The Dinar Daily, Monday December 15, 2014
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  1. #1

    The Dinar Daily, Monday December 15, 2014





    The Exchange Rate of Foreign Currency in Economic Feasibility Studies

    Below are the central controls related to the exchange rate of the foreign currency to convert the project inputs and outputs from foreign currency to its equivalent in the local currency, and that is by calculating the net discounted present value standard and the internal return on investments in economic analysis that governs investment projects that costs excess one million dinars.

    Estimate the shadow price of foreign currency:

    1. It is necessary to put central controls to amend the official exchange rate * to reflect the shadow price of the foreign currency, and that is considered one of the necessary requirements to implement the net discounted present value standard and the internal return rate on investment in the economic calculation stated in the instructions, paragraph nine.

    The central controls for adjusting market prices distinguished a group of outputs and inputs traded internationally, where the projects production or usage of them is reflected on the abundance of foreign currency in the economy and thus project outputs or inputs used of such are considered purely foreign currency outputs or inputs.

    * What is meant by exchange rate: the number of units of foreign currency, expressed in dollar per one dinar.In particular the following outputs and inputs of foreign currency were distinguished:


    • Export-outputs.
    • Outputs marketed locally that substitute imports.
    • Imported inputs.
    • Inputs produced locally that usually go to exports.
    • Foreign labor.


    According to the pricing rules the value of the output and input (traded) is calculated using export prices (FOB) and import prices (CIF), according to what is listed in the pricing rules.

    In other words the pricing rules calculate what the project produces from foreign currency (quantity of exports multiplied by the export price (FOB) in foreign currency or the quantity of substitute imports multiplied by the import price (CIF) in foreign currency, as well as what the project uses from foreign currency and imported inputs multiplied by the import price (CIF) in foreign currency …. etc.).

    In a later step, project outputs and inputs must be converted from the foreign currency to its equivalent in local currency (dinars) by using a specific exchange rate for the foreign currency.

    2. Justifications for exchange-rate adjustment: there are a number of important and powerful arguments which support the view that the official exchange rate reduces the real value of foreign currency for purposes of calculating the economic national profitability for investment projects and hence for the purposes of investment planning. It is demonstrated in this context to call for assessing the dinar for less than (3.208) dollar (official exchange rate) when assessing project outputs and inputs of traded goods of exports, substitute imports and imports… etc.

    The justifications to call for the use of an exchange rate that is lower than the official exchange rate are:


    • The use of an exchange rate that is lower than the official rate is the appropriate action at the investment planning level to translate the country’s economic strategy aiming at stimulating central investments in the sectors that encourage the development of non-oil exports, as well as sectors that encourage the expansion of domestic production base in order to reduce imports and compensate it with local commodities. This helps to reduce reliance on foreign exchange earnings from crude oil exports and increases the share of non-oil sectors in the local production.
    • The application of the amended exchange rate on project imported inputs will assist in directing investments away from aggregated sectors dependent on imported inputs and the preference of those sectors that rely on locally produced inputs.
    • The use of the amended exchange rate helps to correct the balance in favor of the traded goods sectors compared to non-traded goods.
    • The real exchange rate has declined rapidly since the early seventies, through rapid rise of the level of prices and local costs which led by the steadiness of the official exchange rate to change in prices and actual local rate costs that gave an advantage for imported goods at the expense of locally produced goods, meaning that it led to deterioration of the competitiveness of alternative replacement goods and export commodities.
    • This action shows that the official exchange rate overestimates the value of the dinar, compared to the foreign currency and from the promoting goods substituting imports and export commodities point of view of.


    And in support to this view is the state’s utilization and in a broad approach to the customs and quantitative protection policies especially for consumer goods, as well as export subsidies that exports have through an amended export exchange rate.

    3. Estimate the amended exchange rate of the Iraqi dinar to be used in technical and economical feasibility studies and for (1.134) dollar per dinar. This price should be approved for 3 years until re-appreciation by the competent authorities.



