The Central Bank of Iraq indicated, on Saturday, a set of opportunities and challenges for the Iraqi economy, while announcing an increase in the volume of internal debt to about 70 trillion dinars, and the volume of foreign reserves to 113 billion dollars.”The Central Bank of Iraq has a key role in financial and economic stability, as this year has witnessed many changes to contribute towards stability in Iraq,” Deputy Governor of the Central Bank, Ammar Khalaf, said in a speech during the Sixth Annual Conference on Finance and Banking Services.
Khalaf added, “There are many opportunities for the Iraqi economy, the Central Bank, all ministries and the private sector, including GDP growth and a surplus in the General Budget Law affected by global oil prices, and an increase in the volume of deposits and credit in general, as well as the increase in foreign reserves to 113 billion dollars.”He pointed out that “despite these opportunities, there are challenges, including the adoption of the budget law with a very large size in which public expenditures reach 198 billion, as planned this year, and also with a financial deficit of 64 trillion dinars, and this in itself represents a challenge for the economy and the Central Bank of Iraq in particular.”He pointed out that “another challenge is the rise in the internal debt, which amounted to about 70 trillion dinars, and this represents a challenge for the monetary authority, as well as the financial authority in the mechanism of managing this debt because of its great pressure on the various monetary policy tools.”He continued: “In the last edition of the fifth conference, we mentioned the importance of electronic payment and the important performance it represents to achieve economic growth, financial inclusion and financial depth, and we stressed that there must be a coercion to adopt its tools. This year was achieved through the great support of the current Iraqi government and the great efforts launched by the Central Bank of Iraq, and we have recently witnessed a great movement by the public sector as well as the private in the adoption of electronic payment tools, and this is a very important thing to achieve economic growth and financial affairs in Iraq.”He added: “In this area, we see an increase and increase in electronic payment tools, for example, the number of different cards has increased from 6 million cards to 16 million, as well as an increase in the number of payment devices from 918 devices to more than 10 thousand devices, as well as an increase in the number of ATMs from 656 devices to more than 2000 devices, which is in continuous increase, there is also an increase in the number of open and efficient e-wallets from 222 thousand wallets to more than 3 million wallets, and this represents a real transition for the sector.”He stressed that “the Central Bank of Iraq has sufficient flexibility in adopting appropriate monetary policies, as this year it has been working on a number of changes in various monetary policy instruments, for example, it raised the policy price from 4 – 7.5%, as well as raising the interest rate on the instruments of the Central Bank of Iraq from 3-4 to 7.5%, as well as raising the legal reserve rate from 15 – 18%,” pointing out that “all these different tools seek to manage the surplus cash liquidity in addition to what the electronic platform does by achieving the surplus liquidity resulting from increasing public spending.”
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