The Dinar Daily, Saturday April 18, 2015
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  1. #1

    The Dinar Daily, Saturday April 18, 2015

    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


    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 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
    – highlights page 94 of the quarterly SIGR report to THE US CONGRESS in April of 2012…
    __________________________________________________ _____________


    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″..

    __________________________________________________ ______________


    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


    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.


    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.


    Crush Expected When Kuwaiti Banks Reopen Today

    March 24, 1991|From Reuters

    KUWAIT CITY, Kuwait — Thousands of Kuwaitis are expected to jam the country's banks today when they open for the first time since the end of the Iraqi occupation.

    Customers will be allowed to withdraw funds and to swap pre-invasion money for a new currency issued to make more than $1 billion in pre-invasion dinars stolen by the Iraqis worthless.

    "We expect a rush of people," said Issam Asousi, an executive with the Bank of Kuwait. He said it could be a chaotic first week because customers have a lot of questions about their accounts.

    Kuwaiti banks continued operating during the seven-month Iraqi occupation under managers brought in from Iraq, but they have been closed since the U.S.-led alliance ousted the Iraqi army from Kuwait a month ago.

    When the banks reopen today, customers will be able to withdraw up to 4,000 Kuwaiti dinars, equivalent to about $14,000 at pre-invasion exchange rates from their accounts, and to exchange a like amount for foreign currency.

    Balances of customers' accounts will go back to what they were on Aug. 1, a day before the invasion.

    Clients will not be able to exchange Iraqi currency issued during the occupation, when Baghdad pegged the rates of the strong Kuwaiti dinar to the far less valuable Iraqi dinar.

    The new Kuwaiti money will be exchanged for old at a one-to-one rate.

    BGG ~ Thanks to wmawhite for some facts on the subject.

    Hi BGG,

    Just thought I would drop you an email. I listened to the call, and was interested in what was said about Kuwait, if I may - I will add my 2 cents worth.

    You were spot on with what you said, I have a close friend who's father made a killing on the KWD. He bought from people who had fled the country and he paid pennies on the dollar (we are in Australia). He took the chance that Iraq would be kicked back out and he was right.

    When the money was reinstated, he exchanged it for AUD at a rate in the mid 3s. The interesting thing about it is, Iraq invaded in November 1990 (I think), they were kicked back out at the end of Feb 1991, the banks reopened with a brand new KWD in late March, that's not a bad time frame to get a currency designed, printed and made ready to use, also the time that the old KWD was valid was initially only for 2 months, then extended to 6, so it was valid until Sept 1991, interesting I think.

    Also the other thing that seems to be a "fact" in Dinar land is Bill Clinton used the Kuwait RV to pay off the debt. However, Clinton was not President in 91, he did not take office until 93, even I know that and I am an Aussie.

    Anyway thanks for the site and enjoy listening to your calls.

    Kind Regards,

  2. #2

    Re: The Dinar Daily, Saturday April 18, 2015


    US dollar USD 1166.000 1164.000

    US dollar USD 1166.000 1164.000
    Euro EUR 1233.511 1232.895
    British pound GBP 1718.451 1717.592
    Canadian dollar CAD 941.918 941.447
    Swiss franc CHF 1194.795 1194.197
    Swedish krona SEK 132.590 132.524
    Norwegian krone NOK 146.586 146.512
    Danish krone DKK 165.193 165.111
    Japanese yen JPY 9.749 9.744
    Drawing Rights
    SDR 1600.463 1599.663

    Indicative rates - 18.04.2015

    Currency Auctions

    Announcement No. (2931)

    The opening offers the sale and purchase of foreign currency in the window of the Central Bank of Iraq on 15/04/2015 and the results were as follows:

    Number of banks 19
    Number of remittance companies 0
    Auction price selling dinar / US$ 1166
    Auction price buying dinar / US$ -----
    Amount sold at auction price (US$) 110,948,963
    Amount purchased at Auction price (US$) -----
    Total offers for buying (US$) 110,948,963
    Total offers for selling (US$) -----