    The Republic of Iraq – Ministry of Planning

    and

    A "flashback recap" of a Live Q and A Call from about a year ago - on THE DAILY DINAR NEWS BLOG...

    In general terms – there were three main focal points of interest I wanted to cover and then allow listeners to ask whatever questions they liked.

    1) the SIGR report…


    2) the Gold Article…


    3) the IIER report…


    I started the conversation out last night by highlighting how crazy this campaign being fielded to contact our lawmakers and bank CEO’s and tell them how unfair it is they are getting to exchange (exchange is the right terminology BTW – NOT “CASH-IN”) at 32.00 per Dinar and we are not – is. It is nuts.


    Firstly, “they” are NOT being allowed to exchange “early” – or at 32.00 per Dinar. It makes you sound “stark raving MAD” to be caught saying such things. You would be better off barking at the moon. It is demeaning to the validity of a true currency play.


    Secondly, this is entirely the wrong way to approach them. I pointed out on the call that Poppy and I fielded a very successful such campaign a couple of years ago. However, we sat down and came up with a much different approach. It was designed to get answers and to approach our lawmakers with respect and as their constituents. Not like a bunch of lunatics. We had extraordinary participation (because it made sense) and we received a good response from lawmakers. It started the conversation in a reasonable manner.


    I asked one caller – “when was the last time you asked a banker for money and told him how unfair it was if he didn’t give it to you”??? Obviously – we chuckled…


    Another caller asked me if (as DC had relayed) – the “zero’s were raised” and the lower denominations were in circulation??


    I said plainly “no”…lower denominations being in circulation would (at the very least) imply there had been a value change. If there were no value change the lower denoms would not only be of little value, they would be such a hinderance – people might even throw them away just to get rid of them. So no – no lower denoms. I told the caller to check the
    CBI.iq website for “real” info on rate change.

    The “zero’s being raised” or “deleted” – as explained by any reasonable researcher, economist or authority – is simply the process removing the large (3 zero notes) from circulation.


    Referring to an Enorrste post from today on
    THE DINAR OBSERVER DAILY(you may want to put this on your favorites and check in several times a day – we to it often )

    “…I have never found a single article from the CBI or the IMF that equates “delete the zeros” to the idea of “move the decimal point.” Instead, the statements overwhelmingly come out to mean “remove the large notes from circulation.”


    Also – this recent internal memo put out by Wells Fargo is likely “push back” from this recent campaign. I pointed out that Pinnacle Bank published an article by an “affiliate” in their internal publication and then “highlighted it” in a similar internal memo a couple of years ago. It is just a defense mechanism. I’m sure Wells is tired of having their name dragged through the “internet rumor mill”. This is highly likely the reason for their vigorous denials about handling it in the future. They get so many useless calls – it isn’t worth the headache. Can you blame them??


    Further, for any bank, lawmaker, adviser or official to state the “Dinar is a scam” is nearly as foolish as some of the internet “Gurus”. It is the official currency of a COUNTRY. I pointed out (below) the post from yesterday’s
    DINAR OBSERVER DAILY
    – highlights page 94 of the quarterly SIGR report to THE US CONGRESS in April of 2012…
    __________________________________________________ _____________

    THIS REPORT WAS SENT TO CONGRESS LAST MAY. IT PLAINLY SHOWS IN THIS REPORT THEY EXPECTED THE DINAR TO REVALUE AT AROUND A DOLLAR IN 2013.

    We are seeing and hearing that the inflation rate is still climbing and they are pushing to get us our money?? This report is from page 84 of the massive SIGR report.





