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2/28/2010 4:36 PM
BAGHDAD / Aswat al-Iraq: Iraqi Prime Minister Nouri al-Maliki said on Sunday that the process to re-evaluate the Iraqi dinar has to do with economic conditions that have to be strengthened. “The Iraqi dinar has all the reasons to grow stronger thanks to an increase in revenues and development of the economy,” Maliki said in response to some questions through the National Information Center. “The government would not rush matters but would rather work on finding all the guarantees to render this measure a success. The Central Bank of Iraq (CBI) is currently entrusted with drawing up a study on the whole issue and would give its decision soon,” said the Iraqi premier. The Iraqi dinar’s exchange rate is suffering from low value against foreign currencies as a result of decades of wars and economic embargo that brought the local currency’s exchange rate to the rock bottom from three dinars per dollar in the late 1970s and 1980s to 3,000 dinars per dollar after the 1990 invasion of Kuwait, followed by a 13-year crippling sanctions regime. The exchange rate fell even more after 2003 to reach 1170 dinars per dollar due to the CBI’s policy of daily auction, in effect for more than five years now. The policy was lambasted by several economists on the grounds that these auctions do not give the real value of the country’s local currency. AmR (S)/SR
§ North Iraq's Kurdistan Region's new budget exceeds 13 trillion (t) and 940 billion (b) Iraqi dinars
2/28/2011 9:24 AM
ARBIL / Aswat al-Iraq: The budget of north Iraq Kurdistan Region's budget for the current year has reached 13 trillions (t) and 940 billion (b) Iraqi dinars, Kurdistan Premier, Barham Saleh, told a news conference in Arbil, attended by Aswat al-Iraq news agency, on Sunday.
(A U.S. dollar equals 1,180 Iraqi dinars approx.)
"We have passed the current budget for the Kurdistan Region, that will be raised to the Parliament for final approval, reaching 13 trillions (t) and 940 billion (b) Iraqi dinars, including 9 trillions (t) and 687 billion (b) dinars for expenditures and the commissioning budget, 4 billions (b) and 150 millions for the investment projects, along with the allocation of 54 billions (b) dinars for the Kurdistan Parliament's expenditures, 48 billions (b) for the Reion's Supreme Legislative Council and 200 billion (b) dinars, as advance payments for the Kurdistan Parties, pending the final approval of the Parties Law," Saleh said.
He pointed out to the "existence of a deficit in the Region's budget for the current year, reaching 1,554 billion (b) Iraqi dinars," adding that "the largest part of the deficit is due to the budget of the Pesh Merga (Kurdish armed forces), because the Pesh Merga Ministry's allocations must be directly paid by the Iraqi Defense Ministry."
Kurdistan's Premier also announced the existence of 25,000 jobs in the Region's government institutions, pointing out to the allocation of 25 billion (b) Iraqi dinars for small credits and for finding employment opportunities for the youth and to support the project aimed at enabling students to find jobs.
Premier Saleh also said that the Region's government had decided to raise the "marraige advance payment from one million to 2.5 million Iraqi dinars and to revise the salaries for the special degrees, the Region's Presidency, the ministers, director-generals and advisors, provided that 10% of those salaries would be deducted.
BAGHDAD / Aswat al-Iraq: Economists have agreed that the long-term project of deleting zeros from the currency which the Central Bank is planning to implement needs ‘unavailable’ economic stability.
“The central bank’s decision to delete the three zeros is not a new decision in the long run on the economic arena, and there are several countries that adopted that decision, including Germany,” Economist Abdul Karim al-Halafi told Aswat al-Iraq.
“The Iraqi case does not have the objective conditions to delete the zeros because Iraq suffers from structural economic problems and a high percentage of inflation as well as the increase in the unemployment rate,” al-Halafi said.
“Iraq can’t continue this decision in the short run nor the long run,” he added, noting that Iraq can delete the zeros when there is a strong production and no structural disorder.
The Central Bank of Iraq (CBI) had announced last October a long-run project to delete the three zeros from the Iraqi dinar to improve the Iraqi currency status.
For his part, Hilal al-Taan, researcher and academic, said “deleting zeros project was suggested by Finance Minister Bayan Jabr al-Zubaidi and could be studied and implemented as a medium or long-run project and could not be implemented without an economic stability and the improvement of the Iraqi dinars exchange rate.”
Meanwhile, Abdul Hussein al-Aanbaki, the prime minister’s adviser, objected the project and told Aswat al-Iraq “I do not agree with this policy and I do not agree with changing the currency shape or deleting the three zero.”
He stressed that the situation will not change for the Iraqi citizen and the only thing that could happen is paying extra money for canceling the old currency and reprinting the new currency and will not has a positive impact on the inflation.
Another economist, Mohamed Islamil, told Aswat al-Iraq “deleting the three zeros is a very complicated economic issue which needs accurate statistics and analysis for the whole economic activities, the matter is not available in Iraq.”
