Iraqi Dinar

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With Chapter 7 Lifted, Iraq Regains Control of Its Own Economy

2013-07-08T10:50:00.001-04:00

by RUDAW 21 hours ago

According to Iraq’s energy plan, oil exports are expected to reach six million barrels per day (bpd) by 2017. AFP photo

By Goran Mustafa

ERBIL, Kurdistan Region – The lifting of Chapter 7 sanctions last month can be considered one of Iraq’s biggest achievements since the ouster of Saddam Hussein a decade ago, allowing Baghdad to regain control over its own currency, oil and economy.

Chapter 7, imposed on Iraq by the UN Security Council after Saddam’s invasion of Kuwait in 1991, froze all Iraqi assets in international banks, ordering they be used to compensate victims of the aggression. Besides placing limits on use of its wealth, the sanctions also placed limits on the Iraqi military.

One of the biggest advantages of the lifting of the sanctions is the return of all frozen assets to the Iraqi government, estimated at $82 billion, according to Central Bank data. Its return will not only revitalize the economy, it will strengthen the value of the Iraqi dinar and increase its purchasing power.

A few hours after Chapter 7 was lifted, the value of Iraqi dinar increased against other currencies. The exchange rate of dinar is fixed against the dollar, but its value continues to rise. Saif Al-Halafi, an economic and banking expert, expects that the dinar will probably replace the dollar for investments, and that as demand for the dinar rises, so will its value.

With Chapter 7 lifted, Iraq also can independently handle its oil revenues without UN supervision.

“The lifting of Chapter 7 against Iraq will enable it to regain independence in its oil policy, and Iraq again can become an important regional and international energy player,” said economic expert, Dr. Rebwar Khinsi. Iraq plans to emerge as one of the world’s biggest oil exporters in 12 years.

According to Iraq’s energy plan, oil exports are expected to reach six million barrels per day (bpd) by 2017, elevating the federal budget to $216 billion dollars. The plan aims for exports of nine million barrels bpd by 2020, raising the budget to $324 billion dollars. In 2025, the federal budget will reach 432 million dollars, if Iraq succeeds to export 12 million barrels of oil per day.

Under George Bush’s administration the US government agreed to keep $50 billion belonging to Iraq in America, and Barack Obama’s administration continues to do the same. An estimated $7.8 billion dollars are blocked in Jordan and Lebanon, and a huge amount of capital belonging to Iraqi Airways remains frozen in Kuwait and Jordan.

The United Nations Security Council forced Iraq to compensate Kuwait for an estimated $52 billion. Following the first Gulf War, Iraq did not have an independent economic policy, with all of its income administered by Iraq’s development program and supervised by the UN. Five percent of Iraq’s annual oil revenue was allocated to compensating Kuwait.
So far, Iraq has paid $41 billion dollars to Kuwait. According to Iraqi Foreign Minister Hoosyar Zebari, Baghdad is committed to paying the rest of the remaining $11 billion in compensation to Kuwait, and expects to pay off all of its debts by 2015.

http://rudaw.net/english/business/07072013

IMF Executive Board Concludes 2013 Article IV Consultation with Iraq

2013-05-21T13:07:00.001-04:00

Public Information Notice (PIN) No. 13/58
May 21, 2013

Public Information Notices (PINs) form part of the IMF's efforts to promote transparency of the IMF's views and analysis of economic developments and policies. With the consent of the country (or countries) concerned, PINs are issued after Executive Board discussions of Article IV consultations with member countries, of its surveillance of developments at the regional level, of post-program monitoring, and of ex post assessments of member countries with longer-term program engagements. PINs are also issued after Executive Board discussions of general policy matters, unless otherwise decided by the Executive Board in a particular case.

On May 13, 2013, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Iraq.¹

Background

Iraq is exceptionally rich in oil, but its economy suffers from severe structural weaknesses, such as a small non-oil sector, a dominating role of the government in all areas of the economy, and a poor business environment. Nevertheless, partly thanks to the increase in oil production since 2003, Iraq has achieved a rise in GDP per capita from $1,300 in 2004 to $6,300 in 2012 in a very difficult security and political context. During this period, Fund program engagement with Iraq was instrumental in maintaining macroeconomic stability—even though progress on structural reforms and job creation was mixed.

Recent macroeconomic developments have been broadly positive. Economic growth has reached 8.4 percent in 2012 and is expected to rise to 9 percent in 2013 as oil production increases to 3.3 million barrels per day (mbpd). Inflation has declined from about 6 percent at end-2011 to 3.6 percent at the end of last year, and should increase only slightly in 2013. International reserves of the Central Bank of Iraq (CBI) rose from $61 billion at end-2011 to $70 billion at end-2012, and fiscal reserves held at the Development Fund for Iraq (DFI) have increased from $16.5 billion to $18 billion.

Thanks to higher-than-expected oil revenues and the under-execution of the investment budget, fiscal surpluses reached almost 5 percent of GDP in 2011 and 4 percent in 2012. However, with a break-even oil price of about $100, fiscal performance is very vulnerable to oil revenue shocks—either from oil price declines or export shortfalls. Furthermore, fiscal discipline weakened over the past two years, with poor budget planning and execution, large off-budget spending, and low investment execution rates. The 2013 budget includes large unfunded commitments, increasing fiscal risks, including the possible depletion of fiscal reserves, if the budget were to be fully executed.

The policy of a de facto peg to the U.S. dollar provides a key nominal anchor to the economy, and the nominal exchange rate in the official market has remained stable since 2010. However, since late 2011, the authorities enforced existing exchange restrictions and introduced new restrictions in response to concerns about money laundering and illegal foreign exchange outflows related to the increased demand for foreign exchange. As a result, the spread between the official rate and the parallel market rate—which had been up to that point below 2 percent—started to climb, passing 9 percent in May 2013.

Over the medium term, Iraq’s macroeconomic outlook will continue to be driven by developments in the oil sector. Staff projects that oil production will rise gradually by about 400-500 thousand barrels per day per year, reaching 5.7 mbpd by 2018. Overall, growth is projected to remain above 8 percent and inflation at 5–6 percent over the medium term.

