Iraq to revalue dinar and introduce new notes in September 2012

[yota691]

The Inspector General Briefs GOI Officials

on SIGIR Oversight of the DFI

On November 14, 2011, the Inspector General briefed the

GOI’s High Committee on the Restoration of Iraqi Funds

on SIGIR’s oversight of the DFI. Iraq’s oil revenues have

been deposited in the DFI since its creation by the United

Nations in May 2003. Formed in 2011, the High Committee

is chaired by Deputy Prime Minister for Economic Afairs

Rowsch Shaways and includes representatives from the Ofice of the Prime Minister, the Ministry of Foreign Afairs,

the Ministry of Finance, the Ministry of Justice, and the

CBI, among others. Its mission is to obtain a complete accounting for all Iraqi funds deposited in DFI accounts at the

FRBNY. he High Committee also seeks to restore to the

GOI any unspent DFI funds still under U.S. control.

In response to the High Committee’s questions, the

Inspector General stated that the CPA controlled about

$20.7 billion in DFI funds, most of which was provided to

the interim Iraqi ministries for salaries, pensions, and operating costs or used to inance reconstruction projects. He

added that, of this $20.7 billion in DFI funds, $10.2 billion

was flown to Baghdad, and $5.8 billion was expended by

electronic funds transfers from FRBNY.

he Inspector General briefed the High Committee on

SIGIR’s third major DFI audit, published in October 2011,

which accounted for almost all of the $6.6 billion that the CPA

controlled when it dissolved on June 28, 2004. Contrary to

some media reports, the Inspector General told the High Committee that this money was neither lost nor stolen. Later this

year, the Inspector General will confer with members of the

High Committee to discuss the results of two more DFI audits,

one of which was released this quarter. http://reliefweb.int/sites/reliefweb.int/files/reliefweb_pdf/node-473604.pdf

Edited February 26, 2012 by yota691

[George Hayduke]

Yea and the dinar can eventually surpass the dollar in time.....being on par with the dollar doesnt mean it has to be exactly worth 1 dollar....in fact I believe the exchange rate would look like 1.17 dinar to 1 USD.....thats damn near on par right there and that would be after deleting the zeros....

After reducing the amount in circulation from 25+ trillion to 25+ billion, and having 60+ billion in their reserves, they could easily support almost a 2 dollar rate....and if they have close to 90 like some articles have mentioned your looking at a 3 dollar rate (this is all based on Iraq only needing to back the physical currency which is possible) So what math doesnt make sense?? They could take it slow, come out almost at a dollar to start after the RD and then slowly raise the value oooorrrrr they could RD, then come right out at a 2 dollar rate and take it from there....

Most likely it will all depend on what they could pull off without upsetting the balance of inflation....but deleting the zeros is a short cut to getting the dinar on par with the USD.....after that, the possibilities would be endless for Iraq because of the massive reduction in the money supply!

I like it when you have your RV goggles on

GH

[MovieMaker]

Just so you all know, in Vegas, I'll be the guy in the Easter Bunny outfit with the ears cut off.

And I'll be the "Chick" with the Easter Basket FULL OF MONEY!

[George Hayduke]

Next stop, number 2 with a bullet...

Nickleback?

[DinarChiTown]

Exactly:

Despite fears of a negative economic impact, the Central Bank of Iraq will remove three zeros from Iraqi dinar notes and print new banknotes in 2013.

The Central Bank of Iraq has agreed with the Economic Committee of the Iraqi Parliament to introduce the new banknotes in September 2012, which will be used in parallel with the current banknotes for a year. The CBI will completely withdraw the old banknotes by September 2013.

Read more: http://dinarvets.com/forums/index.php?/topic/106999-new-banknotes-to-be-introduced-in-september/#ixzz1nQopj38m

This article makes absolutely no sense to me from the get go!

And as someone else pointed out it is from a currency dealer in Erbil.

Lends no credibility with me, IMO the lower denoms are already printed and in Iraq. (JMO)

WM13

Keep those blinders on and go and buy more.

[abby01]

Supporters of the idea believe the introduction of the new banknotes will help reduce inflation, strengthen the Iraqi dinar in the international market, facilitate trade with international banks and other financial institutions, as well as reduce the social gap between classes.

Read more:

How does keeping the same value "$25,000=$25." REDUCE THE SOCIAL GAP BETWEEN CLASSES? Without an RV, everything is the same value just different bills. What do you think?

