The Dinar Daily, Tuesday December 23, 2014
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  1. #1

    The Dinar Daily, Tuesday December 23, 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, Tuesday December 23, 2014

    Currency Auctions
    Announcement No. (2850)


    The latest daily currency auction was held in the Central Bank of Iraq on the 23-12-2014 results were as follows:








    DETAILS NOTES
    Number of banks 17
    Auction price selling dinar / US$ 1166
    Auction price buying dinar / US$ -----
    Amount sold at auction price (US$) 129,717,000
    Amount purchased at Auction price (US$) -----
    Total offers for buying (US$) 129,717,000
    Total offers for selling (US$) -----





    Market Rate 1222

  3. #3

    Re: The Dinar Daily, Tuesday December 23, 2014

    Iraqi Central Bank approval to United Bank to resume issuing letters of guarantee

    Referring to the central bank No. (14779/2/9) in 09/28/2014, containing deprive the United Bank of issuing letters of credit received central bank approval to the bank to resume the issuance of letters of credit under their book No. (18247/2/9) 8 / 12/2014. More details are provided in the attached file

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355358&usg=ALkJrhj2Kltvo9RQDLYbflJTNUk-lBW8sA

  4. #4

    Re: The Dinar Daily, Tuesday December 23, 2014

    Cabinet to vote on the federal budget law for 2015



    Orbit -Cabinet to vote in its regular Tuesday on the draft federal budget law for 2015, after the end of the Technical Committee of the ministerial conduct modifications.

    Deputy Secretary General of the Council of Ministers for Administrative and Financial Affairs Obaid shop said that the Cabinet meeting today will focus on the discussion of the final draft of the draft federal budget law for next year 2015 and approval, stressing that the Technical Committee of Ministers completed its work and discuss its final report in regards to reduce the expenditures of the ministries of all government institutions, including contribute to reducing the deficit caused by the decline in global oil prices.

    He pointed out that the cabinet meeting held on Monday evening to discuss the final report and put the final touches before it passed and sent to parliament for a vote before the end of this year.

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355508&usg=ALkJrhh0G4tChCHIM_F3WeBC0o696YGq9Q

  5. #5

    Re: The Dinar Daily, Tuesday December 23, 2014

    Budget before the Council of Ministers for approval

    Federal Cabinet
    Federal Council of Ministers held on Tuesday, a session during which the vote on the budget bill, while the Deputy that the House would need a month to approve the budget.

    He said the Finance Committee decision in the House of Representatives MP Ahmad Haji Rashid's PUKmedia, the House of Representatives and as soon as the budget bill will go a legislative recess and come back into session to start approving the budget measures, pointing out that the nature of the pass laws need to read the first and second reading after 48 hours of First, the project is then discussed and send a copy to all the committees of Finance and private, to write a final report on the defects and flaws in the budget bill, pointing out that the House of Representatives would require a period of 20 days to a month to approve the budget bill.

    And MP Rashid on the Finance Committee in accordance with the Ministry of Finance not to repeat the 2014 experience, and the absence of the country's budget, stressing that the Finance Committee insists on preparing the draft budget law, ratification, in order to maintain the Iraqi economy and restore recovery him and provide as requested by the citizens of Services.

    The Deputy Secretary General of the Council of Ministers for Administrative and Financial Affairs Obaid replace announced in a press statement that the Federal Cabinet meeting on Tuesday, will focus on the discussion of the final draft of the draft federal budget law for next year 2015 and approval, stressing that the Technical Committee of Ministers completed its work and discuss its final report in regards to reduce expenses of the ministries and government institutions, including all contribute to reducing the deficit caused by the drop in oil prices globally.

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355451&usg=ALkJrhjoaN8iLY7TStl7AE-0z6mUqMC72w

  6. #6

    Re: The Dinar Daily, Tuesday December 23, 2014

    ​sczin11- note the translation here! VOTE within 48 HOURS! We shall see...

