An economist expects different scenarios for the dollar crisis
Today, the economist Nabil Al-Marsoumi predicted that people would dispense with their “dollar” savings and transfer them to the Iraqi dinar.
“It is expected that after the unexpected response from the Minister of Finance and the accompanying turmoil in the currency market, most people will give up their dollar savings and convert them to the Iraqi dinar,” Al-Marsoumi said in a clarification followed by NRT Arabia.
He explained that, “in light of the lack of confidence in the Iraqi banking system, the demand for land, real estate and gold is expected to rise because they are a store of value, which will lead to an increase in their prices or people hoarding some of their savings in Iraqi dinars, as well as the expectation that the Central Bank of Iraq’s sales will decline in the coming days due to the increase in the dollar supply.” in the local market.
Yesterday, Friday, the Minister of Finance, Ali Abdul-Amir Allawi, responded to a request to be summoned by the First Deputy Speaker of the House of Representatives, Hakim Al-Zamili under the dome of Parliament, considering it an outrageous and unacceptable interference that should not be tolerated, while confirming that he would seek a vote of confidence in him from the House of Representatives.
Allawi mentioned in a letter he addressed to Prime Minister Mustafa Al-Kazemi, which included 21 points, the following:
1- I received a summons from the Deputy Speaker of the House of Representatives to appear before him to discuss the exchange rate. This came as soon as Muqtada al-Sadr tweeted, asking me to appear before Parliament to discuss the exchange rate.
2- The summoning of the Deputy Speaker of Parliament came as a result of the tweet of Mr. Muqtada, the leader of the Sadrist movement, to which the Deputy Speaker of Parliament belongs.
3- The entire process is not acceptable and should not be tolerated, whether for the dignity of the government, my dignity as a minister, or my personal dignity and the dignity of my family.
4- First. This government is not accountable to any political party. It is only answerable to the Iraqi people through its elected parliament.
5- If, as a government, we do not reject these nefarious interferences in the function of government by political parties, we may cede the independence of the government as the executive arm of the state. Here comes the question of determining the role of the government, whether it represents the people or an executive arm of political parties.
6- I categorically reject the summons of the Deputy Speaker of Parliament, because they are outside his powers. I also completely reject government running through tweets from political leaders.
7- I am a minister in a sovereign ministry. I worked in very difficult circumstances for nearly two years. I believe I have succeeded in managing the finances of the country, nurturing the economy towards a degree of safety.
8- I had to make many difficult decisions, including my strong call for an exchange rate adjustment. The decision was supported by the international community, the Council of Ministers, the Central Bank of Iraq and political parties in two separate meetings with their leadership, which was approved by the House of Representatives in February 2021. I made it clear that the costs of adjusting the currency would be immediate; But the benefits will appear in the medium and long term.
9- In order to protect the poor, a huge increase for the poor and vulnerable has been included in the 2021 budget, amounting to nearly 3 trillion Iraqi dinars to be disbursed through the Ministry of Labor. This unfortunately was curtailed by the House of Representatives in the final budget.
10- After a year we can evaluate the benefits of the exchange rate adjustment, which are very real. But the politicization of the exchange rate, making it responsible for high prices.
11- (High prices) This is a deliberate lie and the people should be aware of it. International prices for all goods and freight have risen dramatically in the past year.
12- Wheat, cooking oil, sugar and fertilizer multiplied many times over. This is about the collapse of the global supply chain and not anything about exchange rate adjustment. Instead of focusing on the real reason for the price hike, people are being fed nonsense about the exchange rate as the source of the cost of living increase we have seen over the past year.
13- I am ready to defend my position and my economic and financial policy before the House of Representatives as a whole and not in front of a particular parliamentary faction.
14- I demand the exercise of my rights under the Iraqi constitution, and I seek a vote of confidence in me by the House of Representatives. I have this right under Article 61/8 of the Constitution. “It is not permissible to raise the issue of confidence in a minister except upon his request or upon a request signed by fifty members….”
15- I will write to the Speaker of the House of Representatives and ask him to take this vote of confidence early. I will also ask him to give me one hour to explain my policies to the House before the vote takes place.
16- Since I was in the government, I have been subjected to a barrage of attacks and personal slanders both in social media and by politicians and some who call themselves analysts and media commentators. I have ignored all this harm because it is based on lies, slander or ignorance.
17- When the leader of a great political party treats me lightly as one of his followers, I must reject it outright. I know that the Sadrists voted for me when I was first nominated for the position of Minister of Finance, and they have stood by me through many crises including defending the exchange rate adjustment.
I freely admit this, but this does not give them the right to address me as a servant at their request and invitation.
18- Attacks continue my family. I don’t brag about my family lineage. But my family has given so much to this country. We have been citizens of Baghdad for hundreds of years. As the Allawi family, we have provided more ministers to Iraqi governments since independence than any other family. Six ministers and one prime minister. If we include the families close to us, Chalabi, the number will rise with four more ministers and one deputy prime minister. My great uncle Hussein Allawi signed a petition to bring Faisal I to Iraq.
19- Our family is completely Iraqi. We do not differentiate between Shiites and Sunnis, Christians and Yazidis. We do not differentiate between an Arab, a Kurd or a Turkmen. In my personal entourage, I am guarded by the Kurds, my personal secretary is among the Sunni brothers, and my personal office in the ministry is headed by a Shiite woman of high religious principles. We are not talking about diversity.
20- We have been supporters of the reference for centuries, and we respect the great religious families with the highest degree of esteem, and no member of my family has been contaminated with corruption or wrongdoing. They were motivated by real service with no concern for reward or benefit. I hope I have continued in this long approach.
21- We will not abandon this country in the face of bullying, pressure or threats. We have always stood against tyranny in any form or kind, and we will continue to do so.”
Earlier on Thursday, the First Deputy Speaker of the House of Representatives, Hakim Al-Zamili, sent a request to summon the Minister of Finance, Ali Allawi, and the Governor of the Central Bank, Mustafa Ghaleb, after a tweet by the leader of the Sadrist movement, Muqtada Al-Sadr, that included proposals regarding the dollar exchange rate, including summoning the director of the Central Bank and the Minister of Finance. Parliament has a date next Saturday to meet with them to discuss the dollar exchange rate.