening the economy) in the government curriculum focused on achieving lending for development, considering banks as a lever for development and building bridges of trust with the public and achieve financial coverage in the sense of expansion and spread Presented by Ntjat and banking services and the practice of real banking and digital transformation of the banking sector in accordance with the time limits specified in the government program.

Al-Nusairi stressed the importance of stimulating and revitalizing the economy with banking finance and banking facilities in the face of its implementation at present. Despite the great efforts exerted by the Central Bank since 2016 to implement the objectives of its strategy for the years (2016-2020) The most important of which are the structural, structural and technical developments in banks, increasing the proportion of financial coverage and investment in human capital, and moving towards stability in the monetary system and stability in the exchange rate. Y year and a half.

He pointed out that the banks also need government support for the purpose of achieving what is stated in the governmental curricula, taking into consideration the following: The nature of the activities of the banks depends on the nature of the activities of the economic sectors. As long as the economic activity is concentrated in trade (imports), the activity of banks remains concentrated on foreign transfer and related Therefore, unless the other sectors (industry, agriculture, tourism) and others move to predict the diversity of banking activity, the legal environment and the extension of the rule of law should be provided to eliminate the phenomenon of default in the repayment of loans. Form a large proportion of total credit granted and thus reluctance of banks to provide loans and banking facilities.

Without the control of imports, these sectors will not rise, which explains the lack of progress on serious loans through the initiative of the Central Bank.

He added that the non-activation of the decisions of the Council of Ministers and the Committee on Economic Affairs in the Council of Ministers, which had previously been issued to support the banking sector, especially private banks, have impeded the activities and activities of private banks and significantly affected the liquidity and revenues and deposits for that and for the purpose of implementation of the government program to ensure the transition The role of banks from banking to the developmental role and the revitalization of the banking business requires the government and in particular the Council of Ministers and the Committee on economic Affairs to activate the decisions that have already been issued by the Council of Ministers and the Committee on economic Affairs and is also documented in numbers and the following dates: -

a 1-
Not to accept the Ministry of Finance to open bank accounts for ministries and state departments in private banks and to reserve them in government banks under its book 207 dated 31/1/2019.

2 - Activate the decision to allow ministries and government departments to open documentary credits in private banks up to 50 million dollars without going through the Iraqi Bank for Trade.

3 - Activation of the Council of Ministers Resolution No. 110 of 2009 and the decision of the Committee on Economic Affairs 141 on 20/02/2012 regarding the transfer of government documentary bank credit up to 30 million dollars to private banks through the Iraqi Bank for Trade.

4- Activating the decision of the Committee of Economic Affairs No. 253 of 2015.

Regarding the acceptance of instruments ratified by private banks to pay insurance and customs fees and taxes.

Second: Activating the Cabinet Resolution No. 378 of 2018 concerning the collection of government fees in the government departments through electronic payment.

Third: Activating the financial services court formed in accordance with the Central Bank Law No. 56 of 2004, and the court may refer cases that require referral to the competent courts in accordance with the applicable penal law.

4 - to consider the debts of troubled banks customers in the private banks urgent claims and excellent debt like government debt.

Fifth, in addition to the efforts of the Central Bank requires the government also to work to provide conditions and take measures to help private banks to obtain the credit rating adopted internationally and thus strengthen international banking relations with correspondent banks.

VI - The Ministry of Finance to compensate for the damage to the monetary assets and fixed lost by the branches of private banks, which amounted to (37) branches in the provinces occupied by the terrorist advocate and documented with the Central Bank of Iraq.

VII. Activating the decisions of the Council of Ministers No. 313 of 2016 and 218 of 2017 regarding the settlement of salaries of employees and the demand from government departments to settle their salaries as they wish and not to direct them to settle salaries in government banks exclusively.

http://economy-news.net/content.php?id=17408

by **Sam I Am** Thu Aug 01, 2019 1:16 pm

Suasponte wrote:That’s $4,024,952,392.

That's included in the $60 billion. They still have 70 trillion dinar, so whether that $60b is comprised of cash, gold, or baseball cards it's still only enough to justify a value of < 1/10 of a penny. It doesn't matter that the article was from 2012. Currencies don't revalue by 100,000%, or 10,000%, or 1,000% or even 100%. The largest revaluation in history was China at about 35% and it took 8 years to carry that out. Dinarians have been duped into believing that Iraq is going to violate all the known laws of economics and finance in order to make speculators rich.

by **Sam I Am** Thu Aug 01, 2019 1:30 pm

claud - I wrote about that MOP report seven years ago because the gurus were pointing to it to justify a $3.20 valuation. The report says that the official exchange rate is $3.20 but the IQD's exchange rate has never been anything like that. The report is from the Saddam era back in the 1980s when the old Saddam dinar was officially valued at $3.20 despite the market value at $1.13. It eventually dropped as low as 3000:1 or $.00033 due to Saddam's reckless management of the country and its economy. This report has nothing to do with the IQD. Sorry. http://dinardouchebags.blogspot.com/2012/08/mop-report.html

by Suasponte Thu Aug 01, 2019 1:40 pm

That’s not included in the $60 Billion. That is monetary cash they have on hand. You are incorrect. The gold alone is worth well over 4 Trillion.

by Suasponte Thu Aug 01, 2019 1:55 pm

Sam, how much is 70 trillion dinar currently in US dollars? Let’s play a game. Once you determine that amount, what does Iraq have on hand in monetary reserves? Then look at what Iraq has on hand in Gold. (Over 4 Trillion). Your mathematical assessment is completely skewed.

by **Sam I Am** Thu Aug 01, 2019 6:55 pm

Suasponte wrote:That’s not included in the $60 Billion. That is monetary cash they have on hand. You are incorrect. The gold alone is worth well over 4 Trillion.

