Iraqi banks undertake overdue reforms

Iraqi banks have undertaken reforms, coinciding with the Iraqi government’s measures to reform the economy.

The Central Bank of Iraq announced in a statement Dec. 19 the devaluation of the Iraqi dinar to 1,450 to help reduce the country’s fiscal deficit in the state budget for 2021 from 70 trillion to nearly 30 trillion dinars.

Simultaneously, Iraqi banks have undertaken additional measures to optimize the Iraqi economy. In the past weeks, government banks intensified calls for citizens to deposit their money in their bank branches instead of hoarding it at home.

Local media published calls by Rasheed Bank and Rafidain Bank along with the interest rates they pay for deposited money.

In less than a week, state-owned Rafidain Bank raised the interest rate on deposited money from 4% to 5% so as to encourage people to deposit funds in Iraqi branches.

Rasheed Bank, however, is paying a 7% interest rate on fixed deposits for 2.5 years.

Rasheed Bank’s offer involves individuals, businesses, associations and other sectors.

According to the Central Bank, funds citizens have hoarded at home are estimated at 77% of those circulating in the local market.

Rasheed Bank, established in 1988, and Rafidain Bank, which opened in 1942, are the largest government banks in Iraq and have branches in most of the 18 Iraqi governorates.

The two banks, among others, have faced financial pressure due to government borrowing as a means to meet the large financial deficit the country has suffered since the outbreak of the COVID-19 pandemic and the drop in oil prices, which is Iraq’s main source of revenue.

Rasheed Bank spokesperson Amal Shuwaili told Al-Monitor, “Our bank is trying to raise awareness among citizens about the importance of depositing money in banks.”

Shuwaili does not have stats on deposits after the call was made, but she pointed out that the bank is increasingly opening new accounts and more and more funds are being deposited.

She explained that “the interest rates are withdrawn on a monthly, not a yearly basis” and “the funds will be protected at all times.”

The Iraqi banking system is underdeveloped, as Iraqis still pay most of their daily financial transactions in cash.

Salary domiciliation for ministry and state institution employees started a few years ago; banks provided them with debit cards, enabling them to withdraw cash.

Shuwaili stated that “as soon as the salary is deposited in the account, the bank sends an SMS notifying the employer that the salary has been deposited in the account.”

Amer Abd Ali, an employee at the Interior Ministry, noted that he only believes in cash and withdraws his entire salary as soon as it enters the account.

He explained to Al-Monitor, “I can only use the card in specific places. … To be honest, I do not trust the banks with my money.”

Citizens’ lack of trust in banks is the main reason behind hoarding money, but it is not the only reason.

Bureaucracy prevails over the banking system, especially government banks, when it comes to opening new accounts and depositing funds. Add to that the interest rate depositors receive.

Shuwaili affirmed that, on the contrary, “… We have started to reduce this bureaucracy, and things have become easier now.” Depositing funds “has become an easy task … but money withdrawal may seem a complicated process for clients. This process is designed to protect the money. Is it a kind of bureaucracy to ask for the client’s ID?” she added.

Shuwaili attributed Rasheed Bank’s call to its ambitious plan to increase loans and encourage investments. “That is why Rasheed Bank is encouraging clients to deposit their hoarded funds.”

Shuwaili’s remarks did not seem to be in line with the international data on the Iraqi government banks’ participation in boosting investments and the economy.

According to the World Bank, only 5% of small- and medium-sized enterprises obtained loans from local Iraqi banks, while businessmen and investors borrowed from family and friends to bridge their financial deficits or expand their businesses.

Iraq was ranked 172 out of 190 in the World Bank’s Ease of Doing Business Index, followed by poor countries devastated by war, such as Syria and Afghanistan.

Nabil al-Marsoumi, professor of economics at the University of Basra, said that “the banks’ calls on citizens does not seem more than a prelude to a new round of government borrowing from these banks.”

Marsoumi, who has written research papers on the defects of the Iraqi economy, identified major defects in the banking system including bureaucracy, underdeveloped e-systems and the fear that these banks could collapse at any moment due to the stifling financial crisis that Iraq is going through. He indicated to Al-Monitor, however, that “Iraqis deposit their money in neighboring countries due to the interest rates — in Turkey and Iran, for example, which are higher than those in the Iraqi banks.”

