dinareffic

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About dinareffic

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  1. Ive been in this 12 years and I can never recall. Govt issued holidays many times, but never CBI itself
  2. This is huge and Iraq will want and need currency parity with neighboring Arab nations
  3. Come on you guys. You can't make this stuff up. Shabibi said he needs 3 days to implement monetary policy and now CBI is declaring a 3 day holiday.
  4. This seems different than other holidays because the CBI itself is requesting it.
  5. Yota's article above is what we want to see. This is good stuff
  6. This can only be good for us. Iraq 🇮🇶 is getting much positive attention and focus. Follow the money
  7. Awesome as always. Thanks Adam
  8. Why is this post not getting more action? Excellent news. MasterCard and visa. $$$$$$$$
  9. Rating Action: Moody's assigns Caa1 issuer rating to the Government of Iraq; outlook stable Global Credit Research - 03 Aug 2017 London, 03 August 2017 -- Moody's Investors Service, ("Moody's") has today assigned a Caa1 long-term issuer rating to the Government of Iraq; the outlook is stable. Moody's has also assigned a (P)Caa1 senior unsecured rating to the country's bond issuance. The rating was initiated by Moody's Investors Service and was not requested by the rated entity. Concurrently, Moody's has assigned B3 long-term local currency and foreign currency bond ceilings. It has also assigned Caa2 long-term local currency and foreign currency deposit ceilings. RATINGS RATIONALE The Caa1 rating is driven by four key factors: 1. Iraq has a relatively large economy that is endowed with very substantial oil wealth, but which suffers from highly volatile growth due to its lack of economic diversification. 2. The country's institutional strength is very low, as reflected in its weak governance indicators and transparency. 3. It has moderate fiscal fundamentals, with a debt burden that is expected to stabilise at around 60% of GDP, but with an overwhelming dependence on oil revenues. 4. Iraq's susceptibility to event risk is very high, against the backdrop of some of the highest political risks in Moody's rated universe. The stable outlook balances the positive security developments and the support from the international community against the still-fragile political situation and fiscal consolidation challenges that the government faces. MODERATE ECONOMIC STRENGTH Iraq is oil rich and has significant potential for economic development and growth. According to the BP Statistical Review of World Energy, Iraq's proven oil reserves were 153 billion barrels, the fifth-largest in the world, equivalent to 9.0% of global proven reserves at the end of 2016. According to the latest data, oil accounts for about 50% of nominal GDP, nearly 100% of exports, and around 90% of government revenues. However, because oil extraction is a capital-intensive industry, it is not particularly important for employment, with only 1% of total employment in the sector. Real GDP growth is highly volatile and is likely to be weaker going forward than it has been in the past. It has remained quite strong in spite of the war with Da'esh and the government's fiscal consolidation efforts that caused non-oil GDP to contract by 1% year-on-year in the first half. Robust oil production was able to pick up the slack. and the IMF has reported real GDP growth of 11.0% for 2016. However, developments in the oil industry as well as base effects have caused a sharp slowdown in growth in 2017, and we are currently forecasting a 0.4% contraction in growth in the economy. And looking ahead, growth between now and 2022 is likely to slow. After a growth rebound of 2.9% for 2018, the IMF is forecasting that real GDP growth will be between 1.7% and 2.1% through 2022. VERY LOW INSTITUTIONAL STRENGTH Iraq has some of the weakest Worldwide Governance Indicator scores in Moody's rated universe. Corruption is endemic and contributes to deep-seated dissatisfaction with the government and, ultimately, undermines the country's political stability and hence policy effectiveness. Policy effectiveness is accordingly mixed. According to the 2004 Central Bank of Iraq (CBI) law, the central bank is independent from the government. The CBI's primary objectives are domestic price stability and a stable and competitive market-based financial system. The CBI has ostensibly been successful in reducing inflation rates to low levels in recent years. However, performance under the Stand-by Arrangement (SBA) with the IMF has been mixed, raising broader questions about governance and policy effectiveness. Further fiscal adjustment will be required to keep the programme