Risks to the macroeconomic outlook remain high. They include (a) weak policy implementation, particularly in the fiscal area; (b) further deterioration of the political and security situation; (c) a larger-than-projected decline in global oil prices; and (d) delays in developing Iraq’s oil fields and oil export capacity, possibly due to security issues but also insufficient investment in oil infrastructure. These risks can translate into lower oil revenues, deterioration in the fiscal position, pressures to use CBI reserves for fiscal purposes, and higher inflation.

Executive Board Assessment

Executive Directors commended the authorities for maintaining macroeconomic stability in a difficult security and political environment. With risks remaining high, including from oil price volatility, they stressed the need to build fiscal buffers and further strengthen the institutional framework. They urged the authorities to step up reforms to develop the private non oil sector to help generate employment and inclusive growth.

Directors emphasized the need to implement sustainable fiscal policies and address risks from oil revenue volatility. Rationalizing current spending—including public employment, energy subsidies, the Public Distribution System, and transfers to state owned enterprises—is needed to create space for priority social spending and public investment and to accumulate buffers. Enhancing public financial management and avoiding quasi fiscal operations by the state owned banks are also crucial. Directors noted that fiscal rules could provide a framework for fiscal policy over the medium term.

Directors supported the objective of the Central Bank of Iraq (CBI) to liberalize the foreign exchange market and the recent steps to simplify market regulations. Further measures are needed to liberalize fully the supply of foreign currency, with the objective of lowering the exchange rate spread, removing distortions, and complying with Article VIII of the Fund’s Articles of Agreement. Directors considered that strengthening the Anti Money Laundering/Combating the Financing of Terrorism (AML/CFT) framework, in line with the Middle East and North Africa Financial Action Task Force (MENA FATF) recommendations and FATF standards, would be more effective than restricting foreign exchange in curbing money laundering and terrorist financing.

Directors agreed that a stable exchange rate, supported by a high level of international reserves, provides a valuable anchor in an uncertain environment. They agreed that the two tier architecture of prudent management of CBI reserves and use of the Development Fund for Iraq (DFI) as a de facto oil stabilization fund is appropriate. They urged the authorities to continue to rely on the DFI to help stabilize government spending and ensure oil revenue transparency.

Directors highlighted the importance of a stable financial sector in developing the private sector and diversifying the economy, and were encouraged by recent progress in strengthening banking supervision and restructuring the Rasheed and Rafidain banks. They encouraged the authorities to ensure a level playing field for public and private banks by opening to private banks access to government business.

More broadly, Directors emphasized that fostering growth in the private non oil sector requires improving the business environment, investing in infrastructure and social capital, reforming state owned enterprises, and enhancing public service delivery. Judicious use of the country’s oil wealth can help address these pressing challenges. Improving the authorities’ capacity to implement reforms will also be critical.

Iraq: Selected Economic and Financial Indicators, 2010–2013

(Quota: SDR 1188.4 million) (Population: 31.7 million; 2010) (Poverty rate: 22.9 percent; 2007) (Main exports: Crude oil)
	2010	2011	2012	2013
	Actual	Actual	Prel.	Proj.

Economic Growth and Prices
Real GDP (percentage change)	5.9	8.6	8.4	9.0
Non-oil real GDP (percentage change)	9.7	5.7	6.3	6.0
GDP per capita (US$)	4,278	5,529	6,305	6,708
GDP (in US$ billions)	135.5	180.6	212.5	233.3
Oil production (mbpd)	2.38	2.65	2.95	3.33
Oil exports (mbpd)	1.91	2.17	2.42	2.70
Iraq oil export prices (US$ per barrel)	74.2	103.6	106.7	102.6
Consumer price inflation (percentage change; end of period)	3.3	6.0	3.6	5.0
Consumer price inflation (percentage change; average)	2.4	5.6	6.1	4.3
Core price inflation (percentage change; end of period)	3.3	7.0	4.2	5.0
	(In percent of GDP)
National Accounts
Gross domestic investment	21.4	19.3	20.3	21.1
Of which: public	15.2	13.0	13.5	14.7
Gross domestic consumption	77.9	66.9	70.8	73.2
Of which: public	25.2	21.7	21.3	21.6
Gross national savings	24.4	31.8	27.3	24.9
Of which: public	10.8	17.7	18.1	17.1
Saving – Investment balance	3.0	12.5	7.0	3.8
(In percent of GDP; unless otherwise indicated)
Public Finance
Government revenue and grants	46.4	49.5	48.2	46.4
Government oil revenue	40.0	46.0	44.6	44.4
Government non-oil revenue	3.5	2.5	4.1	2.0
Grants	2.9	1.0	0.0	0.0
Expenditure, of which:	50.7	44.6	44.1	44.8
Current expenditure	35.5	31.6	30.6	30.1
Capital expenditure	15.2	13.0	13.5	14.7
Primary fiscal balance	-3.8	5.6	4.5	2.3
Overall fiscal balance (including grants)	-4.3	4.9	4.1	1.6
Non-oil primary fiscal balance (percent of non-oil GDP)	-76.0	-84.6	-73.1	-73.6

Memorandum items:
Tax revenue/non-oil GDP (in percent)	1.8	1.9	2.3	2.0
Development Fund of Iraq (in US$ billions; end of period)¹	7.4	16.5	18.1	18.9
Total government debt (in US$ billions; end of period)²	70.8	73.4	74.1	40.4
o/w external debt (in US$ billions; end of period)	60.9	61.0	60.2	27.8
	(In percent; unless otherwise indicated)
Monetary indicators
Growth in reserve money	15.2	9.9	9.2	7.7
Growth in broad money	14.8	38.0	4.1	13.8
Policy interest rate (end of period)	6.0	6.0	6.0
(In percent of GDP; unless otherwise indicated)
External sector
Current account	3.0	12.5	7.0	3.8
Trade balance	6.6	18.8	14.8	12.4
Exports of goods	37.9	44.1	44.3	43.5
Imports of Goods	-31.3	-25.3	-29.5	-31.1
Overall external balance	1.7	10.5	5.1	4.6
Gross reserves (in US$ billions)	50.6	61.1	70.3	80.1
In months oil imports of goods and services	10.6	9.5	9.3	9.7
Exchange rate (dinar per US$; period average)	1,170	1,170	1,166	-.-
Real effective exchange rate (percent change)	1.3	4.7	5.7	-.-

Sources: Iraqi authorities; and IMF staff estimates and projections. ¹ Excluding escrow account held abroad to purchase military equipment. ² Assumes a debt reduction in 2013 by non-Paris Club official creditors, comparable to the Paris Club agreement.

