Thursday, August 10, 2017


8-10-2017   Newshound Guru Kaperoni   "The government will gradually remove remaining exchange restrictions and a multiple currency practice (MCP) with a view to eliminating exchange rate distortions. Such a move towards acceptance of the obligations under Article VIII of the IMF’s Articles of Agreement will send a positive signal to the investor community that Iraq is committed to maintain an exchange system that is free of MCPs and restrictions for current international transactions and thus facilitate creation of a favorable business climate..."  Article VIII is not that far away.  If the CBI can get past these two restrictions they can move to Article VIII.  Doing so is exactly what we want to see.  The one thing I keep reading throughout the Article IV Consultation is how Iraq has missed numerous target dates.  On a positive, as of late, they seem to be catching up or meeting some of the conditions.  Looks like by June 2018 they want the CBI to be fully compliant with international standards and reporting accordingly.  That is less than a year for the banking system to be fully compliant and hopefully integrated with the worlds banking system.   [post 3 of 3]

8-10-2017   Newshound Guru Kaperoni
   "Steps to strengthen the legal framework of the CBI, remove one remaining exchange restriction and implement AML/CFT measures need to be accelerated. Iraq currently maintains one exchange restriction and one multiple currency practice (see Informational Annex) for which staff is not recommending approval. Removal of these, and implementation of AML/CFT measures, will help to improve the integration of the domestic financial system into the global economy."  This paragraph is telling.  It says very clearly... "staff is not recommending approval."  In other words, they have to meet compliance on these.  The good news is these are achievable.   And meeting them they would then be in Article VIII compliance.  Just get it done Iraq!  ...the IMF has been frustrated with Iraq keeping on target and doing what was agreed.  But the good news is that they have reviewed that with them and come to terms to continue such efforts which include..."implementing structural reforms to promote private sector activity."   [post 2 of 3....stay tuned]

8-10-2017   Newshound Guru Kaperoni   "Iraq : 2017 Article IV Consultation and Second Review under the Three-Year Stand-by Arrangement..."   Quote: "The simplification of documentation requirements implemented by the Central Bank of Iraq led to a decline in the parallel market spread to 6 percent in June 2017."  So we have confirmation from the IMF that the CBI spread (official rate to market rate is at 6%)...well out of compliance of the required 2% in order to move to Article VIII.   The CBI has to find a way to get the market rate down to 1207 or so.  Currently it is 1260.  ...the IMF states that Ali al-Allaq and his team have lowered the spread from 11%  in December to about 6% currently.  Still out of compliance for acceptance into Article VIII, but progress.  ...the CBI believes that three of the SB's (i believe that means Structural Benchmarks) can be met very soon. The key one's seems to be the law in parliament to modify the CBI law and freeing up one of the CBI's current financial restrictions  which they believe is the reason for the current 6% spread. If so, this is more good  news.  Clearly they are working to reduce the spread and get in compliance as soon as possible.   [post 1 of 3....stay tuned]

8-10-2017   Newshound Guru Adam Montana   [ I am curious about all of the billions of dinar that has been stolen from Iraq by ISIS and of course the big Maliki? Will this have an effect on the possible RV in the future or do you feel that the money has already been spent and back in the hands of the CBI?]  From what I'm told, and making a fairly educated guess, at least half of that "cash" is not a consideration - lost, burned, or buried. The other half is mostly accounted for and is going to be factored into the RV amount.

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