The banking system need to pause to address the fundamental legal lapses
Baghdad – Haider Filaih Rubaie
did not debate rages long after I am confident most of those present that the monetary policy in Iraq should not in any way that fall under the pressures of government or the guardianship of the State, especially since the independence of the central bank as experts say in light yield economy started will not end, was not lost from the minds of those present at the seminar Iraqi Institute for Economic Reform importance that monetary policy is represented by the Central Bank is absolutely independent from any government intervention, particularly since the Iraqi legislator said through a number of paragraphs of the Constitution to the independence of the Bank, but the a number of legal experts have made clear the existence of ambiguity in some paragraphs of the Constitution, which called for the importance of policy-making financial consultation between the government and the central bank, and this according to legal given the large area of government that is seeking to join the Central for a number of bodies that supervise them directly.
The symposium addressed Titled “The independence of the central bank and its role in achieving the objectives of monetary policy” and was attended by a number of experts and researchers in the economic aspect of many of the themes that I discussed the meaning of the independence of the Bank and its importance in the making of monetary policy, as well as on the justification for such independence and can produce them from the economic gains of the country .
has emphasized the symposium on the need to be aware of all that central banks in various other countries accountable to their governments for the stability of price level, and maintain the financial system, and achieve greater prosperity and sustainable development for their people, and those are the same goals that came by the Central Bank of Iraq, which makes it imperative for the government control the means of achieving those goals do not interfere in the plans and programs, the bank also sees the participants in the seminar.
shows the deputy governor of the Central Bank of appearance of Dr. Mohammed Saleh during the symposium brought by the Bank Law No. (2) which states: Enjoy the central bank independence complete and accountable by Parliament.
This gives a clear indication that the bank is responsible fully for all aspects of monetary policy in the country and gives the right as well as to Parliament in the accountability in the event of economic imbalances caused by the policy.
suggested for display all the plans the strategy of the bank in front of makers Policy the country’s economic or political in order to inform them of what purports to implement the bank of economic plans during the periods and different periods of time, and this, according to Saleh gives eligibility for the government to monitor the performance of the bank and its implementation of the plans properly, and allows the Parliament accountable bank in the event failed to implement his plans set.
not showed the deputy governor of the Bank of any reservation about the possibility that participating entities other government in the formulation of the policy of the country’s monetary, pointing out that this is necessary and very contrary to all the calls for annexation of the bank to the government, stressing that the road map related to monetary policy and the possibility of achieving the goals of the Central Bank of development cooperation and consultation with the government is positive and important role in achieving the highest completion rates possible.
Saleh said that the banking system in Iraq need to pause a radical address many of the lapses of legal or working on the development of regulations and new laws free banking from the shackles of many of its crisis during the past periods and still some of those restrictions inherent in the banking business now.
He noted the benefit that the central bank during the past were led roles formidable economic enabled the state to maintain the value of their currencies to cash without significant damage to remember,
and also said that Iraq contains the domestic market to export the dollar abroad, and the private sector to import dollar at all, since all the revenue the country’s financial come through the sale of oil in world markets, and this means that the central bank reserves, estimated at more than $ 60 billion came thanks to tight monetary policy has worked to find the umbrella of protection of the Iraqi dinar by providing this level of the dollar or cash reserve. Saleh explained the importance of the exchange’s central information all with the government, especially those that can increase the rates of growth or working to raise the value of the Iraqi economy, stressing the importance that the government and central bank partners to bear the problems that could face the Iraqi economy It is not necessarily or be connected outdated administrative or Qanuena one.
the futility of fiscal policy
and considered by many experts that the financial policy in Iraq is still struggling between the decisions of state and the mechanism of the application of those decisions, and this, according to experts participating in the seminar led to the weakening of important aspects in the structure of Iraq’s economic , and paralyze other aspects almost completely, especially the fields of trade, industry and agriculture.
Saleh said in this regard: that the fiscal policy in Iraq is not feasible at all, and aims to convert people to the consumer only, a policy that destroyed many of the economic facilities.
pointing out that what enhances this say, is to reach workers in the government sector according to the latest official statistics approximately (4) million employees, a figure that shows the size of the slack in the private career government if it is known by everyone that the volume of production in this sector did not exceed only the ratios are very simple.
