Thursday Morning Iraq Economic News Highlights 7-6-23
Parliamentary Finance Determines The Reasons For The Rise In The Dollar And Calls On The Government To Develop Solutions
A member of the Parliamentary Finance Committee attributed the continued rise in the dollar exchange rate in the “parallel” local markets to several reasons.
Ali Jabbar Moanes said in a press interview seen by “Takadam” that “the issue of high exchange rates reached its climax at the beginning of this year, and what happened in terms of a gradual decline in prices was after the decisions of the Central Bank and the government to reduce exchange rates.”
He added, “The reasons behind the current rise are due to the commitments of merchants and banking transactions, which constitute a great loss if the official price is relied upon.”
Moanes explained that “there is stability in the exchange rates at 146,000 thousand dinars per hundred dollars, in commercial transactions, and that the main reason for the difference in prices is because of supply and demand and commercial dealings that do not allow prices to go down to the figure specified by the government.”
Moanes called on “the government to seek solutions and find alternatives in controlling exchange rates, which have not been controlled.”
It is noteworthy that the local markets are witnessing a rise in the exchange rate of the dollar, as it sometimes reaches 1490 dinars per dollar, while the official price set by the state is 132 thousand dinars.
And the reason for the rise in the dollar on local prices and sales, which caused a state of increasing stagnation with the lack of construction and the scarcity of investment projects that stopped years ago, in the hope that they will be initiated after the approval of the budget law that Parliament voted on on the 12th of last June. https://takadum-news.com/archives/172256
Fears Of New Jumps In The Exchange Rate And The Decline In The Value Of The National Currency
Posted On 2023-07-06 By Sotaliraq Baghdad / Firas Adnan
The exchange rates of the dollar are still rising in the local markets, despite government measures, while observers are calling for the absorption of the national currency in the markets to preserve its value in conjunction with the imminent launch of the allocations of the budget law.
Representative Ali Jabbar Moanes says, “The central bank’s tendencies contributed to controlling the exchange rate of the dollar after it reached its peak at the beginning of this year.”
Moanes continued, “The commitments of merchants and banking transactions are among the main reasons for the current rise in the dollar’s exchange rate in the parallel market.”
He pointed out, “The prices in the market, although they are higher than the official price, are witnessing a kind of stability at 1460 dinars per dollar.”
However, Moanes called on the government to “make more efforts to bring the price in the market close to the official price approved by the budget at 1,300 dinars per dollar.”
For his part, economic academic Safwan Qusai said, “The Ministry of Finance’s survival on the same policies will help the depreciation of the Iraqi dinar.”
Qusai continued, “The dinar that will be released by the ministries after the implementation of the budget law is higher than the previous spending.”
He pointed out, “Iraq is an importing country, and the increase in pumping the dinar into the markets will contribute to increasing the demand for the dollar, whether through the window of selling the currency to meet the consumables or through the parallel market.”
And Qusay demanded, “To work within the detection of cash flows, by observing the path of the Iraqi dinar, where it comes from and where it goes.”
And he noted, “This is happening through an effective electronic collection system at the level of all government units.”
Qusai believes that “pumping the dinar without absorbing it will help in rising inflation and increasing the price of the dollar in the parallel market.”
And he stressed, “the need to link border crossings, customs, and the spread of technological systems at the level of all government institutions in order for us to have a policy in financing and re-acquiring the dinar at the level of some federal ministries that can obtain it again.”
And he stated, “The World Bank referred in its recommendations to a set of observations that are not related to the central bank, but are linked to financial and economic policy.”
Qusai noted, “The recommendations included asking the government to reduce the number of workers in public sector institutions and to increase the level of collection and its activation.”
And he believed that “it is not reasonable for Iraq to spend no less than 109 trillion on salaries and compensation for workers, while the recovery is 17 trillion dinars.”
Qusai stressed that this “difference will go into the pockets of the corrupt and the import, and therefore we need a process of integration between the economies of the provinces and reduce dependence on exports.”
And he stressed the importance of “activating the role of industry and agriculture to return the Iraqi dinar to the Ministry of Finance, which is the guarantor of ensuring the stability of the exchange rate according to what is officially established by the government.”