[FishmanTx]

Well there is one problem with this article, they already have a 50 dinar note so why would they spend money to reprint it, And if they are only removing the 3 zero notes what about the 250 and 500 notes. You could not redenominate without drawing in all the notes and reprinting otherwise I will go out and buy the 500 note and wait till they draw in the 3 zero notes and raise the value.

250 is the smallest in circulation that I'm aware of. Still tho, if there's the 250, why a 200? Smells like it could be BS, but it makes no sense for a money trader to come off with this. After looking at the WHOLE ARTICLE, here is the WHOLE THING. There is NO money trader, but some of it still doesn't add up.

Here is every word with nothing left out....

New banknotes to be introduced in September

Views differ on financial and socioeconomic impacts

Despite fears of a negative economic impact, the Central Bank of Iraq will remove three zeros from Iraqi dinar notes and print new banknotes in 2013.

The Central Bank of Iraq has agreed with the Econnomic Committee of the Iraqi Parliament to introdduce the new banknotes in September 2012, which will be used in parallel with the current banknotes for a year. The CBI will completely withdraw the old banknotes by Septembber 2013.

Abdul-Hussein Abtan, Economic Committee Member of Parliament in Baghdad stated in a press conference that there is an initial agreement between Parliament and the central bank to start the process of removing three zeros in September, and it will take a year to complete. The new banknotes will be printed in Arabic, Engllish and Kurdish.

The CBI will introduce three new banknotes: 50 dinars, 100 dinars and 200 dinars. For smaller transactions, the CBI will also issue 1-dinar and 2-dinar coins which Iraq currently does not use.

MP Abtan says “The grant agreement is to ensure that during the one year process, the old banknotes are traded in the market and replaced by the new one.”

The CBI expects this move to positively impact the country’s economy; however, some parties say the negative consequencees will be more serious.

The Security Commisssion says deleting the zerros will have a negative impact on financial trade in the stock market. Other opponents of the move arggue it would pave the way for money laundering and want the government to reconsider its decision.

Supporters of the idea believe the introduction of the new banknotes will help reduce inflattion, strengthen the Iraqi dinar in the international market, facilitate trade with international banks and other financial instittutions, as well as reduce the social gap between classes.

“The process of removiing zeros from the currenccy will contribute to dealiing better with inflation, facilitate economic coopeeration with international banks and reduce the differences in [standards of] living in society,” Abtan explained. Mahma Khalil, another Member of the Iraqi Parliament and official spokesperson of the Economic Commmittee says an agreement has been reached about the mechanisms of introdducing the new banknotes after a series of meetings and discussions with the CBI Governor Dr. Sinan Al Shibibi.

“According to the agreemments, the new bill will be printed by a European company and introduced to the market gradually and in a well-planned schedule to ensure it will not result in shocks and would not have a negative impact on the market,” explained MP Khalil. He added the exchange rate between the new banknotes and the old ones would be 1:1,000.

The objective behind this move is to appreciaate the value of the Iraqi dinar against the U.S. dolllar, which would in turn increase the balance of the Iraqi dinar and there would be sufficient resserves of that currency,” explained MP Khalil. “Additionally, the econoomy of Iraq would grow and oil sales would also increase.” Khalil added that Iraq has a reserve of $60 billion in the CBI.

The CBI previously stated it would consult with Parliament and reprresentatives to see whetheer there would be a need for a law to be passed for this shift. The Economic Committee announced on 19 February it was inttroducing new legislation for the purpose and would also address the inflation issue in the country.

The introduction of new banknotes and withdrawiing the current ones from the market is generally exppected to reduce and conttrol the number of dinars in circulation and would also help facilitate paymment systems and control the banking transactions in the country.

Edited February 27, 2012 by FishmanTx

[George Hayduke]

Supporters of the idea believe the introduction of the new banknotes will help reduce inflation, strengthen the Iraqi dinar in the international market, facilitate trade with international banks and other financial institutions, as well as reduce the social gap between classes.

Read more:

How does keeping the same value "$25,000=$25." REDUCE THE SOCIAL GAP BETWEEN CLASSES? Without an RV, everything is the same value just different bills. What do you think?

Could be thats the starting point...

GH

[zul]

But in reality there is no devaluation.....from what they are saying, 1000 current dinar at the current value will equal 1 NEW dinar because it will carry a higher value and purchasing power. Nothing loses value, it would just be that the bills we have now would never see a higher exchange rate...