on track. Public financial management is a particular area of weakness for Iraq and is, therefore, a key component of the SBA targets. Iraqi data also have significant shortcomings relative to what we see in other rated sovereigns. While detailed monthly oil sector data are available, the analysis of the non-oil sector is hampered by the lack of high-frequency activity indicators and quarterly expenditure-side national accounts data. Quarterly balance of payments data is only available with very significant lags. MODERATE FISCAL STRENGTH The decline in oil prices in recent years caused a very material deterioration in Iraq's fiscal position. The government faces funding constraints even with the SBA. The deficit for 2016 as a whole was much larger than targeted—14.1% of GDP versus a 10.9% of GDP target. The IMF anticipates a very large 9 percentage point deficit reduction in 2017 that is almost entirely dependent on oil revenue increases. Set against that, the government has very significant reserves that total around US$40 billion, which provide it with a fiscal buffer for when other sources of funding are constrained. Headline fiscal numbers may not fully capture the country's true vulnerabilities. The large state-owned sector implies the potential for sizeable contingent liabilities to crystallise on the government's balance sheet, though a detailed quantification is challenging due to data availability constraints. VERY HIGH SUSCEPTIBILITY TO EVENT RISK Political and security risks are very high, driven by underlying ethnic and sectarian tensions, and by Iraq's location within an unstable region. Even if dissolution or disintegration of the country is unlikely, the combination of domestic and geopolitical risks affects the government's capacity to service its debt, which weights very heavily on Iraq's rating. Notwithstanding the Iraqi army's recent successes in the campaign against Da'esh, Iraq still faces very significant domestic and geopolitical challenges that stand in the way of a lasting and significant improvement in the security situation. Moreover, we expect regional tensions within Iraq, particularly with regard to the Kurdish region, to be an ongoing source of domestic political risk. While political event risks dominate Moody's assessment, the banking sector, which is dominated by weak state-owned banks, poses a further source of contingent liabilities. RATIONALE FOR THE STABLE OUTLOOK The stable outlook reflects that balance between recent positive developments and the fragility of the country's overall political, economic, and fiscal position. On the positive side, security developments have reduced political risks somewhat, though they still remain very significant. Moreover, the support from the international community gives Iraq an opportunity to bolster the country's macroeconomic, institutional, fiscal, and balance of payments position. Nevertheless, the political situation remains fragile and will do so for some time. Moreover, the government faces significant fiscal consolidation challenges that are a notable focus of the SBA. WHAT COULD MOVE THE RATING UP/DOWN The rating could move up should political and geopolitical tensions reduce significantly in a way that is likely to be sustainable over the medium term. Positive rating pressure would also build with successful implementation of the SBA, particularly with regard to fiscal targets. Over the longer term, greater economic and fiscal diversification that reduces the government's and the economy's dependence on oil would also be credit positive. Conversely, a further intensification of domestic political tensions or increase in violence would put downward pressure on the rating. The rating would also come under negative pressure should budget deficits and government debt fail to decrease in line with our current expectations. GDP per capita (PPP basis, US$): 17,721 (2016 Actual) (also known as Per Capita Income) Real GDP growth (% change): 10.1% (2016 Estimate) (also known as GDP Growth) Inflation Rate (CPI, % change Dec/Dec): -1.0% (2016 Actual) Gen. Gov. Financial Balance/GDP: -8.3% (2016 Actual) (also known as Fiscal Balance) Current Account Balance/GDP: -7.2% (2016 Actual) (also known as External Balance) External debt/GDP: 58.5% (2016 Actual) Level of economic development: Moderate level of economic resilience Default history: At least one default event (on bonds and/or loans) has been recorded since 1983. On 02 August 2017, a rating committee was called to discuss the rating of the Iraq, Government of. The main points raised during the discussion were: The issuer's economic fundamentals, including its economic strength, have materially decreased. The issuer's institutional strength/ framework, have not materially changed. The issuer has become increasingly susceptible to event risks. The principal methodology used in these ratings was Sovereign Bond Ratings published in December 2016. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology. The weighting of all rating factors is described in the methodology used in this credit rating action, if applicable. REGULATORY DISCLOSURES For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com. For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity. Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review. Items color coded in purple in this Press Release relate to unsolicited ratings for a rated entity which is non-participating. Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating. Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating. Sarah Carlson Senior Vice President Sovereign Risk Group Moody's Investors Service Ltd. One Canada Square Canary Wharf London E14 5FA United Kingdom JOURNALISTS: 44 20 7772 5456 Client Service: 44 20 7772 5454 Yves Lemay MD - Sovereign Risk Sovereign Risk Group JOURNALISTS: 44 20 7772 5456 Client Service: 44 20 7772 5454 Releasing Office: Moody's Investors Service Ltd. One Canada Square Canary Wharf London E14 5FA United Kingdom JOURNALISTS: 44 20 7772 5456 Client Service: 44 20 7772 5454 © 2017 Moody’s Corporation, Mo https://www.moodys.com/research/Moodys-assigns-Caa1-issuer-rating-to-the-Government-of-Iraq--PR_370893?WT.mc_id=AM~WWFob29fRmluYW5jZV9TQ
  10. Capital market, attracting investment factors and activating trading in securities The indicators of securities trading from the point of view of financial markets, success or decline in the foundations of capital formation within the mechanisms of market economy. If the financial markets within the mechanisms of transfer of ownership only, this helps to build and continue growth of the capital market, if markets are active in strengthening the mechanisms of building Capital contributes significantly to economic growth through attracting and directing working capital towards competitive projects that operate at lower cost and economic benefit. Within the global classification, the markets move from the frontier market to Emerging market after achieving the main factors including market liquidity, free market capitalization, turnover rate Share. Through the indicators achieved, the Iraqi market for securities is still a developing market and did not reach the level of the emerging market as the economic environment needs to strengthen the legal factors aimed at deregulating investments and enhancing the attractions of national savings and stimulate foreign investment. They are achievable factors During : 1. Issuing the procedures for implementing Article 55 / IV of the Companies Law, which allows the offering of shares of companies for sale to cover the capital increase through the Iraqi Stock Exchange, through the adoption of the IPO mechanism. The IPO allows for effective capital building through daily marketing according to the economic feasibility study through the stock market, brokerage and trading companies E-mail. 2. Developing the legal climate in the capital market, including attracting foreign investment from During : Issuing the instructions of international depository certificates and allowing the circulation of Iraqi securities on the London Stock Exchange and the NASDAQ market American Issuing short or margin trading instructions that allow the expansion of the market through the borrowing of securities between *Shareholders. 3 - Issuing the Capital Market Law in Iraq or the Investment in Securities Law in accordance with international standards to achieve the factors of transition to a market economy in order to allow the use of the rules of public offering, privatization of companies, listing the shares of foreign companies, especially those that obtain contracts in Iraqi projects, Buy companies listed as a percentage of their capital when their market prices fall due to non-economic factors and other international rules that stimulate and attract investment. 4 - Allow the transfer of financial investment companies to investment funds according to structural indicators that increase the ability of investment capital of the company and the investors' portfolios and enable them to play the role of market maker and the replacement of the budget in the trading entry purchase at the low prices and selling at Its height. Taha Ahmed Abdel Salam Executive manager / Iraq Stock Exchange http://www.alsabaah.iq/ArticleShow.aspx?ID=141861
  11. This demand is ultimately going to have a positive effect on dinar
