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Iraqi News Thursday AM 12-17-20

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Parliamentary Finance Holds An Emergency Meeting To Discuss The Reasons For The High Dollar And The Draft Budget Leaked

Pratha News Agency99 2020-12-17  The Parliamentary Finance Committee will hold an emergency meeting this afternoon, Thursday, to discuss the reasons for the high exchange rate of the dollar, and to discuss the leaked draft budget law for 2021.

The main stock market and local markets in Iraq are witnessing a significant increase in the exchange rates of the dollar against the Iraqi dinar, as the Kifah Stock Exchange recorded, earlier in the day, 137,000 dinars against 100 US dollars.

While the selling price in the local market was 138,000 dinars per 100 dollars, and the purchase price was 136,000 dinars per 100 dollars.   And earlier today, Thursday, the draft general budget bill for 2021 was published, which included deductions from employees’ salary allocations, and the imposition of taxes on several sectors.

Parliamentary Finance Holds An Emergency Meeting To Discuss The Reasons For The Rise In The Dollar And The Draft Budget

Time: 12/17/2020 12:41:58 Read: 4,251 times   {Baghdad: Al Furat News} The Finance Committee will hold an emergency meeting this afternoon to discuss the reasons for the high exchange rate of the dollar, and to discuss the leaked draft of the 2021 budget law.

The exchange rate of the dollar had risen again, and it reached 1340 dinars in the Central Kifah Stock Exchange in Baghdad against the dollar.   Sources indicate that prices are not fixed.

In addition, {Al Furat News} published a draft of the federal financial budget bill for 2021.

The budget included a surprising price in the exchange of the dollar, as the government proposed to install it at 1450 dinars per dollar.   It also included reducing the allocations granted to state employees.

According to the draft, the estimated revenues from exporting crude oil will be calculated on the basis of the rate of (42) dollars per barrel.

The draft budget for the year 2021 includes imposing a tax on gasoline and aviation fuel at a rate of 20%, and the price of a liter of gasoline will be 540 dinars instead of 450 dinars, and the price of kerosene increased by 15%.

A 10% sales tax will also be imposed on all commercial stores, cigarettes, cars, alcoholic beverages, and barber shops for men and women.   LINK

Member In Parliamentary Finance: The Leaked Version Of The Budget Is Unofficial And Not Approved

Time: 12/17/2020 13:35:10 Read: 4,667 times  {Baghdad: Al Furat News} A member of the Parliamentary Finance Committee, Hoshyar Abdullah, confirmed, on Thursday, that the leaked version of the budget is unofficial and not approved.

Abdullah said in a press statement that “this leaked version of the 2021 budget is unofficial and not approved,” indicating that “the budget so far is still in the cabinet and has not been discussed, and in the Finance Committee and Parliament we have not officially received any copy of it.”

He added, “These leaks are part of the government’s floundering, and it bears it and bears the confusion of the market, the currency rate and the economy.”  LINK

A Jump In The Exchange Rates Of The Dollar In Iraq

Pratha News Agency 100 2020-12-17  The exchange rates of the dollar rose again, on the main stock market and local markets, today, Thursday (December 17, 2020).

The Kifah Stock Exchange recorded 137,000 dinars against 100 US dollars, while the exchange rates for Wednesday in the Kifah Stock Exchange were 129,500 dinars per 100 dollars.   As for the exchange rate on the local market, it also rose where it was —  Sale price: 138,000 dinars per $ 100.   Purchase price: 136,000 dinars per $ 100.

The High Exchange Rate Of The Dollar Is A Matter Of Concern To The Citizen And The Legislature

Thursday 17th December 2020   32  Baghdad: Morning  Yesterday, Wednesday, the dollar exchange rate in all governorates of Iraq reached 129 thousand and 500 dinars against one hundred dollars, at a time when the Central Bank set the dollar exchange rate at 1190 dinars per hundred dollars.

The Parliamentary Economic and Investment Committee attributed the reasons for the high exchange rate of the dollar against the dinar in the local markets to the decline in the cash reserves at the Central Bank to 46 billion dollars.

