Saturday, December 9, 2017


Kaperoni Moderator  Central Bank of Iraq (CBI) News > The CBI will hold its third annual conference next month to discuss financial stability in Iraq

By rami - November 7, 2017        440

The Central Bank will hold its third annual conference next month under the title of the role of the Central Bank of Iraq in achieving financial and economic stability.

A source at the Central Bank of Iraq, “The Central Bank will be held on the ninth and tenth of December next year’s third annual conference under the auspices of the governor Ali Alalak,” adding that “the conference will discuss the sustainability of public debt and financial stability in Iraq and achieve the process of financial inclusion and the performance of banks and mechanisms to stimulate the sector Financial through monetary policy instruments and highlight the financial merit of the banking sector. ”
​He pointed out that “the conference aims to strengthen the relationship between the tools of monetary policy and macroeconomic variables and strengthen the role of the financial sector.”

“The conference also seeks to create an interactive meeting between officials of monetary policy, academics and researchers to determine the mechanisms that monetary policy can adopt in achieving its objectives,” noting that “among the goals of the conference to achieve the strategy of the Central Bank.”


Kaperoni Moderator   This is in just a couple of days.  Surely with all the economists there the delete zeros project will be a topic of discussion

Phil Oberholzer    Nice find Kap. I like this part "mechanisms to stimulate the sector Financial through monetary policy instruments"....Can't wait to see what mechanisms they'll use.

Kaperoni Moderator   I hope we get lots of media articles on this event.

Kw   Safety, security, money laundering... all being tackled or taken care of. Sounds like a safe harbor to launch from.

Punisher   Glad they are talking this all up (important issues) before another new year.

Kaperoni  Moderator   Tomorrow!

Mike  Moderator  I'm going to go out on a limb here and say not much is going to come from this conference, nothing ever does. We need political will to legislate and pass the laws to create an open market economy.

johnbob1            Mike What other laws are we waiting on? I believe I read something a while back from Kap saying the cbi law was what was needed and there was no specific law needed for the deposit insurance.

Punisher              Wait and see what comes of it....

Kaperoni Moderator  Both are done Johnbob.  CBI law passed last month and deposit insurance was passed months ago, never implimented..yet the CBI stated just a day or so ago insurance was iminent.

johnbob1            That is awesome Thanks Kap


Kaperoni  Moderator    Central Bank of Iraq (CBI) News > Central Bank calls on the government to get rid of dependence on oil

9/12/2017  Economy News Baghdad: Called on the Governor of the Central Bank on the Keywords, the Iraqi government to get rid of the dependence on the oil sector over the next 30 years.

Keywords and said in his speech, the third annual conference of the Central Bank, held in Baghdad, under the title "The role of the central bank in achieving economic and financial stability", attended by "Economy News", "Iraq needs a national administration or institutional,

which represents the government's ability to country management efficiently in order to achieve stability and development in addition to the separation of powers and effective coordination, "calling for the application of e-governance and management of the country through the macroeconomic to produce national wealth and variety."

He added that "the financial management that worked during the current period to reduce expenditure and management of public debt and reduce the gap between expenditure and revenue, which represents 90% to cope with fluctuations in oil prices," pointing out that "Iraq needs to reduce the gap by 2.5% per annum for 30 years to become the country after 30-year-old relies on oil by 15%. "

He noted that "the central bank contributed to the stability of the exchange rate and to maintain inflation by pumping 25 trillion dinars."

Justwaiting    Hmmnn ~  methinkith needs to be a bit more aggressive than 2.5% -   the energy sector is evolving rapidly in other areas than oil ~  I may be wrong, but ~  ??


Kaperoni Moderator Iraq Dinar, Iraqi Banks, Iraqi Stock Exchange (ISX) News >   Association of private banks: 3 million Iraqis will create a bank account during the next two Amyin

6/12/2017  Economy News Baghdad:
The Iraqi Association of private banks, on Wednesday, that about three million Iraqis will create a bank account in the next two years because of the resettlement project of state employees' salaries.

The executive director of the Association of Private Banks, Ali Tariq in an interview for "Economy News", "The localization of public sector employees' salaries of important projects that will withdraw money compactum at home and deposited in the banking sector project, which is reflected positively on the development of the movement," he said, adding that "about three million Iraqis will create a bank account in the next two years working in the public sector to receive their salaries."

The estimated Iraqi Central Bank, money compacta houses about 34 trillion dinars and represent more than 70% of the printed currency.

Tariq explained that "the government is obliged to put the employees' salaries in the bank two days before the distribution of salaries," noting that the salaries of resettlement projects implemented by calling the World Bank project.

The central bank began settling its employees 'salaries in seven private banks and then the General Secretariat of the Council of Ministers is currently working all ministries except the security ministries to localize their employees' salaries in the banks.

Tariq pointed out that participation in the settlement of salaries banks increased their number one became 15 banks after the Iraqi Islamic Bank join and open the doors to all banks operating in Iraq to enter into this project ownership requirement for environment infrastructure.

