The Central Bank’s stimulating initiatives for the economy in 2021 and 2022 are a continuation of the reform approach

 
01/16/2022

Samir Al-Nusairi*

The Governor of the Central Bank emphasized on a field tour of the strategic and development projects financed by private banks in accordance with the Central Bank’s development and economic stimulus initiatives in 2021.

These initiatives will continue in the current year in order to achieve the central bank’s methodology for economic reform. The bank had previously announced in a specialized symposium held by the Association of Iraqi Private Banks in the presence of the Secretariat of the Council of Ministers, the National Investment Commission, the Insurance Bureau, the Board of Directors of the Central Bank, university professors and representatives of various media about the detailed results achieved from the initiatives Central Bank lending in 2021 and focus on the stimulus and development dimension of the initiatives that achieved the operation of more than 9000 projects and the employment of up to 40,000 unemployed citizens and the implementation of 90% of the one trillion dinars initiative only
allocated to private banks, and a trillion new dinars were allocated for the current year and another trillion dinars for renewable energy projects. The total amount of initiatives from 2015 to 2021 is (15) trillion dinars.

Among the most prominent results of the initiative was the achievement of 30% of the cash credit granted to the private sector, 8% of the gross domestic product, and 18.4 of the total actual investment spending for the years (2016-2021), and the percentage of financial inclusion increased to 25%, and it contributed to the financing of important strategic projects and achieved success experiences. It is evident in pioneering small and medium projects with great economic and societal returns.

What matters to us is the success of the Central Bank’s initiatives in 2021, as the strategic measures adopted by the Central Bank within its plan to revitalize the economy to restore confidence in the banking sector, as private banks have proven that they are committed to implementing and succeeding lending initiatives in accordance with the controls, regulations and banking instructions issued by the Central Bank in the governorate. on financial stability. The development of small and medium enterprises and focus on housing projects.

And that the observer and observer of banking affairs in 2021 clearly notes the primary role played by the Central Bank with its executive, supervisory and control measures on the banking market in Iraq, according to what was targeted in its second strategy, which it began implementing since the beginning of 2021.

Assets, deposits, capital and cash credit granted have increased at advanced rates compared to the previous two years, and the competent departments of the Central Bank and the Association of Banks and Banks have worked to proceed according to the programs set to reach the goal, of which the large percentage was achieved, and we hope to achieve the goals set in the stability strategy by 100% in 2022.

What confirms the correctness of the Central Bank’s actions is the increase in foreign cash reserves to more than 64 billion dollars, which is an indicator that confirms its success in maintaining its foreign reserves despite the economic and financial challenges that Iraq has suffered. In revitalizing the economic cycle, overcoming the state of economic depression and achieving stability, thus restoring confidence in the Iraqi economy and international banking transactions and its commitment to international banking and accounting standards, especially with regard to combating money laundering and terrorist financing. As a stabilization bank for the national economy in 2022, aiming to achieve the following -:

1 - Developing the Iraqi banking system and allowing it to be a lever for the economy and encouraging it to lend to stimulate the economy

2- Converting banks to their main function and real work, which is lending for development.
And that banks that do not provide loans and banking facilities that help in development lose their meaning as banks, which requires a specific stance towards them from the Central Bank.
3- Dealing with defaults in some banks and finding ways to rehabilitate them in accordance with the recent board of directors’ decision and giving them the opportunity and the time period to do so.

4- Seeking to move from the paper currency economy to the digital economy and launching the electronic payment strategy, which is currently under discussion.
 Withdrawing the money outside the banking cycle and entering it into the banking system. Enhancing financial inclusion, launching a financial inclusion strategy, and spreading banking services over the widest geographical area in all governorates.

* Advisor to the Association of Iraqi Private Banks

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