Tishwash: The budget revives currency markets in Iraq
The unanimous vote of the House of Representatives, last Wednesday, on the Federal Budget Law for 2021, left a general impression of satisfaction at the official and popular levels.
Parliament ended many months of disagreements and quarrels between the political blocs, as well as the effects of the failure to approve the budget on movement, market and trade, which showed signs of a return to activity, yesterday, through the relative rise in the movement of buying and selling currencies.
Traders in the stock market in the Shorja area in Baghdad said, “The market witnessed good movement and the price of the dollar rose slightly against the dinar, as a result of approving the budget.”
They attributed the reasons for this to that “traders and even ordinary citizens had expected that the decision to reduce the value of the dinar against the dollar, which was approved by the government last year, would be reversed. However, the approval of the budget while the exchange rate remained in a state encouraged the return of market movement to normal.”
The Baghdad Stock Exchange closed yesterday evening, Thursday, at 1467 dinars to one dollar. link
Tishwash: A deputy calls for an emergency session and sends a warning to the governor of the Central Bank
MP for the Badr Parliamentary Bloc Uday Shaalan Abu Al-Joun called, today, Friday, the Presidency of the House of Representatives to set an urgent date for an emergency session in the presence of the Governor of the Central Bank to find out the repercussions of high market prices due to the insistence not to reduce the exchange rate, warning against interrogating the governor The Central Bank, as a prelude to his dismissal, in case it sticks to its positions that are not in the interest of Iraq and its people
Abu Al-Jun said in an interview with Alsumaria News, “The Al-Fateh Alliance in general and the Badr Bloc, especially when it participated in the voting session on the budget, despite its reservations on many of its articles, especially with regard to the exchange rate of the dollar against the dinar, it was a matter of paying the greatest damage in order not to say that we obstruct Passing the budget that the Iraqi people have been waiting for so long
Abu Al-Joun added, “Today, after the budget has passed, this matter does not mean that the exchange rate has become a thing of the past and will not be reduced. Rather, we will work continuously to pressure the executive authority and the Central Bank to reduce it and take immediate measures to address the economic crisis and the rise in prices in the market,” pointing out that “” And within the first steps, the Presidency of the House of Representatives is required to hold an emergency session as soon as possible in the presence of the governor of the Central Bank devoted to discussing the exchange rate and the reasons for the central bank’s insistence not to reduce it.
He stressed that, “In the event that the governor refrains from attending the session or his answer is not convincing, then we will work to pressure to question him, and the national forces within the parliament must stand with the Iraqi people and not with the parties benefiting from the central bank’s confusion, and the oath is preserved and moral and legal responsibility is not shied away.link
Harambe: Vietnam+: Fitch Ratings upgrades Vietnam’s outlook to “positive”
Fitch Ratings has revised Vietnam’s outlook to “positive” from “stable” and affirmed the long-term foreign-currency issuer default rating at “BB”.
The Ministry of Finance (MoF) said the credit rating agency’s upgrade of Vietnam’s outlook reflects the growth resilience of the country, which was among the few economies in the Asia Pacific region and the “BB” rating category to maintain positive growth in 2020, at 2.91 percent.
Fitch Ratings recognised Vietnam’s fiscal and government debt achievements, its successes in bringing the coronavirus outbreak swiftly under control, strong policy support and export demand, along with continued strengthening of external finances due to persistent current account surpluses and rising international reserves.
It forecast GDP growth of about 7 percent in 2021 and 2022, in line with a broader global economic recovery sustaining export growth and a gradual normalisation of domestic economic activity based on its expectation of continued success by the authorities in containing domestic coronavirus infections.
The agency noted Vietnam’s efforts to maintain macro-economic economic stability, sustain high growth, reduce the GDP per capita gap vis-à-vis the country’s peers, and further improve public finances, for example, through sustainable fiscal consolidation and debt stabilisation over the medium term are among factors that could, individually or collectively, lead to positive rating action.
Apart from Moody’s Investors Service recently raising the outlook for Vietnam to “positive” from “negative” – an unprecedented move in its ranking globally since the start of the COVID-19 pandemic, Fitch Ratings’ upgrade of Vietnam’s outlook demonstrates credit rating organisations’ belief in the Government’s effective policies, strong growth prospects, and increasingly solid fiscal space, according to the MoF.
The MoF attributed the improvement in the country’s credit outlook to the actively implemented macro-economic stabilisation measures, the enhanced financial – banking system, along with ministries and sectors’ efforts to share updated information with Fitch Ratings.
Harambe: Bloomberg: U.S. Trade Chief Raises Concerns on Vietnam Currency Policy
U.S. Trade Representative Katherine Tai raised concerns about Vietnam’s currency practices during a virtual meeting on Thursday with the country’s trade minister.
Tai also addressed U.S. concerns on illegal timber practices, digital trade and agriculture, according to a readout from her office of the meeting with Tran Tuan Anh, Vietnam’s minister of industry and trade. They agreed to a “sustained dialogue” in the future, it said.
Vietnam and the U.S. “will continue to actively cooperate to comprehensively address the concerns to maintain stable trade relations,” the trade ministry said in a statement posted on its website.
Vietnam’s currency had become a target in the Trump administration even as the former enemies continued to become closer to counter China’s rising military and economic might in the region. The U.S. has refrained from hitting Vietnam with punitive tariffs even after the U.S. Treasury designated the Hanoi government as a currency manipulator and the U.S. Trade Representative labeled Vietnam’s currency actions unreasonable and restrictive to American businesses.
The USTR’s determination in January was the result of an investigation that started last year under section 301 of the Trade Act of 1974 — the same legislation the Trump administration used to apply tariffs on billions of dollars of imports from China.
Vietnam’s central bank has maintained it doesn’t use the exchange rate to create an unfair competitive advantage in international trade. The Southeast Asian nation’s wood industry has vowed to tighten regulations and buy more American lumber to avoid punitive tariffs that would devastate the sector.
Tai and Anh plan to hold a meeting later this year under the Trade and Investment Framework Agreement to work on “resolving bilateral issues,” according to the U.S. readout.