The central bank stands ready to "liquidate" special entitlements farmers Treasury bonds

08/04/2016 (0:01 pm) The number of readings: 132

Baghdad / Ibrahim Ibrahim

It showed the Iraqi Central Bank, on Wednesday, his willingness to "liquidate" Treasury bonds to pay off the dues of farmers while issued by the Ministry of Finance. The CBI announced that the Commercial Bank bought treasury remittances worth 400 billion dinars, economists stressed that Treasury bonds are considered a solution in real time to the government but it is the new debt.

The Parliamentary Committee on Agriculture revealed, in the 28th of July 2016, its intention to adopt a resolution of parliament obliging the government to pay the dues of farmers within ten days, while threatened to question the officials in the Ministry of Finance and the Central Bank on the delayed payment of arrears since 2014.

He said the Iraqi Central Bank, said in a statement the "long" received a copy of it, "the Bank declares its readiness to liquefy the special treasury bonds to pay farmers dues while issuance of the Ministry of Finance."

The bank said a statement that "the commercial bank bought through public auction conducted by the central bank on behalf of the Ministry of Finance treasury remittances amounting to 400 billion dinars," noting that "the duration of the transfer of 364 days."

And between the central bank through his statement that "the commercial bank full assignment and bought the highest price," explaining that "the number of participants in the auction was the only one."

In turn, economist Mohammed Abdul Latif Al-Ani said in an interview for the "long", that "the central bank buying government treasury bonds is a good step to tackle the financial liquidity that the government suffered for nearly two years the crisis."

"The unsold national bonds by the government characterized by a high level of security being guaranteed by the government and financial institutions, especially the Ministry of Finance, in addition to that they are held as collateral for financing, and a yield of financial rewarding and fixed a specific duration of time not to exceed three years."

And between al-Ani he said "the federal government has developed a plan to pay off their debts vessels through bonds that characterized as" high liquidity "because of the possibility of selling them at any time through the Central Bank of Iraq, and what does not affect the interest accrues on the retention period writ and the stability of the price to the local market variables ".

He noted economist that "the national debt is an investment for the various financial institutions, government and private entities such as banks and pension and social security tool because it owns large cash liquidity can be invested in a legal and honest to buy bonds from the government."

He said al-Ani said "bonds issued by the federal government represents a solution in real time to repay its debt, it was a new borrowing process will raise the internal debt of the state the size and increase the burden of servicing the public debt in the future, as well as it would lead to the reduction of excess liquidity in banks, which will raise the cost of deposits, and it will reflect negatively on the work of government banks in the future. "

"The government has directed the funds foreign loans according to specific plans include the strengthening of internal resources provides a real opportunity to recycle oil imports in the domestic market will revive that suffer from paralysis as a result of the lack of liquidity of government."

The Central Bank of Iraq was considered an independent bank under the law issued on March 6, 2004, and is responsible for maintaining price stability and the implementation of monetary policy and the management of foreign reserves and the issuance of currency management, and regulate the banking sector to promote a competitive and stable financial system.