Kurdish MPs push for removal of zeros on Iraqi Banknotes 25.5.2012
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Thread: Kurdish MPs push for removal of zeros on Iraqi Banknotes 25.5.2012


    
  1. #1

    Kurdish MPs push for removal of zeros on Iraqi Banknotes 25.5.2012

    Flashback to 2012



    Kurdish MPs push for removal of zeros on Iraqi Banknotes 25.5.2012




    Making changes in Iraq’s banknotes may add to already heightened tensions between Baghdad and Erbil. Kurdish MPs in Baghdad say that if such a law is passed in parliament, the new bills must have Kurdish alongside Arabic script on them, as stipulated by the constitution.

    “So far, there has not been any designs for the new bills,” Haji noted. “Without a doubt, having Kurdish written on the new bills will be our pre-condition.”

    According to Article 4 of the Constitution, Kurdish and Arabic are the official languages of Iraq and both languages must appear on Iraqi banknotes.

    Section two of the article says, “Use of both languages is enjoined by the principle of equality such as banknotes, passports, and stamps.”

    Haji is optimistic about the future use of the Kurdish language on Iraqi official documents.

    “I don’t expect that this constitutional right will be ignored or cause more tensions between Baghdad and Erbil,” he said. “This is a legal and constitutional subject. There are also Kurdish-Arabic interpreters in Parliament. Kurdish MPs can speak Kurdish if they want. However, it has become a habit for them to speak Arabic in the Parliament.”

    MP Faizulla is more skeptical, saying, “Many constitutional articles and rights have already been violated. This will depend on agreements between the political parties. If the political parties don’t agree, it most likely won’t happen.”

    Copyright ©, respective author or news agency, rudaw.net

    Removing zeros from the Iraqi Dinar - Related Links

    Kurdish MPs push for removal of zeros on Iraqi Banknotes 25.5.2012

    Removing of the three zeros from the Iraqi Dinar and its effects: Interview 12.4.2012

    Iraq plans to change currency: Three zeroes will be removed from ID 28.4.2011


    http://ekurd.net/mismas/articles/mis.../state6242.htm
    Last edited by CanTWaitwoRV; 11-11-2015 at 09:24 PM.



  2. #2

    Re: Kurdish MPs push for removal of zeros on Iraqi Banknotes

    Iraq plans to change currency: Three zeroes will be removed from ID 28.4.2011
    By Mayada Daood




    By Mayada Daood


    April 28, 2011

    BAGHDAD, — The Iraqi government plans to chop three zeroes off the national currency. It should make transactions easier and enhance the exchange rate. But local economists are not sure the country is ready.

    Recently the Iraqi government announced that they were close to completing plans for re-denomination. Three zeroes will be removed from Iraq’s currency, the Iraqi dinar or IQD, and old banknotes will gradually be phased out. For example, this would make an IQD 1,000 note into an IQD 1 note. Currently IQD 1,000 is worth around €0.60 and US$0.85.

    Logically speaking, re-denomination does not change the value of a currency nor should it cause inflation. It should make currency easier to use and increase its credibility. Re-denomination may also be a matter of political expedience.

    For example, when Turkey announced a re-denomination in 2005, the country’s central bank explained that extra zeroes on their
    Three zeroes will be removed from Iraq’s currency.
    banknotes meant “problems in accounting and statistical records, data processing software and payment systems”, adding that the move to cut them was “psychologically and technically essential”.

    Re-denomination can usually only be undertaken once inflation is under control and over the last few years, inflation in Iraq has dropped from over 30 percent to single digits. Nonetheless Iraqi opinions about the planned change remain divided.

    Qasim Jabbar, an economic researcher, is concerned about the psychological impact the removal of three zeroes will have on locals. Additionally Jabbar does not think the time is right. “We must create a stable environment in political, economic and legal terms, in order to control the conditions during the transition period to a new currency,” he explained. “This is necessary in order to ensure that the transition is not manipulated by government departments and in society in general, where there is rampant corruption.”

    Jabbar was also worried about the absence of a central authority that was truly capable of controlling the Iraqi currency market. He believed that the psychological problem will be people “focusing on the change in numbers, rather than in real value”. By rights,http://www.ekurd.netre-denomination should not impact the actual value of a currency; it should still buy the same goods as it did before for the same prices. “But a person with IQD 10 million will feel they have lost a fortune when the zeros are removed,” he noted.