A member of the committee, MP Hamid al-Mousawi, explained in a press statement that the high exchange rate of the dollar against the dinar is a matter of concern to the citizen and the legislative authority, pointing out that “Parliament is unable to interfere with the policy of the Central Bank,” indicating that “the statements of the Minister of Finance regarding changing the exchange rate in the paper Al-Bayda led to an increase in the price of the dollar in the local markets.

He indicated that the monetary reserves at the Central Bank during the war against ISIS amounted to $ 65 billion, and $ 5 billion was withdrawn from it by the Al-Abadi government.

Indicating that the current cash stock reached 46 billion dollars. He continued, that oil sales from 2003 to 2018 amounted to 970 billion dollars, pointing out that the banks entering the currency auction are linked to well-known political parties.  LINK

Humam Al-Shamaa: Violating The Local Currency Does Not Serve The Economic And Financial Reality Of The Country

Thursday 17, December 2020 14:13 | Economical Views: 201  Baghdad / NINA / Economic expert Hammam Al-Shamaa affirmed: “The prejudice to the local currency and the high exchange rate of the dollar does not serve the economic and financial reality of the country in light of the current circumstances.”

He said in a statement to the Iraqi National News Agency ( NINA ): “What is being circulated is that the amount of the budget is double the budgets of Syria, Jordan and Iran, which expresses an incorrect financial policy.”

Al-Shamaa added that: “It is assumed that other sectors will be revitalized to be a substitute for the single resource that is constantly affected by any regional and international developments.”

He explained: “The manipulation of the value of the local currency against the dollar is a negative matter, the results of which will affect the overall living situation, which mainly suffers from an ongoing crisis. “/ End 3

The Parliamentary Economic Committee Meeting Begins, In The Presence Of The Central Bank Governor, To Discuss The Rise Of The Dollar   Pratha News Agency115 2020-12-17

Representative Economy Meets With The Governor Of The Central Bank

Time: 12/17/2020 14:24:12 Read: 2,782 times  {Baghdad: Al Furat News} The Parliamentary Economic and Investment Committee held a meeting with the Governor of the Central Bank of Iraq, Mustafa Ghaleb.

The meeting coincided with the significant rise in the dollar exchange rate, which exceeded 1,300 dinars.

It is noteworthy that the governor is facing interrogation in the House of Representatives at the request of the questioned deputy, head of the Parliamentary Wisdom Bloc, Faleh Al-Sari.    LINK

The Start Of The Meeting Of The Economic Committee With The Governor Of The Central Bank

Economie| 02:29 – 12/17/2020   BAGHDAD – Mawazine News  The Parliamentary Economic and Investment Committee began its meeting, on Thursday, with the Governor of the Central Bank.

The Media Department of Parliament stated, in a statement that Mawazine News received a copy of, that “the Parliamentary Economic and Investment Committee held a meeting today with the Governor of the Central Bank.”

It is scheduled to discuss the recent rise in the price of the dollar in the Iraqi market. Ended 29 / A43

The Parliamentary Economic And Investment Committee Hosts The Governor Of The Central Bank

12/17/2020  The Parliamentary Economic and Investment Committee, headed by Representative Ahmed Salim Al-Kinani, and the presence of its members, on Thursday 12/17/2020 hosted Mr. Mustafa Ghaleb, Governor of the Central Bank.

The meeting discussed the central bank’s work on the window for selling the currency and the instability of the dollar exchange rate, as well as the central bank’s monetary policy plan.

And the governor of the central bank gave a detailed explanation of the work of the central bank and selling the currency through the single window.

Al-Kinani added that the committee is working to prepare a detailed report on the work of the central bank and how to control the window for selling the currency through practical procedures presented to the central bank, monitoring imports and excluding false imports, calling for accountability for violating and lagging banks and imposing financial penalties on them.   House of Representatives  Media  Department 12/17/2020   LINK

Representatives Warn Of The Continuing Rise Of The Dollar, And Are Aiming At The Bank’s Governor: Enough!

