Member of Parliament Finance: The state has no authority to reduce the value of the dinar .. The decision is in the hands of a single party

Baghdad today – Member of Parliamentary Finance Committee MP Ahmad Hama Rashid, said that the demand for a move to change the Iraqi dinar exchange rate against the dollar, or what is known as (floating the dinar), to face the fears of the economic collapse should be the last economic solution In the event that all other attempts fail.

Rashid said, in an interview with (Baghdad today), that “the current or future government cannot change the exchange rate of the dollar against the Iraqi dinar because the monetary authority is independent and has no authority over it.”

Rashid said, “If things require and the monetary authority in the country (with the financial authority) decides to change the exchange rate, there are different views of the Finance Committee in terms of opposing some and supporting others, because changing the exchange rate will lead to an overall inflation of all components of Iraq.”

He continued, “But is this the economic solution, I believe that the last ironing-out medicine, and if necessary, I will be a supporter of such steps.”

And the former Minister of Transport, Amer Abdel-Jabbar, expected, on the day before yesterday, Tuesday, to reduce the salaries of employees and increase deductions and taxes, due to the decrease in oil prices in Iraq. In order to reduce the budget deficit.

In his speech to the program (A View), which is presented by Dr. Nabil Jassem on the screen of (Degla Satellite)), he pointed out that “the continuation of monetary policies and the current government in the same contexts with the sharp decline in oil prices will be disastrous, and the employee should expect to cut his salary, perhaps for half or exchange part From his salary every two months, “noting that” the next stage may witness a decrease in employee salaries and increase in deductions and taxes to reduce the budget deficit. ”

He added that “the Iraqi dinar is on its way to float (i.e. reduce its value), and the Iraqi government may have to increase the exchange rate of the dollar to 1250 dinars against the dollar in order to obtain additional funds estimated at 4 trillion dinars in the budget and this matter is positive because it will allow encouraging the national industry because it will raise the value Imported goods and makes domestic competitive. ”

And between “we fear a government decision to reduce the price of the dinar against the dollar to 1300 or 1350 in the event that the drop in oil prices is catastrophic, this float will cause the price of commodities to rise and burden the citizens, the state may use it to reduce the budget deficit.”

Abdul-Jabbar continued, “The government’s decision to place customs and other exemptions to remove visa amounts with some neighboring countries has harmed Iraq and contributed to preventing the entry of important revenues to the state,” noting that “since 2018, it warned of low oil prices in 2020.”

He pointed out that “the advisory base available to the Prime Minister is not qualified to deal with major crises, especially those related to low oil prices.” Because it will take the place of others. ”

Abdul-Jabbar said that “the recent appointments made by the Prime Minister killed the state and burdened its financial resources, and there is a 200-square-meter department with 270 employees.”

Earlier yesterday, the Finance Committee revealed the fact of discussing lowering salaries of employees and retirees after the drop in oil prices.

The committee confirmed, according to a book issued by it, “The news circulated regarding the reduction of the salaries of employees and retirees is incorrect, and it categorically denies the intention of the financial committee or the parliament, and the government delve into this issue as it is an acquired right.”

Baghdadtoday.news

Currencies: Undervalued versus Overvalued

Professor Farok Contractor explains the advantages and drawbacks to undervalued and overvalued currencies.

Currencies can be undervalued (very devalued) for natural reasons, such as political crises causing the rest of the world to become wary of holding that country’s assets or currency (e.g., Brazil and Turkey in the 2013–2019 period). Or in some cases, such as China, the government is alleged to deliberately keep the currency undervalued, for reasons described below.

Currencies can be overvalued (not sufficiently devalued) when foreigners in the rest of the world desire that currency in the exchange markets and wish to hold assets in that nation. Currencies can also be temporarily overvalued if the country’s central bank raises internal interest rates, and foreigners wishing to earn higher interest then demand that currency in the spot market. In other cases, especially in the emerging world, governments may deliberately keep their currency overvalued, for reasons described below.

Take the case of China, whose currency, the RMB (Renminbi yuan), is alleged to have been consistently undervalued by the People’s Bank of China (PBoC) since the early 1990s.

Advantages of Undervaluation

1) Undervaluation gives a boost to China’s exporters because the dollars they earn convert into more RMB than they would otherwise.

2) Undervaluation also makes foreign direct investment (FDI) more attractive to outside investors, since their currencies, say the U.S. dollar (USD), convert into more RMB with which to buy land, factories, or any local asset. The cost of establishing FDI in China is reduced, in say dollar terms, thereby boosting FDI in China from the rest of the world.

3) The expectation of consistent future undervaluation by the PBoC has caused investment and jobs to pour into China’s export sector, turning it into the “Factory of the World.”

4) Undervaluation makes imports coming into China more expensive in RMB, thereby protecting domestic Chinese firms from import competition and retaining investment and jobs in the country.

