Value of the dinar is declining because of the sanctions on Iran and Syria .. The Iraqis do not trust him
On: Saturday 19/05/2012 7:37
Baghdad / Mustafa Habib
in a corner on a neighborhood sidewalks Arasat upscale central Baghdad Sadoun Khudair sitting behind Basta small buys and sells U.S. dollars. This Serafi not simple considering the economy and its laws, but he asserts that “the Iraqi dinar is in danger.” Adds Saadoun while wrapped package of thick rubber thread, paper currency, “my career flourished a little these days,” adding that “for the first time in years, Iraqis are increasingly accepted to convert their currency to the local dollar.”
According to the experts may not have heard from the young man Saadoun, the Iraqi dinar is exposed for a few months due to the crisis of political reasons, and other related international sanctions imposed on Iraq’s neighbors, Syria and Iran. During the past few weeks the price of the Iraqi dinar exchange in the domestic market against the U.S. dollar from less than 1200 dinars to 1280, and arrived at certain times to 1300, which means that the Iraqi dinar fell by about 9% against the dollar. As an economist Anton attribute this decline to increased demand for the dollar, by virtue of the political conditions in the region, in general. Indicates Anton said in an interview with the “discussion” that “the smuggling of large place of the dollar abroad during the past months,” which led to rising demand for U.S. currency.
officials at the central bank said the site “discussion” that the bank was selling every day 160 million dollars, before the withdrawal of U.S. troops from the country late last year, but demand is rising remarkably in the recent period and arrived in a few days to $ 400 million. Analysts say the reasons why the merchant and the ordinary citizen to request many dollar in this period, including the political crisis experienced by the country after the U.S. withdrawal and lack of confidence with the growing local economy. Map analysis, but it expands with the events of the spring linked to the Arab and Western sanctions on Iraq’s neighbors, Iran and Syria. Iraqi Planning Minister and former chief economist veteran Mahdi Al-Hafiz said in an interview with the “discussion” that both Iran and Syria, living a suffocating economic crisis because of international sanctions imposed on them what pushed them to the attack on the Iraqi market for hard currency. “Says the former minister that” the overlap of economic and political support for the two countries with Iraq, allowed them to get a dollar of it, “pointing out that” large quantities smuggled to them and that the continuation of this will reflect negatively on the local currency. “and suffers Iran blockade internationally imposed by hindering export its oil to world markets because of doubts about its nuclear program. As Asttalt series of financial sanctions and economic Syria since the outbreak of protests in mid-March last year, and the feet of the regime of Bashar al-Assad on the suppressed strongly. and easily in Baghdad and other Iraqi cities to get on the dollar through hundreds of banking companies not licensed to street vendors and owners of “stalls” on the sidewalks, and convert it to the States mentioned, does not cost much more than wages. Abbas al-Araji, the owner of a small office for banking in the region of Kadhimiya in Baghdad admits that his work is not subject to censorship by the government or central bank., says, “I work in the profession five years ago did not get necessary approvals from the central bank being subject to complex mechanisms. “says al-Araji said his customers prefer the large banks because of the routine procedures of complex imposed on remittances abroad, in addition to the high cost.” I’m doing this service in advance faster and at lower cost and does not require me not to contact colleagues to me in many countries to inform them of transfers. “Central Bank of Iraq in an attempt to curb the smuggling of dollar issued in the past three months a series of measures including an emphasis on monitoring the conversion factors of large and regular to the dollar. called the Central all banks and banking companies to provide official documents about transactions to convert U.S. dollar , and the closure of shops banking is licensed, according to Vice-President of the Central Bank of the appearance of favor. recognized for the existence of an imbalance in the exchange rate of the dinar, but he denies saying Ptdhorh., says in a telephone conversation with “Talk”, “drop the dinar against the dollar naturally in the presence of two neighbors, namely Iran and Syria were subjected to a major economic crisis. “and adds that” open-door policy and the freedom of foreign exchange and the relative stability of Iraq in the economic field are all factors that help to smuggle currency. “precautionary measures to restrict the movement of large sums abroad revealed According to Vice-President of the Central Bank that the majority of big customers were not prepared for such changes., says surprising: “Some of them come to the bank to transfer to another state in his hand, millions of dollars, but he does not have a bank account.” In addition to the problems of neighbors and the sanctions imposed on them, experts attribute others weak dinar to the internal crisis between the poles of politics and eagerness of the Government of Nuri al-Maliki to impose its influence on the central bank.
The Federal Court of Iraq has interpreted the beginning of last year dependence independent bodies to the Prime Minister contrary to the provisions of the Constitution, which was considered independent bodies such as the Central Electoral Commission, an infringement on their independence., says Vice President of the Finance Committee in the Iraqi parliament Ahmed Faizullah Osman from the Kurdistan Alliance said that “the government’s attempt to control the Central Bank, annexed to the Council of Ministers is the risk of destabilizing confidence in the economy and the local currency.” and adds that “the central bank continued to Parliament under the Constitution, but the prime minister is trying to control him and the bodies of other independent” and refers to “The government is seeking for years to use the cash reserves of Iraq of 60 billion U.S. dollars.”
and previously directed the “Iraqi List” led by former Prime Minister Iyad Allawi similar accusations against the prime minister, that he seeks to control the monetary and fiscal policy. spokeswoman said the Iraqi List Maysoon al in a press statement the middle of last month: The prime minister wants, “bullying” the central bank in order to “control the issuance of currency to finance wasteful government on the one hand, and to support the economies of two adjacent subjected to the economic blockade on the other hand,” in reference to Syria and Iran. these interactions political lead, according to observers to the loss of confidence in national currency and the continued demand people to replace them, so that many employees are turning part of their salaries to the dollar. Samer Ahmed, for example, an employee in the Ministry of Transport, converts half his salary to the dollar from Basta Serafi Saadoun., says ” No safety of the dinar these days, “while suggesting that some of his colleagues are buying instead a few grams of gold. remembers Samer fluctuations of the many experienced by the Iraqi dinar, from the” old days “in the seventies and eighties when the price of one dinar equivalent of about three dollars down to the collapse of the winning 1991 history of Iraq’s invasion of Kuwait by President Saddam Hussein, saying that “History of the dinar is like the history of Iraq.” and the “Coalition Provisional Authority” headed by Paul Bremer issued in mid-October (October 2003) has replaced the dinar old papers include a new monetary categories 50 250, 1000, 5000.10000 and 25,000 Iraqi dinars. was used in all parts of Iraq including the Kurdistan region in northern Iraq.
for: site Talk Weekly