The Iraqi government expected the completion of this project within the next two Amyin Iraq, which would avoid annual losses of up to 8% of GDP due to theft and damage to the currency.

The executive director of the Association of private banks, the localization of salaries is mandatory for all state employees with the exception of the security services project.

Tariq announced that after the completion of the public sector will be oriented towards working in the private sector companies.


Kaperoni Moderator    So they expect it to take up to 2 years to withdrawl 34 trillion dinars from the market.  This to me would also include the delete zeros project.

Chasting    whats another 2 years...lol

prosper                  What value will Iraqi's get when it would float?

Kaperoni Moderator   To clarify, I beleive the process which is activation of the electronic banking, the float or deletion of zeros  and the removal of chunky money 34 trillion will take 2 years.  Previous articles on deleting zeros also mentioned a timeframe of 2 years (this to me is what Dr. Bakri was talking about in my interview when he referred to "treatment" on the dinar..

So to me this is not a delay, but a schedule of sorts to complete the whole process.  I still beleive the float, and beginning of the removal of the larger notes will start soon (it has to if they are planning 2 years for this entire process).  As the last economist wrote in his delete zeros article...

"Today , we find it easy in front of the Central Bank of Iraq to work to the principle of reducing the exchange rate gradually to the extent that it can be equivalent to the dinar against the dollar,"

Kaperoni Moderator   Prosper, Iraqi's use dinar, they will see the cost of goods come down in price as the dinar rises in value..  Remember, they are not exchanging dinar for another currency.

Leslie     So...does this mean that it is anticipated that the dinar will = the dollar approximately 2 years after the float begins?

Kaperoni Moderator   I do not think we can put a prediction on how fast it will rise.  But it does appear they want to equal $1

Mike Moderator   In order for the dinar to rise in value there has to be some kind of demand for it based on exports and Article VIII acceptance, right?

Kaperoni Moderator   Mike, I have been on the fence on this.  Dr. Bakri makes a clear statement regarding the deletion of zeros in my interview that..." first needs to improve before coming to such a work, and improvement comes through delete some zeros from the Iraqi dinar."

Punisher  Seems they expect the banking sector to thrive over the next two years.

Mike Moderator   kaperoni,  So, Iraq would have to raise the value artificially to delete some of the zero's? Say something like move the official value to 500-$1 and begin the deletion process?  That seems to be the only way to raise the value outside of Article VIII acceptance and an open market economy with Iraqi exports.

Justwaiting   Ugh, each time I think I have a real "grasp" - something throws me off.
Thanks all ~  pondering time ;-)

Kw   I stated this in another article that when I first joined the military they had pay line and payed you in cash. That went to direct deposit or check. Either way, it pretty much forced you into getting a bank account inorder to cash your check. I see nothing different here.

The statement: he said, adding that "about three million Iraqis will create a bank account in the next two years working in the public sector to receive their salaries." This is a drive to get them into the banks.

 Yes I think this is connected to the delete the zero's project. If the dinar is undervalued as some economists have stated, they could raise the dinar, remaining pegged to control the process.

The IMF told them to stay pegged, and I believe that is the reason why. They want to reduce the money supply. No other country in the world is doing this. With continued tightening of the CBI enforcing money laundering and enforcement the spread will tighten then the free float. Just a thought.

Mike Moderator   Here's the kicker though, in order for it to work the Iraqi's have to leave their money in the banks and pull it out as they go. But they won't do that. Why? Because there's no deposit guarantee's.

Would you put your money in a bank without the assurances that it would be there when you used your debit card? Nope, and neither will the Iraqi's. The banks have systemically failed the citzens (think Warka) and there's just about zero trust between the citizens and the banks themselves.

The silver lining, even when the citizen's empty their bank accounts on payday, is there's no space for corruption to exist. As it stands now these guys stand in lines to get their cash and the corrupt skim off the top as a type of gratuity because they gave them the job in the first place. If the MoF and MoI deposit their money into an account, it cuts out the middle man and allows the citizens to keep their money.

Iraq can't just will the banks to succeed, the government needs to get out of the way while providing protections to the consumers who will use them. Create an open market economy where citizens go to the banks and borrow money to create wealth, making proclamations and statements won't cut it. The only way to reduce the number of bank notes is to add value to the dinar, banking is just a part of the equation.   IMO

Punisher              Good stuff Kw.

Kw    Agreed mike, but we have seen a greater uptick in banking this year. That being said, they are the ones saying that this is a 2 year process. The deposit insurance company is going to happen, and may have been instituted, and if not, probably by the end of this month. Unfortunately they are not turning a speed boat, but a big ship.

Terry   No, more like trying to refloat the titanic.

Mike Moderator   Good stuff KW. There's a generational distrust in Iraqi banking that began with Saddam, these guys have their work cut out for them when in comes to instilling trust in the Iraqi banking system. Passing the deposit guarantee law is just the beginning, for the life of me I don't know why this hasn't passed yet.

BelievingInTheBest    Thanks for the article and input everyone.

Bglong    Yup very good read. Thanks to all.


No comments:

Post a Comment

Note: Only a member of this blog may post a comment.