The Iraqi Central Bank and the US Federal Reserve to meet the challenges of the “electronic platform.”
The Iraqi Central Bank and the US Federal Reserve to meet the challenges of the “electronic platform.”
2-13-2023
The Central Bank of Iraq revealed the results of its meeting with the US Federal Reserve Bank and the US Treasury, against the background of the rise in exchange rates and its tilt in favor of the US dollar at the expense of the Iraqi dinar, weeks ago, and creating severe disturbances in the prices of most commodities and foodstuffs.
Economic circles are talking about Washington giving Iraq an additional 3 months, provided that it adheres to the standards followed for the movement of funds and preventing their smuggling.
The bank said, in a statement, on Saturday evening, that “the Central Bank of Iraq delegation met for long hours with each of the US Federal Reserve and US Treasury delegations in Washington, D.C., and that the two parties expressed their willingness to work jointly to face the challenges of working on the electronic platform for remittances and cash.” Referring to the procedures of the US Federal Reserve and its request from Baghdad to adopt an electronic platform for money transfer; To eliminate corruption, currency smuggling and forged import documents.
He added, “The delegation of the US Federal Reserve Bank and the US Treasury discussed a number of support and attribution mechanisms for the Central Bank of Iraq, in order to enhance its capabilities to deal flexibly with crises during this stage.”
The statement quoted the governor of the Central Bank, Ali Mohsen Ismail, as confirming, “The bank’s intention to launch the second package of facilities that would enhance the stability of the exchange rate.”
He also mentioned that the US Federal Bank praised, during the meeting, saying: “The procedures of the Central Bank of Iraq are in the right direction to build a sober banking sector.”
He noted that the Assistant Deputy Secretary of the US Treasury indicated “ways to fully support the efforts of the government of Prime Minister Muhammad Shia’a al-Sudani in economic reform, and the readiness of the US Treasury Department to provide the required support.”
The statement concluded that “the meeting listened to a presentation by the Governor of the Central Bank of Iraq regarding the bank’s directions in achieving its most important goals to ensure general stability in prices, and options and proposals in the field of accelerating, expanding and smoothing the work of the electronic platform for external transfer.”
Despite the Central Bank’s decision to adjust the exchange rate of the dinar against the dollar to 1300 dinars per dollar, after it was 1470 dinars, confusion still prevails in the Iraqi markets and the difficulty of commercial transactions, and the exchange rates of the dollar are still high despite the relative stability in the local stock exchange, where prices were recorded Selling the dollar 1470 dinars for one dollar. Yesterday, Sunday, the currency auction in the Central Bank witnessed the sale of 305 million dollars, which is a very large amount that was not dealt with during the past weeks, which led to a rise in exchange rates, and the amounts sold did not exceed, during those weeks, the ceiling of 50 million dollars per day. .
Commenting on the increase in currency auction sales in the central bank, Nabil Al-Marsawi, a professor of economics at the University of Basra, said yesterday: “Sales reached 305 million dollars, of which 257 million dollars are transfers and credits, which means that the problem of remittances has ended and that this figure is similar to what it was in the time of Al-Kazemi (former prime minister). He added, “If the number (dollar sales) rose as a result of postponing work on the platform, smuggling will return again.”
Last week, Prime Minister Muhammad Shia al-Sudani publicly acknowledged currency smuggling operations to neighboring countries.
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