The Dinar Daily, Monday December 29, 2014
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  1. #1

    The Dinar Daily, Monday December 29, 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, Mondat December 29, 2014

    Currency Auctions
    Announcement No. (2855)


    The latest daily currency auction was held in the Central Bank of Iraq on the 29-12-2014 results were as follows:








    DETAILS NOTES
    Number of banks 16
    Auction price selling dinar / US$ 1166
    Auction price buying dinar / US$ -----
    Amount sold at auction price (US$) 181,066,000
    Amount purchased at Auction price (US$) -----
    Total offers for buying (US$) 181,066,000
    Total offers for selling (US$) -----




    Market Rate 1220

  3. #3

    Re: The Dinar Daily, Mondat December 29, 2014

    Parliamentary Finance postpone the meeting devoted to the study of the budget because of their travel

    BAGHDAD - ((eighth day)) Announced the parliamentary finance committee member Jabbar al-Abadi, the committee decided to postpone the meeting, which was scheduled to be held today to study the general budget to next Saturday.

    Ebadi said that "the postponement of the meeting was due to the year-end holidays, travel and some members of the committee," adding that "the Committee's work stopped until next Saturday."

    He said the parliamentary Finance Committee member Jabbar al-Abadi, last Thursday, said that "the budget and after reading a first reading has been referred to the Finance Committee, which will hold a meeting Monday to discuss the budget and in the intention to call the Ministers of Finance, Hoshyar Zebari, and planning Salman Jumaili" likely "to pass the budget soon."

    The House of Representatives has done in its meeting held last Thursday special session, the first reading of the draft budget law and referred to the Finance Committee before its lift to the seventh of next month, and the size of the budget amounted to 125 trillion dinars and a deficit of 25 trillion.

    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%3D3371811&usg=ALkJrhhRMCYwt-xJepJVsPZ8IPOsp4EF2w

  4. #4

    Re: The Dinar Daily, Mondat December 29, 2014

    Amendments and negotiations on the draft National Guard ends after the legislative recess



    MP for the coalition of state law, Iman al-Fadhli

    Tomorrow Press / Baghdad: revealed MP for the coalition of state law, Iman al-Fadhli, on Monday, that the draft of the National Guard Law is still under discussion and research within the National Alliance, likely completion of the amendments after the legislative recess of Parliament.
    She Fadhli for "tomorrow Press", "The National Alliance blocks discussed for a long draft of the National Guard for a period of Law cured before being sent to the House of Representatives."

    She explained that "any dispute concerning paragraphs and articles of this draft does not exist within the coalition."

    She added that "the draft did not provide for the preparation of the National Guard, but will leave it to the parliament is limited by nature, according to the needs of each province," asserting that "there is the will of all to pass this law for the next period.

    It is noteworthy that the theme of the National Guard and find the intricacies of the law by some of the House of Representatives since put Prime Minister Haider al-Abadi with assuming his official duties.

    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%3D3371758&usg=ALkJrhiGDuPgjR5QdGBjBUQV5Y4rTHwUaw

  5. #5

    Re: The Dinar Daily, Mondat December 29, 2014

    sczin11- THEY ARE CALLING FOR THE MONETARY REFORM TO BE IMPLEMENTED

    Economic reason to support the Iraqi dinar and remove him from the effects of the budget deficit
    BAGHDAD / Source News / .. called economist Rashid al-Hilali, on Monday, the government and the Parliament to support the Iraqi dinar and remove him from the effects of the budget deficit.

    He told al-Hilali / Source News / "The Iraqi dinar may be affected by emotion budget by economic reports and this requires the government and the parliament backing to face any possible decline."

    "The middle class and poor are only to be affected by the decline of the Iraqi dinar. They have to put the mechanics of a slide in the side effects," explaining that "the economic situation in Iraq wobbling because of internal and external factors and there are parties working on the exploitation of the budget deficit in order to raise the price of the dinar" .