No offense, but you have no idea what you're talking about. The entire global gold supply is less than $8 trillion, and the US has the largest gold reserves followed by Germany and 33 other countries ahead of Iraq. Either you got your math wrong or you looked at the gold charts wrong. If Iraq had $4 trillion in gold the IMF would be coming to them for a loan rather than the other way around. LOL

And yes, foreign currency reserves include gold along with Special Drawing Rights.

https://en.wikipedia.org/wiki/List_of_countries_by_foreign-exchange_reserves

https://tradingeconomics.com/country-list/gold-reserves

by Suasponte Thu Aug 01, 2019 7:58 pm

Perhaps you can explain this. A metric tonne has 2204 pounds. A pound of gold is worth approximately $18,959. Thus 1 Tonne of gold is worth $41,785,636 in USD. Iraq has 96.3 Tonnes of gold. $41,785,636 x 10 Tonnes is $417,856,360. See where I’m going? Do the math Sam.

by **Sam I Am** Thu Aug 01, 2019 8:34 pm

I did the math. 96.3 tons x $46.5 million per ton = $4,477,950,000. 4 BILLION, not 4 TRILLION.

https://sdbullion.com/blog/how-much-is-a-ton-of-gold-worth/

Like I said, they've got roughly $60 billion in their FCR of which less than $5 billion is gold. Now, divide roughly $60 billion by 70 trillion in their M1 money supply and you come up with $.000857 which is remarkably close to the current value of the IQD. Those are the numbers and that's why there's no big RV coming. Ain't math a bitch?

by Suasponte Thu Aug 01, 2019 9:19 pm

Lol. Agreed Sam. We agree to disagree. Remember, stay fact based. Not opinion based.

by Suasponte Thu Aug 01, 2019 9:35 pm

58,800,000,000 USD is what 70,000,000,000,000 dinar is worth. So based on that relevant calculation, 60 billion divided by 58 billion is $1.0344. Ain’t math a bitch....lol. The 70 trillion you quoted above is dinar, not USD. They have in reserves, 60 billion USD.

by **Sam I Am** Thu Aug 01, 2019 9:55 pm

Why are you dividing 60 billion by 58 billion? The IQD is backed by the foreign currency reserves. There are approx 70 trillion IQD backed by the equivalent of $60 billion in FCR. You have to have the right numerator and denominator to get the right valuation. The 58.8 billion number is irrelevant. If there were 58.8 billion IQD in their money supply then that figure would be a relevant numerator in the equation, but that's not the case.

by **RamblerNash** Thu Aug 01, 2019 10:51 pm

Suasponte wrote:That’s not included in the $60 Billion. That is monetary cash they have on hand. You are incorrect. The gold alone is worth well over 4 Trillion.

Your mixing your IQD figures with USD figures. Tsk, tsk...

Here's a screenshot of the current figures and take note that gold is included.

Iran to Remove Four Zeros from National Currency Scree361

Here's the link from the CBI and note that it goes back to 2003.

https://cbi.iq/static/uploads/up/file-156405312317068.xls

Looks like the currency outside banks (85), and the Bank reserves (86) is rising still. More Dinar for everyone!!!

by **RamblerNash** Thu Aug 01, 2019 11:06 pm

Suasponte wrote:58,800,000,000 USD is what 70,000,000,000,000 dinar is worth. So based on that relevant calculation, 60 billion divided by 58 billion is $1.0344. Ain’t math a bitch....lol. The 70 trillion you quoted above is dinar, not USD. They have in reserves, 60 billion USD.

70 trillion
----------- = ~1,167 or expressed in another way: 1,167:1
60 billion

60 billion
---------- = ~0.000857 or expressed another way: 1:1,167
70 trillion

Math is a bitch!...Until you learn it. LOL

Do you need the "IQD's" and "USD's" put in their respective places for both equations?

by **RamblerNash** Fri Aug 02, 2019 12:29 am

claud39 wrote:A last article that the project has been delayed by 5 years, is the time to improve the banking system in the financial inclusion of the country because of corruption, and the Islamic state this article is dated 2014 + 5 years = 2019 !!

[size=39]Iraqi Dinar revaluation postponed by Central Bank for 5 years says MP Noura al-Bajari[/size]
by Amre SarhanOct 29, 2014, 11:54 pm

A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari.

Baghdad (IraqiNews.com) A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari, confirmed on Wednesday that the initiative to revalue and delete zeros from the Iraqi Dinar is ready for implementation by the Central Bank although it will be delayed by five years given the political and security situation of Iraq.
In an interview with IraqiNews.com al-Bajari said “The policy to delete zeros from the Iraqi currency is ready to be executed by the Central Bank, however, its implementation will be delayed by 5 years on the basis of the extreme security and political situation of the country.”
Al-Bajari said that the head of the Central Bank of Iraq had previously said that this policy from parliament was accepted and that the zeros will be deleted from the Iraqi currency in the next 5 years.
Related articles:

https://www.iraqinews.com/features/iraqi-dinars-project-postponed-5-years-says-central-bank/

Claud (Moose)

Iraqi dinar to have 3 zeros canceled by the Central Bank of Iraq according to Finance Commissioner

by Amir Abdallah Apr 13, 2013, 7:19 am

Iran to Remove Four Zeros from National Currency Iraq-Finance-Committee-MP-Abdul-Hussein-al-Yasiri

Iran to Remove Four Zeros from National Currency Iraq-Finance-Committee-MP-Abdul-Hussein-al-Yasiri

Iraq Finance Committee MP Abdul-Hussein al-Yasiri – File photo

The Iraqi dinar will have 3 zeros canceled by the Central Bank of Iraq according to Finance Commissioner, MP Abdul Hussein al-Yassiri.