    BGG ~
    This is a screen shot from the “Special Inspector General for Iraq Reconstruction” – Apr 2012, quarterly report to Congress. For members of our Government to say they have no idea what is going on here – means they haven’t read some very basic documents presented them.
    __________________________________________________ ______________

    I pointed out (last night) this is a highly speculative investment. We are, in no way, guaranteed anything. However, this SIGR report gives us some valuable insights…

    1) This is information given to the US CONGRESS on a quarterly basis… I find it hard to believe such an information source would intentionally mislead Congress. They tend to frown on such behavior. Which goes directly to the validity of this adventure – against all advice from Wells Fargo or other such naysayers.

    2) It points out there having been a legitimate “plan” – or time frame in motion…having been projected to be done in 2013. We are obviously in “over time” now.

    3) It gives us an idea as to who is in charge…the CoM – or Council of Ministers. Who do they answer to?? Maliki. Period. When is he likely to push this forward?? Historically – he has been a “weak Dinar” policy advocate. However, rumor from his own inner circle admits he can’t win a third term in office without some currency reform.

    I fully expect him to use every tool in his “wheel house” to win – his recent moves in Anbar and the disputed territories prove as much. Currency reform has to be a “biggie”. Though this WAS their thinking a couple of months ago – there is no promise it is still part of their political calculus. We shall see.

    4) Though no guarantee of the actual future plan they wind up engaging – this report points out an increase in value that would have taken the Dinar from “one-tenth of a cent” to a value “of slightly less than $1″..

    __________________________________________________ ______________

    AND

    Coins put on the market !!



    Nora Albjara member of the committee of economy and investment in the House of Representatives revealed that the central bank completed its preparations for the issuance of metal coins of seven small groups, in conjunction with the implementation of the project to delete the three zeroes from the paper currency is currently in circulation.

    She said in her statement Albjara "The project will take between four and five years, and which will be the launch of the categories of small coins gradually."

    He predicted the financial expert Hilal Taan inflation rate declines, with the issuance of metal coins of small denominations in the daily financial transactions, remarkable that 3% of the value of inflation in Iraq due to the presence of large cash block.

    The economic expert on behalf of Jamil Anton, noted that he may not find metal coins accepted by a lot of Iraqis, especially young people, due to the existence of an entire generation of Iraqis had not trading coins due to stop use since the early nineties of the twentieth century

    waradana.com

    And

    CBI is preparing to issue a monetary metal parts



    Metal coins from the category of 25 fils were in circulation until the nineties of the last century

    Nora Albjara member of the committee of economy and investment in the House of Representatives revealed that the central bank completed its preparations for the issuance of metal coins of seven small groups, in conjunction with the implementation of the project to delete the three zeroes from the paper currency is currently in circulation.

    She said in her statement Albjara Radio Free Iraq, "said the project will take between four and five years, and which will be the launch of the categories of small coins gradually."

    He predicted the financial expert Hilal Taan inflation rate declines, with the issuance of metal coins of small denominations in the daily financial transactions, remarkable that 3% of the value of inflation in Iraq due to the presence of large cash block.

    The economic expert on behalf of Jamil Anton, noted that he may not find coins accepted by a lot of Iraqis, especially young people, due to the existence of an entire generation of Iraqis had not trading coins due to stop use since the early nineties of the twentieth century.

    http://www.iraqhurr.org/content/article/26666313.html

    and

    Another "FLASHBACK"...

    Economists Divided Over Deletion Of Zeros

    By Amina al-Dahabi for Al-Monitor.

    The Central Bank of Iraq (CBI) has been attempting to delete three zeros from the Iraqi currency since 2003. This project has raised many concerns among the Iraqi public and within the business community, and Iraqi economists are divided…

    …Haider al-Abadi, the head of the Iraqi parliamentary Finance Committee, told Al-Monitor that while deleting zeros from the current currency is possible, this has been postponed until after parliamentary elections. He noted that studies are being carried out to ensure that, following the currency change, counterfeiting is limited and that Iraqis don’t go back to trading in the old currency.