    Hilali promised: "The government went about raising taxes on water, electricity, fuel and other" comes in the interests of the wealthy class and not in the interests of the general public. "

    The parliamentary Finance Committee, has confirmed Majaraazm government to impose taxes on certain public services such as electricity, water, fuel and high Kmarkip fees on imports, especially electrical appliances, to reduce 2015.anthy / 19 p budget deficit

    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%3D3372052&usg=ALkJrhjuH0bQblFyP0hvKrUoPVD2YsVHMQ
    Last edited by sczin11; 12-29-2014 at 11:03 AM.

  6. #6

    Re: The Dinar Daily, Mondat December 29, 2014

    Parliamentary Finance: new goods will be imposed by the taxes in the future and will continue even after the end of the crisis


    Tomorrow Press / Baghdad: likely the Finance Committee in the House of Representatives member Ahmed flesh, on Monday, continuing the tax imposed on mobile, Internet and car cards even after the economic crisis, noting that other goods will be imposed by the tax as well.
    The flesh for "tomorrow Press", "The government is now looking at other sources of funding other than oil because of the financial crisis in, especially since the budget 201 584% of which relies on oil exports and that any new drop in oil prices will lead to an imbalance in the Iraqi economy more, so the government resorted to find other resources such as taxes. "

    He added that "the imposition of taxes on Kartat mobile and internet, cars, and this is what leads to the first: the low purchasing power of citizens and secondly to reduce inflation and thirdly to get revenue for the government is the oil and reduce the budget deficit."

    Hama said that "these actions will not harm the citizens, Citizens those with limited income originally were frugal use Kartat mobile as well as online, but those with good incomes are used Rtat and the Internet frequently, and these are not affected by the tax that it will present the government a 20%, because the very good incomes." .
    He said a member of the Finance Committee that "these taxes will go in the discussions of the Finance Committee, as well as in the next House of Representatives meetings, and if approved by the Board will be a window, and I support this government went," likely "These taxes will continue and will be added to other things, if voted on by Parliament , and will not end once the financial crisis. "

    The Council of Ministers approved in its regular, in 23 of the current December, the budget bill and sent it to Parliament for formal approval, pointing out that the budget approved B123 trillion dinars and a price of $ 60 per barrel of oil and a large deficit.

    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%3D3371679&usg=ALkJrhgXju309iAs1FIOKg-Q-UK-6WPs6A

  7. #7

    Re: The Dinar Daily, Mondat December 29, 2014

    ​sczin11- LOOK AT HIGHLITED LINE



    Kuwait signs a commercial cooperation agreement with Iraq

    Iraq and Kuwait signed an agreement for commercial cooperation on the sidelines of the meetings of the Iraqi - Kuwaiti Supreme Joint Committee yesterday in Baghdad, which has continued over the past two days.

    According to the Iraqi Ministry of Trade site that the agreement signed by the Minister of Commerce Engineer Mlas Mohammed Abdul Karim, who for his part stressed that the agreement will be an alternative to the commercial agreement signed between the two countries in 1964, which includes all areas of economic cooperation, as determined by the International Trade and the decisions of the Economic Council and the Arab meeting pop Arab League.

    Earlier in Kuwait confirmed, that the security and stability of Iraq, a basic foundation for the stability of the Arab region , noting that the joint committee will hold a meeting with Iraq later this year to discuss the outstanding issues.
    On the Iraqi reparations to Kuwait Kuwait has confirmed that residual amounts of the value of compensation for the losses of the Iraqi war, an estimated 5.7 billion US, after receiving $ 1.19 billion in July last 24 to reach the payment of compensation to the final stages.

    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%3D3371867&usg=ALkJrhgb9z_q-qSziMKDUijz9sNYOONH0w
    Last edited by sczin11; 12-29-2014 at 11:23 AM.