MP al-Yassiri told Iraqi News that “it is supposed that this year will witness necessary preparations to cancel three zeros from the currency”.

He added that his commission supports such move for its importance to the Iraqi economy.

The Central Bank of Iraq, earlier, announced that cancelling the zeros is within a plan to develop monetary policies in the country.

One of the difficulties facing is Iraq is withdrawing 30 trillion Iraqi dinars from Iraq’s market at the present time and to replacing it with new currency.

Earlier, the ministry of finance ruled out the idea of cancelling the zeros in 2013 because the federal budget was based on the current currency.

https://www.iraqinews.com/business-iraqi-dinar/iraqi-dinar-3-zeros-canceled-by-central-bank-of-iraq-cbi/

by **RamblerNash** Fri Aug 02, 2019 12:34 am

claud39 wrote:A last article that the project has been delayed by 5 years, is the time to improve the banking system in the financial inclusion of the country because of corruption, and the Islamic state this article is dated 2014 + 5 years = 2019 !!

[size=39]Iraqi Dinar revaluation postponed by Central Bank for 5 years says MP Noura al-Bajari[/size]
by Amre SarhanOct 29, 2014, 11:54 pm

A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari.

Baghdad (IraqiNews.com) A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari, confirmed on Wednesday that the initiative to revalue and delete zeros from the Iraqi Dinar is ready for implementation by the Central Bank although it will be delayed by five years given the political and security situation of Iraq.
In an interview with IraqiNews.com al-Bajari said “The policy to delete zeros from the Iraqi currency is ready to be executed by the Central Bank, however, its implementation will be delayed by 5 years on the basis of the extreme security and political situation of the country.”
Al-Bajari said that the head of the Central Bank of Iraq had previously said that this policy from parliament was accepted and that the zeros will be deleted from the Iraqi currency in the next 5 years.
Related articles:

https://www.iraqinews.com/features/iraqi-dinars-project-postponed-5-years-says-central-bank/

Claud (Moose)

Iraqi Cabinet rules out replacing or omitting zeros from Iraqi dinar

by Ibrahim Khalil Feb 4, 2013, 12:18 pm

Iran to Remove Four Zeros from National Currency Iraqi-cabinet-rules-out-replacing-or-omitting-zeros-from-iraqi-currency

Iran to Remove Four Zeros from National Currency Iraqi-cabinet-rules-out-replacing-or-omitting-zeros-from-iraqi-currency

Iraqi Cabinet rules out replacing or omitting zeros from Iraqi dinar

Baghdad (IraqiNews.com) The Secretariat General of the Council of Ministers ruled out replacing the Iraqi dinar or crossing out the zeros from it in this phase.

A statement by the SG quoted its Secretary General, Ali al-Allaq, as saying “The project of replacing the Iraqi dinar and omitting the three zeros from it was discussed in past period at the Council of Ministers where the Council stressed that this topic is not within the priorities of the Council since there is no problem in this respect.”

“The Iraqi Government thinks that changing the dinar needs suitable and stable circumstances,” he added confirming “This proposal will be given priority if the stable conditions are there.”

“The price of the Iraqi Dinar is expected to rise against the US Dollar encouraged by the increase of the dinar reserve accumulated at the Central Bank of Iraq in addition to the revival of the economic growth of Iraq,” Allaq concluded.

https://www.iraqinews.com/business-iraqi-dinar/iraqi-cabinet-rules-out-replacing-or-omitting-zeros-from-iraqi-currency/

by **RamblerNash** Fri Aug 02, 2019 12:38 am

claud39 wrote:A last article that the project has been delayed by 5 years, is the time to improve the banking system in the financial inclusion of the country because of corruption, and the Islamic state this article is dated 2014 + 5 years = 2019 !!

[size=39]Iraqi Dinar revaluation postponed by Central Bank for 5 years says MP Noura al-Bajari[/size]
by Amre SarhanOct 29, 2014, 11:54 pm

A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari.

Baghdad (IraqiNews.com) A member of the Parliamentary Economic and Investment Commission, MP Noura al-Bajari, confirmed on Wednesday that the initiative to revalue and delete zeros from the Iraqi Dinar is ready for implementation by the Central Bank although it will be delayed by five years given the political and security situation of Iraq.
In an interview with IraqiNews.com al-Bajari said “The policy to delete zeros from the Iraqi currency is ready to be executed by the Central Bank, however, its implementation will be delayed by 5 years on the basis of the extreme security and political situation of the country.”
Al-Bajari said that the head of the Central Bank of Iraq had previously said that this policy from parliament was accepted and that the zeros will be deleted from the Iraqi currency in the next 5 years.
Related articles:

https://www.iraqinews.com/features/iraqi-dinars-project-postponed-5-years-says-central-bank/

Claud (Moose)

