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Publishes a preliminary version of the 2021 budget: a change in the exchange rate and its revenues more than 91 trillion


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Iraq 2021 ... a year of "austerity" and a salary "of no value"

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 2020-12-17 23:52
 

Shafaq News / After the Iraqis faced a year of economic challenges for a year, fears are increasing that things will get worse after submitting a draft budget for 2021 that focuses on austerity, which may expose Iraqis to greater pressure next year.

Iraqi officials who worked on preparing the bill say to Agence France-Presse, that their goal is to "withstand" after an unprecedented financial crisis caused by the emerging Corona virus pandemic and the collapse of oil prices, whose sales Iraq relies on to finance 90% of its budget.

Baghdad is expected to end this turbulent year, with GDP growth shrinking by 11% and the poverty rate rising to 40% of the country's 40 million people.

A set of measures included in the draft 2021 budget, which was presented Thursday before an extraordinary session of the Council of Ministers over the weekend to discuss them, is an attempt to find solutions.

Foremost among them is the reduction of the value of the official currency from 1,190 Iraqi dinars against the US dollar to 1,450 dinars, the first such measure in half a decade.

"We are trying to relieve pressure on the public sector wage bill, which is our biggest expense," an Iraqi official said when the draft was being prepared.

The public sector is the largest employer in Iraq, with about four million employees, in addition to three million retirees and one million people receiving social welfare salaries.

"If we pay our employees salaries in dinars, whose value is now about 25% less, we can undermine the fiscal deficit and distribute this money further," the official said.

It appears that the markets have been obsessed since last week with the next downgrade even before the surprise release of the draft Thursday. The unofficial rate in exchange offices across the country increased from about 1,240 Iraqi dinars to a dollar to 1,300 Iraqi dinars.

Worthless salaries

Public sector employees are outraged by the measure. “Our salaries will be without any value,” says Mohammed, a doctor in a ward designated for Covid-19 patients in Baghdad. He refused to give his full name so that he could speak freely.

State employees were long overdue in collecting their salaries in October and November, resulting in a negative impact on their purchasing power and impatience.

“I’m nervous about watching the price go up and I'm angry with the government,” Muhammad confirms.

The Iraqi economic expert, Ali Al-Mawlawi, says that at a stage witnessing a recession in the world economy, the devaluation of the currency “may do more harm than good.”

“Yes, the government is desperate and has no other options. But what worries me is that it will harm the poor more by reducing their purchasing power. ”

Iraqi officials hinted at the possibility of another significant devaluation next year, bringing the exchange rate to 1,600 Iraqi dinars per dollar, after pressure from the International Monetary Fund.

Until then, the salaries of public sector employees will also be reduced by imposing a new income tax of 15% for middle and upper-level employees.

The government is also planning to increase electricity tariffs to force citizens to pay more for the electricity provided by the state.

The budget plan hopes to generate 18 trillion in non-oil revenues in 2021, compared to 11 trillion in the 2019 budget. It expects oil revenues to reach 73 trillion, 20 trillion less than in 2019.

Iraq did not approve the 2020 budget due to political tensions. The decrease in expected oil profits is due to the 2021 budget projection that Iraq will sell each barrel at $ 42, which is lower than current crude market prices and well below the $ 56 per barrel price in the 2019 budget.

And it approved in 2019 one of the largest spending budgets in Iraq ever, amounting to 133 trillion Iraqi dinars, but in 2021 it exceeded it, with 150 trillion Iraqi dinars in expected spending.

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2020/12/18 21:31
  • The number of readings 227
  • Section : Iraq

Finance Minister: An urgent need to rationalize the salary bill and the 2021 budget includes the reduction

https://almasalah.com/ar/news/202644/وزير-المالية-حاجة-ملحة-لترشيد-فاتورة-الرواتب-وموازنة-2021--تتضمن-التخفيض

 

Baghdad / Obelisk: Minister of Finance Ali Abdul Amir Allawi said, Friday, that the previous dollar exchange rate "distorted and damaged the Iraqi economy," referring to the adoption of an exchange rate of 1450 dinars per dollar in the fiscal budget for 2021, while he considered that the rise in salaries and pensions "has become A cause for concern, as it accounts for 120% of oil revenues.

Allawi said in a statement that "the 2021 budget adopted an exchange rate of 1450 dinars per dollar, because the previously approved exchange rate of 1182 dinars per dollar is distorted and does not reflect the actual reality," noting that "the previous exchange rate harmed the Iraqi economy as a result of goods being paid from neighboring countries." Which negatively affected the local product.