  8. #8

    Re: The Dinar Daily, Mondat December 29, 2014

    sczin11- LOOK AT HIGHLITED LINE



    Minister of Construction: heading towards investment and attract companies sober

    (Independent)
    .. The Minister of Construction and Housing Tariq Kikhany that the ministry is moving toward attracting investment and sober companies in the implementation of construction projects.

    Kikhany said when meeting with a delegation of representatives of French companies specialized roads and bridges sector, the ministry doors open to Arab and foreign companies wishing to implement projects of the ministry and the actual contribution to the infrastructure development of the country

    The minister presented in the meeting profile projects implemented by the ministry in all provinces of the country in the areas of roads and bridges, as he explained the areas available and the opportunities available in front of the French companies to work in Iraq.

    For their part, the French delegation expressed their desire exclusive in the implementation of projects of the ministry concerned that roads, bridges and private sector, between the delegation and the ability of these companies to set up bridges ready fast monument according to the latest international standards. (End)

    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%3D3371932&usg=ALkJrhi2IFbjNHeNtiTSTSRBwQzWDaOhzg

  9. #9

    Re: The Dinar Daily, Mondat December 29, 2014

    sczin11- I GUESS SOME ARE STILL WORKING, WHILE OTHERS CLAIM THEY ARE NOT..... TARRIF LAWS.....WE LIKE!



    Economic parliamentary: the application of the tariff law on all imported materials soon

    Information / special / ..
    Economic Commission announced in the House of Representatives, on Monday, that the government will start soon apply the tariff law will cover all imported materials, arguing that law enforcement has become an urgent necessity.

    Said committee member Najiba Najib told / information /, "The tariff law passed in the House of Representatives in 2010 and was supposed to be applied in 2011, but the Council of Ministers sent a formal letter asking to postpone the application of the tariff law, so do not get pressure on the street ".

    She added, "actually has been delayed application of the law for a year and after the government introduced an amendment Third, in order to delay the law, too, but the parliament did not approve the amendment and asked the government to be applied gradually, but now the need for the law has become an urgent and will be implemented soon."
    Najib explained that "the law will include all the materials that go into Iraq from the border crossing points, and on the adequacy of the funds Stderha Customs to fill the budget deficit, it depends on the movement of trade and the extent of the application of the law and not for the corruption of it."

    And confirmed member of the Economic Committee that "the government's move to obtain internal imports from taxes and other very good," a 25 .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%3D3372109&usg=ALkJrhgGL3l76wRNi0aan-IuyD2JP-aDqg

  10. #10

    Re: The Dinar Daily, Mondat December 29, 2014

    sczin11- I GUESS SOME ARE STILL WORKING, WHILE OTHERS CLAIM THEY ARE NOT..... TARRIF LAWS.....WE LIKE!

    Economic parliamentary: the application of the tariff law on all imported materials soon

    Information / special / ..
    Economic Commission announced in the House of Representatives, on Monday, that the government will start soon apply the tariff law will cover all imported materials, arguing that law enforcement has become an urgent necessity.
    Said committee member Najiba Najib told / information /, "The tariff law passed in the House of Representatives in 2010 and was supposed to be applied in 2011, but the Council of Ministers sent a formal letter asking to postpone the application of the tariff law, so do not get pressure on the street ".

    She added, "actually has been delayed application of the law for a year and after the government introduced an amendment Third, in order to delay the law, too, but the parliament did not approve the amendment and asked the government to be applied gradually, but now the need for the law has become an urgent and will be implemented soon."

    Najib explained that "the law will include all the materials that go into Iraq from the border crossing points, and on the adequacy of the funds Stderha Customs to fill the budget deficit, it depends on the movement of trade and the extent of the application of the law and not for the corruption of it."
    And confirmed member of the Economic Committee that "the government's move to obtain internal imports from taxes and other very good," a 25 .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%3D3372109&usg=ALkJrhgGL3l76wRNi0aan-IuyD2JP-aDqg

    WELL THEY ARE TELLING US WHAT THEY ARE DOING AND IT APPEARS IT WILL BE SOON. That word needs to be banned from our vocabulary.

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