CBI: removal of zeros meant to boost currency policy

by Ibrahim Khalil Oct 27, 2008, 8:52 am

BAGHDAD / IraqiNews.com: The Central Bank of Iraq (CBI) described the removal of three inflation-generated zeros from Iraqi banknotes as a long-term strategy to improve its currency policy. “Dropping zeros from currency is a normal procedure by most central banks in countries that have gone through long periods of high inflation…,” according to a statement released by the national media center, quoting a CBI source as saying. Commenting on the monetary policy to raise the value of the Iraqi dinar against the dollar, the source said that this policy will not do any good to Iraq, which he said has a surplus in its balance of payments. A recent proposal to drop three inflation-generated zeros from Iraqi banknotes has sparked heated controversy in Iraqi economic circles, with some experts arguing that the process will not boost the economy or the country’s monetary mechanism. Several economic experts argued that dropping zeros from inflated currency is a purely administrative process that will have no influence over the Iraqi economy. SS (P) 7

https://www.iraqinews.com/business-iraqi-dinar/cbi-removal-of-zeros-meant-to-boost-currency-policy/

by **RamblerNash** Fri Aug 02, 2019 1:09 am

claud39 wrote:I would like to share with you an article dated the year 2012 on the exchange rate, and this comes from the Ministry of Planning directly, and read the last line which says this: 3. Estimate the modified exchange rate of the Iraqi dinar to use in technical and economic feasibility studies as well as for (1,134) dollar per dinar. This price should be approved for 3 years until the competent authorities re-evaluate it. this text tells me in this time there is 2012 for the parallel market, and not on the free market until the competent authorities decide to change the rate for the free market !! and I mention it I am not an economist, but someone who follows the news about Iraq! and to finish, and I maintain my point. they had a value before the sanctions, they will have a value when they are going to be back as on the wto for example, and I mention it that are supported by the United States for their return !! and look at this morning's article that I send to the forum with the economics specialist for the bank deprives the government to give the bank the chance to deprive them of providing support for the reconstruction, and the bank participation deprive on the Iraqi economy !! Have a lovely day everybody !!

Claud (Moose)

The Exchange Rate of Foreign Currency in Economic Feasibility Studies

Below are the central controls related to the exchange rate of the foreign currency to convert the project inputs and outputs from foreign currency to its equivalent in the local currency, and that is by calculating the net discounted present value standard and the internal return on investments in economic analysis that governs investment projects that costs excess one million dinars.

Estimate the shadow price of foreign currency:

1.      It is necessary to put central controls to amend the official exchange rate * to reflect the shadow price of the foreign currency, and that is considered one of the necessary  requirements to implement  the net discounted present value standard and the internal return rate on investment in the economic calculation stated in the instructions, paragraph nine.

The central controls for adjusting market prices distinguished a group of outputs and inputs traded internationally, where the projects production or usage of them is reflected on the abundance of foreign currency in the economy and thus project outputs or inputs used of such are considered purely foreign currency outputs or inputs.

* What is meant by exchange rate: the number of units of foreign currency, expressed in dollar per one dinar.
In particular the following outputs and inputs of foreign currency were distinguished:

·          Export-outputs.
·          Outputs marketed locally that substitute imports.
·          Imported inputs.
·          Inputs produced locally that usually go to exports.
·          Foreign labor.

According to the pricing rules the value of the output and input (traded) is calculated using export prices (FOB) and import prices (CIF), according to what is listed in the pricing rules.

In other words the pricing rules calculate what the project produces from foreign currency (quantity of exports multiplied by the export price (FOB) in foreign currency or the quantity of substitute imports multiplied by the import price (CIF) in foreign currency, as well as what the project uses from foreign currency and imported inputs multiplied by the import price (CIF) in foreign currency .... etc.).
In a later step, project outputs and inputs must be converted from the foreign currency to its equivalent in local currency (dinars) by using a specific exchange rate for the foreign currency.
[size]

2.      Justifications for exchange-rate adjustment: there are a number of important and powerful arguments which support the view that the official exchange rate reduces the real value of foreign currency for purposes of calculating the  economic national profitability for investment projects and hence for the purposes of investment planning. It is demonstrated in this context to call for assessing the dinar for less than (3.208) dollar (official exchange rate) when assessing project outputs and inputs of traded goods of exports, substitute imports and imports... etc.

The justifications to call for the use of an exchange rate that is lower than the official exchange rate are:

·          The use of an exchange rate that is lower than the official rate is the appropriate action at the investment planning level to translate the country’s economic strategy aiming at stimulating central investments in the sectors that encourage the development of non-oil exports, as well as sectors that encourage the expansion of domestic production base in order to reduce imports and compensate it with local commodities. This helps to reduce reliance on foreign exchange earnings from crude oil exports and increases the share of non-oil sectors in the local production.

·          The application of the amended exchange rate on project imported inputs will assist in directing investments away from aggregated sectors dependent on imported inputs and the preference of those sectors that rely on locally produced inputs.

·          The use of the amended exchange rate helps to correct the balance in favor of the traded goods sectors compared to non-traded goods.

·          The real exchange rate has declined rapidly since the early seventies, through rapid rise of the level of prices and local costs which led by the steadiness of the official exchange rate to change in prices and actual local rate costs that gave an advantage for imported goods at the expense of locally produced goods, meaning that it led to deterioration of the competitiveness of alternative replacement goods and export commodities.

·          This action shows that the official exchange rate overestimates the value of the dinar, compared to the foreign currency and from the promoting goods substituting imports and export commodities point of view of.

And in support to this view is the state’s utilization and in a broad approach to the customs and quantitative protection policies especially for consumer goods, as well as export subsidies that exports have through an amended export exchange rate.

3.      Estimate the amended exchange rate of the Iraqi dinar to be used in technical and economical feasibility studies and for (1.134) dollar per dinar. This price should be approved for 3 years until re-appreciation by the competent authorities.