¹ Under Article IV of the IMF's Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country's economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board. At the conclusion of the discussion, the Managing Director, as Chairman of the Board, summarizes the views of Executive Directors, and this summary is transmitted to the country's authorities. An explanation of any qualifiers used in summings up can be found here:http://www.imf.org/external/np/sec/misc/qualifiers.htm.

IMF Mission Concludes Article IV Discussions with Iraq

2013-03-22T10:25:00.003-04:00

Press Release No. 13/87
March 21, 2013

An International Monetary Fund (IMF) mission, led by Mr. Carlo Sdralevich, met with an official Iraqi delegation headed by the Acting Minister of Finance, Dr. Ali Al Shukri, in Amman, Jordan, during March 2-12, 2013 to conduct the Article IV Consultation discussion. The IMF mission met with the Acting Minister of Finance, the Acting Governor of the Central Bank of Iraq (CBI), head of the Board of Supreme Audit, AbdulBasit Al Turki Said, and other Iraqi officials from the ministries of finance, planning, and oil, and representatives from the Central Bank and the Board of Supreme Audit. The team also met with representatives from the Iraqi banking and business community.

At the conclusion of the mission, Mr. Sdralevich made the following statement:

“Following the recent expiration of the Stand-By Arrangement with Iraq approved in 2010, the IMF is committed to continue close collaboration with Iraq to support its development and help the government improve the social conditions and employment opportunities of Iraqi citizens.

“Despite a difficult security and political environment, Iraq managed to maintain macroeconomic stability over the past two years. On the back of rising oil production and robust non-oil activity, economic growth has remained strong at about 8 percent in 2012. We expect activity to accelerate further to 9 percent in 2013, as oil production increases from just under 3 million barrels per day (mbpd) in 2012 to 3.3 mbpd in 2013. In 2012, inflation was contained at 6 percent, and we project it to decline slightly next year. On account of strong oil proceeds, CBI reserves reached US$70 billion at the end of 2012, while the Development Fund for Iraq (DFI) rose to US$18 billion.

“While we welcome the achievement of a budget surplus of about 4 percent of GDP in 2012, largely due higher-than expected oil revenues, the execution of the 2013 budget should be aligned with available financing and provide for the accumulation of adequate fiscal buffers in the DFI, which suggests to target a budget surplus in 2013. Public financial management should be strengthened, notably by phasing out off-budgetary spending practices and reliance on state-owned bank financing to support public enterprises. Approval of additional spending commitments during the fiscal year should also be avoided.

“Financial sector policies are improving, but more remains to be done. The CBI’s ongoing efforts to refine monetary policy instruments, strengthen banking supervision, and accelerate the restructuring of the banking system are crucial. In this respect, the recent steps to clean up the balance sheets of Rasheed and Rafidain in preparation for their restructuring and recapitalization are key. The CBI should also take measures to gradually liberalize the provision of foreign exchange through its auctions, with the objective of avoiding in future the turbulence experienced by the market in the past year.

“Iraq will need to address serious medium-term challenges in order to be able to create the conditions for high and sustainable growth that is necessary to improve the living standards of its people. The economy continues to suffer from severe structural weaknesses such as a small nonoil sector, high unemployment, public sector dominance, and a weak business environment. In this context, we discussed the role of economic policies in leveraging Iraq’s potential and creating an enabling environment.

“With regard to the fiscal sector, the budget must be managed carefully to maintain macroeconomic stability, meet Iraq’s large social and investment needs while continuing to accumulate buffers to address oil market volatility, and ensure medium-term fiscal sustainability. At the same time, Iraq needs to strengthen fiscal institutions and public financial management to make sure that the large oil revenues are used effectively and transparently.

“Developing a stronger financial sector development will require moving away from the current model in which weak state-owned banks dominate the financial sector and enjoy favorable treatment vis-a-vis private banks. A solid banking system that can support growth and employment will require the full financial and operational restructuring of state-owned banks and creating a level playing field for both private and public banks.

“Finally, while oil-growth is projected to remain high over the coming years, boosting non-oil private sector growth will need a long-term government strategy centered on improving the business environment and opening up opportunities for the private sector.”

IMF EXTERNAL RELATIONS DEPARTMENT

Public Affairs		Media Relations
E-mail:	publicaffairs@imf.org	E-mail:	media@imf.org
Fax:	202-623-6220	Phone:	202-623-7100

http://www.imf.org/external/np/sec/pr/2013/pr1387.htm

Parliament Financial Commission (PFC) is discussing to cancel zeros from iraqi dinar

2012-05-22T09:49:00.003-04:00

May 08, 2012

The statement, also added that the foreign currency transfer will be also discussed, in addition other matters connected with the Iraqi currency dinar.
Earlier Iraqi Cabinet decided to postpone cancellation of from the dinar and to form a committee to investigate the fluctuations in the Iraqi dinar currency and its effects on national economy and dinar rate.
The cancellation of the zeros from dinar, announced earlier by the Iraqi Central Bank, was disapproved by many Iraqi economic experts, who believe that Iraq was not ready for such a move because it lacked political and security stability, in addition to the economic.

http://www.edinarfinancial.net/news/?quer=&nm=05&ny=2012&nn=754

Iraq halts plans to cut zeros off dinar currency-cabinet

2012-04-13T09:28:00.002-04:00

* Cabinet says stops plans to redenominate dinar "until further notice"

* Iraq has over 30 trillion Iraqi dinars in circulation

* Plan to trim zeros not seen as a priority

By Aseel Kami

BAGHDAD, April 12 (Reuters) - Iraq has decided to hold off on a plan to knock three zeros off the nominal value of bank notes of its currency because it does not believe the economic climate is suitable, the cabinet secretary said on Thursday.

