Economists: Statements of change in the exchange rate of the dollar confused the market
Baghdad: Experts and economic specialists have criticized statements by several blocs and parties about changing the exchange rate, noting that it is a political media marketing that has confused the local market.
“Some of them see exchange rate change as just a digital process that goes up or down,” economist Uday al-Alawi told Al-Sabah, noting that “this change has a significant impact on the market and the commitments of many who live on the sale of materials.”
“The exchange rate can never be changed overnight, because the damage to those decisions made without knowledge of billions in losses to citizens,” al-Alawi said, adding that “changing the exchange rate requires overlapping processes of continuous market preparation that take at least two years.” “Statements regarding the change in the exchange rate of the dollar have confused the market and stopped many business operations, and forced families to reduce spending and be content with important goods, although private sector workers make up about 80% of society and are the most directly affected by such statements,” he said, adding that “any moves to reduce and raise the exchange rate must be considered, because there is a benefit between the trader and the simple citizen, as well as that many citizens have turned their dealings to the dollar.”
After the devaluation of the dinar, which suggests that it is not fixed internally, which causes a major economic change in the event of a decline or appreciation of the exchange rate of the dinar against the dollar.” Al-Alawi linked efforts to change the exchange rate on the one hand with talks to form a government on the other, noting that they would be temporary statements and would be nothing more than promotion and media marketing.
At the technical level, experts believe that Iraq should follow the steps of some neighbouring countries that have fixed the dollar exchange rate against their currency for years, even though they do not have any economic data, while the exchange rate in Iraq changes frequently.
On the same level, other blocs are trying to push economic laws to the House of Representatives, where the governor of Zamili, the first deputy speaker of parliament, announced the intention of the Sadrist bloc to legislate a law to deduct a grant from oil revenues distributed directly among citizens under the title “popular oil grant”, but experts and observers pointed out that these efforts cannot be applied within the law because of a budget deficit estimated at more than 27 trillion dinars.
Observers warn that Iraq is dependent on the current high oil prices, especially since its volatility will continue in accordance with market requirements and the consequences of the actions of the countries of the world on the general closure of the Corona pandemic.
They stressed the need for alternatives away from oil rents, as such wealth might not last long and could be reduced at any moment, noting that those funds could be invested in the construction of infrastructure for industrial cities that could compete with the world.
Alsabaah.iq