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

He pointed out that the government "managed the financial crisis with very limited resources without any support from the international community, and that the failure to issue the Federal Budget Law for the year 2020 created additional burdens when preparing next year's budget, and the reason for not knowing the real numbers required in the spending," noting that " The rise in salaries and pensions has become a cause for concern, as they are now around 120% of oil revenues. "

Allawi stressed, "We have started a process of serious treatment of the deficiencies in the customs and tax departments. These reforms will take some impact to show the results, but these revenues are expected to be maximized in the year 2021," noting that "spending was the main issue as the need to rationalize the salary and pension bill. These rates have increased year by year at an alarming rate and are now far from critical levels. "

He pointed out that "government support programs and subsidies have hit the economy, as subsidies have reached very high levels, and it has become difficult to change or reduce them, and the most subsidy is given to the electricity sector, as the real economic costs of the electricity sector were estimated at 24 trillion dinars, as about 10% of the gross domestic product." ", Explaining that" subsidies to the agricultural sector cost the state, last year, 2.5 trillion dinars, as the Ministry of Agriculture purchases wheat, rice and barley at prices much higher than international prices. "

He noted that "direct support for the ration card is still close to 2.5 trillion dinars, while next year's budget included maintaining and even increasing support for the poor and vulnerable segments in the country, as the Ministry of Finance is working with the World Bank and the Ministry of Planning to expand the scope of the Community Development Fund to more than one billion dollars." Pointing out that "the 2021 budget allocated 500 million dinars to increase the capital of state-owned banks, and these funds will be allocated to enhance the capital base and operational efficiency."

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

Allawi pointed to "adding new taxes for sales in addition to the total salary being subject to tax, as we will achieve an additional revenue of 5.2 trillion dinars."

 Screenshots:

 Minister of Finance: salaries of employees and retirees equal to 120% of oil revenues
Minister of Finance: Obligations to pay salaries can only be managed through delay in payment

Minister of Finance: The government borrowed 27 trillion dinars between June and November and we have reached the limits of this borrowing
Minister of Finance: We see an urgent need to rationalize the bill for salaries and pensions in the public sector
Minister of Finance: We propose to stop new employment in the public sector and monitor slack in this sector
Minister of Finance The 2021 budget included big cuts in salaries and benefits

Minister of Finance: The 2021 budget included a major change in the exchange rate of 1450 dinars to one dollar.
Minister of Finance: The total salary is subject to tax through the application of the income tax law in force
Minister of Finance: Services tax on malls and major markets will generate an additional income of 225 billion dinars

Minister of Finance: The services tax on salons will generate an additional revenue of 123 billion dinars
Minister of Finance: The sales tax on gasoline fuels for cars and airplanes will generate an additional income of one trillion and 8 billion dinars
Minister of Finance: The sales tax on cigarettes and tobacco will generate an additional income of one billion dollars

Minister of Finance: Income tax on total employee income will generate additional revenue of one trillion and 451 billion dinars
Minister of Finance: Abolish all customs and tax exemptions except for those contained in international agreements or special laws in force

Minister of Finance: Stop all appointments in the public sector and amend allocations granted to employees.
Minister of Finance: Reducing the allocations granted to employees will save 12 trillion dinars for the purpose of reducing the budget deficit.
Minister of Finance: The 2021 budget focused on giving a developmental impetus to mega projects such as the Faw port project and the suspended train

 

 
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1. I hope that the GOI is smart enough not to approve a budget with a loan to a known thief, that does not require the loan to be paid back. Or with the fore knowledge that the loan recipient will default on it.

 

2. If they go ahead and pegged the value of the IQD at 1450 IQD to 1 USD, would the IQD then be a internationally recognized currency ? 

 

3. If the answer to #2 is YES, it would be a internationally recognized currency , would they allow it to float ?

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8 hours ago, 3n1 said:

Sixth: – Monetary policy
A – The exchange rate
1 – Begin to gradually reduce the Iraqi dinar price to reach 1500 dinars against the dollar until the end of the year 2020 and review the economic situation.
2 – And then start another reduction up to 1,800 within 6 months.
3 – Then we study the possibility of deleting the zeros, so we will end with a fixed price of 2 Iraqi dinars per dollar.

thank you very much 3in1 for bringing the old article in, so this will bring my memory back. it is a long read though. but i really this " monetary policy " part even better. so now i understand why there are a lot of articles lately talking about devaluing the dinars to 1500. so this is all the cbi' plan and the cbi has really implemented the plan. so we will see the rate 1500 until the end of december 2020. and then from january - june 2021, we will see the rate going down to 1800. and finally, from june 2021 onward, we will see the iqd rv at 1 iqd=0.5us. not bad even mpst still prefer at least 1:1. is there a possibility that the date for rv move, like in the first six month ( between january - june 2021 )?

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11 hours ago, 3n1 said:

3 – Then we study the possibility of deleting the zeros, so we will end with a fixed price of 2 Iraqi dinars per dollar.

my question is why did the cbi announce  " a fixed price of 2 Iraqi dinars per dollar. " openly to the public? did the cbi do this on purpose so the dinar speculators will hoard as much dinar as possible and hide them under their mattress while waiting for rv?? i am sure a lot of dinar investors out there will already hoard a lot of dinars after reading this..

when they say " fixed price 2 Iraqi dinars per dollar " means 1 iqd=0.5 us. can 1 iqd= 0.5us be called the first rate? and then may be a week or a month later boom iraq launch the second rate suddenly at 1 iqd= 3.22 us ( pre war rate because iraq wants the rate to return to what it was )

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Parliamentary Finance reveals the reasons for the delay in the 2021 budget

Posted 2 hours ago
 
News source / Alsumaria channel
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Alsumaria channel
News source / Alsumaria channel
 
 

A member of the Parliamentary Finance Committee, Majed Al-Waeli, revealed, on Saturday, that there are three main reasons that delayed sending the 2021 budget from the government to Parliament.

