A number of Iraqis demanded that their country's currency be returned to its normal state and raised its value against the US dollar, which made the hashtag # I want_Denary among the most discussed topics on Twitter in Iraq. The Central Bank of Iraq announced a reduction in the exchange rate of the Iraqi dinar against the US dollar, last December, in the first such measure in half a decade, and coincided with a stifling financial crisis plaguing the country as a result of the collapse of oil prices.
A statement by the Central Bank of Iraq stated that the new price of the dinar against the US dollar was set at 1450 dinars instead of the previous rate of 1190 Iraqi dinars per US dollar. And the Ministry of Finance promised, at the time, that "the decision to amend the exchange rate will be a one-time only and will not be repeated in the future."
After the issuance of the decision last year, the Iraqi government reassured its citizens about the decision to reduce the value of the official currency, stressing that it would not affect the classes that depend on local goods, but experts and observers criticized the move and believed that it would increase the already high poverty rates in a country experiencing the worst economic crisis in decades . The Iraqi Ministry of Finance attributed the decision to the government's attempts to address the stifling crisis that Iraq is witnessing as a result of low oil prices, to ensure the protection of the economy and to achieve the reforms that it promised several months ago.
The decision sparked a wave of anger in the Iraqi street, but Prime Minister Mustafa Al-Kazemi defended his government's move and said that he had two options, "either the collapse of the system and the entry into complete chaos, or we enter into a Caesarean section for reform."
Since the collapse of oil prices earlier this year, Iraq has faced an unprecedented liquidity crisis. The oil-exporting country was forced to borrow from the bank’s reserves in dollars to pay off nearly $ 5 billion a month, representing public sector salaries and pensions.
Author / Mazhar Al-Ghaithi The West deals with strategy, and it is a mistake not to try to understand what they are trying to do with us through gathering information, analyzing it, and deducing future goals and plans for them so that we can confront them through tight, easy and reluctant planning that depends on loyalty to God and trust in Him and relying on His success. Here we will discuss one of the challenges that are the focus of the hour’s talk, which is changing the exchange rate, and summarize it accordingly: 1. Many observers are confused about the real reasons and motives behind the Al-Kazemi government’s feet to sell dollars at a high price to the people for reasons. Let us think out loud and say is it:
A- To withdraw cash or cash from the people, which exceeds the financial potential of the state, as it is known that the monetary properties in circulation in the market or in the possession of people are higher than what the state owns, and this in itself poses a threat to the state’s financial sovereignty and loss of its balance and threatens the failure of the financial system B - Did the instructions come from America in this regard in order to control the people and the Shiites in particular like this and simply to make it easier to fight them and implement all kinds of plans that they want to implement on them? 2. Is it that the families controlling the global economy want internal control over the Iraqi economy through the window of the World Bank, since it is arbitrary and now in the implementation of a loan to Iraq worth 5 billion and perhaps the intention is to exhaust Iraq economically and this in itself is a harbinger of affairs and has serious repercussions as:
A- Iraq owes the World Bank large sums and benefits will be imposed on it in the next stage. Iraq cannot get out of this crisis and it will be bargained for to implement their plans in Iraq. B - Is the goal of these families is to control Iraqi money, and that will not be done for them except after distorting the reputation of Iraq abroad and reducing its economic power to the bottom through its relationship with the World Bank and keeping Iraq indebted to them for longevity, and this will affect the choices of future generations as they do not They allow Iraq to deal with other countries in financial matters, in order to develop and boost its economy.
3. This stage represents the preparation for the next stage, which is the new global economic system. If the Iraqi financial system and economy are restricted and shackled, it will be soft at the hands of governments and governments, which are controlled by the royal families and they are already infiltrated. 4. If Iraq were to regain its strength and there was a possibility to strengthen the Iraqi dinar, it would be the first in the region and it would be a good supporter of the economy and vice versa, and it would overcome the region’s currencies and economies and would be a global power, and for this there would be no interest for the region’s countries to support the Iraqi dinar and save it from the system’s hegemony. Globalism.