08:42 – 12/17/2020   The information / Baghdad ..Representatives from various political blocs warned of the continued rise in the dollar exchange rate against the Iraqi dinar, stressing at the same time the need to hold the central bank governor accountable for the lack of control over the exchange rate.

A member of the Finance Committee, MP for Al-Hadi Mohan, told “the information”, that “the unconsidered policy of the Central Bank caused an increase in the exchange rate of the dollar against the dinar, and therefore this rise must be controlled through quick measures.”

For his part, the representative of the Al-Fateh Alliance, Hassan Al-Kaabi, confirmed that “the policy of the Central Bank is not balanced, and the currency auction gives privileges to some parties at the expense of others,” pointing out that “the Al-Fateh Alliance confirmed the questioning of the governor of the Central Bank after enough enough and harm to the citizen economically”.

In addition, the deputy from the Saeron Alliance blamed Star Jabbar, “the central government is responsible for the continued high exchange of the dollar against the dinar, due to its lack of control over the economic situation as well as the merchants’ plans.” 25 n

Baghdad Chamber Of Commerce: The Exchange Rate Of The Dollar Will Return To Stability Within Days

Thursday 17, December 2020 14:45 | Economical Views: 221  Baghdad / NINA / The Baghdad Chamber of Commerce assured traders, citizens and markets that the exchange rate of the US dollar will return to stability in the coming days.

In a statement received by the Iraqi National News Agency ( NINA ), Chairman of the Chamber’s Board of Directors, Firas Rasul Al-Hamdani , called on the government to prepare a pre-emptive plan to organize the process of monetary stability of the Iraqi currency against the dollar, through a plan organized with the competent authorities of advisors and expertise in the financial field.

Al-Hamdani asserted: “The events, the accelerating waves of news, speculations and rumors have generated anxiety within the Iraqi market, and that the specialized committees in the state are able to maintain the stability of the exchange, especially since the 2021 budget is still a draft under discussion and study.” / End 3

Al-Kazemi Government Announces A Revolution Of High Prices For The People .. Who Will Benefit?

Political| 03:20 – 12/17/2020   Special – Mawazine News  After the financial crisis that hit the world’s economies, especially the rentier one, including the Iraqi economy due to the Corona pandemic, which plunged black gold prices to about $ 10 per barrel, the commercial closure of many countries, and the imposition of strict restrictions on commercial and civil travel, Iraq is on the verge of a revolution of high prices starting from Early next year, ”

millions of dollars that go out from the window of sale of currency in the Central Bank of Iraq, days ago, and the exchange rates of the Iraqi dinar against the US dollar are gradually increasing until, at the time of writing the report, they reached about 1135 dinars for every one dollar.”

  • How the exchange rate works

In most countries of the world there exchange currency, which sets the price of the changing almost every twenty seconds , which is mainly based on supply and demand, ie , the greater the demand for the currency increased price, and the greater the offer say the price according to the researcher economic Aqeel Ansari “.

  • reasons for increased demand or The offer

, Al-Ansari said in his interview with / Mawazine News / that “the average citizen and the merchant cannot buy directly from the stock exchange, but rather through intermediaries, and most of the time banks play the role of mediator, and in some cases banking companies play this role.”

And that “banking companies work mainly to buy currencies from customers and exchange them for the local currency, and here they have a stock of currencies and can change the price according to local need without referring to the specified price.”

As for banks, they buy currencies from the currency exchange, so how do they make profits ?!

Al-Ansari answers that by saying: Banks in general add certain percentages above the offered price, starting from 25 points and reaching 1500 points, meaning from 0.25% to 15%, and this is called “Bank Margin,” or the bank’s profit margin. As for the banking companies, they work in the same way. The same, but with a smaller margin, and some of them add a “commission”, which is their profits.