The semi-official Al-Sabah newspaper quoted Al-Waili as saying: “The first issue is the exchange rate of the dollar in the Iraqi market, as it is part of the monetary policy that the government will pursue during the next phase to solve part of the financial and economic problem in the country is to raise the exchange rate,” referring to "The mission of the Central Bank of Iraq is to control its prices in the market, being in control of the exchange rates, whether in selling it to banks or buying it from the markets."

He added, "The second issue is to reduce the percentage of deficit in the budget as much as possible after the political blocs refused to send the budget without measures to reduce the deficit percentage," describing it as "very high."

Al-Waeli clarified, "The third basic thing is the article concerning the dues of the Kurdistan region, as last Wednesday's meeting with the regional government delegation was paving the way to put an article in the budget law that was present in the deficit financing law, but that needs measures from both parties, not to mention On the non-oil revenues such as ports, taxes and municipalities, after controlling the oil revenues by addressing the oil marketing company SOMO to determine its quantity, despite what is in it of belongings such as companies and other contracts.

A member of the Finance Committee indicated, "The budget is ready to be sent to the House of Representatives after these three basic points are resolved."

You can read the news also from the source from here

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The head of the Parliamentary Finance Committee, Haitham al-Jubouri, hinted today, Saturday, to the possibility of adopting an increase in the exchange rate of the dollar against the dinar, in order to get rid of part of the financial crisis facing the country, indicating that this measure should be the last resort.

Al-Jubouri said, during his speech at the first Iraqi media forum, that "changing the exchange rate has pros and cons."

He added, "We asked the government to take a number of measures in addition to raising the exchange rate," explaining, "We have proposed 32 practical measures by the Parliamentary Finance Committee."

He pointed out that "changing the exchange rate should be the last option for the government."

Al-Jubouri pointed out that "increasing revenues is possible, through the border crossings, the tax base, and many other measures."

He called for "discussing practical measures that could reduce the negative effects of changing the exchange rate."

 

Before that, the Ministry of Finance expressed its "resentment and deep regret" for the unauthorized publication of the draft budget for 2021.

The ministry said, "Budget preparation is a complex technical process that includes many ministries, government institutions and international agencies concerned with the budget over a long period of time and cannot be fully understood without referring to the data, policies and strategies on which it is based, including the government white paper."

"Releasing it prematurely to the media is an irresponsible act to a large extent, and this may precede the possibility of ministers to comment impartially on the draft budget and amend it in a special budget session scheduled to be held next Saturday," she added.

The ministry requested "not to pay attention to the exciting statements related to the budget that may arise during the next two days."

She added, "The Council of Ministers will discuss the budget in detail, and it is the appropriate place to present its recommendations regarding it. Then the budget will be sent after its approval by the Council of Ministers, to the House of Representatives," adding that "This is the correct approach and framework for discussion and deliberation regarding the budget, not social media, which may be Full of inaccurate news

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Parliamentary economy warns of the repercussions of the dinar losing part of its value in the local markets

 
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The information / Baghdad ..
Member of the Parliamentary Economic and Investment Committee, Riad Al-Tamimi, warned, on Saturday, of the repercussions of the Iraqi dinar exchange rate against the dollar and the loss of the dinar part of its value in the local markets, considering that the state's economic control is absent.
Al-Tamimi said in a statement to "the information", that one of the government's proposals is that the exchange rate of the dollar be 145 thousand dinars per sheet in exchange for supplementing the budget deficit by 25%.
"The rise in the exchange rate will generate an unprecedented rise in the local markets , the only affected is the simple citizen , " noting that " the US dollar continues to rise against the Iraqi dinar amid a financial and economic crisis experienced by Iraq months ago,"
pointed Taymi that " the prices of food products and other Of the fundamental items will continue to rise with the dollar rally. End / 25 h

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The 2021 budget will contain the highest fiscal deficit in the Arab countries and the history of Iraq: the government will address it using 5 solutions

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Yes Iraq: Baghdad

The economic expert, Nabil Al-Marsoumi, revealed that the 2021 budget contained a financial deficit that is the highest in the Arab countries and in the history of Iraq, as to how to bridge this deficit through 5 means.

 

Al-Marsoumi said that “the planned deficit for the 2021 budget has increased to 58.260 trillion dinars, equivalent to 40.178 billion dollars (calculated at the new dinar exchange rate), which is the highest in the history of Iraqi budgets and the highest in the Arab countries and OPEC countries, as the budget deficit in Qatar reached 9.5 "Tunisia $ 3.2 billion, Bahrain $ 3.4 billion, Algeria $ 22 billion, Saudi Arabia $ 38 billion."

 

He added that "the percentage of deficit from the total Iraqi budget = 38.8%, and the percentage of deficit from the gross domestic product = 19.4%, which is more than six times higher than the percentage determined in the Financial Management Law, which is 3%."