5. America and most of the dominant forces in Iraq deliberately keep Iraq under the terms of pressure in order to be safe in their future in the event of revolutions, especially as they are frequently repeated. Finally, if you collect everything that has been said and put with it what will happen in terms of a shift in the digital currency, especially in the dollar and digital dealings in buying and selling, in addition to some of what we have previously mentioned about some manipulating the financial balance between Baghdad and the region, it is certain that the clues and features of the next phase will be revealed to you. My brothers who have the word and fair people in Iraq and the region, the solution is simple. We know our patriotic men who defend our rights. Our salvation is by pushing them to power, and any negligence in this matter will lead to the completion of the Tamer rings that will lead not only to the families of our word, but to the shackling and families of our children and grandchildren as well.
Salah Hassan Baban "I lost my seat in Parliament after I received more than 3000 votes in the 2018 elections, because I did not pay three million dollars to the head of the bloc that I ran with, so another losing candidate won by paying the same amount." With this "opportunistic treatment" with the candidates, SA (45 years old), a former candidate for the parliamentary seat, is likely to hold the next parliamentary elections. He says, "There are two main sources of financing party budgets for the elections, the first is through corruption in the ministries that they seize, and the second is from external support, especially Iran and Saudi Arabia."
With renewed hopes for holding parliamentary elections on October 10, talk about sources of funding for Iraqi parties in parliamentary elections has returned, raising doubts about the existence of common points or link between the depreciation of the Iraqi dinar against the US dollar and the preparation of influential Iraqi parties to finance their election campaigns, through Several outlets, the most vital of which are private banks, at a time when statistics issued by the Independent High Electoral Commission indicate that about 300 political parties and blocs have so far registered their participation in the upcoming elections with the possibility that the number of political parties and blocs will reach twice what it was in the 2018 elections, which reached 204 parties and blocs.
The political parties ’evasion in Iraq helped the law that stipulates that the parties’ work must be regulated and their sources of funding announced and not disclosed to the public opinion and the voter, provided that they have more than one source of funding, among internal sources, mainly related to ministerial contracts and investment projects that the parties obtain after their participation in The formation of the government within the political quota system in effect in the post-2003 period, specifically the large blocs, and between another external source, where candidates receive financial support from their regional sponsors, especially Saudi Arabia and Iran. While the candidate affirms p. A to “Darj” that the first step in the electoral race has really begun for the big parties by distributing some valuable gifts such as pistols and the like, in addition to food, clothes and various gifts with the purchase of the debts of some media professionals, writers, poets, as well as clerics.
S.A. believes that the political parties resorted this time to a new trick to achieve greater financial gains through lowering the local currency and raising the dollar, which would bring them huge profits, especially since most of the parties own private banks.
The Iraqi government started with the initial steps to implement the terms of the white paper that it launched and marketed a lot over the past months to support its economy by raising the price of the dollar against the local currency from 1184 dinars to 1450 dinars to the dollar at the selling prices approved by the Ministry of Finance of the Central Bank, and this step was negatively reflected on the prices of goods, commodities and needs. The daily percentage of the citizen is not less than 25 percent.
Doubts and many questions have been raised about the possibility that the influential parties in Iraq would stand behind the decision to reduce the local currency against the dollar after the collapse of the dinar, in order to benefit from it to fill the deficit of the government in which it participates and to be able to pay the salaries of its employees in addition to strengthening its budgets as the elections approach, but the Al-Kazemi government and an extension of its failure In the political, security and health files, in addition to her fear of revealing the killers of the demonstrators as she promised before her arrival to the prime minister, although they are known to her, her monetary policies caused employees to lose about 25 percent of the value of their salaries.