The central bank said last August it planned to redenominate the Iraqi dinar to simplify financial transactions in an economy that is still heavily centralised and dominated by oil, and where deals are often carried out in cash.

The proposal to restructure the dinar to bring more liquidity into the market has been awaiting parliamentary approval since last year.

On Thursday, a statement on the website of the cabinet secretary said the cabinet had decided to halt all procedures relating to the redenomination of the dinar "until further notice".

"The economic committee discussed this issue and so did cabinet ... There is a possibility that it could cause some problems in the economic situation. Besides that, this operation is so big that cabinet sees circumstances are not right to control this," cabinet secretary Ali al-Alaq told Reuters.

Iraq is slowly getting back on its feet after years of war and sanctions. Oil accounts for 95 percent of government revenues and the country's banking system is still highly underdeveloped.

HUGE PROCESS

The central bank has kept the dinar fixed at 1,170 dinars to the dollar in its daily auction but it recently moved to revalue the dinar slightly to 1,166 dinars after demand for the U.S. currency soared.

The central bank said it also had to tighten regulations over who can participate in the auctions as Iraqi traders sought to snap up dollars for resale in neighbouring Syria and Iran, both under Western economic sanctions.

Sales of dollars in currency auctions held by Iraq's central bank rose as high as $400 million on some days in December from a previous average of $150 million, according to central bank data.

"We have more than 30 trillion dinars in circulation. To withdraw this amount from the market and then to examine them and to dispose of them is a huge process. Even the technical and the monetary capabilities to control a process like this, we consider as insufficient and it is not seen as a priority currently," Alaq said.

The central bank says Iraq's large foreign reserves, which have risen to a record $60 billion on the back of high oil prices, will shield it from any damage to its financial system on the national level.

CURRENCIES

MARKETS

USD IQD - US Dollar Iraqi Dinar Rates

2012-01-30T16:12:00.001-05:00

Jan 30, 2012

This could get interesting. An announcement that they will raise the value of the Iraqi dinar against the dollar.

Not sure where they are getting their information from, but I have noticed that there is movement again with the rates of the IQD.

Also, read some interesting articles about the oil production surpassing the output of Saudi oil within the next few months, and the military contract with the US in negotiations.

Anyways, who really knows what is going to happen with the IQD??? All I know is that the hope for revaluation has given me the *false hope* to hang tough through this economically horrendous times.

Here is the link for the Forex site referenced above.

http://www.forexpros.com/currencies/usd-iqd

Good luck to all, and hope for a revaluation within this lifetime...

FreeTheDinar.org - Website to shape Iraqi Monetary Policy

2011-08-18T09:43:00.002-04:00

FreeTheDinar.org Announces Creation of Website to shape Iraqi Monetary Policy to Include a Plan for Repatriation of Iraqi Dinar Paper Currency Held by Foreigners
PRWEB.COM Newswire
San Diego, CA (PRWEB) August 18, 2011
http://www.freethedinar.org has created a central repository of contact information for organizations and individuals who can shape Iraqi monetary policy. Several recent announcements by the Central Bank of Iraq to completely restructure the Iraqi Dinar have heightened new investor interest in the currency. Iraq’s Central Bank has detailed its general plan for the Dinar that when completed will reflect a Dinar with a value approximately equal to one U.S. Dollar with entirely new redenominated banknotes in circulation. However, certain parts of the story remain untold.
David Pratt of http://www.DinarFund.org has called for the Central Bank of Iraq to reveal its plan for the importation of all Iraqi Dinar paper currency purchased and accumulated by thousands of U. S. citizens the last seven years from the offices and branches of several international banks and registered currency dealers here in the United States.
“We are encouraging people holding this paper to contact the Central Bank of Iraq or anyone who may be in a position to influence Iraq’s monetary policy. We want leadership in the Central Bank to acknowledge these Dinars and display the existence of structures within their master plan designed specifically to facilitate the efficient and orderly repatriation of this currency,” says David Pratt.
William Burbank of BB&M International Corporation, operator of the AmIraq Fund agrees and goes on to state: “individuals who purchased paper currency, often in small denominations were investing in Iraq in its darkest hour. It seems only fair that the Bank of Iraq institute policies that allow them to participate in the growth of the Dinar’s value”. Mr. Burbank went on to state “At this point in time we are awaiting approval of the Central Bank’s recommendations by the Iraqi Parliament and this is the time when policy can be influenced or introduced to protect the paper currency holders.”
It is important to note that only the holders of paper currency outside of Iraq may be impacted by the current ambiguity. Investors holding equity shares, dinar denominated bank deposits and other financial instruments inside of Iraqi are not in question.
To assist holders of Iraqi Dinar paper currency, a dedicated interactive website is available which contains contributed contact information for organizations and key individuals that may have influence in the creation of new policies and procedures being crafted at this time in Parliament. The best time to make changes is before the finalization and execution of any currency exchange program.
Please go to http://www.freethedinar.org to access these links and build momentum by spreading the word.
###
Read the full story at http://www.prweb.com/releases/Iraqi/Dinar/prweb8727787.htm

Is The Iraqi Dinar Worthless Paper Or Maker Of Millionaires?

2011-07-27T09:37:00.002-04:00

Jul. 27 2011 - 8:40 am | 43 views | 0 recommendations | 1 comment

posted by ROBERT A. GREEN, CPA

50 dinars, what's it worth?

Dozens of people have signed up for tax consultations with me over the years looking for a windfall profit on the U.S. government revaluation of the Iraqi dinars back into U.S. dollars. In other words, these were people holding dinars who were hoping they could exchange them for dollars again.

