Raising the exchange rate is not the alternative to overcoming the crisis.
Raising the exchange rate is not the alternative to overcoming the crisis.
2026-10-12
Majed Zeidan
Last week, the government changed the exchange rate by devaluing the dinar by 15.17%, bringing it to 1520 per 100 dollars. This came after assurances and obfuscations from senior officials that the exchange rate was fixed, that there was no intention to change it, that salaries were guaranteed, and that there were no problems in the national economy. However, leaks revealed that the coordination framework and the government had been holding continuous discussions and exploring alternatives for over a month. This provided an opportunity for some close to decision-making centers to accumulate dollars from the market and get rid of dinars, which was the reason for the continued high exchange rate. Whether the price rises or falls, they profit and do not bear the burden of the flawed policies pursued by their governments that led to the crises and their exacerbation, instead shifting the blame onto broad segments of the Iraqi people.
Even worse, the Al-Zaidi government, with the support of the ruling powers, looked for the easiest way out and did not bother to take many alternatives and less harmful options for those with limited income and minimum wages. It resorted to reducing the dinar, the easiest option and the quickest to return on its investment. In order to poison the citizen, it wanted to appear concerned for him by offering two alternatives: reducing salaries and delaying their payment.
While discussions among economic experts revealed that the government could have provided the same amount it aims to achieve from its chosen option, and perhaps more, through several methods that would be less burdensome on the citizen but heavier on its social base, most notably tax settlement with foreign oil companies and others, estimated at several trillion, such as Shell and the Chinese company Petrochemicals, and collecting debts from telecommunications companies, which are also trillions, and improving collection of services provided by the state, and pursuing the collection of taxes and customs, all of which generate huge sums, as well as reducing waste and spending and compressing the operational expenses of public departments and institutions, and refusing to create senior positions to satisfy certain political forces, in addition to reducing the salaries of the three presidential bodies and special grades, the huge numbers of advisors, the salaries of the Rafha and double salaries, reducing diplomatic missions, replacing imported alternatives with local alternatives, imposing taxes on luxury goods and progressive taxes on high incomes, and intensifying the campaign against corruption and speculators, and much more that was pointed out in the comments and writings of analysts and followers.
Adopting a strict austerity policy that does not affect the development of national resources and does not target those with limited income will provide more financial resources than what is expected from changing the exchange rate.
Apparently, the government did not think or bother to avoid the effects of its decision on the poor, needy, and even middle classes. It put everyone on the same level without noticing the differences in income and economic conditions. This is further confirmation that it is a government of fat cats, high-income groups, merchants, and parasites. They will not be affected if the dollar rises even more, as they are able to reap the gains.
shafaq.com