 

Regarding how to finance the budget deficit, Al-Marsoomi referred to 5 methods, represented by “one trillion dinars from the round account of the Ministry of Finance, 8.5 trillion dinars national bonds, 34.738 trillion dinars, deducting treasury transfers at the Central Bank of Iraq, 500 billion dinars, loans from government banks - Rasheed and Rafidain. And the Iraqi Trade Bank, 13,522 trillion dinars of external borrowing and from 24 countries and international and regional organizations

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Saturday 19 December 2020 | 1:48 PM
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irq_129804178_1608374917.jpg&max_width=3

 


The head of the National Approach bloc, MP Ammar Tohme, made preliminary observations about the media leaked 2021 budget. 
In a press statement, Tohme said, "We were very shocked by the circulating and leaked figures from the 2021 budget, which indicated an estimate of expenditures at an amount of (150) trillion, and if these leaks are true, they portend a real economic and social disaster.
We believe that such a figure represents a greatly exaggerated estimate for the following reasons:
 
1. In light of the previous circumstances that witnessed explosive budgets, they depended on the price of oil, which reached nearly (100) dollars, and those budgets did not reach 75% of the estimates of this leaked budget.
2. The 2021 budget must depend on actual numbers as its basis, which is actual spending in 2020 and the total spending for the first eight months was 46 trillion. Of them, depending on the announced price of the government (42) dollars, the oil revenues are close to (64) trillion according to an exchange rate of (1300) and with the addition of the outlets revenues, according to the statement of the Minister of Finance to the Guardian, it is estimated (9.5) trillion, so the total is more than (73) trillion. Without the rest of the non-oil revenues and in excess of the region's oil produced over the number proven in the budget (250 thousand) and its other non-oil revenues 
This estimated amount alone covers the same spending that was actually spent for the previous year without the budget incurring a deficit.
 
3. Approval of the leaked budget, an exchange rate of (1450) dinars to the dollar, which means actually reducing the salaries of employees by 18% ؜, which means reducing part of the operational expenditures from what was spent in the year 2020.
4. The leaked budget included a reduction of all allocations granted to employees of central and self-financed state departments, at rates ranging from 20% to 60% of the categories of those allocations, and this procedure also means that it reduces operational expenditures from what they were in the 2020 budget.
5. The leaked budget included imposing new taxes, including a 20% tax on the sale of fuel.
 
We confirm our position rejecting these very exaggerated estimates, and we reject measures that reduce the salaries of public employees or that burden the low-income brackets, and we believe that realistic solutions are represented by the following measures:
 
1. Compression of expenditures, eliminating unnecessary ones, such as petty cash, and closing embassies in countries where there is no clear benefit.
2. Reducing the salaries of special ranks 
3. Collecting oil derivative revenues for the local refineries supplied by the government with crude oil, which estimate the value of the product from one barrel (150) dollars.
4. Full payment of taxes and fees on mobile phones and banks benefiting from the currency auction.
5. Collecting customs revenues and subjecting all its transactions to electronic audit (automation).
6. Delivering all produced region’s oil and all other imports thereof to the federal authority.
7. Complete the biometric check on employees and eliminate hundreds of thousands of fake jobs.
8. Adopting precise and resolute mechanisms for collecting fees and levies that reach the ministries 
9. Rescheduling of external debts, postponing payment of internal debts and compensation for Kuwait.
10. Canceling the contracts of licensing rounds and the region’s partnership contracts with foreign companies, and finding an alternative formula to achieve the highest economic benefit for Iraq 
11. Raise the interest of government banks to 10% to encourage citizens to deposit with the state and provide liquidity instead of paying interest to foreign companies and banks at a higher rate than this, and citizens are more likely to pay this interest.
12. Encouraging the private sector, especially in building housing complexes to solve the housing crisis, employ the unemployed, and move the economy forward.
13. Print one trillion dinars per month 
14. Control of inflation caused by the currency auction by opening windows for sale to real import citizens.

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Iraqis panic as leaked budget draft signals dinar devaluation

 

A leaked draft of Iraq’s state budget has spurred panic as it confirmed the government’s intentions to devalue the national currency, the Iraqi dinar, and cut salaries to cope with a severe economic crisis

 
/image/policy:1.1131446:1608379580/Iraq-Economy.jpg?f=16x9&w=1200&$p$f$w=7c3a6a1 Shop owners wait for customers at an almost empty market in Baghdad, Iraq. A leaked draft of Iraq's state budget has spurred panic as it confirmed the government's intentions to devalue the national currency. AP

A leaked draft of Iraq’s state budget sent Iraqis into a panic on Thursday as it confirmed the government’s intentions to devalue the national currency, the Iraqi dinar, and cut salaries to cope with the impacts of a severe economic crisis.

Discussions about devaluating the Iraqi dinar, which has been pegged to the dollar for decades, have been going on for weeks as the government worked to finalise the 2021 budget. The draft law, which has to go through a parliament vote first, gives an anticipated exchange rate of 1,450 Iraqi dinars for the dollar — a significant drop from the central bank’s current official rate of around 1,182 dinars for $1.

As the draft made rounds on social media, the Finance Ministry expressed “resentment and deep regret over the unauthorised publication” of the proposed law, saying public hysteria would impact the neutrality of ministers. The cabinet is to discuss — and introduce possible amendments — to the draft in a session scheduled for Saturday.

