An economic expert raised several questions regarding the Central Bank of Iraq’s dollar sales and their comparison with previous years.
Manar Al-Obaidi said in a statement, a copy of which was received by {Al-Furat News}, “By reviewing the Central Bank’s sales of the dollar, both cash and remittances, it is noted that the bank’s sales of foreign currency cash to the local market were not greatly affected in 2023, which is the year in which the crisis of American restrictions on dollar sales began.” “.
He added, “According to Central Bank data on foreign currency sales to local markets, the value of dollar cash sales in 2023, the year of the dollar crisis, amounted to 8.4 billion US dollars, noting that the average foreign currency sales of the dollar from 2006 until 2022 amounted to 6.1 billion dollars.”
He pointed out that “the Central Bank’s sales of cash are higher than the average sales of the Central Bank over all the past years, and the ratio of cash sales to total foreign currency sales in 2023 was 25%, while the average ratio of cash sales to total foreign currency sales was over Extension of years (2006-2022) 18.7%.
Al-Obaidi stated, “What actually decreased and was affected were the Central Bank’s sales of dollars through the remittance window, as the value of the Central Bank’s sales through the remittance window for the past year amounted to 25 billion dollars, while the average foreign exchange sales of dollars from 2006 until 2022 was 31 billion US dollars and amounted to The highest value of the Central Bank’s sales from the remittance window in 2019, amounting to 45 billion dollars.”
He explained, “From these numbers, it is clear that what affects the exchange rate in the local market is the decrease or increase in the central bank’s sales of foreign currency through the remittance window, and not cash sales, which were not greatly affected over the previous years.”
The economic expert pointed out, “Based on these numbers, two questions arise. The first is: If the majority of the Central Bank’s sales of foreign currency over the years from 2006 to 2023 were through the remittance window, at a rate of 84% of the Central Bank’s total sales, then what is the source of foreign currency?” Which was available in the local markets? Why was the parallel exchange rate affected by the remittance sales window if the demand was to cover the internal need, given that the remittance window sales deliver hard currency outside Iraq?
He said, “The sales of the Central Bank through the cash window from 2006 until 2023 amounted to more than 113 billion US dollars, and where was this mass of hard currency consumed? Was it all consumed outside Iraq to cover the travel expenses of Iraqis? Or was it done to cover specific types of merchants that were not Can you enter the external transfer window, or was it used for other purposes?
Al-Obaidi continued, “These data and questions require a deep analysis to know what the foreign currency cycle is in Iraq and who is responsible for the continued demand for it in the local market despite the high remittance window. Does Iraq really need cash sales of the dollar amounting to $9 billion annually, and what are the reasons for this demand? Is it really to cover foreign trade with countries that are prohibited from dealing with?
The Central Bank’s management plans to gradually cancel the dollar auction during the year 2024, leading to its complete cancellation by the end of the year, and to maintain it for audit and statistical purposes, in an effort to enable Iraqi banks to establish and establish solid banking relationships with the global and regional banking sector in order to achieve the sobriety of the Iraqi banking sector and full commitment. According to international standards and requirements.
Iraq relies on the platform for selling currency directly to local banks and companies, which was previously known as the daily dollar auction, as one of the mechanisms for preserving the value of the Iraqi dinar and combating speculative operations in the parallel market.
alforatnews.iq