It doesnt screw anyone because after its said and done you still have the same worth or value in dinar.....a 25k note is now worth like 23 USD or so, and if they delete the zeros the NEW 25 dinar note would also be worth around 23 USD....your trading a 25k note for a single 25 dinar note but you lost no value.

The US is invested in oil.....thats our business with them....has always been part of the plan....we wont let the country fail, but this isnt all about the just the currency....yea a higher valued dinar will look more attractive, but the US and everyone else is in there for the black gold.....

Hey Keep

I'm still clueless, if they were to LOP, then deleting the zeros would be immediate upon implementation and your 25,000 dinar would become 25 dinar, almost immediately. Right..?

So why are they taking one whole year..?

bank to start the process of removing three zeros in September, and it will take a year to complete

Unless....removing 3 zeros means withdrawal of bank notes with 3 zeros.

[hame55]

Hey Keep

I'm still clueless, if they were to LOP, then deleting the zeros would be immediate upon implementation and your 25,000 dinar would become 25 dinar, almost immediately. Right..?

So why are they taking one whole year..?

Unless....removing 3 zeros means withdrawal of bank notes with 3 zeros.

Good analysis, Zul. You always have intelligent posts. ThanX!

[dgibbs20]

That is not more different than the rate now... I'm I wrong?

[zul]

Good analysis, Zul. You always have intelligent posts. ThanX!

TQ hame55

[Dinaronair]

We'll get more than a nickle back on this investment.

LOL!

[dvforumuser]

Hey Keep

I'm still clueless, if they were to LOP, then deleting the zeros would be immediate upon implementation and your 25,000 dinar would become 25 dinar, almost immediately. Right..?

So why are they taking one whole year..?

Unless....removing 3 zeros means withdrawal of bank notes with 3 zeros.

The year is for the withdrawal of the current IQD (all denominations) from the market. During the year businesses have to accept both current and new dinars, but banks will more and more only give out the new dinars. At the end of the year (end 2013?) the market no longer has to accept IQDs, though the banks (or maybe just the CBI) will continue for another ten years (or maybe it was a total of ten years, I don't recall). The zero's don't magically disappear from the current IQD, when they announce the plan and release the new dinars, they just aren't printed on the new currency.

[zul]

The year is for the withdrawal of the current IQD (all denominations) from the market. During the year businesses have to accept both current and new dinars, but banks will more and more only give out the new dinars. At the end of the year (end 2013?) the market no longer has to accept IQDs, though the banks (or maybe just the CBI) will continue for another ten years (or maybe it was a total of ten years, I don't recall). The zero's don't magically disappear from the current IQD, when they announce the plan and release the new dinars, they just aren't printed on the new currency.

Read again.... you are explaining this paragraph....

The Central Bank of Iraq has agreed with the Economic Committee of the Iraqi Parliament to introduce the new banknotes in September 2012, which will be used in parallel with the current banknotes for a year. The CBI will completely withdraw the old banknotes by September 2013.

And i am talking about this paragraph ......

the process of removing three zeros in September, and it will take a year to complete

Edited February 27, 2012 by zul

[DetroittoAZ]

Go Zul

[MrFnHappy]

Did you people ever hear Shabibi make a statement 1:1000?? NO. You need to remember that name SHABIBI hes the one that calls the shot. So this BS you are reading, is just that BS..

21/02/2012

Shabibi «morning»: 2013 will see the launch of the new currency

BAGHDAD - Alaa al-Tai

Said the Iraqi Central Bank announced new measures to maintain the value of the Iraqi dinar against the dollar. Said Central Bank Governor Sinan Shabibi»Sabah»: it is «given the high demand for the dollar has taken the Central Bank of new measures regulatory rather than a restrictive». Assured Shabibi that «the monetary policy Iraq's okay because there are up high which is called the cover of the currency, which gives us flexibility in dealing with monetary policy based on the study of the march of the economy, inflation and high prices as if prices rose significantly we will resort to tougher measures, but if increased the pace of price is less there will be other action ». the past few days have seen a rise in the exchange rate of the dollar against the Iraqi dinar, prompting concern among some citizens on the process .. and delete the zeros, Shabibi said: The« There are a lot of work and continuing in relation to the process of deletion of zeros. The new currency will be launched in 2013 .. But now we have many ideas for the design of the coin and paper to reach a final form for the new currency, but it needs time to the multiplicity of designs and designers, the competition for features included in the currency ». Ruled out the central bank governor influenced by the market to change the currency, saying:« steps a well-thought, and all banks will contact the bank Central in accordance with the regulatory process will withdraw currency from banks and provide them with the Central Bank of new currency will not accompany the process has no effect in relation to the markets and trading will be easy for the new currency ». is scheduled to be deleted three zeros from the new currency, ie that the sum of one thousand dinars will become the new currency dinars one Iraqi. describes the process of central bank currency exchange project, the national supporter of the economy in the country, expresses in government and political parties for fear of the project as it will increase the phenomenon of money laundering, also believes that adversely affect the financial trading the stock market.