Multiple officials said the leaked draft was authentic but stressed it might undergo changes in parliament. Sharp public reactions indicate the challenges the country will face implementing needed economic reforms in an election year, and in particular to the budget-draining public sector. Nationwide parliamentary elections, a year earlier than expected, are due in June.

“Budget preparation is a complex technical process … over a long period of time,” the ministry said. “Releasing it prematurely to the media is a largely irresponsible act.”

 

Already, the value of the dinar is falling on the street, with exchange houses in Baghdad selling the dollar for 1,300 Iraqi dinars.

Public discussion over the government’s reform policy — dubbed the “white paper” — focused sharply on ways to bring the wage bill down from 25 per cent of the GDP to 12 per cent. The draft budget took a step in this direction by looking to cut salary benefits, which sometimes exceeds the base pay of many in Iraq’s bloated public sector. Benefits can include incidentals such as danger pay, higher education degrees and hospitality expenses for high-level officials.

The news prompted an outcry from government workers fearing serious cutbacks with the devaluation compounded with benefit reductions.

“The majority of Iraq’s work force are government employees. We are the middle class, but (the government’s latest) decisions are going to make us the poorest class,” said Ali Kadhim, 50, a teacher. “I am paying off two loans that take up a third of my salary. After these decisions I don’t know how much I am going to earn.”

 

Several public workers echoed his fears, including physicians, dentists, school teachers and administrators in various ministries.

Reformists in the government consider public wages unsustainable.

Facing a severe liquidity crisis brought on by spiralling oil prices, the crude-exporting Iraq has had to borrow from the central bank’s dollar reserves to pay the nearly $5 billion in monthly fees for public salaries and pensions. Oil revenues, which account for 90 per cent of the budget, have brought in an average of $3.5 billion since the oil price crash earlier this year.

In an October interview, Finance Minister Ali Allawi said devaluation was being considered seriously in talks with the International Monetary Fund. The IMF has proposed a rate of 1,600 dinars to the dollar, which the Iraqi government deemed “politically difficult” according to a senior-level official, speaking on condition of anonymity to discuss the IMF talks.

The anticipated rate in the draft of 1,450 dinars against the dollar “will help cover the financial deficit, but, of course, if they don’t manage to make some supportive steps for poor people, then the impact of inflation will be very severe,” said Mohammed Al Daraji, a minister in the finance committee.

Parliament must still approve the law, expected to be deeply unpopular. This month protesters in the northern province of Sulimaniya burned down government buildings over delayed salary payments.

But there is little choice, said the senior government official. Without these steps, Iraq’s foreign currency reserves would dip below $20 billion by next year, he said. They currently stand at $50 billion.

Updated: December 19, 2020 04:06 PM

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20 hours ago, GregHi said:

Totally agree!! Nothing, nothing, nothing, suddenly something...

I dont give them enough credit to be that smart. I wish that I thought they were.

This smoke and mirrors is just smoke being blown up the petunia. Remove corruption and the greedy punes from the process and Maybe we get some movement in value.

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8 hours ago, rvmydinar said:

my question is why did the cbi announce  " a fixed price of 2 Iraqi dinars per dollar. " openly to the public? did the cbi do this on purpose so the dinar speculators will hoard as much dinar as possible and hide them under their mattress while waiting for rv?? i am sure a lot of dinar investors out there will already hoard a lot of dinars after reading this..

when they say " fixed price 2 Iraqi dinars per dollar " means 1 iqd=0.5 us. can 1 iqd= 0.5us be called the first rate? and then may be a week or a month later boom iraq launch the second rate suddenly at 1 iqd= 3.22 us ( pre war rate because iraq wants the rate to return to what it was )

 

 rvmydinar ...... that was not the cbi that was from a member of the house of representatives last july is when it came out i just thought it a little coincidental that it appears the cbi is possibly devaluing the iqd now along the parameters with what that rep. was suggesting is all , 2 iqd to 1 dollar would be like a reinstatement of the iqd , when they speak of removing or deleting the zeros that all began in 2011 and imo because of political instability the plan never moved forward always put off to what they stated as " a more suitable time " , some suggest it will lop i personally think the delete the zero plan was quite different from what most think the traditional lop is or what countries have done in the last couple decades they have all had the common denominator of hyperinflation , Iraq has not ,

when the delete the zero plan first came out in 2011 it was described a lot and again it was to inform iraqi's not iqd investors about the plan many times it stated the new currency would enter along side and traded with the 3 zero notes for a period up to ten years if anyone remembers those articles something much different from a traditional lop and thru the 10 year coexist period would enable the cbi to withdraw the old currency to preserve liquidity in the market ........ so that was the delete the zero plan in a nutshell its anyone's guess if it is going that way , we will never know till it has began

how it will unfold ... just take what i typed as speculative conjecture myself or anyone else has no way of knowing when , how or even if it will take place .... livin life , we wait

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Disclosure of the value of the money that the government will gain after raising the dollar price .. How much will it enter the budget?

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Yes Iraq: Baghdad

The economic expert, Abdul-Marhman Al-Mashhadani, revealed today, Saturday, the value of what the government will gain in the budget after raising the exchange rates of the dollar against the Iraqi dinar.