  12. IRAQ EYES FIRST INDEPENDENT BOND SALE IN A DECADE Oil rich but war-ravaged nation looks to tap investor demand for yield Iraq, July 29, 2017 Iraq is bidding to make its first independent return to the capital markets in more than a decade, canvassing investors’ interest in a five-year bond after successfully launching a US-backed $1bn fundraising earlier this year. The oil-rich but war-ravaged Middle Eastern country has appointed three banks as bookrunners and will be meeting with prospective investors in the coming days. In late 2015 Iraq called off plans to return to the bond markets for the first time since the official end of US occupation, citing the excessively high cost investors were demanding in order to buy into the issuance. Its attempt to revive the plan last year was also abandoned, before it succeeded in raising $1bn of five-year bonds in January this year. That sale was guaranteed by the US and paid a coupon of 2.149 per cent. The new bond is being offered to investors without a US guarantee, leaving them dependent on Iraq’s own credit quality. The Republic of Iraq has a high-risk credit rating of B minus from both S&P and Fitch Ratings. Fitch in March revised its outlook upwards from negative to stable, citing an improved fiscal position. The budget deficit narrowed to 8.1 per cent of gross domestic product in 2016, from 12.3 per cent the previous year, and the rating agency forecasts it will fall further to 5.1 per cent this year. Baghdad agreed a $5.4bn IMF bailout programme last summer which, Fitch said, “has helped Iraq’s financing options”. The country has also received funding from the World Bank and bilateral project loans. Iraq has $2.7bn of bonds outstanding that were sold in 2006, but has issued no new long-term debt in the past decade. Its bid to return to the capital markets is the latest sign of a buoyant environment for sovereign debt issuers, coming two days after Greece raised €3bn in its first deal since 2014, and a month after Argentina issued debt with a 100-year maturity. Iraq will hold a series of investor meetings in the coming days with a view to drum up appetite for the dollar-denominated, long-dated, benchmark-scale bond, and has mandated Citi, Deutsche Bank and JPMorgan as joint bookrunners on the deal. Investors who buy into the bond will be taking on an uncertain political and economic situation. The country’s economy was badly hit by falling oil prices and regional observers fear the waning power of Isis could precipitate further instability. Jan Dehn, head of research at emerging markets specialist Ashmore Group, said the prospect of an Iraq bond was appealing. “There is a lot of bad noise of course because there are real problems but that has not impacted on Iraq’s ability to pay,” he said. “So you get a nice risk premium compared to other countries in the region. Iraq is in a bad neighbourhood but it has done a lot of adjustment to lower oil prices and we feel they are able to service their debts.” Even without an explicit US guarantee, any new Iraqi debt issuance would be regarded by investors as having “the implicit backing” of the US, Mr Dehn said, given the geopolitical regional importance of the country “remaining in the US sphere of influence”. http://iraqdailyjournal.com/story-z15667999
  13. Banks welcome amendments to the law «Central» Iraq Version: Paper - International Monday, 31 July 2017 (01:00 - GMT) Last Updated: Monday, 31 July 2017 (01:00 - GMT) Baghdad - Adel Mahdi The Association of Iraqi Private Banks confirmed the importance of recent amendments to the Central Bank of Iraq Law for the banking sector, which is looking for more opportunities to contribute to the development of the national economy and enhance its role in the Iraqi capital market. "The increase in the number of members of the Board of Directors of the Central Bank from outside the bank is an important step that will be positively reflected in the level of decisions taken by the bank," said Wadih Nouri Al-Hanal, Of the 9 members, which means that there is a majority of outside the bank, which will push to benefit more than the support provided by the bank to banks to expand their contribution to sustainable development and investment ». He pointed out that «the latest amendments of the Central Bank reflected his desire to develop the sector's work and mechanism of dealing with developments in the world, as well as addressing the problems related to the activity of financing and lending and lead to the simplification of procedures related to it». He added that «the increase of the capital of the Central to one trillion dinars ($ 850 million) confirms the desire to activate its role on the level of investment of his funds and his intention to find wide outlets in the acquisition of new