The Dinar Daily, Wednesday December 24, 2014
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  1. #1

    The Dinar Daily, Wednesday December 24, 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, Wednesday December 24, 2014

    Currency Auctions

    Announcement No. (2851)

    The latest daily currency auction was held in the Central Bank of Iraq on the 24-12-2014 results were as follows:


    DETAILS NOTES
    Number of banks 15
    Auction price selling dinar / US$ 1166
    Auction price buying dinar / US$ -----
    Amount sold at auction price (US$) 190,585,000
    Amount purchased at Auction price (US$) -----
    Total offers for buying (US$) 190,585,000
    Total offers for selling (US$) -----


    ​Market Rate 1220

  3. #3

    Re: The Dinar Daily, Wednesday December 24, 2014

    Law: Saudi Arabia is committed to the opening of the embassy and the relationship did not reach the stage of normalization




    Twilight News / said a coalition of state law, Wednesday, The Kingdom of Saudi Arabia is committed to open an embassy in Baghdad after the visits conducted by a number of Iraqi officials series, among the relationship between Iraq and Saudi Arabia did not reach the stage of normalization.
    He said coalition member Abbas al-Bayati's "Twilight News", "There is a promise Saudis to open an embassy in Baghdad, this promise cut in front of the President Fuad Masum, and Foreign Minister Ibrahim al-Jaafari and was emphasized in the visit of the President of Parliament Saleem al-Jubouri to Saudi Arabia."
    Al-Bayati said "wait step Arabia in this direction, the relationship between Iraq and Saudi Arabia began moving, and began the deadlock broken, but Anicol reached the stage of normalization can be built upon the attitudes and policies, but at least the Saudi side is committed to open embassy believes that serious government wants to continue to the basis of common interests. "
    And Saudi Arabia welcomed the new trends of the Iraqi government, as she was named an ambassador to Riyadh is not a resident in Iraq in 2012, which Fahd bin Abdul Mohsen Al-Zaid, while expressing its emphasis on near send a technical delegation to Baghdad to choose a place for the embassy.
    The announcement of sending technical delegation after mutual meetings between Iraqi and Saudi sides over the past few months, most recently visiting Iraqi delegation headed by Iraqi President Fuad Masum to Saudi Arabia in November (November) last year.
    Saudi Arabia was severed diplomatic relations with Iraq after the invasion of Kuwait, the Iraqi army in 1990, and is a cruiser Ambassador Abdullah Hussein Al-Harthy another resident Saudi ambassador to Iraq; the eye and began his work from 1983 to 1990.

    http://translate.googleusercontent.c...sB6QHZ3gm9f8PQ

  4. #4

    Re: The Dinar Daily, Wednesday December 24, 2014

    Husseini demanded parliamentary blocs to attend tomorrow's meeting to discuss and approve the budget of public interest


    History of edits:: 2014/12/24 11:59
    14 visits readable


    {Baghdad: Euphrates News} MP called on the mass of citizens Hamdiya Husseini political blocs to attend Thursday's meeting to discuss the 2015 budget, and approval as soon as service in the public interest and the national need time.

    Husseini confirmed in a statement released by her office's media agency {Euphrates Uza received a copy of it on Wednesday that "speed up the adoption of the budget is to serve the national economy and overcome the many challenges faced by the various sectors in the country.

    She added that "it is necessary to emphasize Add item not to purchase from the private sector longer apologize to the public sector for the processing of formations in order to promote self-financing and the non-recurrence of the problem of their salaries."

    Husseini stressed that "the promotion of the national industry is an important supplier of the budget to organize resources and not rely only on oil."

    The head of the Kurdistan National Alliance bloc Ala Talabani on Wednesday to Firat News announced the receipt of Parliament's budget in 2015 of the Council of Ministers, for the purpose of approving the emergency session on tomorrow. "

    Cabinet voted during its Tuesday on the budget and forwarded to the House of Representatives for the purpose of voting upon .anthy

    http://translate.googleusercontent.c...KsaIo60YXj0MUw

  5. #5

    Re: The Dinar Daily, Wednesday December 24, 2014

    Citizen bloc in the House of Najaf, calling on the government to withdraw the appeal against Law 21



    History of edits:: 2014/12/24 12:07


    {Najaf: Euphrates News} citizen bloc in the province of Najaf called on the central government to withdraw the appeal against the law's 21 governorates, noting that "in the otherwise there will be a significant administrative problems also occurred in the past."