Al-Mashhadani said in a televised statement that "the leakage of the draft budget law was intended for the street to accept the situation before it was passed in the Council of Ministers."

The economic expert explained that "the Ministry of Finance's move to raise the dollar exchange rate comes within the framework of strengthening the budget by 16 trillion dinars through the dollar that it collects as a result of selling oil, so it decided to sell the dollar to the Central Bank at 1450 instead of the 1180 at the previous time."

He pointed out that "the government wants to build the budget numbers on the 150 trillion dinars, and this is impossible, especially with the large deficit that the country suffers from, and the debts that have burdened the Iraqi budgets, which he does not know how will be paid

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The Iraqi Ministry of Finance announces the suspension of appointments and the increase in social welfare allocations

The Iraqi Ministry of Finance announces the suspension of appointments and the increase in social welfare allocations
Allawi
 

 

Mubasher: Ali Abdul-Amir Allawi, the Iraqi Finance Minister, announced the suspension of appointments, as well as an increase in social welfare allowances.

The minister revealed an exception to the appointments that took place at the end of last year and early 2020, according to the Iraq News Agency, "INA", today, Saturday.

Allawi said that the budget is the beginning of reform, and there will be other steps in the future to implement the paper.

He added that "the Kurdistan region exports its oil at prices that are less than SOMO oil by 5 to 7 dollars," noting that "the ministry reached an agreement with Kurdistan on the 2021 budget, and the present delegation is discussing its allocations for the year 2020."

He pointed out that "the Ministry of Finance did not leak the budget," and I categorically deny this, explaining that "Parliament and Parliamentary Finance and heads of the blocs have knowledge of the direction the government is taking."

Allawi also announced an increase in social welfare allocations, indicating that the government will take measures to compensate for the negative consequences of adjusting the exchange rate on the poor.

The minister emphasized that changing the exchange rate would contribute to reducing the budget deficit and help the state fulfill its obligations towards paying salaries, retirement and supporting vulnerable groups in society, adding that changing the exchange rate would contribute to creating good job opportunities.

He continued that "travelers will not be affected, most likely, by changing the exchange rate," noting that "the central bank will continue to ensure the provision of all necessary foreign currencies."

Allawi stressed that "the government will take measures to compensate for the negative consequences of adjusting the exchange rate on the poor."

And the minister added, "We have increased social welfare allocations in the budget for next year to compensate for the possible rise in the prices of some imported goods," noting that "some imported commodity prices will rise for one time."

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Parliamentary Finance: The degrees of deletion and creation will be launched within the 2021 budget

Baghdad - Awa - Noor Al-Zaidi

Today, Saturday, the Parliamentary Finance Committee renewed its refusal to prejudice the salaries of employees, while it confirmed that the degrees of deletion and creation will be launched within the 2021 budget.

Committee member Naji Redis told the Iraqi News Agency (INA), "The reduction of state employees' salaries is totally untrue and causes an economic blow that affects the situation in the country." 

He added, "The Finance Committee and the House of Representatives are the ones concerned with the amendment and addition as they see fit," stressing, "absolutely not allowing any prejudice to the salaries of state employees."

Radis favored radically making amendments to the budget law regarding the issue of appointments, deletions, creation and addition of appointments in it, and not to reduce the salaries of employees and transfer from other chapters.

He pointed out that "the degrees of deletion and creation will be launched within the 2021 budget."

He continued, "The Minister of Finance, Ali Allawi, pursued the easy solution in reducing state salaries and raising the price of foreign currencies against the dinar and not looking for other solutions, such as maximizing state revenues from customs duties and direct and indirect tax revenues to create new financial resources and address waste in the oil sector and sell black oil to bypass the crisis".

Today, Saturday, Minister of Finance, Ali Abdul-Amir Allawi, announced the suspension of appointments, while revealing an exception for appointments made at the end of last year and early 2020.

Allawi said during his meeting with a number of journalists, including the correspondent of the Iraqi News Agency (INA), that "the ministry will issue a statement to raise the exchange rate of the dollar to 1450 dinars to one dollar," noting that "it will stop appointments, and there is an exception for appointments that took place at the end of last year and beginning of 2020." .

He added, "The central bank will add a margin to the specified price, as the margin that the central bank will add will not be large and may reach 1490 dinars," noting that "we have received the support of all major countries, the IMF and the World Bank, for the reform paper."

And he added that "the budget is the beginning of reform, and there will be other steps in the future to implement the paper."

He added that "the Kurdistan region exports its oil at prices that are less than SOMO oil by 5 to 7 dollars," noting that "the ministry reached an agreement with Kurdistan on the 2021 budget, and the present delegation is discussing its allocations for the year 2020."

He pointed out that "the Ministry of Finance did not leak the budget," and I categorically deny this, explaining that "Parliament and Parliamentary Finance and heads of the blocs have knowledge of the direction the government is taking."

The Minister of Finance revealed that "the budget may reach Parliament within a week."