[/size]

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https://web.archive.org/web/20150213021830/http://www.mop.gov.iq/mop/index.jsp?sid=1&id=308&pid=295&lng=en

The article is not from 2012. I can find it in the same archives captured in 2010.

https://web.archive.org/web/20101008060642/http://www.mop.gov.iq/mop/index.jsp?sid=1&id=308&pid=295&lng=en

~~~~~~~~~~

AnonymousSeptember 1, 2012 at 3:45 AM
Sam, if you click on your link provided in point 3 (just under "Estimate the amended exchange rate of the Iraqi dinar to be used in technical and economical feasibility studies and for (1.134) dollar per dinar"), then click one level up (click on the Planning Budget header), you'll see it clearly states:-

"In turn, The Guidance For Technical And Economic Feasibility Studies And Post-Project Assessment Of Development Project (Regulations No. 1 for the Year of 1984 and it’s amendment for the year of 1990) has specifies a series of steps to be undertaken, which lead to the completion of a Capital Budget."
http://www.mop.gov.iq/mop/index.jsp?sid=1&id=295&pid=259

It openly states itself that it's almost 30 years old, written during Reagan's first term in office, when John Lennon was still alive, when Prince, Frankie Goes To Hollywood and Status Quo were in the top 10, when "Ghostbusters", "Indiana Jones and the Temple of Doom" and the original "Police Academy" were filmed, etc...

You might as well pull Cold War era "planning budgets" as "proof of the USD's RV" (because the USD was worth more 30 years ago vs today). LOL.

http://dinardouchebags.blogspot.com/2012/08/mop-report.html

~~~~~~~~~~

@Sam I AM wrote:While I’m talking about B, let me issue a reminder about his claim that the Ministry of Planning’s feasibility study told us that they’re going to raise the value to $1 and eventually $3. That study said that they recommended REDUCING the exchange rate from $3.20 to $1.13. The IQD was never valued at more than a tenth of a penny. The feasibility study is from the Saddam era and is 100% irrelevant. The issue that they were addressing was that depreciation of the Saddam dinar during the 80s had rendered the $3.20 valuation obsolete.
It turns out that the study was from 1984 and was revised in 1990. As our friend Brian has pointed out more than once, basing your dinar speculation on this feasibility study makes about as much sense as shopping for a house based on real estate prices from the ’70s. I wrote about this two Decembers ago.
In turn, The Guidance For Technical And Economic Feasibility Studies And Post-Project Assessment Of Development Project (Regulations No. 1 for the Year of 1984 and it’s amendment for the year of 1990) has specifies a series of steps to be undertaken, which lead to the completion of a Capital Budget.

