The Central Bank issues clarification regarding US sanctions against 14 Iraqi banks (document and names)
The Central Bank issues clarification regarding US sanctions against 14 Iraqi banks (document and names)
2023-07-20
Today, Thursday, July 20, 2023, the Central Bank of Iraq issued a clarification regarding depriving some Iraqi banks from dealing in dollars, after the sanctions imposed by the US Treasury Department on 14 Iraqi banks.
And the bank stated in a statement, that preventing Iraqi banks from dealing in dollars came against the background of checking bank transfers for the past year (2022), and before the application of the electronic platform, and before the formation of the current government as well.
He added, “Banks deprived of dealing in US dollars enjoy complete freedom in dealing in Iraqi dinars with various services within the Iraqi banking system, in addition to their right to deal internationally in currencies other than the US dollar.”
And the statement continued, “The application of the electronic platform for external transfer ensures the safety and accuracy of transfer transactions from all aspects, in accordance with international standards and practices, and the law against money laundering and terrorist financing. The US Federal Bank, the US Treasury and international financial institutions praise this system, and it enjoys their care, with high coordination from those parties, and with an accredited international auditor.”
He explained, “What the Central Bank of Iraq has achieved in terms of expanding transfer channels and approved correspondent banks, makes transfer operations available and secure, and that the number of local banks that do this is able to cover all transfer requests, with the ability of the Central Bank of Iraq to cover them without restrictions or ceilings, as long as they involve legitimate operations, knowing that the banks banned from the dollar do not make up their requests for only 8% of the total external transfers.”
The statement pointed out that “the announced exchange rate in the market is based on the cash dollar granted by the Central Bank of Iraq to cover citizens’ requests for travel and others, and because of the citizen’s need for the national currency, some merchants and others withdraw the dollar for trade or other purposes, away from the platform and away from the fundamentalist transfer contexts, which leads to raising the exchange rate on the black market, which is not a parallel market, as long as the source of the dollar is the central bank and not from within the market.”
And the statement continued, “In order to address this phenomenon, we call on the esteemed government to set up a mechanism to link imports, and to prove the existence of a fundamental financial transfer corresponding to their value in order to prevent the use of illegal means to pay their values that constitute unjustified pressure on the cash dollar, and on the other hand helps in controlling manipulation and smuggling of imports.”
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