    Re-denomination is nothing new. “Many countries, such as Turkey and Germany, have also taken this step,” another Iraqi economist Kareem al-Halfi said. “But this doesn’t mean that the Iraqi experience will be like that, of those nations. Iraq has serious structural problems and high rates of unemployment. These problems cannot be solved in the short term and we need to create the economic conditions necessary to allow re-denomination.”

    According to Mothahhar Mohammed Saleh, an advisor to the Central Bank of Iraq, which was established in 2004 to administer monetary policy in Iraq, the impact of re-denomination could have both positive and negative effects.

    Firstly, a reduction in the large amount of currency in circulation – there is an estimated IQD 27 trillion in circulation – could have a negative impact on everyday transactions, he said. For example, one previously recorded impact in other countries has included the rounding up (or down) of prices due to re-denomination.

    On the other hand, the currency will become far easier to use. “In the wholesale sector, goods are being traded using US dollars.” This process is known as “dollarization” and occurs when a country uses a foreign currency, in parallel to or instead of, its own currency because it is seen as more stable and subject to fiscal disciplined.

    Anyway, according to Saleh, “this change will not be introduced hastily. It will only be introduced when inflation is under control - and after parliament and the Iraqi cabinet has gone through legislation thoroughly. They will then decide how the [re-denomination] law will be implemented.”

    As Saleh said, “the Central Bank is proceeding cautiously in this matter because it realizes re-denomination could cause economic problems if implemented in haste.”

    The IQD was first introduced in the early 1930s and was pegged first to the British pound, then the US dollar. After Iraq’s invasion of Kuwait, under the leadership of Saddam Hussein, strict economic sanctions saw the value of the IQD drop. By the mid-1990s, IQD 3,000 was worth around one US dollar.

    In order to make purchases in Iraq, huge amounts of cash were needed. An IQD 25 note was the highest denomination available so to make life easier, the government introduced an IQD 250 note. After the American-led invasion in 2003, the Iraqi government issued even more notes with higher values. IQD 25,000 notes were now the highest value.

    The average person on the Iraqi street said they would be happy to see the IQD stabilize further. But they are also afraid that the lopping off of zeroes will have a negative impact.

    Baghdad merchant Abdul Amir trades in food products and when he deals with wholesalers he prefers to use US dollars because then he doesn’t have to carry as much paper around. “Large transactions require millions of Iraqi dinar. If I use foreign currency, I don’t need as much,” he explained. “But when it comes to daily transactions, I don’t mind using the dinar.”

    As to his thoughts on the planned re-denomination, Amir had only questions: “Would there be a loss expected? Would the market be controlled to guarantee its stability?” he asked.

    Government employee Sabah Daoud raised further questions: “Would the Iraqi dinar rise against the dollar? Would my salary be worth the same, with and without the zeroes?” He wanted to see more research on the impact of such a step on the average Iraqi citizen.

    Currently the Iraqi government seems set on losing the extra zeroes, those digits that have become such a burden on the dinar. But the road toward this goal is a difficult one. And it is just one stop along an even longer road, the one leading toward prosperity and steady, stable economic growth for Iraq.
    Copyright ©, respective author or news agency, niqash.org

    http://ekurd.net/mismas/articles/mis...4/govt1829.htm

    April 28, 2011

    BAGHDAD, — The Iraqi government plans to chop three zeroes off the national currency. It should make transactions easier and enhance the exchange rate. But local economists are not sure the country is ready.

    Recently the Iraqi government announced that they were close to completing plans for re-denomination. Three zeroes will be removed from Iraq’s currency, the Iraqi dinar or IQD, and old banknotes will gradually be phased out. For example, this would make an IQD 1,000 note into an IQD 1 note. Currently IQD 1,000 is worth around €0.60 and US$0.85.

    Logically speaking, re-denomination does not change the value of a currency nor should it cause inflation. It should make currency easier to use and increase its credibility. Re-denomination may also be a matter of political expedience.

    For example, when Turkey announced a re-denomination in 2005, the country’s central bank explained that extra zeroes on their
    Three zeroes will be removed from Iraq’s currency.
    banknotes meant “problems in accounting and statistical records, data processing software and payment systems”, adding that the move to cut them was “psychologically and technically essential”.