https://iraqcurrencywatch.com/december-update-12114/

~~~~~~~~~~

https://www.dinardaily.net/t56133-the-exchange-rate-of-foreign-currency-in-economic-feasibility-studies

by **claud39** Fri Aug 02, 2019 9:17 am

I would like to share this news that I just read, it is dated July 31, 2019, but I do not currently find the link of this news now, I will try to find it to be sure that this news is true, but look at the End of the text, it is said that Iraq have removed the 3 zero in 2015 !! Have a lovely day everybody !!

Claud (Moose)

https://www.albayan.ae/economy/the-world-today/2019-07-31-1.3617720

[size=38]What does it mean to delete 4 zeros from the Iranian currency?[/size]

Iran to Remove Four Zeros from National Currency Image

Iran to Remove Four Zeros from National Currency Image

Electronic Statement

History: 31 July 2019

The Iranian government, subject to harsh sanctions, approved Wednesday a plan to remove zeros from its currency and replace the current riyal with the Toman.

"The government today passed a bill to remove four zeros from the currency and the two nations will be our national currency," Iranian government spokesman Ali Rabie told a news conference in Tehran.

The value of the Iranian riyal has continued to deteriorate since last year.

Three years ago, the US dollar was worth 37,000 Iranian riyals, but the Iranian currency deteriorated sharply last year to become a dollar of 180,000 riyals.

With the Iranian government taking a decision to delete 4 zeroes from its depreciated currency and replacing the riyal in two transactions, the state has acknowledged the devaluation of the currency and the need to speed up steps that reflect the bitter reality of the economic situation in the light of sanctions.

The Iranian government will send the economically bitter draft to the parliament for approval, so that every 10,000 riyals will be one tumana, and the exchange between the banks will remain only. This carries many meanings, all of which deal with the bitter decline of the currency and its exchange rate domestically and internationally. Published by Arabic Net.

Governments are erasing zeros when their currency loses purchasing power. This is a substitute for the issuance of large currency categories. With the tightening of sanctions on Tehran, the currency has deepened. The central bank is only trying to delete zeros from the Iranian riyal in an attempt to cope with rising inflation Due to the steady deterioration of the country.

It was not the first time that Tehran delete the zeros. In 2017, the central bank had to delete one zero. This time, the recommendations talk about the deletion of 4 zeros, and with this deletion, one million riyals will equal only 100 riyals.

The Iranian currency has fallen against the dollar in the past two years due to the deterioration of the economic situation and the rise of inflation by 30%, making the US dollar jump by 221% against the Iranian riyal.

Economists confirm the futility of the deletion of zeros in the appreciation of the currency, because of the failure of the government fundamental reforms in the monetary and banking system in the country.

The exchange rate of the dollar 120 thousand Iranian riyals on Wednesday compared to the exchange rate of 2017 of 34 thousand riyals to the dollar, a decline of 250%, while the exchange rate of the US dollar before the Iranian revolution in 1979 about 70 riyals only, reflecting the bitter collapse suffered It has the Iranian currency value.

Iran's experience in eliminating zeros is not the first. It was preceded by Venezuela last year when five zeros were eliminated, and Iraq in 2015, when 3 zeros of the Iraqi dinar were deleted. Turkey eliminated 6 zeros in 2003, with one million Turkish lira.

https://www.albayan.ae/economy/the-world-today/2019-07-31-1.3617720

by **RamblerNash** Fri Aug 02, 2019 11:59 pm

claud39 wrote:I would like to share this news that I just read, it is dated July 31, 2019, but I do not currently find the link of this news now, I will try to find it to be sure that this news is true, but look at the End of the text, it is said that Iraq have removed the 3 zero in 2015 !! Have a lovely day everybody !!

Claud (Moose)

https://www.albayan.ae/economy/the-world-today/2019-07-31-1.3617720

I think you already know that Iraq did not delete 3 zeros in 2015. Wink

by **claud39** Sat Aug 03, 2019 7:15 am

RamblerNash wrote:
claud39 wrote:I would like to share this news that I just read, it is dated July 31, 2019, but I do not currently find the link of this news now, I will try to find it to be sure that this news is true, but look at the End of the text, it is said that Iraq have removed the 3 zero in 2015 !! Have a lovely day everybody !!

Claud (Moose)

https://www.albayan.ae/economy/the-world-today/2019-07-31-1.3617720

I think you already know that Iraq did not delete 3 zeros in 2015.

You know I do not want to give my opinion on the subject, I do not like to persevere no longer, that's why I do not like to give my opinion, but as you are better than me on the internet maybe you'll be able to find what I'm looking for, I'll give you an image of what I understand about removing the 3 zeros, you know like me they've made the Iraqi currency to remove the one that's in your hands, and I wonder if it is not in 2015 that they made the new currency to replace this one, presently they make the change of money in the country, the bank asks the people to put their money in an account of bank, it recovers the money that we have in hand to hand over the new money to then get rid of the old currency at the same time destroying it, that's what they are currently doing in the country, when they are going to be on the international it will be up to us to do the same things in changing our money, and you have to go into a bank that has a street machine to make your change, and you will have 10 years to make your change, after that it will no longer be possible to change your currency, I try to find an image or an article on 2 currencies, the one we have in our hands, and the new currency in 2019 in Iraqi dinar !! It is to know that in the year they had the new Iraqi money in their hands, I wish you and member of the forum a good day to all!

Claud (Moose)

by **Jayzze** Sat Aug 03, 2019 1:52 pm

do you think Iraq will do the same?

by **RamblerNash** Sun Aug 04, 2019 1:27 am

claud39 wrote:
RamblerNash wrote:
claud39 wrote:I would like to share this news that I just read, it is dated July 31, 2019, but I do not currently find the link of this news now, I will try to find it to be sure that this news is true, but look at the End of the text, it is said that Iraq have removed the 3 zero in 2015 !! Have a lovely day everybody !!

Claud (Moose)

https://www.albayan.ae/economy/the-world-today/2019-07-31-1.3617720

I think you already know that Iraq did not delete 3 zeros in 2015.

You know I do not want to give my opinion on the subject, I do not like to persevere no longer, that's why I do not like to give my opinion, but as you are better than me on the internet maybe you'll be able to find what I'm looking for,

You seem to be very capable of finding things on the internet. The hard part is finding something that does not exist...

I'll give you an image of what I understand about removing the 3 zeros, you know like me they've made the Iraqi currency to remove the one that's in your hands, and I wonder if it is not in 2015 that they made the new currency to replace this one,