Most dinar investors are current and ex-military, warzone contractors and now speculators. A cottage industry of promoters has sprung up on the Internet promising dinar “get rich” schemes. Many have invested, say, $5,000 and they hope to make millions. I’ve always thought it was a scam, as it sounded too good to be true.

These people ask me about their potential large tax bills. Most hope for long-term capital gains tax rates, currently up to 15 percent. I have to give them the bad news: holding physical currency is considered ordinary gain or loss in Section 988 (foreign currency transactions). Unlike forex traders, who don’t hold physical currency and don’t take or make delivery, they can’t file a capital gains election to opt out of Section 988 and into short- and long-term capital gains treatment.

That means no lower 60/40 futures tax rate either (Section 1256). At least, it’s not considered a personal loss which otherwise can’t be deducted, as is the case when a person returns from a vacation and exchanges his left over currency from that trip. Investors in dinars can deduct ordinary losses in Section 988, but few expect a loss.

Lords of Finance: The Bankers Who Broke the World by Liaquat Ahamed is about how the four leading central bankers from the U.S., U.K., France and Germany navigated in and out of WWI and financed recoveries and German reparations. These central bankers went off and on the gold and new dollar standards by manipulating their exchange and interest rates and much more. This is how money and power (military and otherwise) go hand in hand.

Our current situation begs the question: Did the Bush administration plan on, and is the Obama administration still considering, paying for part or all of the Iraq war by collecting taxes from the revaluation of the dinar?

If this scheme has any resemblance of reality, it could be an interesting revenue raiser for the government, and I know the government is hunting for revenue raisers and closing of tax loopholes.

Maybe the story here is just that it’s a scam. But, if rumors in the marketplace are true, and the dinar does revalue and allow conversion for most to pre-war levels, what are the ramifications for the government, Iraq, the military, investors and taxpayers? Also, what’s holding up the revaluation? Can Iraq handle it?

It does sound like a happy ending which makes me suspicious. How much tax revenue do U.S., state and local governments stand to collect? How many former and current military personnel and contractors stand to become millionaires overnight?

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Iraqi Dinar Revaluation Soon

2011-07-18T10:40:00.000-04:00

Iraqi Dinar Revaluation Soon

A growing question by individual investors outside of Iraq looking in is, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

As more and more new investors buy into this speculation, they tell their friends about it. And as their friends buy into it, those friends tell other friends about it, and so on. A point has been reached where there are so many individual investors buying and holding the Iraqi Dinar in their possession waiting for the day when the value of the Iraqi currency is going to skyrocket.

When the new currency began to be printed in 2003, it was estimated that approximately 5 Trillion dinars were printed for circulation. Overtime, so much of this currency ended up in the hands of speculative investors all over the world. New estimates have been reported that approximately 25 Trillion dinars have now been printed and are in circulation. And of course as time goes on, more and more dinars are leaving the country and ending up in more speculators hands hoping to cash in big some day.

The Iraq Banking system has come a long way since 2003 in becoming more modern. Many current internet financial transactions are occurring, and are not requiring the actual paper currency. The Central Bank of IRAQ (CBI) monitors this issue a maintains a balance of needed paper cash in circulation for the citizens of Iraq to do day to day business. One of the ways it controls a balance of cash on hand is to have daily auctions of foreign cash to trade back for their own currency.

During and since the Saddam Hussein in Power days, the main populace of Iraqi citizens have remained very poor. However, its citizens have lived through hard times before and do see their futures in a growing Iraq as a reason to stay. The Iraqi’s do have a strong sense of staying the course, because Iraq belongs to them. They have a strong core belief in their country as shown during the recent elections. Many threats of violence were in the air that they could be risking their lives if they chose to go out and vote. Yet the Iraqi people showed up to vote.

When Saddam Hussein was still in power, many citizens were tortured and poisoned by the dictator, and he failed to overcome them. When the War on Iraq began in 2003, living in Iraq was extremely frightening for the citizens. But the war did not beat them, they stayed and weathered the storm. Even Iran terrorized the citizens of Iraq and tried to bribe its politicians. The country of Iraq has survived all of this. Iraq has become the bright shining star of the future in the Middle East leading the way as a new democracy in that part of the world.

The recent political election on March 7th, 2010 is their second such election since the new Iraqi Government was formed in 2005. It is taking a lot of time for the election committees to complete the counting of the ballots. Every day on every major world news site, there are many news stories making headlines about the progress on the counting of the votes in Iraq to see who the decided winners will be. The whole world is watching and waiting on every word of each news story. Why, because so many individual investors across the globe are holding the new Iraqi dinar? Maybe this is partially the reason. And maybe much of the reason news like this coming out of Iraq is so important is because of the all the potential for the oil they have. (If you found this article, its probably because you were looking for it, for example.)

Iraq has the third largest oil reserves known in the world. (Some believe it is actually the second largest.) There is more oil to be found in their country than anyone can imagine. Every week there is a new story in the news about another oil field discovery in Iraq. And also, it seems like every week there is a news story about another country or large oil company signing a contract with Iraq for the rights to a piece of those oil reserves. Iraq gets revenue from every gallon of crude coming out of the ground. This revenue is really beginning to escalate. And the world needs crude to sustain life as we know it and is beginning to make Iraq a very wealthy country.

Many Positive Signs!

In September, 2005, the new Iraqi government signed into law their new Constitution. Since then, the presence of the Iraq Military, with the help of the large foreign military alliances, has made the country more secure, with only a small amount of terrorism still lurking in the shadows. It is finally felt that security is now under control and in 2010 the foreign military alliances will begin to withdraw as Iraq will be able to manage it with less help.

The Iraqi Economy is beginning to spread its wings and their stock exchange has gotten its start. Many of the needed utilities such as electricity and water has also been improving over time.

If you began investing in the Iraqi Dinar from 2003 to 2006, You would have realized at that time that this currency investment was one huge long shot, but it had just enough potential to peak your interest. And if you have stayed in this investment or are just getting into it now, the odds of this investment now paying off are greatly improved from before.

