Economist: the decision to postpone the deletion of zeros from the currency "true" and holds economic and political dimension

17/04/2012 13:52

BAGHDAD / Aswat al-Iraq: economic expert considered contrary goldsmith, Tuesday, the Iraqi government's decision to delay the deletion of zeros from the currency, who plans to apply the CBI "true" and holds economic and political dimension.
He said a member of the trustees in the Iraqi Institute for Economic Reform contrary goldsmith told (Voices of Iraq) that process, "accompanied by a plan to stimulate agriculture and industry," and need "not to engage in monetary procedures that could lead to the implications of incorrect on these events and thus may do not achieve the desired results. "
The Cabinet announced late last week about his decision to stay the proceedings on the process of deleting all the zeros of the dinar until further notice, while insisting the Iraqi Central Bank to implement the plan starting from next September, the month of September, a process that takes two years.
In total, expert says that the deletion of zeros from the currency decision by the monetary policy, "when there is inflation, monetary and large size of the currency leads to confusion of financial transactions," while seeking monetary policy to "be the currency used by the strong and stable against foreign currencies."

This inflation, according to expert, was the result of what happened in Iraq from the events during the nineties of the last century through the events of 2003 and what happened to inflation, monetary and the low exchange rate of the dinar against foreign currencies, especially the dinar, "follow the central monetary policy to control inflation and Khvza on the basis of consistency with the fiscal policy used by the Ministry of Finance. "
Central Bank "was able to reach the fixed price of between 1170 and 1180 dinars per dollar for a long time," he managed to "achieve a cash reserve and a cover of the Iraqi currency equivalent to $ 62 billion and was able to give value for money of Iraq."
The plan of the new centralized delete the zeros and change the currency says expert that it "comes to reducing the amount of Iraqi currency circulation estimated at more than 35 trillion dinars," to reach out to "about 30 billion dinars delete the zeros, it is the idea of ​​true and in the interest of the Iraqi currency."

In spite of the fact that the plan of the central bank as valid as he believes, "but it" comes at an inconvenient time and is associated with the sensitive period at the economic level, "because the Iraqi government" started the process of stimulation for both the industrial and agricultural, "and at the political level," the fact that the period of changing the currency comes sensitive period in the election and does not require the citizen to confuse delete the zeros and change the currency. "
Iraq has been in the first quarter of 2013 provincial elections, to be followed during the 2014 parliamentary elections that will choose the Iraqis under which new members of the Iraqi Council of Representatives.
In response to a question about the time period that can be applied in which the central bank's plan zeroes delete and change the currency jeweler said that the matter "does not depend on a certain time period, but requires many factors to isnaad."
"There are laws must be enacted for the private sector to be an active partner with the public sector", in order to "stimulate the creation of jobs and higher levels of production and contribution to gross domestic product."
He said the goldsmith that there are "plans and programs must be working out in conjunction with the development of the oil sector, to develop other economic sectors, especially industry and agriculture", because they are sectors "actors real, and bring them to an earlier outdated because they were Tsihaman about 35% of GDP while that did not exceed Today its share of 3%. "
He concludes his speech by saying the goldsmith, "All these things should be taken into consideration before you put a specific date for the start of the central bank's plan to delete the zeros and change the currency, issues left to the ability of economic activity in itself."