Warnings of the collapse of the local currency when you withdraw funds from monetary
Warnings of the collapse of the local currency when you withdraw funds from monetary reserves
1/19/2016 0 Comments
BAGHDAD / JD / .. warned a number of experts and specialists in the financial and economic affairs of the local national currency collapse when the government resorting to withdraw funds from monetary reserves of the Central Bank to bridge the budget deficit, calling to resort to other measures Kalaguetrad and the issuance of bonds and the application of savings forced to confront the financial crisis.
The government plans, according to a memorandum of the International Monetary Fund, to finance the deficit in the balance of payments of withdrawal from Iraq, the foreign reserves held by the central bank, including make it go down to $ 43 billion in 2016 from 59 billion last October end.
He warned an expert on financial affairs spokesman Hadi al-Tamimi of the Iraqi dinar big injury in the event of the collapse of the government resorting to the monetary reserves of hard currency that exists among the central bank in the conduct of state financial matters, calling to resort to other means of financing.
He said al-Tamimi told / JD / that "the crisis is going through an extraordinary country and processors government is not the level of this crisis, they require the issuance of exceptional decisions for each joints of the economic state and the formation of a room made up operations from the concerned authorities in the government and relevant experts to address the crisis quickly, because in the absence of processed consequences will be disastrous for Iraq and harm its security policy. "
He explained that "there are many processors can be adapted from past years that have passed on Iraq in the eighties years and nineties relying on domestic production and the organization of Statistics resources and exploitation, where enable Iraq to fill his need of food, most medicines and supplies daily life despite the scarcity of financial resources, in addition to investment the right of the Iraqi local industries. "
The economic researcher Muhammad al-Hassani has stressed that reducing the monetary reserves of the Central Bank means higher dollar exchange rate against the dinar and is weakening and this is what will cause economic upheaval in the country, because the central bank will reduce sales in the auction and this is what will make a growing demand for the dollar in the domestic market.
He said al-Hassani told / JD / that there are many treatments and solutions which can be used to address the financial crisis, including savings compulsory application rates given to the employees' salaries with the first four grades and increase taxes and fees rate on imports in addition to issuing internal and external bonds as well as borrowing from domestic and foreign banks, When the improvement in oil prices could pay off all these debts.
He favored economic researcher improvement in oil prices during the second quarter of the current fiscal year, which could reach the barrel price of $ 60 and is improving little by little in the coming months, the government and its officials that Athlo patient and careful and not to be drawn to decisions that may cause disrupt the economic situation in the country.
For his part, former MP Wael Abdul Latif warned of the danger of the asylum State of manipulating the cash reserve of the country and the enactment of a law authorizing the government to withdraw money from the balance of the State to cover its expenses.
Abdul-Latif said in a press statement, said the government had resorted to the manipulation of the cash reserve to fill the fiscal deficit in the budget, not up to the slightest understanding of the monetary and economic sphere. "
He added, "The cash reserves of gold and hard currency, represents the power of the Iraqi dinar and the strength of the Iraqi economy, and if it has been tampered with, the Iraqi dinar will collapse."
He continued, "The Iraqi cash reserves rose to $ 87 billion, which enhances the Iraqi currency, but the country began to draw from this reserve, which led to the deterioration of the Iraqi currency."
And Abdel Latif, that "there is a draft law allows the government modified the Iraqi Central Bank Law No. 56 of 2004, allows the government to withdraw what covers the needs for the year 2016 from the cash reserve, stressing that" this decision is dangerous and will lead to the collapse of the Iraqi currency and would cause great harm to the citizen. "
Iraq has been a major financial crisis as a result of the fall in world oil prices, where Brent crude was $ 28, while Iraqi oil to $ 20 a barrel.
And oil revenues make up 93% of the annual financial budget revenues.