Here is a quote from a news paper ad that I saw in 2006.

“Stability is the keyword in Iraq. Democracy is taking over and the Iraqi people are free. It is only a matter of time before the Dinar is released on the foreign exchange and many experts feel that Baghdad could be a mirror image of Kuwait City but on a much larger scale.”

The United States Government thinks Iraq is worth it because it is spending its tax dollars there to help start the economy. One oil company executive who wished to remain anonymous who purchased dinars said, If you think the United States of America is going to let the second largest oil producing country in the world fall into the hands of thugs again…guess again. It’s not going to happen”

Recently, the Iraqi Government stated “We have promised the people of Baghdad and Iraq that the next four years will be the phase of construction and better economy, and we will live up to our promises”

So, to answer the original question asked above, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Absolutely, YES!… Because a new government is in place, and old oil fields are getting back on line, and new ones are being discovered, and the security has been restored. Iraq also had a lot of debt piled up owing to many other countries. And most of that debt has been forgiven by those countries. What will keep the currency revaluation from happening now?Iraqi Dinar Revaluation Soon

A growing question by individual investors outside of Iraq looking in is, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Many Positive Signs!

The Iraqi Economy is beginning to spread its wings and their stock exchange has gotten its start. Many of the needed utilities such as electricity and water has also been improving over time.

Here is a quote from a news paper ad that I saw in 2006.

So, to answer the original question asked above, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

A growing question by individual investors outside of Iraq looking in is, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Many Positive Signs!

The Iraqi Economy is beginning to spread its wings and their stock exchange has gotten its start. Many of the needed utilities such as electricity and water has also been improving over time.

Here is a quote from a news paper ad that I saw in 2006.

So, to answer the original question asked above, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

A growing question by individual investors outside of Iraq looking in is, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Many Positive Signs!

The Iraqi Economy is beginning to spread its wings and their stock exchange has gotten its start. Many of the needed utilities such as electricity and water has also been improving over time.

Here is a quote from a news paper ad that I saw in 2006.

So, to answer the original question asked above, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

A growing question by individual investors outside of Iraq looking in is, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Many Positive Signs!

The Iraqi Economy is beginning to spread its wings and their stock exchange has gotten its start. Many of the needed utilities such as electricity and water has also been improving over time.

Here is a quote from a news paper ad that I saw in 2006.

So, to answer the original question asked above, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

A growing question by individual investors outside of Iraq looking in is, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Many Positive Signs!

The Iraqi Economy is beginning to spread its wings and their stock exchange has gotten its start. Many of the needed utilities such as electricity and water has also been improving over time.

Here is a quote from a news paper ad that I saw in 2006.

So, to answer the original question asked above, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

A growing question by individual investors outside of Iraq looking in is, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Many Positive Signs!

The Iraqi Economy is beginning to spread its wings and their stock exchange has gotten its start. Many of the needed utilities such as electricity and water has also been improving over time.

Here is a quote from a news paper ad that I saw in 2006.

So, to answer the original question asked above, “Will Iraq’s currency, the Iraqi Dinar, gain value compared to other world currencies soon?”

Trackback

http://dinartrade.org/iraqi-dinar-revaluation-soon/

Iraq Dinar Value Seems Likely to Significantly Increase

2011-07-18T10:39:00.000-04:00

“the Iraqi dinar worth may be expected to strengthen considerably above its present trading valuations.”

The Iraqi dinar is the official currency of Iraq. The nation remains mostly isolated from international monetary markets. The country has no real sovereign credit, there is little need for its money which remains thinly traded. All Iraqi property, including its currency are seen as being a very great risk. The Iraqi dinar value, or the Iraqi dinar exchange rate, is effectively determined through the central bank via it’s US currency auctions.

The Iraq dinar was originally introduced in 1932 when Iraq grew to become independent from British rule. The dinar replaced the Indian rupee that had been introduced by the British following winning control of Iraq from Turkey in WWI. The Iraqi dinar has been a managed or controlled currency all through its life.

Initially, when it was first positioned into circulation, the Iraqi dinar was pegged in the direction of the British pound. By 1959 Iraqi national wealth had become more and more linked with oil. Oil was priced and traded globally in terms from the US currency, so the Iraqi currency peg was changed in the path of the US dollar and remains so to this day.

With the introduction of financial sanctions after the initial US Gulf Struggle, financial conditions deteriorated significantly in Iraq. Inflation spiraled to an annual rate of over 1000% by early 1993, unemployment expanded to over 50% and the worth of the Iraq money fell significantly. During 1994, the dinar was valued at about 2,500 per 1 US dollar. In an attempt to help the new money, a range of actions had been launched including a brand new law in 1996 to allow citizens to use financial institution accounts in a foreign currency.

Following the second Gulf conflict, new preparations were created to take effect on 15 October 2003 to issue a brand new Iraqi dinar and also to manage the Iraqi dinar exchange rate. Since those new arrangements were launched, the Iraqi dinar value has steadily increased. The present exchange rate is 1,170 dinars for one US dollar.

Data published through the US Central Intelligence Agency points out that the number of Iraqi dinars required to purchase a US dollar was 1,475 dinars (on average) throughout 2005, 1,255 during 2007 then down to 1,170 in 2009. The exchange rate today remains near 1,170 dinars per US currency.

Iraq is rich in raw oil, now possessing the 2nd largest level of confirmed crude oil reserves following Saudi Arabia. Iraq lately quantified its proven raw oil reserves at 143 billion barrels, in comparison with Saudi Arabia with 265 billion barrels of proven reserves. More importantly, these reserves are easily accessible and therefore the oil has a low cost to produce. About 95% of Iraqi export income is generated from raw oil or oil derivative commodities.

Longer term, as political balance returns to Iraq, its financial system increases efficiencies and its citizens capture the complete worth of the national crude oil abundance, the Iraqi dinar worth may be expected to strengthen considerably above its present trading valuations.