Read more: http://dinarvets.com.../#ixzz1nAgGZgwM

[FishmanTx]

Hey Keep

I'm still clueless, if they were to LOP, then deleting the zeros would be immediate upon implementation and your 25,000 dinar would become 25 dinar, almost immediately. Right..?

So why are they taking one whole year..?

Unless....removing 3 zeros means withdrawal of bank notes with 3 zeros.

They'll give one year for everyone to change out...Just like the Saddam dinar.

Repost....

Timeline EXAMPLE:

The GOI and CBI set the time for the activation of the process as September 1, 2012 @ 00:00:01 a.m.

Through the previous "education" and "awareness" campaigns (quote from Saleh in another thread/post Here) it was made known that the old vs. new currency exchange rates will be 1000:1 (see reference in post #1) beginning Sept 1 @ midnight; a 25k note will become equal to 25 IQD. A 1000:1 exchange of old note vs new.

At 00:00:01 on Sept 1, the program exchange rate goes from 1169:1 IQD/USD to 1:1 on the world market. At this time all Iraqi bank account values are reduced electronically by 3 zeroes (3 decimal places).

The next day, the People, with their new "education", begin to exchange notes @ 1000 old to 1 new their soon-to-be obsolete notes at an extreme pace to get rid of the old and acquire the new so they won't get stuck with it. Not just through day-to-day transactions, but lining up at the banks and money changers to get rid of the old notes (Do YOU remember how it was when the Saddam dinar exchange was started?) as fast as possible.

The old and new notes then coexist for a year until on Sept 1, 2013 they become obsolete and no longer accepted as a viable currency.

Over the next 2-3 years the exchange rate is incremented upwards to 1:2.89 IQD/USD (last appx rate before devaluation).

The GOI and CBI have now achieved their goal of bringing the Dinar back to being a prominent currency in the world market.

Read more:

Edited February 27, 2012 by FishmanTx

[Carrello]

Hey Keep

I'm still clueless, if they were to LOP, then deleting the zeros would be immediate upon implementation and your 25,000 dinar would become 25 dinar, almost immediately. Right..?

So why are they taking one whole year..?

Unless....removing 3 zeros means withdrawal of bank notes with 3 zeros.

Thanks, Zul!

From the time stamp on your post, Zul, it has been almost an hour, and not a peep from Keep.

Keep does have a newborn. His schedule and sleeping is probably off.

[keepmwlknfny]

Well Zul it seems like your question was answered between a few diff people.....no need for me to go on about it but yea they pretty much wanna get all the old notes withdrawn within a year, they will accept them for up to ten years though....both old and new will be used at the same time and there will be two sets of prices in the marketplace, one for old and one for new....very common in a redenomination.....at least for the ones that give ample time for exchange....your 25k note will still be 25k dinars but it will have the value of one new 25 note....the current dinar gets stuck with the 1170 rate....

[Goldiegirl]

I don't know why this just occurred to me and it's not the blonde thing...if they co-exist for one year and we do have a year to cash in, then the rate will stay the same for that year. Right? I was always under the assumption they would give a 90 day cash in timeframe because of the managed float.

another thought:

If we have a year we could in fact deposit our dinar into a IQD account in a bank in the USA. Then it doesn't matter if we have small notes or the larger three zeros. It's all electronic.

They'll give one year for everyone to change out...Just like the Saddam dinar.

Repost....

Timeline EXAMPLE:

The GOI and CBI set the time for the activation of the process as September 1, 2012 @ 00:00:01 a.m.