5) Overall, an undervalued currency boosts investment and jobs – something critical in a population of 1.4 billion people.

Drawbacks of Undervaluation

1) Effective protection against imports through undervaluation means reduced competition, which could also make local firms less competitive.

2) In a country with a limited labor supply, the excess demand for jobs could escalate wages, which in turn could increase inflation in general. (This did not happen in China for many decades because of its large population. However, with the one-child policy finally having an effect starting in 2015, labor shortages are now being seen: Chinese labor costs have escalated sharply, threatening China’s “Factory of the World” position.)

Overvalued currencies are more likely to be found in emerging countries, for reasons described below. However, there are many examples of overvaluation in the rich world, such as Norway and Switzerland.

Advantages of Overvaluation:

Overvaluation means that imports are cheaper in the local currency. This can be crucial for import-dependent populations or where basic necessities (e.g., food, medicines, energy) in emerging countries have to be imported for the local market.

Overvaluation also increases political stability. To the extent that imports of basic necessities are handled or subsidized by the country’s government, the political consequences of allowing devaluation (i.e., reducing overvaluation) would be detrimental to the ruling regime. This is because – following a devaluation – basic necessities may still have to be imported anyway, costing more in the local currency. This may lead to protests against the government.

In some cases, keeping a currency overvalued puts a damper on local inflation. Especially in import-dependent economies, importing at the overvalued exchange rate is cheaper than local production, keeping price increases under control.

Drawbacks of Overvaluation:

Overvaluation may hurt or reduce exports because companies converting their foreign currency earnings (e.g., USD) at the overvalued exchange rate do not earn enough local currency (e.g., Rs ) to justify their costs.

Overvaluation also means imports appear artificially cheap compared with local substitute products, thereby dampening investments and jobs in the sectors that could produce locally to compete against imports.

FDI coming into a country with an over valuated currency is somewhat reduced because foreign currencies (e.g., USD) convert into fewer units of local currency (e.g., Rs) with which to buy assets such as land, factories, and so forth.

Business.rutgers.edu

After Allawi’s apology .. Al-Araji expects the current government to maintain

The former deputy prime minister, Bahaa al-Araji, on Wednesday criticized the mechanisms for choosing a candidate to head the new government, while he expected to maintain the current government.

Al-Araji said, in a post on “Twitter” today, March 11, 2020, that “the complexity of the mechanisms for selecting a candidate for prime minister will result in difficulty selecting one of the names offered, which will lead – and as a natural result – to maintaining the current government!”, He said.

Al-Aaraji said, “The large number of candidates for prime minister reflects the lack of seriousness in deciding to choose one of them first, and the presence of hidden hands working to implement this in order to maintain the situation as it is second.”

He pointed out that “negotiations to select the prime minister have fallen to square one, by returning to discuss the nomination mechanisms, and this puts us before the possibility of the end of the constitutional period without agreement on any candidate.”

Alliraqnews.com

The names of seven new candidates for the presidency of the government are presented, and the negotiations end in the middle of this week

Mawazine News – Al-Fateh Alliance revealed, on Tuesday, the release of new names to choose a candidate for prime minister, indicating the date of the end of political negotiations.

The deputy of the coalition, Fadel Al-Fatlawi, said, “The political blocs presented seven names of candidates during the ongoing consultations to choose whoever meets the criteria agreed upon in choosing a candidate for prime minister.”

He added that “the four nominated names were presented earlier and the other three are not affiliated with a political party and have not received previous positions.”

He pointed out that “the negotiations of the political blocs regarding the resolution of the candidate for prime minister and his presentation to the President of the Republic are expected to end in the middle of this week.

The Presidency of the Republic announced earlier, the start of consultations with the political blocs to choose an alternative to the Prime Minister after Muhammad Tawfiq Allawi’s apology for assigning the formation of the government. Ended 29 A4

Mawazin.net

Facebook.com

Al-Rafidian announces the recovery of about 600 million dinars during February

Rafidain Bank announced, on Tuesday, the sum of the total sums that were recovered by the delayers, who refrained from paying their funds in February.

The media office of the bank said in a statement that Alsumaria News received, a copy of it, that “the sum of the money that was recovered by those who wavered who refrained from paying their money during the month of February reached a total of more than 595,682,202.”

He added that “the bank is continuing its strict procedures to recover the bank’s money from those who are lagging behind, who failed to repay the money from advances and loans and to take all legal methods against everyone who refuses to do so.”

It is noteworthy that the Rafidain Bank began granting loans and advances to employees and retirees during the past period, according to specific mechanisms and controls.

Alsumaria.tv

The Central Bank launches a program of pooled Islamic financing

Economy News – The Central Bank of Iraq announced, on Tuesday, the launch of a program of combined Islamic finance (SIFP) to create opportunities for partnership in financing between Islamic and traditional banks.