Qusai continued, “The Ministry of Finance has a set of solutions, such as selling part of its property in Iraqi dinars to state departments and not to other parties in order to ensure that the national currency is returned to the public treasury.”
Qusai went on to say that “the injection of money without a recovery process, means that we are facing an increase in inflation rates, with the exacerbation of the waste of public money with the rise in the price of the dollar in the parallel market.”
For his part, economic specialist Abd al-Rahman al-Sheikhly described, “the variables of the exchange rate of the dollar in the parallel market as a game of cat and mouse.”
Al-Sheikhly continued, that as for “Iraq’s continued dependence on oil rents as it is now, the turmoil in the exchange rate will continue.”
He agrees with Qusai, with “the need to look for other sources to finance the budget and reduce dependence on foreign imports, by activating the industrial and agricultural sectors.”
Al-Sheikhly concluded, “Iraq has fully developed a consumption budget based on the operational side, and this helps demand the dollar and its high prices in the market.”
It is noteworthy that the exchange rate witnessed an unprecedented rise since the end of last year, in conjunction with the launch of the electronic platform that requires private banks to participate in it in exchange for obtaining their share in the currency auction, and the refusal of some of those banks to participate in the platform led to a deficit in dollar sales in Markets in conjunction with increased demand. LINK
A Request To Investigate The Distortion Of The Budget .. Parliament Will Resume Its Sessions Next Week
Posted On 2023-07-06 By Sotaliraq It is hoped that the parliament’s legislative recess will end next week, so that it can resume its sessions, while one of the deputies submitted a request to the Public Prosecution in order to investigate what he considered a distortion in the budget law and to make an addition to one of its items contrary to what was voted on.
Representative of the State of Law Coalition, Firas Al-Maslamawi, said in a press statement that the legislative recess for the House of Representatives began after the approval of the Iraqi state’s general budget law, and ends on the 13th of July.
He added: It is expected that the House of Representatives will resume its sessions at the end of next week, and there is no legal problem or violation of the rules of procedure regarding the convening of the new legislative term days after the end of the legislative recess.
And the House of Representatives voted on the dawn of Monday, the twelfth of June, on the general federal budget law “with three years 2023, 2024, 2025” for the Iraqi state, after discussions inside the dome of Parliament that lasted for five days.
The value of the current year budget is 197 trillion and 828 billion Iraqi dinars (about 152.2 billion dollars), with a total deficit of 63 trillion dinars (48.3 billion dollars).
In addition, a document by Representative Jabbar Al-Kinani showed that he had addressed “the Public Prosecution according to the oversight purposes stipulated in Article (61/Second) of the Constitution and Article (15) of Law (15) of the House of Representatives Law and its formations No. (13) of 2018 and the Law of the Apparatus Public Prosecution No. (11) of 2017.
Al-Kinani spoke in the document about what he called “some of the violations that were monitored in the Federal Budget Law No. (13) for the year 2023.”
And he continued, “After the Federal Budget Law No. (13) for the year 2023 was ratified and published in the Official Gazette, it became clear that there were manipulations and additions within the attached tables that were not present during the vote on some articles under the dome of Parliament.”
Al-Kinani indicated that “table (f) paragraph (15), point (5), page number (73), which includes (completing the contract with the annex of lecturers and administrators according to Resolution (315) in Diwaniyah. Anbar – Basra – Diyala.”
He pointed out that “Article (67/Second) voted on included only three provinces (Diwaniyah – Basra – Anbar).”
Al-Kinani confirmed, “The attache of the lecturers and administrators of Diyala Governorate did not vote on it, but rather it was inserted into the tables illegally, and after the voting was completed.”
Al-Kinani called for “taking legal measures regarding the investigation of these violations and crimes related to adding some categories and requesting a complaint against anyone whom the investigation finds guilty.”
The government had previously submitted an appeal against 12 articles of the budget, and requested the Federal Supreme Court to issue a state order to stop the implementation of these articles until the lawsuit filed by it is resolved. LINK
A List Of Dollar Exchange Rates In Baghdad And The Provinces
Economy |Baghdad today – Baghdad Today, Thursday, the exchange rates of the dollar against the Iraqi dinar witnessed stability in the local exchanges in the capital, Baghdad, and in the provinces.