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Iraq today

Parliamentary Finance reveals to "Al-Zawra" the details of its meeting with the governor of the Central Bank regarding the collapse of the local currency

Posted 4 hours ago
News source / Al-Zawra Newspaper
iraq-news-810x456.jpg
Al-Zawra Newspaper
News source / Al-Zawra Newspaper

 

Al-Zawra / Hussein Faleh:
The Parliamentary Finance Committee revealed the details of its meeting with the governor of the Central Bank regarding the collapse of the local currency against the dollar, and while the former deputy and economic expert, Rahim Al-Darraji, attributed the reasons for the high exchange rate of the dollar to the leakage of the 2021 budget before voting on it, he identified three treatments to reduce exchange rate.
A member of the Parliamentary Finance Committee, Representative Naji Redis, said in an interview with Al-Zawraa: The Finance Committee hosted the Governor of the Central Bank to discuss the issue of the large and sudden exchange rate of the dollar in the local markets. Indicating: that the governor emphasized that the rise was caused by the government and not the Central Bank.
He added: The dollar comes from Iraqi oil sales that go down to the Development Fund for Iraq in the United States of America, and therefore the real owner of the dollar is the Ministry of Finance, which sells the dollar to the Central Bank as the government accountant.
He explained: The Ministry of Finance, two months ago, refrained from selling the dollar in order to raise its price towards the Iraqi dinar to fill the public budget deficit, and to achieve some developmental processes according to what the government sees, and therefore the Central Bank’s justifications that the exchange rate rise is a government decision, and it was not a decision. Issued by the Central Bank.
He pointed out: that the Council of Ministers, up to this point, has not voted on the general budget. Stressing: that the Finance Committee has not received anything official from the government in this regard.
For his part, the former deputy in the Finance Committee and the economist, Rahim al-Darraji, said in an interview with Al-Zawra: The central bank bears the responsibility for the high exchange rate of the dollar as it is an independent body, and the government is not allowed to interfere with the monetary and financial policy of the central bank.
He added: The financial policy inside the central bank is a wrong policy that led to a monopoly on the window to sell the currency to certain destinations, which led to an abnormal rise in the dollar. Indicating: that the Iraqi citizen is the biggest loser from this rise, and also the state treasury is not benefiting from it, as for the interest only to the owners of private shops and banks belonging to well-known political parties.
He explained: The leak that occurred on the subject of the budget, and an item was mentioned regarding selling the dollar, led to confusing the market, and to encourage speculators in dollars to raise its price abnormally. Pointing out: that the government bears responsibility for leaking the budget before approval and the confusion that occurred in the market.
He pointed out: The treatments can be by stopping random imports for a week, while pumping large quantities of dollars into the local market, because the central bank sells daily up to 230 million dollars, it is assumed that 20 million go to the market and 210 million go abroad for the purpose of imports.
He continued: The central bank should also strengthen the outlets for selling currency and prevent monopoly to private banks. Indicating: There are 3 government banks that have dozens of branches, so the central bank can give authority to these banks to sell dollars, and in this way, the dollar can return to its normal state.
He pointed out: There is insistence on harming the Iraqi citizen, weakening the citizen's purchasing power, destroying the Iraqi market, and stagnating goods inside the market, and thus may lead to damages that may even affect the nature of the Iraqi government’s performance. It is likely that the dollar will continue to rise to significant levels

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19 hours ago, 3n1 said:

it stated the new currency would enter along side and traded with the 3 zero notes for a period up to ten years if anyone remembers those articles something much different from a traditional lop and thru the 10 year coexist period would enable the cbi to withdraw the old currency to preserve liquidity in the market 

If there is 10 years time limit to exchange dinars for dollars, then this is one time rv rate only and therefore, there will never be a second rate  a third rate, and so on.

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3 hours ago, rvmydinar said:

If there is 10 years time limit to exchange dinars for dollars, then this is one time rv rate only and therefore, there will never be a second rate  a third rate, and so on.

 

 i really don't even know what ur talking about with this multiple rate stuff no one knows what will take place period . please last time , just consider what i have typed on here as guru hopium nonsense and ill refrain for putting anything on here that seems like or maybe something that could take place , cheers and all the best to u rvmydinar ..we wait

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23 minutes ago, 3n1 said:

 

 i really don't even know what ur talking about with this multiple rate stuff no one knows what will take place period . please last time , just consider what i have typed on here as guru hopium nonsense and ill refrain for putting anything on here that seems like or maybe something that could take place , cheers and all the best to u rvmydinar ..we wait

3n1,

I remember that article.👍

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Deputy: The 2021 budget will be the largest in the history of Iraq despite the financial crisis

18:28 - 12/20/2020
 

 

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https://www.almaalomah.com/2020/12/20/511133/

The information / Baghdad ..

MP Muhammad Al-Baldawi confirmed, on Sunday, that the government will present the highest budget in the history of Iraq during 2021 despite the financial crisis.

Al-Baldawi said to "the information", that "the 2021 budget, which the government will present to the House of Representatives, will reach 150 trillion dinars, which is the highest in the country's history," noting that "this number did not reach even the explosive budgets, as if the country was not going through a crisis and had to borrow twice to secure salaries." Their employees ”.

He added, "The House of Representatives will push to protect the citizen and the employee in several ways if the budget reaches him because the government is unable to find and provide effective solutions to the current crisis," stressing that "the budget will be subject to dialogues and provide better solutions than the solutions of the government that does not have a vision in the economic scene." .