The Central Bank said in a statement received by “Al-Iqtisad News”, that it had “presented a monetary approach that combines the methodology of specific monetary policy and the basic conditions for establishing market economies by designing a program for Islamic syndicated finance (SIFP)”.

He added that this is “in an effort to reduce the unemployment rate and reduce the import gap by supporting projects that have a positive impact in raising the rate of growth of GDP.”

The statement stressed that the program “provides opportunities for partnership in financing between Islamic banks and traditional banks by targeting projects of strategic importance.”

He continued that the program “comes at a time when the current economic stage is witnessing a number of challenges in the production and consumption markets.”
The Central has allocated the following link (https://cbi.iq/static/uploads/up/file-158383413570107.pdf) to view the executive controls and basic principles of the consolidated Islamic finance program.

Economy-news.net

Iran’s influence in Iraq is not the same as it was before the assassination of Soleimani

Baghdad / Political thinker, Hassan Al-Alawi revealed that Iran’s influence in Iraq is not the same as it was before the assassination of Quds Force commander Qassem Soleimani.

Al-Alawi said in a press statement that “without an American-Iranian consensus, it is difficult to pass a new Iraqi Prime Minister because of the different circumstances, data and the nature of the conflict between the two parties.”

He added, “After what happened between America and Iran, especially after the killing of Qasim Soleimani, Iran no longer had a major impact (in Iraq), which withdrew over its influence in Iraq, as the Soleimani assassination incident changed many equations in Iraq and the region, and thus things became more complicated even In terms of passing a prime minister. ”

He explained that “the passing of an Iraqi prime minister is linked to external factors; not only internal.”

On the ongoing efforts to return Adel Abdul-Mahdi, Al-Alawi says that “Adel Abdul-Mahdi is not a leader; rather, he is a soldier who commands the matter of the power to which he belongs, but he is neither aggressive nor vengeful and also not bold in making decisions, while we need a bold man in making decisions.” .

Ikhnews.com

Al-Kazemi’s chances of becoming prime minister are back

Mawazine News – After the Prime Minister-designate, Muhammad Tawfiq Allawi, failed to form the interim government, the fortunes of the head of the Iraqi National Intelligence Service, Mustafa al-Kazimi, came again, to take over the presidency of the interim government.

A well-informed political source told Mawazine News that “Al-Kazemi has regained his chances of assuming the presidency of the interim government, after Muhammad Tawfiq Allawi apologized for forming the government.”

He added, “One of the main factors contributing to the rise in Al-Kazimi’s fortunes is that he does not belong to any political party, in addition to enjoying good international relations, in addition to strong relations with many political players in Iraq, especially since he was an active member of the opposition during the era of previous system”.

He stressed, “Al-Kazemi enjoys the support and support of the majority of peaceful demonstrators in the demonstration and sit-in arenas, because of his successes during the tasks he assumed, especially the presidency of the intelligence service,” pointing out that “Al-Kazemi, since he assumed responsibility in the presidency of the Iraqi National Intelligence Service, in June June 2016, he became largely the focus of attention, due to his notable success as a man with a background in journalistic and nonmilitary work. ”

He noted, “Among the successes of Al-Kazemi also, he supervised the efforts of the Iraqi intelligence on the internal and external fronts, and his administration was influential in combating ISIS and removing it from the main Iraqi lands, and he was recently in the spotlight for his role in the killing of Abu Bakr al-Baghdadi, the leader of the terrorist organization”.

Al-Kazemi was born in Baghdad in 1967 and holds a law degree and published a number of books, including a book called “Human Fears”, which was chosen in 2000 by the European Union as the best book written by a political refugee.

Al-Kazemi was in exile because of his opposition to the former regime’s president, Saddam Hussein, and from 2003 to 2010 he led the Iraq Memory Foundation, which was established to document Saddam Hussein’s crimes.

Al-Kazemi also worked as a journalist, and until 2016 he wrote extensively on the necessary reforms in Iraq, before he took over the post of the Iraqi National Intelligence Service.

Mawazin.net

The central bank demands citizens to stop dealing in banknotes

The Central Bank of Iraq called, on Thursday, merchants and citizens to avoid dealing in cash payment as much as possible to prevent the emerging corona virus.

The bank said in a statement received by Shafak News, “We coincided with what our dear country is going through, and as a result of the Central Bank of Iraq following up on international reports that warn of the ability of banknotes to be a carrier medium for viruses.”

The bank called on merchants and citizens to “deal with electronic payment tools (cards, points of sale, mobile wallets) and avoid dealing in cash for the sake of public health.”

Iraq recorded 3 deaths from coronavirus infections, two in Baghdad and one in Sulaymaniyah, out of a total of 38 recorded infections.

The injuries are distributed as follows: 14 Baghdad, 8 Sulaymaniyah, 5 Kirkuk, 4 Najaf, 2 Wasit, 2 Diyala, 1 Maysan, 1 Karbala and 1 Babel.

Alliraqnews.com