  3. #3

    Re: The Dinar Daily, Saturday April 18, 2015

    Breaking News Parliament turns its session to secret

    Baghdad (Forat) – The Iraqi Parliament Speakership decided to turn its session secret. /End/

  4. #4

    Re: The Dinar Daily, Saturday April 18, 2015

    Iraq's election commission on Population and Development of the Economic and Social Council of the United Nations

    Baghdad / Iraq ... elected to the Commission on Population and Development of the Economic and Social Council of the United Nations by the Asian Group for the period from 2015 to 2017 during the elections that took place at United Nations Headquarters in New York.

    According to a Foreign Ministry statement received "Eye Iraq News" that the election of Iraq came after a strenuous diplomatic efforts undertaken by the Iraq mission and a series of discussions with members of the Asian Group at the United Nations to ensure a win this Mouncb.anthy

  5. #5

    Re: The Dinar Daily, Saturday April 18, 2015

    Parliamentary Finance: Sndqq disbursements delegations presidency abroad

    BAGHDAD / .. parliamentary Finance Committee confirmed on Saturday, they will scrutinize Besrviac delegations presidency out of Iraq.

    The committee member said Masood Haider's "Eye Iraq News" that "the presidency of the republic have specific budget, as well as delegations presidential them specific amounts, noting that" if the amounts spent on the presidential delegations in what have been allocated so there is nothing wrong. "

    Between Haider and "we are waiting for the report of the supervisory court to assess the amounts spent on the delegation," adding "we can not now be judged on something we do not have knowledge of it, especially the amount of funds allocated."

    He said the Finance Committee member, said, "to determine the number of the delegation accompanying the presidency is set by Fuad Masum," explaining, "We do not care about the number of the delegation accompanying the President what concerns us is that the disbursements delegation does not exceed the allocations earmarked delegations within the federal budget law."

    The social networking sites have deliberated and documents showing that the delegation of the President Fuad Masum, who is visiting Turkey Tuesday consists of 43 people.

  6. #6

    Re: The Dinar Daily, Saturday April 18, 2015

    Sheikh Hafiz to find real solutions to get out of the economic crisis


    He is a member of the House Commission headed by Sheikh Humam hammudi, Dr all relevant parties from the ministries of finance, planning and the Central Bank and private sector professionals to strive and fruitful to study financial and economic problem from different angles and distances in order to find alternative plans fit with the current situation in the country.

    According to a press release issued by the information Office got newspaper (Alalam) a copy during his seminar discussions tagged with (the Iraqi budget 2015 between reality and aspiration) organized by the Iraqi elites and competencies, and which was attended by the Deputy Speaker of the House of representatives Mr. Aram Sheik Mohammed, Chairman of the parliamentary Finance Committee, Dr. Ahmad Chalabi, Minister of science and technology Mr. Nita jajou, a broad exclusionary Government participation, with a view to finding appropriate solutions needed cash and support the economy and the budget in the country.

    Sheikh hammoudi, said "we are all aware of the magnitude of the problem and the front positions to improve economic path and support the private sector, and ensuring public money and real oversight it, away from logos or titles that are not geared towards Executive steps to restore financial stability and get out of this crisis."

    And Sheikh hammoudi importance other seminars with the participation of government agencies that participated today, representatives of the private sector, researchers and experts in this regard, serious solutions ttkhelha extensive dialogues as in this symposium, we come out with important recommendations to the deputies and Ministers, aimed at restoring financial stability and prosperity for all the people of the country. Finished 111

  7. #7

    Re: The Dinar Daily, Saturday April 18, 2015

    World Bank Group confirms its full support for Iraq

    Dr. Haider Abadi Prime Minister received at his residence in Washington, World Bank Group President Jim Yong Kim.
    During the meeting, they discussed the economic and financial realities and challenges facing Iraq and the support of the World Bank and its contribution to the financing of a number of projects.
    He expressed the World Bank president for full bank support for awarding Iraq and follow up personally to support Iraq in many sectors. He noted that the Bank will contribute to the financing of several projects in the electricity, water and infrastructure sectors in addition to the urgent projects related to the liberated areas will also support economic and financial reforms and confront the challenges that Iraq is going through. PUKmedia