    Re-denomination can usually only be undertaken once inflation is under control and over the last few years, inflation in Iraq has dropped from over 30 percent to single digits. Nonetheless Iraqi opinions about the planned change remain divided.

    Qasim Jabbar, an economic researcher, is concerned about the psychological impact the removal of three zeroes will have on locals. Additionally Jabbar does not think the time is right. “We must create a stable environment in political, economic and legal terms, in order to control the conditions during the transition period to a new currency,” he explained. “This is necessary in order to ensure that the transition is not manipulated by government departments and in society in general, where there is rampant corruption.”

    Jabbar was also worried about the absence of a central authority that was truly capable of controlling the Iraqi currency market. He believed that the psychological problem will be people “focusing on the change in numbers, rather than in real value”. By rights,www.ekurd.netre-denomination should not impact the actual value of a currency; it should still buy the same goods as it did before for the same prices. “But a person with IQD 10 million will feel they have lost a fortune when the zeros are removed,” he noted.

    Re-denomination is nothing new. “Many countries, such as Turkey and Germany, have also taken this step,” another Iraqi economist Kareem al-Halfi said. “But this doesn’t mean that the Iraqi experience will be like that, of those nations. Iraq has serious structural problems and high rates of unemployment. These problems cannot be solved in the short term and we need to create the economic conditions necessary to allow re-denomination.”

    According to Mothahhar Mohammed Saleh, an advisor to the Central Bank of Iraq, which was established in 2004 to administer monetary policy in Iraq, the impact of re-denomination could have both positive and negative effects.

    Firstly, a reduction in the large amount of currency in circulation – there is an estimated IQD 27 trillion in circulation – could have a negative impact on everyday transactions, he said. For example, one previously recorded impact in other countries has included the rounding up (or down) of prices due to re-denomination.

    On the other hand, the currency will become far easier to use. “In the wholesale sector, goods are being traded using US dollars.” This process is known as “dollarization” and occurs when a country uses a foreign currency, in parallel to or instead of, its own currency because it is seen as more stable and subject to fiscal disciplined.

    Anyway, according to Saleh, “this change will not be introduced hastily. It will only be introduced when inflation is under control - and after parliament and the Iraqi cabinet has gone through legislation thoroughly. They will then decide how the [re-denomination] law will be implemented.”

    As Saleh said, “the Central Bank is proceeding cautiously in this matter because it realizes re-denomination could cause economic problems if implemented in haste.”

    The IQD was first introduced in the early 1930s and was pegged first to the British pound, then the US dollar. After Iraq’s invasion of Kuwait, under the leadership of Saddam Hussein, strict economic sanctions saw the value of the IQD drop. By the mid-1990s, IQD 3,000 was worth around one US dollar.

    In order to make purchases in Iraq, huge amounts of cash were needed. An IQD 25 note was the highest denomination available so to make life easier, the government introduced an IQD 250 note. After the American-led invasion in 2003, the Iraqi government issued even more notes with higher values. IQD 25,000 notes were now the highest value.

    The average person on the Iraqi street said they would be happy to see the IQD stabilize further. But they are also afraid that the lopping off of zeroes will have a negative impact.

    Baghdad merchant Abdul Amir trades in food products and when he deals with wholesalers he prefers to use US dollars because then he doesn’t have to carry as much paper around. “Large transactions require millions of Iraqi dinar. If I use foreign currency, I don’t need as much,” he explained. “But when it comes to daily transactions, I don’t mind using the dinar.”

    As to his thoughts on the planned re-denomination, Amir had only questions: “Would there be a loss expected? Would the market be controlled to guarantee its stability?” he asked.

    Government employee Sabah Daoud raised further questions: “Would the Iraqi dinar rise against the dollar? Would my salary be worth the same, with and without the zeroes?” He wanted to see more research on the impact of such a step on the average Iraqi citizen.

    Currently the Iraqi government seems set on losing the extra zeroes, those digits that have become such a burden on the dinar. But the road toward this goal is a difficult one. And it is just one stop along an even longer road, the one leading toward prosperity and steady, stable economic growth for Iraq.

    http://ekurd.net/mismas/articles/mis...4/govt1829.htm
    Last edited by CanTWaitwoRV; 11-11-2015 at 09:22 PM.

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