Iraq suffers from a severe financial crisis in light of government decisions that pushed to raise the exchange rate for the dollar, which contributed to increasing public opinion’s concern about food prices. Finished 25 F

 

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“The white paper is excellent.” An economist talks about the effect of raising the exchange rate and calls for frankness with citizens

1608666107_143119.jpg
Baghdad today
News source / Baghdad today
Baghdad Today - Follow-up

The economic expert, Thaer Al-Dulaimi, spoke, on Tuesday (12-22-2020), about the impact of raising the exchange rate of the dollar in the Iraqi market, while noting that the white paper of reform is excellent and should not be neglected.

Al-Dulaimi said in a televised statement that (Baghdad Today), that "there has been a recession in the Iraqi market for months and it increased a month ago due to late salaries and the lack of projects, and its level increased by changing the exchange rate," indicating that "the new exchange rate difference from the previous one will encourage the movement of local industry And it makes Iraqi goods competitive. ”

He added, "People should know that the economic reality is dangerous. Central Bank reserves do not exceed 50 billion dinars, while the internal and external debt exceeds $ 110 billion," noting that "operational expenditures, including salaries and allowances, reach 7 billion dollars a month while Oil revenues last month did not exceed 2.7 billion dollars.

And on the white paper that the government sent to Parliament to solve the economic crisis, Al-Dulaimi said that "the white paper on reform is excellent and its 97 papers should not be neglected and applied."

The economic expert, Dawood Al-Jumaili, said that Iraq has not relied on any economic theory in the mechanism of changing the exchange rate of the dollar against the Iraqi dinar, indicating that Iraqi funds were allowed in the previous exchange rate.

Al-Jumliy said, "The previous price of the dollar, of (1200), was considered a cheap exchange rate by the exporting countries. Therefore, Iraq was one of the largest commodity importers as it adopted an unreal dollar exchange rate and was not based on scientific theories, for the purpose of flooding the market with imported goods." .

He pointed out that "the lack of disclosure in the budget law on the real dollar price, and the authorization of the Minister of Finance to follow steps that would contribute to bridging the deficit, and after the leakage that occurred to the initial budget, the markets caught up with dollar prices."

The economic expert called "to put laws in the 2021 budget in order to protect the poor classes and people with limited income from sudden changes taking place in the Iraqi economy."

The Minister of Planning, Khaled Battal Al-Najm, confirmed, last Monday (December 21, 2020) that the Iraqi economy is going through the most difficult crisis in its history, resulting from the unilateralism and rentier nature of this economy.

The ministry said, in a statement received (Baghdad today), that "Al-Najm chaired a meeting of the follow-up cell for achieving the 2030 Sustainable Development Goals, and preparing the second national voluntary report that will be presented during the high-level meeting of the United Nations in the middle of next year."

He added that “the Iraqi economy is going through the most difficult crisis in its history, which is a complex crisis, accumulated over long decades of failures, resulting from the unilateralism and rentierness of this economy, making it reach a dead end, which requires urgent and effective measures to overcome the crisis, by establishing economic policies that help The growth of productive sectors, and the diversification of funding sources.

He pointed to “Iraq's obligations with the international community to achieve the goals of sustainable development, and these commitments receive important obligations on all sectors of the state, including the government, the private sector, civil society organizations, and the media,” pointing to “the role of sectoral ministries in achieving sustainable development goals, which represent the basis for reforms. The economic government that the government is working to achieve.

Al-Najm called for "adopting sustainable development standards in the construction of residential complexes, which adopt thermal insulation processes, and thus reduce electrical energy consumption, while continuing to educate citizens about the need to rationalize energy consumption in general."

On the day before yesterday, Bloomberg Economic Agency said that the decision of the Central Bank of Iraq, which was issued yesterday, Saturday, which includes adjusting the exchange rate of the US dollar against the Iraqi dinar, is a “deserved reduction in the value of the national currency.”

In a report translated (Baghdad Today), Bloomberg explained that the measure “reduces the currency by about 20 percent against the dollar,” indicating that it came “to avoid depleting countries’ foreign currency reserves after the Corona virus drained energy demand and caused a collapse the prices".

The agency stated in a report that "this measure is the first of its kind since 2003. It was an inevitable reduction of the dinar due to the low oil prices and budgetary pressures facing Iraq."

The government pledged that this reduction would be one-time and not be repeated, but the Bloomberg report warned of the importance of monitoring the public response to the upcoming increase in the cost of living and the government's austerity program.

The central bank statement announced the reduction of the price of buying foreign currency from the Ministry of Finance from about 1190 dinars per dollar to 1450 dinars, while the selling price of foreign currency to banks became 1460 dinars per dollar, and 1470 dinars per dollar the price of selling foreign currency to the public.

In turn, the Iraqi Ministry of Finance said that “adjusting the exchange rate is a political decision of the Iraqi leadership, and it is a decision that enjoys the support of political and parliamentary forces and economic actors that participated with the government in lengthy discussions to reach this measure, in addition to the competent international bodies, including the International Monetary Fund.

The International Monetary Fund expects that the Iraqi economy will contract by 12% this year, and that its budget deficit will reach 22% of GDP

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