  8. #8

    Re: The Dinar Daily, Saturday April 18, 2015

    Parliamentary Economy: adoption of smart card in salary payments will kill aliens

    The Commission on Economy and Investment parliamentary Saturday, the smart card adoption in the salaries of state employees distribution will kill names phantom known Balvdaúaan.
    , said committee member Najiba Najib said in a statement received by the agency / information / copy of it, "the decision to mainstream card Smart in the ministries and institutions of the state employees' salaries Exchange worthy names phantom and aliens reveal particular security. "

    Najib added that "the presence of the employee himself to the bank will reveal many cases of financial and administrative corruption," adding that "the money in the country, the transfer is still traditionally This should work to promote smart card to keep pace with global developments in this area. "

    The Rafidain Bank announced on 11 of this month his intention to smart card adoption in the mechanism of the employees' salaries distribution in circles and state institutions all, instead of the manual cash method of a similar step taken in Almottagaeidin.anthy the pay / 25 R.الاقتصاد-النيابية:-اعتماد-البطاقة-الذكية-في-

  9. #9

    Re: The Dinar Daily, Saturday April 18, 2015

    Abadi call to Iran with the request to honor the sovereignty of Iraq

    Prime Minister Abadi thanked Iran for their aid in his fight against the militants of the Islamic state, but simultaneously asked the government in Tehran to respect the sovereignty of Iraq.

    "I just told my Iranian friends for help Iraq. Thank you very much for your support, but any aid must go through a strict control of the Iraqi government, "- said Haider al-Abadi, speaking at the Center for Strategic and International Studies in Washington.

    Abadi visit to the Center for Strategic and International Studies was part of his planned three-day visit to the United States, and his first visit after his election as Prime Minister of Iraq.

    "We must not only win the war. We also need to conquer the world. And that's what we plan to do, "- he said, noting that the top priority of his government today is:" reducing ethnic and religious tensions and disagreements in the country. "

    During a recent battle with insurgents in the Iraqi city Daash Tikrit, Iran and the US were on one side of the struggle against the terrorist group.

    Later, the United States set a condition: the complete removal of the Iranian Shiite militias to continue receiving US aid from America. Translated by Carolina Mazur.
    Last edited by donnie; 04-18-2015 at 02:16 PM.

  10. #10

    Re: The Dinar Daily, Saturday April 18, 2015

    Iranian Foreign Minister called for the support of Iraq's anti-IG

    Iranian Foreign Minister Mohammad Javad Zarif said that Tehran's activities against the terrorist group "Islamic state" in Iraq agreed with the Iraqi authorities and Baghdad should support other countries.

    Iran's activities in Iraq, "is to be agreed with the government," said Zarif.

    "We believe that the Iraqi government will be supported in the international arena and should not be taken no selective approach. Any terrorist activity and the killing of civilians is unacceptable for us and for the government of Iraq, and we hope that the IG crime and terrorist groups end" - Zarif said.

    US Secretary of State John Kerry in late February, said at a congressional hearing that the US and Iran share an interest in the defeat of the terrorist group "Islamic State". He noted that the Iranian military destroyed the IG members along the Iraqi border with Iran.

    Terrorist group "Islamic State" with links to "Al Qaeda" with the highest force during the fighting in Syria, where IG fought against government forces and where acquired "glory" one of the most violent.

    Wide expansion of the IG, seized a large territory of Iraq and Syria, has become one of the world's major problems in 2014. The grouping, numbering, according to the CIA, about 30 thousand militants declared in the occupied territories, and the caliphate seeks to further expand its acquisitions.

    United States, with the support of a number of allied countries from September 23 began to be applied on the positions of the IG in Syria air strikes, with the US involved aircraft without permission from the Syrian authorities. Since August, a similar operation takes place in Iraq.

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