Iraq: the cost of stabilizing the value of the dinar $ 200 billion since 2004

Posted 29/04/2012 02:18 AM

Exceeded the cost incurred by the Central Bank of Iraq since 2004 to stabilize the exchange rate of the dinar against major currencies $ 200 billion, according to Iraqi officials, alerted to the possibility of growth of the number in the coming months due to pressure against the dinar of UN sanctions and Western Syria and Iran, which assesses Iraq with them relations economic and strong.

The Adviser to the Prime Minister for Legal Affairs Mohammad Fadel, the central bank about $ 200 billion out of Iraq by way of auctions to support the dinar exchange rate and restore balance to the domestic market for foreign exchange. And dropped the dinar exchange rate during the last few days against the dollar to one thousand and 227 dinars per dollar, and 118 thousand dinars.

He described the mechanism of monetary policy to Iraq b «unique» of its kind in the world, told «life»: «nothing in the world today, a central bank continues to hold auctions and pumped huge amounts of dollars to support the fixed exchange rate of the local currency. Since this is a new experience, she appeared with errors, and thus benefiting persons who are not traders ».

He said Fadel: «We buy and sell dollar, the dinar, and turn these amounts through auctions to the outside by way of remittances. There are people who participated in the auctions of the Central Bank and they are not really traders, and did not go these amounts for the purposes of the state and the private sector and cover the needs, but into the pockets of speculators and smugglers have benefited from the funds allocated to the projects and welfare of the people ».

The deputy governor of the Central Bank of Iraq the appearance of Mohammed Saleh told «life»: «on the Central Bank until last year, nearly $ 180 billion in remittances in hard currency abroad, and of the mechanisms of auctions the bank, and the expected arrival of remittances this year to more than $ 200 billion ».

He added «that this mechanism, any auctions selling the dollar, found originally to serve the market and meet the needs of the Iraqi economy». He stressed that «the central bank would not budge from his decision to request notification of tax authorities to contribute to the auctions, in order to know the reasons for the request large amounts of dollar, and follow the movement of funds, we are obliged to apply the terms of the international agreement on combating money laundering and terrorist financing».

Iran and Syria

He did not rule in favor of continuing effects of the neighboring countries, especially Iran and Syria, which imposed on them UN economic sanctions caused the deterioration of the values ​​of their currencies, but he denied that these two countries intervene directly in the auctions of the Iraqi currency, he said, «The auctions dedicated to the shareholders of Iraqi exclusively and will not allow any outside interference by ».

He explained that the auctions have seen recently from the entry can be named «speculators Ghosts», «They walk in as a local in origin, but they are working in secret to make a profit under speculation on the black market, and therefore continue to be strict in checking applications».

He pointed out that the Central Bank reserves of foreign currency have risen recently from 52 billion to more than $ 63 billion.

The «that the current plan of the bank tend to enhance the value of the dinar against the dollar, and after the implementation of the project to delete three zeros from the dinar, we will be able to apply through the auction mechanism to make all the new Iraqi dinar equivalent of $».