    The head of the citizen's bloc in the province of Najaf Khaled Aljcami told {Euphrates News} today that "we're certainly bloc citizen in the province of Najaf, as well as all members of the provincial council against the appeal of your 21 law government," noting that "the principle of the Constitution is the principle of The law emphasizes decentralization enjoy the provincial wide powers, "adding," We appeal to the government to withdraw the appeal. "

    He noted that "in the otherwise there will be a significant administrative problems also occurred in the past," noting that "some circles association with the ministries and provinces at the same time will make the duplication of work and lead to a shortening and vinegar in the provision of services to the citizen," adding that "the experience proved that since the fall of the former regime and to this period. "

    He Aljcami he "must ministries at the moment that you transfer the powers and establish a mechanism for it without considering the ton or waiting for what will happen to him the decision," explaining that "if the delay in the ministries concerned about the thought of the link, those ministries Stsael and held accountable for that," noting that "There are a number of powers should be transferred to the provinces by jurisdiction," noting that "some departments will not have any link with the ministries fully transmitted powers of the administration to the provinces and this will contribute to the development of work in those departments and will provide services to the citizen in a smooth and easy far from the complexities of the routine. "

    The House of Representatives edition earlier acknowledged after the middle of last year, the second amendment to the provincial law No. 21 of 2008, so that the law became gives oil-producing provinces five dollars dollars instead of one for each barrel, and gives them the right to act on a large part of the border outlets revenue, and also the text of the law to withdraw most of the powers of the service ministries and given to local governments.

    It is said that the previous government, objected to the law and filed an appeal against it before the Federal Court, while the new government did not withdraw the appeal so far. ".anthy 21

    http://translate.googleusercontent.c...YDm57duMFNiFsw

  6. #6

    Re: The Dinar Daily, Wednesday December 24, 2014

    / .. Zaidi: stabbed the previous government law 21 is effective now and will be given broad powers to the provinces and
    Date: 12/24/2014 09:49

    Attorney confirmed for full-Zaidi mass independent, Wednesday, that the appeal made by the previous federal government's 21 law powers of provincial councils become ineffective now, because the situation has changed, indicating that the current government is determined to give the provinces wide powers.

    He said al-Zaidi told / information /, that "local governments need to be broader powers and this is what they promised the new central government at the beginning of its formation, and the law of 21 private amended the powers of provincial councils gives broad powers to the conservatives, but the previous government challenged the law in Federal Court on some security powers. "

    idi said that "challenged the previous government is moving now, because the situation has changed and the government is determined to give powers to the provinces, to
    the belief that local governments an integral role with the central government," a 25 .anthy

    http://translate.googleusercontent.c...ZBW-PSGKFYeI_g



  7. #7

    Re: The Dinar Daily, Wednesday December 24, 2014

    Advisor to the Prime Minister: procedures for imposing taxes will work in gradually



    • Agency eighth day
    • December 24, 2014, 11:15






    BAGHDAD - ((eighth day))

    Prime Minister for Economic Affairs Advisor to detect the appearance of Mohammed Saleh that the taxes that will be imposed gradually, while explained that inflation in Iraq is universally accepted.

    Saleh said, in a press statement that "the taxes that will be Asthsalha of some categories will be spent on services which is more like recycles resources from taxpayers for other economic activities," noting that "inflation is basically in Iraq, no more than 2% and is therefore universally accepted is the least In the history of Iraq and will not be greatly influenced by the imposition of this tax. "

    Saleh said the thinking in such procedures began after the fluctuation of oil prices in world markets.