    Decision of Parliament: the House of Representatives held an emergency session within 48 hours after the arrival of the budget



    Information / special / .. Announced the decision of the House of Representatives Niazi architecture Ihsanoglu, on Tuesday, that the Presidency of the Council of Representatives will hold an emergency meeting within 48 hours to vote on the general budget for the 2015 law after the vote by the Council of Ministers.

    He said Ihsanoglu told / information /, "When you reach the general budget of the Council of Ministers to the House of Representatives will call the presidency of the Council to an emergency session of Congress to attend in order to vote on the 2015 budget."

    Ihsanoglu said that "the Council will be held during the 48-hour emergency session to vote on the budget."

    The Council of Ministers endorsed on Tuesday, on the 2015 budget and decided to refer them to the House of Representatives for deliberation and approval. Ended a 25

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355740&usg=ALkJrhjnfzpD0UxlHWHkwU2BswwVduum6g
    Last edited by sczin11; 12-23-2014 at 11:10 AM.

  7. #7

    Re: The Dinar Daily, Tuesday December 23, 2014

    sczin11- WE NOW HAVE MULTIPLE CONFIRMATIONS... THE 2015 BUDGET HAS BEEN APPROVED BY THE CABINET, COM, COUNCIL OF MINISTERS, AND HAS BEEN SENT TO THE PARLIAMENT, GOI, HOUSE OF REPRESENTATIVES FOR....READINGS AND VOTE. OR. JUST VOTE!!



    Cabinet approves federal budget law and forward it to the House of Representative

    Fallujah News / Baghdad ... the Council of Ministers approved a draft federal budget law and referred it to the House of Representatives for approval.
    An official source said that the cabinet voted in its session today under the chairmanship of Haider al-Abadi to approve the 2015 budget and will send them to Parliament.

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355774&usg=ALkJrhhJYiGBYnpCXd7RXtezxbmQQsFZkw

  8. #8

    Re: The Dinar Daily, Tuesday December 23, 2014

    Acceptance of the Securities Commission to include a number of money transfer in Iraq Stock Exchange companies

    I got the approval of the Securities Commission on the Board of Governors decision to request the number of shares of remittance companies included below in the Iraq Stock Exchange, to provide a listing conditions required by the Securities Commission.

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355636&usg=ALkJrhh50N1kd0fURuipKNXrelLxPopqVQ

  9. #9

    Re: The Dinar Daily, Tuesday December 23, 2014

    Rafidain Bank opens its doors in Ramadi


    Information / Anbar / .. Said the mayor of Ramadi DLF Qubaisi, on Tuesday, opening its doors Anbar Rafidain Bank branch in front of the citizens for the disbursement of retirees and military salaries.

    He told Kubaisi / information / that "Anbar Rafidain Bank branch opened its doors to the citizens of the exchange of retired military and financial receivables, and the categories covered by this review of the bank said the aim of receiving their salaries."
    He added that "This operation came after the approval of the security forces on the open road that leads to the city of Ramadi, central bank to facilitate the process of receiving salaries."

    And experiencing some of the gray areas of the city battles between security forces backed sons of tribal elements "Daash" criminal in order to grab the land and the expulsion of the terrorist Ltinayzm of the entire territory of the city and a 12 Mahafezh.anthy

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355641&usg=ALkJrhhnEObSS_HikjmkQUOrc7e4BZRq3g

  10. #10

    Re: The Dinar Daily, Tuesday December 23, 2014

    Book of the Iraqi Central Bank to Elaf Islamic Bank

    Referring to the central bank in the No. 18116/3/9 12/16/2014 got bank approval to enter Elaf Bank of
    window sale and purchase of foreign currencies after the completion of measures to increase the head

    (200) billion dinars. More details are provided in the attached file

    http://translate.googleusercontent.com/translate_c?depth=1&hl=en&rurl=translate.google.com&sandbox=0&sl=ar&tl=en&u=http://www.faceiraq.com/inews.php%3Fid%3D3355757&usg=ALkJrhjsh4k_52lLZfYOVdh9n6WSw4_Kvg

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