Central Bank wants Iraqis to drop the dollar in internal commercial transactions

Azzaman, June 29, 2012

The Central Bank has decided to remove three zeros from the dinar, a move it sees essential to strengthen local currency and tempt Iraqis to stick to it.

For months, the bank has been mulling the issue but only recently it said a decision has been made and it was a matter of time to translate it into action.

“The knocking out of zeros will save Iraqis using massive sums of paper money in their transactions,” said Central Bank Deputy Governor Mudher Saleh.

Saleh, speaking in a seminar on currency organized by the High Institute of Accounting in Baghdad, assured skeptic Iraqis that the removal of zeros from the currency “shall not affect your earnings, wealth, financial and transactions, financial obligations and duties.”

He said, on the contrary, the Iraqi economy and Iraqi citizens were to benefit from the move.

The Central Bank, awash with hard cash reserves estimated at more than $60 billion, is working hard to boost the dinar’s value against major convertible currencies.

A firmer currency along with the removal of zeros has been among the bank’s priorities.

But Saleh said the bank was concerned to see the economy being dollarized and one target behind the new move was to lessen dependence on the dollar in domestic transactions and dealings by Iraqis.

A dollar is now worth about 1,200 dinars.