Annual interest rates in Turkish and Iranian banks hit 20% on fixed deposits.

Read more: Al-monitor.com

The Finance Committee revealed, the fact that the Central Bank intends to change the exchange rate of the dollar again.

Baghdad – Al Furat News: Committee member Jamal Cougar told {Al Furat News} that “it is not possible for the central bank to re-price the dollar again,” stressing that “do not retreat from the new exchange rate and it is unrealistic for the monetary authority to circumvent itself.”

Cougar added, “There will be no retreat from changing the exchange rate and no new rate may be adopted because it will confuse the entire market,” noting that “we need two weeks to overcome the crisis of changing the price so that citizens adapt to the new price.”

Raghad Daham

Alforatnews.com

Ministry of Commerce: the middle of next month, the date for the application of the electronic payment system

Mawazine News: The Ministry of Trade confirmed, on Thursday, that mid-January will be the date for the application of the electronic payment system for exporters and importers, while it indicated the reasons for the obstacles to the export process.
The general manager of the General Company for Fairs and Iraqi Commercial Services, Sarmad Taha Saeed, said, according to the official agency, that “the company has signed a contract with the Central Bank regarding electronic payment, as it will be the middle of next month to implement the electronic payment system, which will allow exporters and importers to pay with any card. Available”.

He added that “attractive offers were made to the exporters, by giving ten percent of the invoice value without charge, in support of the Iraqi exporter, as our goal is not only to export, but rather to be the transfer in Iraqi banks, and to provide hard currency.”
He pointed out that “the Council of Ministers previously issued a decision to make the export absolute, but we were surprised to stop exporting most of the materials due to the presence of laws that contradict the decision.”

He explained that, “when traders started exporting, they were surprised to stop exporting gravel, aluminum industries, etc., as we must take sectoral approvals, after which export is allowed, in addition to the existence of laws issued in previous years that prevent the export process, and therefore we must present a proposed law to the Council of Ministers and ratify it.” And it is sent to the House of Representatives and presented for the first reading and the second after which a decision is issued. ”Ended 29 / A43

Mawazin.net

The Kurdistan government calls for the implementation of the financial agreement between Baghdad and Erbil

Baghdad – On Thursday, the President of the Kurdistan Regional Government of Iraq, Masrour Barzani, expressed his hope for the implementation of the recent agreement between Erbil and Baghdad regarding the 2021 budget .

Barzani said in a press statement, that the Kurdistan Region and the whole world have faced a difficult year in light of the outbreak of the Corona epidemic and its difficult economic consequences, and the federal government’s refusal to send financial dues to the Kurdistan Region, which created a financial crisis and a difficult situation that, in turn, formed a heavy financial burden on our dear citizens in the Kurdistan Region. .

He added, “We have reached an agreement with the federal government regarding the draft federal budget for the year 2021, we hope that the agreement will be implemented in full, and we ask the political parties in Iraq, and from now on, not to accept the use of Kurdistan Region’s dues and rights as a political pressure card against the people of Kurdistan who do not.” His rights are still being denied, affirming at the same time that we will never compromise our constitutional rights . ”

Economy-news.net

Iraq and Iran are discussing signing the draft economic agreement and raising the level of trade exchange

Baghdad – Trade Minister Alaa Ahmad al-Jubouri and Iranian Energy Minister Reza Ardakanian discussed, on Tuesday, the signing of the draft economic agreement and raising the level of trade exchange between the two countries.

“Al-Jubouri received the Iranian Minister of Energy and during the meeting discussed a preliminary meeting for the Iraqi-Iranian joint committee, discussing raising the level of trade exchange between the two countries and conducting negotiations on the signing of the draft economic and trade agreement between the two countries,” the Ministry of Commerce said in a statement. .

The statement added, “Ardakanian’s visit to Iraq came to discuss with Iraqi officials about preparations for the meeting of the joint economic committee between the two countries to be held soon in Tehran.”