    The step to delete zeros from the currency has been postponed several times, leading the parliamentary Economic Committee to demand that the CBI accelerate this project, as Al-Sharqiya reported. In a news conference held July 6, the Economic Committee confirmed that the deletion of zeros will lead to an increase in the value of the Iraqi dinar and will have positive repercussions, including a reduction in unemployment and poverty rates in the country.

    ARTICLE LINK



  2. #2

    Re: The Dinar Daily, Monday December 15, 2014

    Currency Auctions

    Announcement No. (2843)

    The latest daily currency auction was held in the Central Bank of Iraq on the 15-12-2014 results were as follows:

    DETAILS NOTES
    Number of banks 18
    Auction price selling dinar / US$ 1166
    Auction price buying dinar / US$ -----
    Amount sold at auction price (US$) 188,991,000
    Amount purchased at Auction price (US$) -----
    Total offers for buying (US$) 188,991,000
    Total offers for selling (US$) -----
    ​Market Rate 1197

  3. #3

    Re: The Dinar Daily, Monday December 15, 2014

    Economic parliamentary: the government tends to activate the private sector and the collection of taxes

    Monday, December 1/15 December 2014 13:43

    [Baghdad - where]
    Parliamentary Economic Commission revealed the direction of the government to activate the private sector and the collection of taxes, to increase the resources of the state and the mitigation of the economic crisis experienced by the country.
    She said a member of the Commission to fulfill Kazem told all of Iraq [where] that "Iraq is heading to activate resources other than oil to increase the country's income, to not rely on oil entirely," pointing out that

    "the coming days will witness changes in the economic situation,

    according to the existing public data on the ground. "
    She said Kazem that "Iraq will be able to overcome the economic crisis, what has the current natural resources and the effects of religious tourism, and that a temporary period of economic decline."
    It is said that the government announced earlier in the adoption of the principle of Alchagaf in deputations and furniture, in addition to reducing government salaries for compulsory savings out of the economic crisis Alhalah.anthy 2

    http://translate.googleusercontent.c...OoViyb5WJJptoA


  4. #4

    Re: The Dinar Daily, Monday December 15, 2014

    Parliamentary Finance reveal the fiscal deficit to Iraq

    • December 15, 2014, 10:13





    BAGHDAD - ((eighth day))
    BAGHDAD - ((eighth day))
    Parliamentary Finance Committee revealed on Monday that the leaked draft of the federal budget for the next year in 2015 showed that the deficit of around 47 trillion dinars.
    He said the Finance Committee decision in the House of Representatives, Ahmed Hama Rasheed, said that "the employees' salaries can not handle this amount and therefore the government will not dedicate yourself to in addressing the current crisis, what will be paid to rely on other income in the forefront of taxes and be aware that the price of a barrel of oil in proportion to the prevailing globally and not to exaggerate cum so as not to adversely affect the Iraqi economy. "
    He added that "registered indicators show that global oil prices will remain below $ 60 until the end of June of next year, therefore the government should remain alert and follow the rational in guidance policy on spending," following up "The Development Fund for Iraq (DFI) Khao of any amount This should not be directed to pay the government set their sights on the withdrawal of foreign reserves at the central bank if degradation and spending on the military's continued. "(AA)

    http://translate.googleusercontent.c...bhILvw_3ywUe9A




  5. #5

    Re: The Dinar Daily, Monday December 15, 2014

    Legal representative: binding of parliament to hold an emergency meeting if the Cabinet approval of the new budget



    • Agency eighth day
    • December 15, 2014, 10:39
    • No comments
    • 35 Reading