Like most national currencies in the world today, the Iraqi dinar value is important to those who do business internationally. The opportunities available to those who are considering investing means tracking the Iraqi dinar exchange rate consistently.

(Source)

http://dinartrade.org/iraq-dinar-value-seems-likely-to-significantly-increase/

TampaDinar Releases RV Cards

2011-07-11T17:09:00.000-04:00

To offer their customers more ease and convenience, TampaDinar has released their Central Dinar revaluation card that will also work as RV registration card for different customers of Jidt.org
The customers are subject to bring their RV card with them when they look for the details of their orders and other such things. The card is scanned before providing the information and other details to some customer. For this reason brining the RV card at the time of revaluation or getting some other details is essential. This is indeed very helpful in reducing RV time and customers will be able to get instant help for the information they need to have.

There are some additional features for investment and trust account holders and most of these features have been developed to offer them complete control over investment accounts. It also offers great control over funds investment through the investments of platinum, silver, gold and several other commodities. This way, trading will become quite easy and simple for the investors and they will have greater control over their different investments which will ultimately lead to more profits and higher gains.

About TampaDinar

Tampa is the highest rated online Iraqi Dinar dealer quite well known for its quality services and reliable source of investing in Iraqi dinar. People looking for some lucrative investment opportunities will find that source quite according to their requirements and get the entire boost that they want to have against a safe and secure investment. TampaDinar has been serving in many other currencies as well, but they are widely known as the largest online dealers of Iraqi dinar. People want to invest in Iraqi dinar and looking for a reliable source for that purpose will find that source quite according to their needs.
About Us: Buy or sell Iraqi Dinars, and Vietnam Dong at Tampa Dinar, we are your trusted source for New Uncirculated Iraqi Dinar, currency. We also have the latest Iraqi Dinar News and exchange rate.
Contact Info: pressrelease20@yahoo.com
Additional: Tampadinar.com, Dinardealers.com and Dinarmint.com. The customers of the site can activate the RV cards with their account on these sites.
Company: Tampa Dinar
Country: United States
Contact: pressrelease20@yahoo.com
Website: www.tampadinar.com
Bus E-Mail: pressrelease20@yahoo.com
Phone: 004412121212

Resident Representative Office in Iraq

2011-07-06T16:08:00.001-04:00

IRAQ RESIDENT REPRESENTATIVE SITE

Resident Representative Office in Iraq

This web page presents information about the work of the IMF in Iraq, including the activities of the IMF Resident Representative Office. Additional information can be found on the Iraq and IMF country page, including IMF reports and Executive Board documents that deal with Iraq.

At a Glance:Iraq's Relations with the IMF

§ Current IMF membership: 187 countries

§ Iraq joined the Fund on December 27, 1945; Article XIV

§ Quota: SDR 1,188.40 million (As of May 31, 2005 )

§ Outstanding Loans: Post-Conflict Emergency Assistance SDR 297.10 million

§ The last Article IV Executive Board Consultation was on August 1, 2007 (Country Report 10/72, published March 16, 2010)

Read the Latest Program Note on Iraq

PDF Version

http://www.imf.org/external/country/IRQ/rr/index.htm

CBI sells 175 million dollars in its Thursday auction

2011-06-30T09:43:00.000-04:00

BAGHDAD / Aswat al-Iraq: The Central Bank of Iraq (CBI) has announced the selling of US$175 millions, in its auction on Thursday, on the rate of 1,170 dinars per dollar, exceeding its Wednesday sale by 73 million dollars, according to its daily bulletin, copy of which was received by Aswat al-Iraq news agency.

“The total demand on U.S.
dollars has reached 175 millions and 382,000, covered by the Central Bank of Iraq, on an exchange rate of 1,170 Iraqi dinars per dollar,” the bullet reported.

The CBN’s sales in its Wednesday auction had reached 73 millions and 730,000 dollars.

The Bank’s cash dollar sales had reached 12 millions and 192,000 dollars, on an exchange rate of 1,183 dinars per dollar, along with the Bank’s interest of 13 dinars per dollar.

The Bank’s foreign transfers had reached 163 millions and 192,000 dollars, on an exchange rate of 1,183 dinars per dollar, including a 13 dinar interest per dollar.

“None of the 8 banks sharing in the CBN’s auction had presented any offer for the selling of dollars,” the bulletin stressed.

Noteworthy is that the CBN holds 5 auction sessions per week, beginning on Sunday and ending on Thursday, for the selling and buying of foreign currencies, charging a 13 dinar interest per dollar, along with a similar interest for foreign transfers.

SKH

http://en.aswataliraq.info/Default.aspx?page=article_page&c=slideshow&id=143484

Iraq Said To Be Planning Currency Overhaul, Redenomination

2011-06-24T13:39:00.002-04:00

Iraq Said To Be Planning Currency Overhaul, Redenomination

Iraq's 25,000-dinar banknotes apparently won't get you as far as they used to.

June 24, 2011

BAGHDAD -- A senior Iraqi Central Bank adviser says the government has adopted a two-pronged plan to restructure the national currency in order to facilitate large transactions and make government accounts more efficient, RFE/RL's Radio Free Iraq (RFI) reports.

Mudhhir Muhammad Salih, a member of the bank's advisory panel, told RFI on June 23 that in the short term, larger banknote denominations of the dinar will be issued to simplify major transactions.

He said that because so many Iraqis still deal mainly in cash, it is cumbersome to carry bags full of money to pay for expensive items like cars. The inconvenience leads people making such purchases -- as well as many entrepreneurs -- to use dollars for those kinds of transactions instead of dinars, something the government wants to end.

He added that large denominations equivalent to around $100 will be issued to simplify major purchases, and new coins and lower denominations will be introduced for smaller transactions.

In the longer term, Saleh said a redenomination is needed wherein three zeros will be dropped so that the 25,000 Iraqi-dinar banknote -- currently the largest denomination -- becomes a 25-dinar note.

He said the change is inevitable, considering the economy is expecting high growth in the coming years with a planned increase in oil production to finance reconstruction projects.