    http://translate.googleusercontent.c...uWTJJyZSXQlsug

  8. #8

    Re: The Dinar Daily, Wednesday December 24, 2014

    Deputy for the National accuse blocks disable Investment Law

    Wednesday, 24 December / 1 December 2014 11:37

    [Wasit-where]
    Deputy for the National Alliance stressed the need to find alternatives to state resources and not rely solely on the proceeds of oil.
    The MP said Rashid al-Yassiri told all of Iraq [where] that "the deficit in the provision of liquidity is sexy and suddenly the fact that Iraq depends on oil revenues by 93% and only has a simple revenue from other sectors, which had a negative impact on the adoption of the budget with lower oil prices," calling on the House of Representatives to "pass the budget to bypass the stage with the need to find alternatives to the rapid government through taxation and other".
    The student Yasiri government to "adopt a long-term strategic plan for the next phase adoption of implementation of investment projects As in other states as states Gulf and the other is the same level of Iraq economically, has made ​​us successful steps for the perpetuation of the provision of financial inventories have and reconstruction of their countries."
    He attributed the MP for the National reasons for non-implementation of investment projects in Iraq to "the existence of the routine, which is a stumbling block in front of the investment law and put it on the shelves without approval because of political pressure and narrow view of things by some political blocs which ended with on this project and it is almost dead."
    He stressed Yasiri "the need to unite everyone and contribute to the payment of the danger of the country, striving to save the current situation to the better through the adoption of laws aimed at positively reflected on the impact of the Iraqi various fields."
    The House of Representatives has officially received Wednesday from the government budget bill on Thursday to hold a special meeting, to be discussed after the Council of Ministers approved in its meeting yesterday, reaching 123 trillion dinars [$ 103 billion] deficit of 23 trillion dinars.
    And the Finance Minister, Hoshyar Zebari, said the budget is a priority for the defense, energy and displaced persons, "adding that" the plug will be through treasury bills and government bonds and borrowing from local banks. "
    For its part, the parliamentary finance committee will meet today to discuss the budget law for the purpose of reading the first reading in the parliament session tomorrow indicating that the batch in which expenditure amounted to 78% and the rest of the expenses of the investment ".anthy 80

    http://translate.googleusercontent.c...TFF0ZYO8pDUTqg


  9. #9

    Re: The Dinar Daily, Wednesday December 24, 2014



    Appearance in favor of inflation in Iraq universally accepted and will impose taxes gradually

    24/12/2014 11:23 | Number of Vie



    BAGHDAD / Source News / .. The prime minister for economic affairs adviser to the appearance of Mohammed Saleh, the tax will be imposed gradually, while explained that inflation in Iraq is universally accepted.

    Saleh said in a press statement seen by Agency / Source News /, that the taxes that will be Asthsalha of some categories will be spent on services which is more like recycles resources from taxpayers and other economic activities.

    And: Inflation basis in Iraq is not more than 2 percent and is therefore universally accepted and is at least in the history of Iraq and will not be affected significantly by imposing these taxes. Finished / 19 b

    http://translate.googleusercontent.c...uD0ujuQ4nqd8nA

  10. #10

    Re: The Dinar Daily, Wednesday December 24, 2014

    Baghdad Municipality reduce its operating budget to around 40%

    24/12/2014 01:09


    BAGHDAD / Source News / .. announced the Municipality of Baghdad, on Wednesday, said the financial allocations of regional development for the current 2014 budget, amounted to "zero" in its operating budget has been reduced to 40%.

    A statement by the Directorate relations and media in Baghdad Municipality Agency / Source News / received a copy of "The Baghdad Municipality passed an impasse during 2014 as a result of lack of financial allocations granted to them, what significantly affected in the process of providing services and the implementation of direct contact with the lives of citizens of strategic projects."
    He added that the Municipality of Baghdad allocations of regional development budget amounted to zero, while the operating budget has been reduced to about 40% a way that the impact on service delivery sectors hygiene, water and sewage, agriculture and maintenance work. "
    He continued: "The Baghdad provincial council, despite pleas and send official letters to him, had not called for regional development budget for 2014 amounts by 1/12."
    He noted that: "In spite of this difficult situation, the lack of financial allocations, the Municipality of Baghdad worked Resume efforts depending on what is available from the funds in order to maintain a good level of services to citizens and prevent any problems and obstacles."

    http://translate.googleusercontent.c...yff5mocO8N3SuQ

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