According to the monitoring of the currency exchange market variables in the capital, Baghdad, and the country’s governorates, the prices were:
In Baghdad: The purchase price of the dollar is 149,000 per 100 dollars
The selling price of the dollar is 147,000 per 100 dollars
In the north: The purchase price of the dollar is 148,750 per 100 dollars
The selling price of the dollar is 146,750 per 100 dollars
In the south: The purchase price of the dollar is 149,000 per 100 dollars
The selling price of the dollar is 147,000 per 100 dollars
It has turned into hotbeds of corruption and the introduction of contraband… Will Baghdad impose its prestige on the outlets of the Kurdistan region?
private files |Baghdad today-Kurdistan
Attention is drawn to the outlets and crossings of the Kurdistan region, and whether they will be under the aspirations of the federal government in Baghdad, after the latter succeeded in winning an international invitation that included stopping the region’s export of oil alone through the Turkish port of Ceyhan, and what is the possibility that Baghdad will succeed in bringing those border points under its control, as happened with oil?
During the last period, many Iraqi parliamentarians and political figures accused the outlets of Kurdistan of not being subject to the supervision of the federal government, in addition to the practice of “some” smuggling operations and the introduction of prohibited materials, and they demanded several times to make them under the control of Baghdad.
Prestige of the state
Earlier in the day, the Border Ports Authority revealed the existence of 11 ports in the Kurdistan region, 6 of which are officially recognized by the authorities in Baghdad, and 5 others are unofficial, indicating that there is a plan to link the ports of Kurdistan with the ports of the federal government as soon as possible.
The director of the Iraqi Border Crossings Authority, Omar Al-Waeli, said in previous press statements: “The government has a tendency to impose the state’s prestige on the region’s outlets that are not subject to its control,” noting that “the region has 5 border outlets that are not officially recognized by the federal government in Baghdad.”
He pointed out that “the governments of Baghdad and Erbil will soon move on the outlets of Kurdistan,” noting that “this will be done after completing control of the other outlets that fall within the responsibility of the federal government.”
Number of official outlets
And the Director General of Kurdistan Customs, Samal Abdul Rahman, revealed in an interview with “Baghdad Today” that “there are 8 official border crossings in the region that are registered with the Iraqi government,” and he adds: “Our direct link is with the Ministry of Finance in the regional government, and the revenues go to the mentioned ministry.”
He says, “We have full commitment to the decisions issued by the federal government and its various ministries, regarding preventing the import of certain materials. As for managing the ports or handing them over to Baghdad, we have not received any new directives in this regard, and this matter is within the jurisdiction of the regional government.”
Recently, the Iraqi parliament voted on the share of the Kurdistan region in the general budget for the next three years, while it was agreed to hand over the region’s oil in full and place it under the supervision of the National Oil Company “SOMO”.
Big corruption file
The former Kurdish deputy in the Iraqi parliament, Sarkot Shams al-Din, confirms that the border crossings in the region are a large file of corruption, exceeding what is in the oil and gas file.
He added in his interview with “Baghdad Today” that “the border crossings in the region are not subject to the authority of the Kurdistan government, but rather to the ruling parties. The ports located in Erbil and Dohuk are managed by the Kurdistan Democratic Party, and the ports located in the governorates of Sulaymaniyah and Halabja are managed by the Patriotic Union of Kurdistan, and the revenues The money goes to the two ruling parties.
He pointed out that “the federal government is required to impose its control over the border crossings, as it did with the oil file, and to end corruption and large thefts carried out by the ruling power parties in the region.”
Revenue sharing
On the other hand, economic expert Bahgat Ahmed acknowledges that “Baghdad cannot fully impose its control over the border crossings in the region.”
Ahmed explained in his interview with “Baghdad Today”, that “the Iraqi constitution recognized that the management of border crossings in Kurdistan is through the regional government, and any directives or instructions from the federal government are through the Kurdistan government.”
He explained that “with regard to the quantum revenues, it will be shared, at a rate of 50% to the federal government, and 50% to the regional government, according to the financial budget law.” LINK