Saleh said there are currently some 29 trillion dinars in circulation in Iraq, represented by some 6 trillion banknotes of various denominations, most of them quite small. He said this also causes complications for the central bank and government, as well as commercial accounting departments.

Saleh said the monetary-restructuring plan was drawn up with the help of foreign experts and financial institutions, including the International Monetary Fund (IMF), of which Iraq has been a member since 1945.

The plan will soon be presented to the cabinet, which is expected to subsequently send a bill to parliament.

Saleh noted that until 1980 the Iraqi dinar exchange rate was 1 dinar/$3.3 compared to $1/1,168 dinars now due to hyperinflation that occurred during the latter part of the late ousted leader Saddam Hussein's reign.

http://www.rferl.org/content/iraq_said_planning_currency_overhaul_redenomination/24245867.html

Iraq Said To Be Planning Currency Overhaul, Redenomination

2011-06-24T13:38:00.002-04:00

Iraq Said To Be Planning Currency Overhaul, Redenomination

Iraq's 25,000-dinar banknotes apparently won't get you as far as they used to.

June 24, 2011

http://www.rferl.org/content/iraq_said_planning_currency_overhaul_redenomination/24245867.html

Bullseye: Most Iraqi private banks hit $85M capital target

2011-06-21T10:18:00.003-04:00

June 15, 2011

22 out of 32 private banks reach $85

million capital target needed to spur

banking activity. Banks that fail may

have licenses revoked.

Reuters

Most of Iraq’s private banks have reached the central bank’s $85 million capital requirement level aimed at diversifying the financial sector’s activities, the head of a private banking association said on Tuesday.

Iraq is slowly getting back on its feet as it emerges from years of war and economic sanctions, and Iraqi banks hope that multi-billion dollar deals signed with international firms to develop the country’s vast oil reserves will spur lending and help private financial institutions flourish.

The central bank laid out a three-stage programme in 2009 for banks to raise their capital. The deadline for the first stage is end-June, when banks should reach capital levels of 100 billion Iraqi dinar ($85 million).

By June 2012, banks need to boost capital to $128 million and the third stage is for June 2013, by which time capital levels need to be at $213 million.

Abdul-Aziz Hassoun, executive director of the Iraqi Private Banks League, an independent organisation to support private banks, said 22 banks had so far reached the $85 million target.

He said another three banks were in talks to merge in order to reach the required level.

“The private banks are on the right path,” Hassoun told Reuters during an interview.

“Only seven banks did not undertake increasing their capital and they have to explain this to the central bank,” he said, adding that the central bank may withdraw the licences of banks that failed to meet the target.

According to the central bank website, OPEC oil producer Iraq has seven state-owned banks, 23 private banks, and eight Islamic private banks.

Its banking sector is dominated by two state-owned banks, Rafidain and Rashid. Much of the private banking activity is limited to deposit services and a small amount is personal lending.

“I personally agree with the capital increasing (decision)…in order to be able to enhance the financial entities’ capability to handle huge banking operations which are monopolised by the government banks,” Hassoun said.

He said private banks also needed to increase other services such as credit cards and ATM machines. Only eight private banks currently offer these services.

Ahmed al-Buraihi, a central bank deputy governor, told Reuters on Tuesday it was important to increase private banks’ capital to help raise their lending capacity.

“This planning is based upon anticipating the future of Iraq’s economy,” he said, referring to expected huge growth in the country’s oil and industry sectors. (By Aseel Kami; Editing by Serena Chaudhry and Toby Chopra)

End to Iraq’s political impasse nears

2010-11-11T09:47:00.000-05:00

President of the Kurdistan Regional Government Masud Barzani speaks to the press in Baghdad on Thursday. Mr. Barzani confirmed the Kurds, the bloc that came in fourth place in the election, will retain the presidency the second highest position in Iraq's political structure. Photo: AP.

Iraq’s eight months of political deadlock appeared to be coming to an end on Thursday after a complex agreement was reached between parties, paving the way for the formation of a new government.

Elected officials are set to convene Parliament later in the day to appoint a speaker, setting in motion the final steps towards a tentative power—sharing deal between Iraq’s multiple political, religious and ethnic groups.

It would be only the second session of parliament since the March elections, with the first session in July lasting less than 20 minutes.

Leading politicians from all major parties at a meeting late Wednesday in Baghdad appeared to have agreed to form a broad—based administration with Nuri al—Maliki, from the Shiite—led Dawa party, staying on as prime minister.

Politicians had agreed that “the presidency of Iraq will belong to a Kurd,” Massoud Barzani, president of the northern autonomous Kurdish region of Iraq, said in a televised address on Thursday morning.

Sources in the capital said former prime minister Iyad Allawi’s secular Iraqiya List, the largest party in parliament with 91 members, would get the foreign minister’s portfolio and most likely grab the role of speaker of parliament.

The Iraqiya List had nominated high—profile Sunni member Osama al— Nujaifi to take the post of speaker, Iraqiya spokesperson Haidar al— Mula said according to regional news network al—Jazeera.

Once a speaker is chosen, the parliament can move toward naming a new president, who would then have the job of appointing a prime minister, according to the country’s constitution.

Mr. Al—Maliki, who heads the broader Shiite—majority State of Law coalition, which won 89 of the 325 seats in elections in March, exuded confidence on Wednesday.

“We will not only experience the birth of a new government but even the beginning of the rebuilding of the Iraqi state,” he said.

However, al—Iraqiya, which had been hoping its leader Mr. Allawi would get the premiership still showed signs of dissatisfaction within its ranks as details of the power—sharing deal were released.

“We are the largest faction, according to the election results, and if the others have divided the positions among themselves, that would mean that democracy in Iraq is over,” said Mr. Abdul Qadir Mahdi, an Iraqiya List parliamentarian.

The party’s leadership was said to be meeting to discuss its final position on the power—sharing deal.

Iraq set a world record with its 249 days of failing to form a government.

http://www.thehindu.com/news/international/article880127.ece