Through the previous "education" and "awareness" campaigns (quote from Saleh in another thread/post Here) it was made known that the old vs. new currency exchange rates will be 1000:1 (see reference in post #1) beginning Sept 1 @ midnight; a 25k note will become equal to 25 IQD. A 1000:1 exchange of old note vs new.

At 00:00:01 on Sept 1, the program exchange rate goes from 1169:1 IQD/USD to 1:1 on the world market. At this time all Iraqi bank account values are reduced electronically by 3 zeroes (3 decimal places).

The next day, the People, with their new "education", begin to exchange notes @ 1000 old to 1 new their soon-to-be obsolete notes at an extreme pace to get rid of the old and acquire the new so they won't get stuck with it. Not just through day-to-day transactions, but lining up at the banks and money changers to get rid of the old notes (Do YOU remember how it was when the Saddam dinar exchange was started?) as fast as possible.

The old and new notes then coexist for a year until on Sept 1, 2013 they become obsolete and no longer accepted as a viable currency.

Over the next 2-3 years the exchange rate is incremented upwards to 1:2.89 IQD/USD (last appx rate before devaluation).

The GOI and CBI have now achieved their goal of bringing the Dinar back to being a prominent currency in the world market.

Read more:

[JayP]

I don't know why this just occurred to me and it's not the blonde thing...if they co-exist for one year and we do have a year to cash in, then the rate will stay the same for that year. Right? I was always under the assumption they would give a 90 day cash in timeframe because of the managed float.

another thought:

If we have a year we could in fact deposit our dinar into a IQD account in a bank in the USA. Then it doesn't matter if we have small notes or the larger three zeros. It's all electronic.

Hello Goldiegirl... As much as I want to believe that were true, and as much as I want to tell myself that the deletion of the zeros is something else, I have to be both honest with myself and those that are here for information.

You are correct in the respect that it is likely the rate will remain the same, but what that would, mean would be that the current notes will remain in circulation co-existing, but at the current rate of .00086, while the new smaller denominations will remain the same at the new rate of .86 (or whatever the new rate would be because they can go to .001 for old, and 1.00 for the new for example)

As far as the deposit, it would not do you any good in terms of the rate, because electronic money would automatically become the new currency by having the decimal point moved over on all accounts, loans, etc. I believe not so long ago they even discussed the laws regarding the loans, etc.

Now, where the electronic money may come in handy IF, they were to follow through with the deletion of the zeros (which I still wait to hear from the CBI with an official announcement that they are definitely moving forward with), that the electronic funds may allow you to hold on to the Dinar longer without needing to find a currency exchanger to exchange your current note for a new note to hold out long term for a nominal gain, without needing to incur that additional dealer expense...you just have the added element of having an Iraqi bank responsible for your money.

Edited February 27, 2012 by JayP

[2fast4u2c]

Stryker.....I am impressed! You are correct! It is - what it is. Noone knows until it happens.

Stay grounded.

[dvforumuser]

Read again.... you are explaining this paragraph....

And i am talking about this paragraph ......

Aren't they talking about the same thing? starting in sept 2012 and taking a year so ending in sept 2013.

[Goldiegirl]

Hello Goldiegirl... As much as I want to believe that were true, and as much as I want to tell myself that the deletion of the zeros is something else, I have to be both honest with myself and those that are here for information.

You are correct in the respect that it is likely the rate will remain the same, but what that would, mean would be that the current notes will remain in circulation co-existing, but at the current rate of .00086, while the new smaller denominations will remain the same at the new rate of .86 (or whatever the new rate would be because they can go to .001 for old, and 1.00 for the new for example)

As far as the deposit, it would not do you any good in terms of the rate, because electronic money would automatically become the new currency by having the decimal point moved over on all accounts, loans, etc. I believe not so long ago they even discussed the laws regarding the loans, etc.

Now, where the electronic money may come in handy IF, they were to follow through with the deletion of the zeros (which I still wait to hear from the CBI with an official announcement that they are definitely moving forward with), that the electronic funds may allow you to hold on to the Dinar longer without needing to find a currency exchanger to exchange your current note for a new note to hold out long term for a nominal gain, without needing to incur that additional dealer expense...you just have the added element of having an Iraqi bank responsible for your money.

Hi JayP, while I appreciate your point of view, I must say that having different rates for the large notes versus the smaller ones just won't happen.

I don't think we see this process quite the same way.

That's ok...that's what makes the world go round and an interesting place to live.