Saleh explained that among the the effects of the collapse of the financial policy in Iraq is the adoption of the private sector to auction the currency in all its imports daily, saying that this auction and as a result of the cessation of most of the local industries and the absence of government measures aimed at reviving who are industrial and agricultural result of all this, the auction is covering imports embarrassing start from a bottle of water and is not ending in need or a particular commodity.
opinion legislator legal
seems that the law did not allow the government to show the tutelage remember the central bank or business carried out by, however, that the judge and former MP Wael Abdul Latif pointed out that the only relationship that can be linked to independent bodies in general and central in particular, with the government are matters of appointment and the operating budget and some administrative orders, and this implies that the law has kept the responsibility of managing monetary policy is limited to independent, however, the central bank.
said Abdul Latif, who spoke during the seminar a legal framework for the possibility of linking the Central Government that in Iraq, I want the central bank to remain independent, but it is a confusion mentioned in the Constitution, pointed out that the state is one of the actual fiscal policy of the country, he said, in my opinion, the making of fiscal policy requires consultation with the Central Bank and the Federal Government, and that the remaining monetary policy is limited, however, the Central, but no harm in consultation also with the parties in government, and the resulting consultation mating important between the two policies of Finance, which oversees the government’s monetary and supervised by the Central Bank.
said Abdul Latif, the attempts you are going to join this body to the government or cabinet is not without risks is the possibility of manipulating some of the bank’s reserves to fund some projects or government investment, and this is a serious can confuse the value of the local currency.
central adviser to the government
in turn, said Dr. Falah Hassan Thuwaini that the central government’s banker and financial adviser and agent in other banking operations, and that Article 108 of the Constitution stipulates that the central bank is accountable to the House of Representatives in the implementation of monetary policy, and this means that the bank can be performed in all its roles without the need to remember to government agencies that can affect many of the decisions taken at all levels.
said Thuwaini during a speech him at the symposium: Can not achieve more than the rates of development that there was no stability of market price, and as long as the financial system in Iraq is the responsibility of the central bank, the price stability objective of the responsibility of the bank and is therefore also responsible for increased rates of development, this means that the increase in size interventions can affect the monetary stability and thus reduce growth rates. He Thuwaini the interrelationship between the central government despite the lack of legal texts had to custody of the bank by the government, as pointed as an example that the Central has all the currencies of the state, as well as gold as an agent or deputy from the government, he also serves as a financial advisor to the government and create a balance of cash strengthens the confidence of all other countries, the economic reality of Iraq, and those policies demonstrate a correlation deep spiritual between the state sponsor of all bodies, government institutions and between the central bank Krasm of the policies of the country’s monetary Although there is no the guardianship of him by the government. He Thuwaini that all legislation and constitutional indicate a correlation between the central bank and finance ministry, particularly with regard to the preparation of the budget that is planned by the central and the ministry, as well as the bank was obliged to give all Khovath to the government in times of specific, and that the central to the procuring the approval of the Ministry of Finance in case he wanted to increase his capital, and all these things demonstrate and beyond any doubt that the central does not work free from regulatory government but walking with her in a balanced manner and in accordance with the needs of monetary policy in Iraq.
risk has borne the dinar
has made no secret Dr. in College of Business and Economics at the University of Baghdad, a rich Khazraji fears of the possibility of damage to the Iraqi dinar in case of acquisition of a cash reserve, criticizing the intervention in the symposium of fiscal policy in Iraq, asserting that monetary policy is the only one operating in the country . explained Khazraji that what is required from the central bank now as an independent three things she was very important is transparency, accountability and credibility, asserting that the government authorities in the event of interference in the work of the Central Bank would founder of monetary policy in general, and said in this regard: that the state in the event set hands on the cash reserves of the Central Bank then we will read the peace on those reserves and the monetary policy, pointing to the central bank and, although to achieve many of the economic gains, it works with one hand, the memory of that hand-the other is the fiscal policy, which said it Off completely.