Political writer Ali Al-Baidar agrees with S.A. about the existence of many political parties that own private banks that have lent to the government knowing the poor conditions of the country at the current stage, and they do not have any other means to recover their money with the interest resulting from that, which reached 13 percent, It is thus pressuring the government to force it to take this step, without having any other option to redress bankruptcy, spending on state institutions, salaries of employees and retirees, and a social protection network that includes 8 million beneficiaries.
Al-Baidar describes the Iraqi Central Bank’s submission directly to political interference as “the biggest and greatest mistakes” committed by the political system, and stresses the necessity of keeping this financial institution away from political interference, as it exercises a basic task, which is drawing and implementing monetary policy.
A former employee of the Independent High Electoral Commission, who was among the cadres that supervised the polling process in 2018, confirms that the candidates' campaigns cost about 60 thousand dollars at least for each of them, and sometimes more than two and a half million dollars for the prominent leaders of the first row in the parties The window, 60 percent of it is spent on purchasing aid for the destitute groups who live below the poverty line, especially in the central and southern regions of the country and the capital, Baghdad, while the other percentages are distributed on organizing various festivals, seminars and celebrations to support the candidates' programs.
No two people disagree that the decline of the dinar and the rise of the dollar reflected on the life of the simple citizen, increased psychological and economic pressures on him, and his life became more bitter, especially with the rise in food prices, electricity and water services, and the pressures of the Corona epidemic on the social and economic situation.
Journalist Hana Riyadh believes that the argument that the government relied on to approve raising the dollar and reducing the salaries of state employees and international borrowing, due to the impact of the Corona virus on the overall economic situation in the world as a whole, is no longer useful. Oil prices have risen again and exports are still in effect. The market was already affected and led to a recession in global markets, but Iraq suffers from complex problems, including the problem of financial mismanagement and corruption. She asked: “How can we absolve the government of creating a crisis? In fact, there is manipulation and intentional to confuse the citizen, and to follow a policy of trauma treatment.
And whether Al-Kazemi is responsible for the collapse of the local currency, Riyad believes that the prime minister did not come with a popular nomination, but rather party consensus, so he is dependent on those parties.
Sure you are confused about the Iranian rial and toman. You are surely thinking that those are two different words with different meaning. These are the Iranian words that are used for their currency. So, there is no difference between rial and toman. Official currency in Iran is rial. The word toman is used by the local people, especially in the daily based payments and for sure, sometimes it is confusing for the ones that are not Iranians. The common bill these days is 10 000 rial bill, but the local people use tomans, which is deducting one zero. A 10 000 rial bill is called 1000 tomans bill. So, 10 000 rial is equal to 1000 toman and that is approximately $1 . We have to say that official dollar exchange rate is somewhere between 1030 and 1040, which fluctuates a bit up or down. The fluctuations are bigger in the free market. The common types of rial bills are 500, 1000, 2000, 5000, that are available both in coins and bills, and just available in the bills there are 10 000, 20 000, 50 000, 100 000. When the tourist are coming and the passing by travelers are exchanging they usually change the most in 50 000 bills. Before there were available the 100 and 250 bills and coins. Today, you can sometimes, still find here and there these 100 and 250 bills or coins. They were used to function as dime and quarters. For example, we will make you a clear image. For example, one hamburger costs 2000 tomans, which is equal to 20 000 rials and that is equal to $2. A mineral water bottle cost 500 toman = 5000 rials = 50 cents. And the exchange rate market is making quite easy and simple to pay for food or any other service when you are a tourist or a traveler in Iran. But one thing you have to remember. Never mix up the rials and toman. They are same but not same at some point. In back and official working places the official currency is rial and that is only acceptable currency there. In the everyday life, and in free market the toman can be used properly.
Finally, we come to cheque Rial which came as a result of the sanctions imposed by USA against Iran back in Trump Era. These are inflation cheque money and there are two cheque Rial denominations: the 500K Bill and the one Million Bill ( which is the largest denomination of Iranian currency. These two bills came to cover the market need for a large bill increase purchasing power.