It would be all over the news and posted on the CBI if they did.

presently they make the change of money in the country, the bank asks the people to put their money in an account of bank, it recovers the money that we have in hand to hand over the new money to then get rid of the old currency at the same time destroying it, that's what they are currently doing in the country,

Presently and currently, no. The only thing that's been in the news is that they are replacing old worn out currency and replacing them with newer notes of the same value. Do you remember the controversy of having the governors name being on those newer notes?

when they are going to be on the international it will be up to us to do the same things in changing our money, and you have to go into a bank that has a street machine to make your change, and you will have 10 years to make your change, after that it will no longer be possible to change your currency,

The latest on the "delete the zeros" project is to have both the old and new currencies run together for 10 years. The Dinar does not have to be "international" in order to exchange them. When the new currency is available, you will be able to go to any exchanger, that wishes to deal in the Dinar, and exchange currencies, just as you can do today. I believe your use of the word "international" is to mean something completely different. i.e. WTO, IMF, WB, UN, etc...

I try to find an image or an article on 2 currencies, the one we have in our hands, and the new currency in 2019 in Iraqi dinar !! It is to know that in the year they had the new Iraqi money in their hands,

As of today, no pictures, or descriptions of the new currency exists from official sources. Remember that if parliament hasn't passed the project, it wont happen. When they do, there will be official announcements and a length of time for the citizens to be aware that there will be a change coming.

I wish you and member of the forum a good day to all!

Claud (Moose)

by **RamblerNash** Sun Aug 04, 2019 1:46 am

RamblerNash wrote:
Sam I Am wrote:Zimbabwe, Turkey Brazil, Netherlands .... they all lopped zeros off of their currencies and it was always a neutral exchange. Nobody ever got rich by holding the currency that was replaced, and if Iraq ever gets around to doing it the results will be no different. So this article pretty much confirms what we've been saying all along. Deleting the zeros means redenomination or "lop".
cut, remove, slash, drop, eliminate, take off, slice, and finally lop are all terms to describe a redenomination, as been said for years.

Here's a bunch of articles above that use those terms.

The IMF 2019 Article IV Consultation doesn't have the words "float" or "balassa samuelson".

What is Kap going to say now? LOL

Published on Aug 15, 2018
Rambler Nash and Sam I Am discuss the upcoming redenomination of the bolivar along with the past RD of the Turkish lira and the proposed RD of the Iraqi dinar.

https://youtu.be/nQAHeqk7PV0

by **RamblerNash** Sun Aug 04, 2019 1:51 am

https://www.youtube.com/watch?v=6jy0T9HVYFA

by **RamblerNash** Sun Aug 04, 2019 2:07 am

Jayzze wrote:do you think Iraq will do the same?

Seminar (delete zeros from the Iraqi dinar)

Iran to Remove Four Zeros from National Currency 3558IMG-20190327-WA0018

2019-03-27

Under the patronage of the Dean of the Faculty of Knowledge University Dr. Yaqub Nazim Ahmed, the Department of Finance and Banking Sciences held today, 2019/3/27, and on the conference hall a scientific symposium entitled (delete zeros from the Iraqi dinar) was divided into three axes

The first axis: the concept of deleting zeros from the Iraqi dinar, provided by Assistant Professor Dr. Ali Abdul Hadi Salem.

The second axis: the expected results of the deletion of three zeroes from the Iraqi dinar, M. Mahmoud Abdelkader Sweid.

The third axis: the experiences of some countries in the process of deleting zeros, M. Mohammed Juma Rahim.

The seminar was attended by the Dean's Assistant for Administrative Affairs, the heads of the scientific departments, faculty members and staff as well as guests from various departments of the State.

http://auc-edu.org/index.php?content=conf&conf=20

https://www.dinardaily.net/t83661-seminar-delete-zeros-from-the-iraqi-dinar

by **claud39** Mon Aug 05, 2019 5:03 pm

Delete 4 zeros from the Iranian currency between truth and illusions

2 August 2019 2:22 p

Iran to Remove Four Zeros from National Currency 81086-1723157868

The Iranian government announced on Wednesday its decision to delete 4 zeros from the Iranian currency and adopt the Toman instead of the riyal as the official currency of the country.

The government's decision to approve the proposal of the Central Bank, which is still awaiting the approval of Parliament and then the Guardian Council, and then President Hassan Rowhani.

What does it mean to delete zeros?

At the beginning, the Iranian Toman is equivalent to 10 riyals, and after the collapse of the currency, the price of one dollar on the black market reached 120 thousand riyals (12 thousand Toman).

The deletion of 4 zeros means that the 10 thousand riyals for example will equal 1 Toman.

Reasons for decision

This is not the first time that Iran has taken the deletion of zeros from the currency. Last year a similar action was taken in 2017.

Tensions over the nuclear issue between Iran and the United States have caused the collapse of the Iranian currency, which lost more than 320 percent of its value in just three years, following the withdrawal of US President Donald Trump from the nuclear deal and the imposition of devastating economic sanctions on Tehran, where the dollar reached 193 thousand riyals. Its highest price against the Iranian currency last year.

Economic pressures have also brought the rate of inflation to a historical average of 48%, according to official statistics, where the price of 1 kilo meat to about one million Iranian riyals, and Iran stopped dealing with coins, and the citizen has to carry large amounts of banknotes to buy Simple products.

The objective of the decision and its impact on the economy

The Iranian government aims to reduce spending on paper printing, re-use of coins, maintain currency efficiency and facilitate local monetary transactions.

"The government has passed a bill to delete four zeros from the currency and the two currencies will be our national currency, which will make the national currency more effective and will be more in line with a common practice. Real is not used very much, and the coins will be traded again," said Ali Rabie, spokesman for the Iranian government. "He said.

The central bank governor, Nasser Hamati, has announced that there will be a new currency market. "The new system will be a regulatory role and not specific to the foreign exchange rate, and will be known as (the multi-market), and will be aimed at crystallizing realistic prices of foreign currencies, The new foreign currency market, which is expected to start operating by August 12, will bring transparency to the offer of foreign exchange securities. "

The Iranian government also aims to create false psychological effects on its currency, which it believes to be more powerful. Although the deletion of zeros does not really add to the strength of the currency unless it is accompanied by economic measures and reforms that support the local currency, such as attracting foreign investment and providing sources of foreign exchange