He pointed out that “the Iranian Minister of Energy and his accompanying economic delegation will discuss during the visit the energies and means of developing economic and commercial cooperation between the two countries, cooperation in the fields of agriculture, industry, health, transportation and a number of other projects.”

Economy-news.net

13 private banks are facing court for entering the currency auction without customs permits

Baghdad / Al-Masala: The Rusafa Investigation Court, which is competent to look into issues of integrity, money laundering and economic crime, decided, Thursday, December 24, 2020, to take legal measures against thirteen banks for violations of entering the currency auction without submitting customs permits that support entry of goods, tax accounting, and suspicions of fraud Related documents.

The Media Office of the Supreme Judicial Council stated in a statement received by Al-Masala that the aforementioned court decided to bring in the authorized directors of the violating banks due to their breach of the due diligence procedures imposed by the Anti-Money Laundering and Terrorism Financing Law No. 39 of 2015.

Almasalah.com

The Iraqi judiciary takes measures against 13 private banks, following violations of the currency auction

Shafaq News / The Rusafa Investigation Court, which is competent to look into issues of integrity, money laundering and economic crime, decided on Thursday to take legal measures against thirteen banks for violations of entering the currency auction without submitting customs permits that support the entry of goods, tax accounting, and suspicions of falsifying documents related to this.

The Media Center of the Supreme Judicial Council stated in a statement today that the aforementioned court decided to bring in the authorized directors of the violating banks due to their breach of the due diligence procedures imposed by the Anti-Money Laundering and Terrorism Financing Law No. (39) of 2015.

On Wednesday, the Supreme Judicial Council directed uncles issued by it to all investigation courts to take legal measures against everyone who caused damage to the national economy, whether from foreign currency dealers or monopolistic merchants of goods, food commodities and essential commodities that people need daily.

In a statement, the Council requested the Ministry of the Interior to instruct the competent police directorates to conduct inspection tours of wholesale stores and places of sale of foreign currency to catch those who violate the law.

The statement noted that the investigation court specialized in combating money laundering began several days ago to conduct an investigation regarding the auction of selling foreign currency and violations of the law by some private banks to participate in the auction of selling foreign currency.

The competent judge stated that the investigation had reached advanced stages and revealed illegal operations, fraud and fraud to participate in the auction of selling currency and smuggling foreign currency outside the country.

These uncles come after the Central Bank of Iraq decided to reduce the dinar against the foreign currency, especially the dollar, which led to an increase in imported goods and commodities, especially food, medicine and other necessities of life.

The Ministry of the Interior had deployed detachments to combat economic crime in the markets to monitor prices and prevent manipulation of them, while stressing that some merchants would not allow monopoly of materials.

“The role of the Ministry of the Interior is limited to monitoring the prices set by the relevant authorities,” said the ministry’s spokesman, Major General Khaled Al-Muhanna, in statements reported by official government media, explaining that it “will not allow monopolization of materials.”

He added that “the monitoring process is through the Economic Crime Control Directorate of the Ministry of Interior.”

And Interior Minister Othman Al-Ghanimi had confirmed earlier, that detachments were moved in all governorates to implement the law against those trying to tamper with prices, taking advantage of the crisis.

Shafaq.com

Representative Finance: Determining the exchange rate of the dollar is a government matter and it is its exclusive powers

Today, Thursday, the Parliamentary Finance Committee issued a clarification regarding the exchange rate of the dollar, indicating that determining the exchange rate of the dollar is a governmental matter and one of its exclusive powers.

The committee said in a statement issued by the Information Department of the House of Representatives that “determining the exchange rate of the dollar is a governmental matter and one of its exclusive powers is that it is the one who designs and implements the financial and monetary policy,” indicating that “the inclusion of that price in the draft Federal Budget Law for 2021 is to calculate the value of oil revenues and loans.” International, which is calculated on a dollar basis and converted into Iraqi dinars depending on the exchange rate. ”

She pointed out that “that price was mentioned in the budget, and it is not intended to acknowledge or not, but to approve it in the calculation of revenues and expenditures only, as mentioned above.”

