Is the process will delete the zeros of the Iraqi currency to stop rigged?!
Is the process will delete the zeros of the Iraqi currency to stop rigged?!
Posted, March 6, 2014, 10:14
BAGHDAD / newspaper rectitude – the central bank began to examine the decision to amend the categories of the Iraqi dinar since 2010 as it seeks today to the deletion of three zeros from the Iraqi currency, a project raises many concerns on the street level and the business community in Iraq.
The delayed implementation of the project after it has been amended, the central bank more than once due to concerns based predominantly to counterfeit currency circulating in the market and the security situation uncontrolled and open market for foreign goods.
It seems that economists are divided between supporters of the project see it as an opportunity to reduce the proportion of counterfeit currency and high inflation, unemployment, and between forewarned of economic shocks may dominate the Iraqi market due to the application of this project.
Where postponed the process of deleting the zeros more than once, until the called the Economic Committee in the House of Representatives on the seventh of July of the central bank, accelerate the process of deletion of zeros from the Iraqi currency, stressing that the process of deleting the zeros will increase the value of the Iraqi dinar will be reflected positively on the issue of reducing the rate of unemployment and poverty in the country.
The aim of the process – according to the Central Bank of Iraq – to reduce the enormous mass of cash flabby, and easing inflation, which he considered the bank (monetary inflation) caused by an increase in the amount of cash pumped into the street, which invited him to foot the deletion of three zeros from the currency.
According to reliable sources that the process of deletion of zeros will be this year, noting that the measure will gradually until full absorption banknotes old from the market completely, memory that the currencies of existing and new will work at the same time without reducing the value of any of them until the full absorption currency Current or that would be (old) time.
A member of the Finance Committee in Parliament Abdul Hussein al-Yasiri: “The year 2014 will see the deletion of zeros from the Iraqi currency, to be done in coordination with the Central Bank of Iraq.”
Abdul Hussein al-Yasiri
The Yasiri that this project will lead to the reduction of the size of the national currency in circulation than four billion Iraqi dinars to one billion only.
For his part, Deputy Chairman of the Finance Committee in the Iraqi Parliament Ahmed Hassan Faizullah to delete the zeros will not change the purchasing power of the Iraqi dinar because it is linked to the size of the industrial production, import, and what saved the Iraqi dinar and whenever replaced the currency in 2007, is owning the central bank cash reserve of hard currency Osafth has formed a cover of the dinar.
For his part, said a member of the parliamentary Economic Committee Mahma Khalil said that “the current currency big bloated and not worthy of the country’s citizens have a strong desire to keep the Iraqi dinar to compete with the dollar and other currencies.”
He said: “It is possible to delete the zeros from the current currency, but it has been postponed until after the parliamentary elections, pointing out that studies are now to put safeguards in order to reduce fraud, or make sure not to current currency trading again.”
A member of the parliamentary Economic Committee Abdul-Hussein Abtan that “the increase of the Iraqi dinar against the dollar is so vital to the citizen, where not enough that we have billions in deposits at the central bank in exchange rate of poverty and unemployment and a weak purchasing power of the citizen.”
He says an economist and head of economic studies at the Center for Mustansiriya Dr. Abdul Rahman al-Mashhadani: “The process of deletion of zeros formality through which to change the face value of the coin without compromising real terms and have no raised real economic because the currency change will not lead to an increase in GDP of the country, explaining that the process is applied without any damage in many countries of the world during the last thirty years, including Bolivia in 1986, Russia in 1998, Turkey in 2005, North Korea in 2009. ”
He called for Mashhadani to the need to distinguish between the process of change in real currency, which means changing the exchange rate of the local currency compared to the currencies of leadership as dollar Mthelaoho is leading to re-evaluate the prices of goods and services due to the change the real value of the currency, such as what happened in Iraq in 2007 when the value of the Iraqi dinar against the U.S. dollar to 1267 dinars after it was sold at a price of 1475 dinars in 2006, and like what was done when China devalued its currency iwan compared to other currencies even compete with Chinese goods other commodities in the world markets being cheaper.
And the expert a number of pros, where he said that the process of deletion of zeros will be provided by the new currency, considering changing the currency order will boost confidence with one of the symbols of national sovereignty of the country, and can increase confidence in the national currency with the citizen at home and the foreign investor abroad, as well as reducing process ( Dollarization) using this currency as a store of value and measurement, as well as to facilitate the process of trade within the country, and to facilitate the process of converting the dinar to other currencies.
As justification for the replacement process Vl_khasha follows:
– Gangs and mafias attempt to juggle the Iraqi currency and pumped into the local market for the destruction of the national economy, which spread recently.
– The presence of a cluster of cash has a big exporter leaves four trillion paper and worth more than $ 30 trillion dinars to the various groups, a large block size and the value in the economy is recovering day by day.
– Currently the largest category of cash is 25 000 dinars, equivalent to $ 21 almost and this requires a larger and a major effort to settle the daily transactions in terms of the time of counting, sorting, acceptance and safety and so we find the settlement of most of the daily transactions that increase Akiemha for the 20 million are in dollars.
– The presence of damage to a large proportion of the currency, especially in small denominations and inadmissible in circulation and constitute almost one-third of the money supply and not replaced gradually by the central bank.
– The difficulty of making the calculations under the numbers increase the number of Ocefarha zero for 14 of the practical and technical error occurred and the possibility of adding either zero or deleted.
From here, the process of lifting the zeros are in the attraction between economists between positives and its negatives is that there is almost a consensus that money laundering, forgery and the spread of financial and administrative corruption and economic instability will be a severe negative factors influencing the process of replacing the currency.
The Iraqi Central Bank acknowledged the existence of Banknotes fakes in commercial markets, and face Aamama to all banks to take the necessary, and detect the presence of vigorous attempts to rig the currency, calling on all government agencies concerned to fight for it if they grew up will be a threat to the Iraqi economy and a violation of his .