products take into account the needs of investment and development sectors», adding that «the reality of private banks Needs a vision and strategy to help them touch the new reality that the sector aspires to communicate with the important objectives contained in the recent amendments to the Center ». The International Monetary Fund has called on Iraq to make fundamental adjustments in its economic and financial sectors, especially the banking sector, which needs to restructure and new policies in line with the reforms called for by the Fund as a condition to support Iraq ». The Council of Ministers and Representatives is working to introduce amendments to the Central Bank's law aimed at increasing its capital and keeping abreast of the global economic development, granting powers to the bank, increasing the number of members of the Board of Directors from outside the bank and forming a committee to audit the interest on loans granted by the bank to commercial banks. Issued by judicial decisions. The new law allows the bank to hold transactions on foreign assets and manage the official reserves of the foreign exchange of the State in accordance with international best practices and monetary policy objectives. The Council may also invest this reserve in gold and foreign currency and coins, which are usually used in performing international accounts held by the Central Bank Or for its account, credit balances payable on demand or short-term foreign exchange repayments, which are normally used to perform international accounts maintained by the Bank in its accounts or those invested through agreements Repurchase, repurchase and fixed-term deposits. The law also allows for the withdrawal of private funds available to the International Monetary Fund (IMF) account, the reserve position with the IMF, as well as any negotiable or fully trustable securities issued by foreign governments, central banks, international financial institutions, Which are paid in foreign currencies, which are normally used in the performance of international accounts held by the Central Bank of Iraq or for its own account. The draft law allows the bank to "use derivatives in investment portfolios as a hedging tool, issue non-negotiable souvenir instruments and, with the approval of the Ministry of Finance, select an international company that performs external audit and auditing for a period of five years, . The concerned circles expressed optimism about the next phase, especially with the intention of the «central» to develop its work by adopting new products. The Governor of the Central Ali al-Alaq stressed that «Iraq has exceeded the difficult stage during the past two years, which saw the issuance of data is not based on facts that raised terror in the Iraqi street, as shown by the Bank, which is a safety valve for the economy and monetary policy of the country, The dinar maintained a stable exchange rate at acceptable limits despite the challenges, in addition to the index raised the interest of global institutions supporting, as the central reserve exceeded the ceiling of the IMF's expectations of ten billion dollars ». A committee was formed by the Central Bank to develop and facilitate the work of the government sector with the private sector. It approved recommendations that would reduce the routine and ease lending conditions for private sector projects and adopt the advanced electronic systems in government banks to support the private sector to take its real role in economic development. . The recommendations approved the need to include the Ministry of Finance in the budget of 2018 all the receivables of contractors for payment, and approved the recommendation for the inclusion of private investment projects implemented or those in the stages of implementation as acceptable guarantees for loans investment projects exclusively, and approved the recommendation for the use of a modern mechanism for financing projects based on the schedule of work in The investment project is similar to the projects implemented in the interest of the state, according to the instructions of the Ministry of Planning, to reduce the pressure of guarantees on companies. The recommendations recognized the use of electronic systems in government banks to eliminate a large part of corruption and extortion, as well as reducing bureaucracy and red tape. http://www.alhayat.com/Articles/23170274/%D8%A7%D9%84%D9%85%D8%B5%D8%A7%D8%B1%D9%81-%D8%AA%D8%B1%D8%AD%D9%91%D8%A8-%D8%A8%D8%A7%D9%84%D8%AA%D8%B9%D8%AF%D9%8A%D9%84%D8%A7%D8%AA-%D8%B9%D9%84%D9%89-%D9%82%D8%A7%D9%86%D9%88%D9%86--%D8%A7%D9%84%D9%85%D8%B1%D9%83%D8%B2%D9%8A--%D8%A7%D9%84%D8%B9%D8%B1%D8%A7%D9%82%D9%8A
  14. Wow. The switch is about to be turned on