Dijlah.tv

Al-Sumaida’i: The currency auction is a smuggling of the dollar and its corruption goes beyond simple sales

Baghdad: Al Furat News – An independent politician, Ibrahim Al-Sumaidaie, described the auction of selling the currency as “smuggling.”

Al-Sumaida’i said {to the Euphrates News} that “the currency auction is a smuggling of currency and is based on covering the sale of the dinar for the purpose of import and credit.”

He pointed out that “the latest statistics of the Central Statistics Agency revealed differences in the currency auction that exceeded the $ 26 billion without basis, even in the amount of $ 19 million for the purpose of import. Most of its invoices are forged and the Central Bank evades responsibility.”

Al-Sumaidaie added, “The only solution to stop the bleeding of currency selling is to inject the dollar in real terms and go to savings accounts,” noting that “the problem of this auction has been in place since 2010.”

The independent politician concluded, “The Central Bank of Iraq deluded the people that there is no alternative to the currency auction, and he admitted that there were 45 trillion dinars outside the monetary policy of Iraq, and the corruption of the auction went beyond simple direct sales to specialization.”

The deputy of the parliamentary wisdom bloc affiliated with the coalition of Iraqis, Khaled Al-Jushami, revealed that Iraq had lost 240 million dinars per month in the currency auction.

Al-Ghashami said in a press statement, that the Central Bank of Iraq sells 4 billion dollars a month, even if we divide it by 200 in 5 working days, it equals one billion dollars in four weeks, and if we multiply the 4 billion dollars by 6, the result is 240 billion dinars per month for the Iraqi state from the auction selling the currency.

He added that the profit goes to people in private banks, not to government banks, in order to return to the state treasury.

It is noteworthy that a member of the Parliamentary Finance Committee, Faleh Al-Sari, collected signatures to submit a request to question the Governor of the Central Bank of Iraq regarding suspicions in the currency auction.

In the year 2019, the Central Bank sold $ 44 billion of hard currency in the currency auction, mostly intended to cover the import of materials and goods that the country needs, stabilize the price of the Iraqi dinar and prevent inflation, according to bank data.
However, as economists say, the volume of Iraqi imports reached 18 billion dollars, and they warn of “currency leakage” outside Iraq due to “corruption” in the currency auction in the country.

In light of this, the Supreme Judicial Council announced that it would initiate the investigation of the documents of the joint banks in the foreign currency sale window.
A statement to inform the judiciary stated that the investigation court competent to combat money laundering and economic crime crimes responds to the request of the Central Bank and conducts the investigation with documents and documents submitted by the participating banks in the foreign currency sale and purchase window to verify its validity and compliance with the law.

Alforatnews.com

“It will create thousands of jobs” .. Iraq aspires to be the “main stop” on the Silk Road

Transport Minister Nasser Hussein Al-Shibli confirmed, Saturday, that Iraq will be the “main station” in the international land and maritime road project, the “Silk Road” linking the two continents of Asia and Europe. The company implemented.

The official Al-Sabah newspaper quoted Al-Shibli as saying, “If a port is completed The FAO, Will be Iraq Center (Silk Road) You are working on China To connect Europe with Asia, “noting that” the completion of the project will follow the implementation of the dry canal to connect a port The FAO BTurkey, And thus completing the connecting line of China to me Pakistan And port The FAO By sea, and by rail to Europe. ”

Al-Shibli added that “the implementation of (Silk Road) Through Iraq It will provide thousands of jobs and a great economic return to the country, equivalent to oil financial revenues, and is linked to the completion of a port The FAOAl-Kabeer. ”

He continued that his ministry would complete the first phase of the portThe FAO Early next year, explaining that “the sum of the allocated contract is two billion and 650 thousand dollars, and the ministry continues to negotiate with the Korean company to agree on this price and reduce the value of the contract,” pointing out that “Port The FAO It includes five large projects and a completion period of three and a half year.

Mentioned that China In 2013, it announced its initiative to create (Silk Road The new), which is a network of ports and railways that will connect nearly 65 countries around the world.

Alsumaria.tv/news