As for Iraq, we see the contradiction of everyone’s work. The Central Bank of Iraq works as a currency exchange (there is no currency exchange in Iraq!) As Al-Ansari said, pointing out that “some banks have left the basis of work. The banker focused on benefiting from currency profits and turned into banking companies and brokerage offices, and that some banking companies do the work of banks, from lending and transferring.

The economic researcher proposed a solution, which is to find the FX Market for investment that works side by side with the Iraq Stock Exchange, and is responsible for exchange rates depending on the base of supply and demand, and as for banks, they must be evaluated according to their basic work, which is banking, and transfers are Secondary service, not essential. ”

The Central Bank of Iraq and other branches such as the Office of Financial Supervision, the Integrity Commission, etc., their role to supervise, control and protect the customer under the competition law and other laws such as money laundering and crime fighting, as Al-Ansari explained, as he emphasized that this means liberalizing the price of the circulated currency For merchants and citizens, and if the Central Bank of Iraq wants, then let him maintain the exchange rate fixed for government transactions only.

According to Iraq’s draft budget for 2021, which is still in the Council of Ministers, the estimated revenues from exporting crude oil were calculated on the basis of an average price of $ 42 per barrel, with a total monthly export of 3,250,000 barrels per day, including 250,000 barrels per day for the quantities of crude oil produced in the fields of the Kurdistan region on the basis of An exchange rate of 1450 Iraqi dinars per US dollar, and all actually realized revenues are recorded as final revenues to the account of the Iraqi state’s public treasury.

This paragraph within the federal financial budget for the next 2021 will lead to an increase in the prices of food, supply, consumer, industrial, agricultural, etc. This led to further economic deterioration, “according to the economist Haitham Al-Hassani, who told Mawazine News that this happened.”

Al-Hassani wondered what is the benefit of drawing a financial policy without drawing a monetary policy, indicating that “these measures are a double-edged sword,” pointing out that “these measures are left to support the budget deficit and reduce the value of borrowing from increasing taxes, raising subsidies, increasing fees, and other measures mentioned in the law. Balancing is a good thing. ”

He said Hassani will be the result of these measures are sanctions on citizens , especially that the Ministry of Planning reports of an unprecedented rise in the poverty rate in Iraq with the rising number of unemployed “.

  • Revolution price increases

play parity value of the national currency a significant role in determining the goods and services prices In Iraq, the lower its value against the major currencies, the higher the inflation, as the importer – and thus the consumer – must pay more sums to buy imported goods. ”

The effect of exchange rates on inflation will be evident and dangerous in Iraq, which imports up to 75% of its food, consumer, industrial, agricultural and other needs, and pays millions of dollars annually for that.

Since the beginning of this year, the exchange rate of the Iraqi dinar has witnessed record stability despite the political events and the resignation of the government headed by Adel Abdul Mahdi and the apology of the new commissioners (Adnan Al-Zorfi – Muhammad Tawfiq Allawi), and then the selection of the head of the intelligence service, Mustafa Al-Kazemi to head the new government until early elections that were determined later. To be in June 2021.

According to economists, the new rise, which will continue throughout the next year, will exhaust the Iraqi citizen, stressing that the high exchange rate negatively affects the lives of citizens, and makes them reluctance to buy goods until their price drops, which generates another loss for sellers.

The upcoming rise in the national currency exchange rate against hard currency has a positive relationship with the Iraqi market; Prices are directly related to whether the dollar is high or low; For example, if the exchange rate became 1400 dinars against one dollar after the previous price was 1200 dinars for every one dollar, then the value of the commodity in the market would jump to half its price, the need for the price would be 1000 dinars would jump by a high rate to be double 2000 dinars, Mad each good and service And imported goods, whether private or local, that are directly affected by the foreign currency exchange rate variations within the country.

The issue of prices reflects everything. The link between prices and domestic and imported production in the US dollar is the country’s loss (of its sovereignty), and it is practically a result of the decline in domestic production and dependence on imports, and the mastery of money owners and the owners of huge profits from influence and monopolistic trade, and their pursuit of a speculative quick profit.

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