    BAGHDAD - ((eighth day))
    A member of the Legal Committee of Parliament MP Abdul Rahman Alloizi that the House is obliged to hold a special session to discuss the budget bill for next year if the terms of the Council of Ministers authentication and forwarded to the House of Representatives, regardless of the current legislative recess.
    Alloizi said in a statement reported for ((eighth day)) that "the completion of the Council of Ministers to discuss the paragraphs of the federal budget for 2015 will lead automatically to the House of Representatives to convene an extraordinary session to read and approved.
    He Alloizi that "the presidency of the parliament will call for an emergency session and inform the House of Representatives to attend the event of assignment of the Council of Ministers the draft budget to him and explained that" the special meeting to discuss the new general budget will cut the current legislative recess of the Parliament resumes its sessions and periodic meetings of the standing committees to approve the state budget ". (AA)

    http://translate.googleusercontent.c...lHXKW2-MsTV7tQ


  6. #6

    Re: The Dinar Daily, Monday December 15, 2014

    House of Representatives are expected to arrive this weekend Aharsalotunai Law

    MP Khalid al-Alwani












    Author: Editor: br reporter: msNumber of Views: 97

    12/15/2014 11:18


    Tomorrow Press / Baghdad: Expect security adviser to House Speaker Khalid al-Alwani, on Monday, the arrival of the National Guard blackish bill to parliament later this week, stressing that there are differences on the number of forces and powers.
    He said al-Alwani for "tomorrow Press", "The House of Representatives is expected to send the government the Law of the National Guard for a vote," adding that "there is a controversial points, including on the number of National Guard troops."
    He added that "there is a view that the demands are elements Guard troops in each province six thousand soldiers while there are those who want to be according to the percentage of population."
    Alwani said that "there are discussions on the possibility of granting conservatives security powers in the National Guard Administration that to be in association with the Ministry of Defence administratively."
    It is noteworthy that the National Guard and law since his idea to put the Commander in Chief of the Armed Forces Haider Abadi faces obstacles in setting legislation.


    http://translate.googleusercontent.c...8qDrEmKoSYH8jw

  7. #7

    Re: The Dinar Daily, Monday December 15, 2014

    Abadi's office confirms that the budget will be presented at a hearing next Tuesday

    A spokesman for the office of Prime Minister Saad al-Hadithi ..












    Author: Editor: br reporter: naNumber of Views: 136

    12/15/2014 12:01


    Tomorrow Press / Baghdad: spokesman of Prime Minister Saad al-Sabri, on Monday, the committee in charge of preparing the budget on the verge of finalizing its work and will present the budget in the next Cabinet meeting, noting that in any case, The Council of Ministers will not delay in sending the budget to parliament more than two meetings.
    A newborn for "tomorrow Press", "The agenda Cabinet meeting of business on Tuesday did not specify the date, but the committee charged with preparing the general budget is nearing completion of its work during the day and will present its report at the next meeting, but not necessarily that the budget would be passed during the session Tuesday ".
    "Maybe there are proposals will be addressed during the meeting, but the Council of Ministers is committed to send the budget to the House of Representatives before the end of this year, that is to say before the government deadline of two weeks," noting that "in any case, The Council of Ministers will not delay in sending the budget to parliament more than two."
    And on the Prime Minister's visit to the UAE, Sabri pointed out that "Abadi left today to the UAE will continue to visit for one day and comes in response to an official invitation by UAE Foreign Minister for Ebadi at his recent visit to Baghdad."
    He said a spokesman for Prime Minister's Office that "the visit is to promote bilateral relations and to promote Alaguetsaa, commercial and investment cooperation, as well as assist in the elimination of Iraq Daash intellectually, financially and militarily."
    It is noteworthy that the state budget for the current year has not yet recognize ago that sent the government for nearly eight months to former House were not included on the agenda, while procrastinated previous Presidency for inclusion due to the lack of them political blocs agreement, nor that harassment continues while people wait for things to material related thereto, as well as the stalled projects.



    http://translate.googleusercontent.c...xUcQFiFttGi66w

  8. #8

    Re: The Dinar Daily, Monday December 15, 2014

    Tripartite meeting between the "Finance and Planning and Finance Committee" to discuss the draft budget 2015



    • Agency eighth day
    • December 15, 2014, 12:09
    • No comments
    • 25 Reading




    BAGHDAD - ((eighth day))

    Met by the Ministries of Finance and Planning with the President and members of the Finance Committee in the House of Representatives to discuss the budget for fiscal year 2015.