With Iran's economic isolation due to sanctions, the removal of zeros will not make a difference in the country's economic situation.

But it is also possible to say that there is a slight change expected to occur in one case, that Iran withdraw the local currency from the market and print new money and then pump it to the local markets, in order to reduce the amount of banknotes in the market, which is reflected in some way on the value of the currency, But this is a huge shift and costs a lot.

http://algiwarpress.com/news/news.aspx?id=7985

by **claud39** Wed Aug 07, 2019 12:46 pm

[size=32][ltr]New Riyal for Exports to Iraq / 1% of Iran's Trade with Iraq Rial?[/ltr][/size]

August 1 - 8: 1

[ltr]A private activist pointed out that despite the ban on Riyal exports this form of export is now being exported to Iraq, said Iraqi businessmen after buying Iranian goods at the factory exit door, through "border markets" and ... " They leave the country.[/ltr]

Iran to Remove Four Zeros from National Currency 1398030214223991117489684

[ltr]According to a government decree issued on May 2, last year, exporters to Iraq and Afghanistan were exempted from returning their export currency to the country, but the exemption lasted only five months, and the riyal exporters also ended on September 20, 97. The central bank was required to return the currency from their exports.[/ltr]

[ltr]Since some of the exports to these two neighboring countries have always been carried out in rials and in practice the foreign currency is not the basis for the exchange of trade between the two parties, the exporters have criticized the policy as saying their currency commitment is not possible.[/ltr]

[ltr]Of course, the protest against the Riyal exporters was not accepted by the central bank, but was followed by the reaction of Abdul Nasser Hemmati, the head of the central bank, in which he considered this form of export to be an exit from the country and threatened the riyal exporters with legal action.[/ltr]

[ltr]Mozaffar Alikhani, Iran's deputy of technical and commerce, said in a television program last week that exporters to Iraq and Afghanistan had exported their goods to the two countries in exchange for rials at the factory. Iraqi and Afghan traders sell and eventually the merchants from the two countries export goods.[/ltr]

[ltr]* New riyal for export to Iraq[/ltr]

[ltr]Mehdi Nejatnia, a former Iranian trade adviser in Iraq, told Tasmanim: "Iraqi merchants are now paying royalties to Iranian exporters through payment systems such as Sheba.[/ltr]

[ltr]He added that in the current situation, the export of riyal is being carried out with new techniques, adding that Iraqi traders buy goods in addition to withdrawing from customs formalities, informally through "border markets", "border cooperatives". "And" cocaine "cause the goods to leave the country.[/ltr]

[ltr]* How to avoid buying Iranian goods in rials?[/ltr]

[ltr]The private sector activist offered a rial to prevent Iranian goods from leaving the country. Under sanctions, our exporters to Iraq could provide a warehouse for their goods in Iraq, and then sell them in dollars to Iraq. Sell and the resulting currency to be returned to the economic cycle of the country in accordance with the mechanism of currency exchange agreement.[/ltr]

[ltr]He added: "This has prevented Iraqi businessmen from entering the country to buy goods through factories and thereby diminishes the intermediation between Iranian exporters and Iraqi consumers and further benefits our exporters, such as the rebar on the Iranian border." It sells for $ 80, with brokers cut to $ 85 in Iraq.[/ltr]

[ltr]Nejatani said that since all foreign exchange transactions in Iraq are in dollars, this is the reason why customers of Iranian goods in Iraq will definitely pay for their purchases.[/ltr]

[ltr]This private sector activist rationalized the purchase of goods by Iraqi traders as a devaluation of the national currency and said: "The presence of Iraqi businessmen in our country firstly makes it impossible for Iranian exporters to profit from the sale of goods in the country. Negative competition among Iranian manufacturers has exploited these conditions and is seeking to maximize their commercial profits.[/ltr]

[ltr]* 40% of Iran's trade with Iraq is in Rials[/ltr]

[ltr]In another part of his speech criticizing the existence of a tariff for trade between the two countries, the former Iranian trade adviser in Iraq said: "Given that Iraq is Iran's main trading partner in the region, it is reasonable that Zero these two countries, while Saudi Arabia is currently offering its products at the Iraqi market without customs duties and with brand names from countries such as Jordan.[/ltr]

[ltr]"Iran currently holds only 17% of Iraq's market share, while it reaches 20% for other countries, and now 40% of Iran's exports to Iraq," he added. Rials and 60 percent are also made in dollars and we do not export in the form of dinars.[/ltr]

[ltr]https://www.tasnimnews.com/fa/news/1398/05/03/2061002/شگرد-جدید-صادرات-ریالی-به-عراق-40درصد-تجارت-ایران-با-عراق-به-صورت-ریالی-انجام-می-شود
[/ltr]

by **claud39** Thu Aug 08, 2019 1:16 pm

[size=35]Iran plans to cancel 700 million rial banknotes[/size]

[size=35] Iran to Remove Four Zeros from National Currency Doc-P-314454-637008549246079218

Iran to Remove Four Zeros from National Currency Doc-P-314454-637008549246079218

[/size]

[color:dbee=rgba(0, 0, 0, 0)]Iran's central bank chief announced on Thursday a plan to cancel 700 million rial [color:dbee=rgba(0, 0, 0, 0)]banknotes and inject a new edition as part of the conversion to the Toman.

"A plan to cancel 700 million banknotes from the rial currency and inject a new edition as part of the conversion to the toman," Hemti was quoted by Fars news agency as saying.

"With the enactment of the abolition of the four zeros from the national currency, the coins will be completely out of people's hands," he said.

It is noteworthy that the Iranian Cabinet prepared a draft law to cancel 4 zeros from the national currency of the riyal and converted to the name of the toman.

https://www.alsumaria.tv/news/%D8%AF%D9%88%D9%84%D9%8A%D8%A7%D8%AA/314454/%D8%A7%D9%8A%D8%B1%D8%A7%D9%86-%D8%AA%D9%86%D9%88%D9%8A-%D8%A7%D9%84%D8%BA%D8%A7%D8%A1-700-%D9%85%D9%84%D9%8A%D9%88%D9%86-%D9%88%D8%B1%D9%82%D8%A9-%D9%86%D9%82%D8%AF%D9%8A%D8%A9-%D9%85%D9%86-%D8%B9%D9%85%D9%84%D8%A9-%D8%A7%D9%84%D8%B1%D9%8A

by **claud39** Thu Aug 08, 2019 1:21 pm

[size=30]Banknote News

Breaking news about international paper & polymer money

[/size]

Iran to revalue and rename currency
02 08, 2019 13:07 Category: Middle East

According to a DW article dated 31 July 2019, the Iranian government has approved a plan to remove four zeroes from the rial and rename the currency the toman, a former superunit of official currency that was in circulation until 1925. Iranians have for decades continued to use the term toman for its simple conversion rate: 1 toman = 10 rial.

Courtesy of Chris Kropinski and Tu Minh Duy.
Tags: Iran

https://www.banknotenews.com/files/e4db5f6debe0226a16fcd4b51c1a4006-5251.php

by TEMPTERBO Thu Aug 08, 2019 1:34 pm

Hey Claud, you might want to Keep an eye out for Boris and Natasha, because they always enjoy phuking up Moose and Squirrel!!!! Also, there is a party at JellystonePark this weekend- There are plenty of pic anic baskets to choose from!!JUST DONT GET CAUGHT BY THE PARK RANGER!! omg

Iran to Remove Four Zeros from National Currency 3508649203