    A statement by the Ministry of Finance received ((eighth day)) that "During the meeting, the draft budget presentation to the Committee members, procedures and plans for the ministry to rationalize expenses and cover the deficit and the search for a new non-oil resources."

    The statement pointed out that he has to discuss ideas and suggestions proposed by the parliamentarians to be included in the budget law, with an emphasis on the current financial and economic crisis requires a combination of all the efforts and cooperation of everyone to overcome these difficulties, "pointing out that" the joint meeting was held at the initiative of the Ministry of Finance. "

    He is scheduled to hold a cabinet meeting on Tuesday to discuss the 2015 draft budget law.


    http://translate.googleusercontent.c...7zXgcn32vlyGxA

  9. #9

    Re: The Dinar Daily, Monday December 15, 2014

    Jubouri: Parliament is ready to hold a special session to discuss the budget, if they come from the government
    Date: 12/15/2014 12:22
    Information / Baghdad / ..
    The head of the House of Representatives Saleem al-Jubouri, on Monday, that the Parliament is ready to hold a special session to discuss the general budget law if they come from the government, while stressing the need to assign the popular crowd and clans and overcome all that would hinder security contribution.
    A statement of the Office of the President of the Supreme Islamic Council and the agency / information / received a copy of it, for al-Jubouri, during his meeting with Mr. Ammar al-Hakim, said that "the security side needs unite everyone and reconsider all the political parties behind the security forces, supporters and supporters in the face of terrorism and challenges", adding that "the meeting Hakim was part of the required and necessary to communicate with the Iraqi decision-makers in the light of the current challenges. "
    Jubouri urged "to consider the political dimension from the political reform contributes to the security reform in the light of the agreements concluded by the political forces," referring to "the importance of the completion of agreements in the timing."
    He added that "all political forces eager to deliver positive messages of Iraqi society with emphasis on ending the security problems and the assignment of the popular crowd and clans and overcome all that would hinder the security contribution that was one of the official or popular," stressing that "sustained dialogue factor enhances confidence and unites views consideration. "
    Speaker of Parliament stressed that "the budget of the most important issues that concerned the House of Representatives," again, "the House of Representatives are ready to hold a special session to discuss the budget, if they come from the government."
    On the other hand Jubouri said he "will discuss with the Islamic Republic of Iran (visited by tomorrow) support Iraq at the same time Iraq should be an important player, effective and decision-makers and influential not in the arena of regional,
    but international and Arab in general," stressing the need to "communicate and open channels , noting that there are a
    number of projects from the vision that believes in the political forces. " Finished / 25

    http://translate.googleusercontent.c...meUoFL6avYsgUA





  10. #10

    Re: The Dinar Daily, Monday December 15, 2014



    Alwani .. anticipate the arrival of the National Guard Law of the end of the week


    Author:
    15-12-2014 12:19 PM
    Number of Views: 30



    Orbit -
    Expect security adviser to House Speaker Khalid al-Alwani, on Monday, the arrival of the National Guard blackish bill to the end of this week Parliament, stressing that there are differences on the number of forces and powers.

    He said al-Alwani to'algd Press', the 'House of Representatives is expected to send the government the Law of the National Guard for a vote', noting that 'there are controversial points, including on the number of National Guard troops'.


    He added that 'there is a view that the demands are elements Guard troops in each province six thousand soldiers while there are those who want to be according to population ratio'.


    Alwani and added that 'there are discussions on the possibility of granting conservatives security powers in the National Guard Administration that to be in association with the Ministry of Defence administratively'.


    It is noteworthy that the National Guard and law since his idea to put the Commander in Chief of the Armed Forces Haider Abadi faces obstacles in setting legislation.

    http://translate.googleusercontent.c...FSxd4rVqR7PUtg


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