Iraqis suddenly woke up to the decision to lower the exchange rate of the Iraqi dinar, and were hit by a monetary shock they had not experienced in decades. They were under the illusion that their currency had reached the shore of stability, and that the fluctuations that their dinars had previously known would not witness, which generated emotional and emotional reactions in their depths that made them launch a wave of tweets in which they criticized the government decision intensely, including the hashtag #Banks_the thief, their Twitter accounts, and the demonstrations went out in protest against This decision, which afflicted the poor classes that suffer from the current economic crisis, made them worse by the process of reducing the price of the dinar against the dollar, where one fifth of Iraqis live below the poverty line.
If we review the history of the Iraqi dinar, we will find that it represents the history of Iraq, with all its fluctuations and storms, as its conditions fluctuated with the fluctuations of the summer, winter, autumn and spring seasons, and its first effect was the abandonment of coins from coins and their disappearance from circulation until the paper currency prevailed in the square. It is known that the dinar went through various political eras, as Iraq continued to use Ottoman banknotes for four centuries from 1534 to 1920, until the advent of the British occupation, which replaced this currency with the Indian currency represented by the Anna and the metal rupee, which bears the image of the British King George V to be The only currency in circulation, both paper and metal.
In the thirties of the last century, coins were issued from all denominations, bearing the image of the face of King Faisal I, and printed in Britain. A year later, the Iraqi dinar was issued, which was linked to the British pound, and then it was decided to peg it to the US dollar without changing its value. After the second Gulf War, and due to United Nations sanctions, previous foreign-printed dinar issues, known as the Swiss dinar, were no longer available. A new banknote bearing the image of King Ghazi I was issued, and then coins bearing the image of King Faisal II were issued. With the republican era, the value of the Iraqi dinar decreased and deteriorated after the Iran-Iraq war, until its value reached low levels, and one US dollar was equal to 3 thousand dinars in 1995. After the fall of Saddam Hussein's regime, the Coalition Provisional Authority issued an Iraqi dinar that was printed at Delaro's presses in Britain with specifications that are difficult to forge, and the Iraqis approached the dream of stabilizing their dinar. Thus is the journey of the Iraqi dinar from the top until what it reached from a permanent turbulent history that has never calmed down, and the reasons for its collapse are known at the present time, which is primarily the dependence on the rentier economy and the slackness of the state apparatus with employees and retirees, which made the government lose its control over the Iraqi dinar as is the case In losing its control over arms and the economy, this economic crisis has nothing to do with the Corona pandemic or with the drop in oil prices, as the government is trying to justify its crises in its inability to find solutions since 2003.
The recent reduction in the price of the Iraqi dinar came, by a decision from the Minister of Finance and in agreement with the ruling parties, explaining this by implementing the white reform paper as a magic wand, that is, raising the dollar exchange rate to 1,450 dinars after it was 1,120 dinars, considering it an approved price for sale from the Ministry of Finance to the Central Bank And the promotion that this reform paper had received support from the major countries, the International Monetary Fund and the World Bank. The main reason for this reduction is due to the Ministry of Finance borrowing from banks and re-deducting them with the Central Bank in large sums, under the pretext of paying salaries, and meeting other spending needs related to services provided to citizens who are essentially non-existent.
What increases the current crisis is the fact that Iraq imports almost all of its goods and needs, and makes payments in dollars. In this, the central bank is imagining that the new price will address the crisis, that is, it will act as a balance to meet the government's needs for liquidity without studying the fundamental causes of the great economic deterioration that the Iraqi economy suffers from, and without assigning the sensitive jobs in finance and banks to experts in this field. These talents and experts have always warned about the necessity to move away from the rentier economy and move towards agriculture and industry, supporting small businesses and so on.
Reducing the dinar will not contribute to achieving development that lacks scientific plans. Rather, it would exhaust the Iraqis and increase their troubles in circumstances in which dollars are smuggled into Iran, as this contributed to the exacerbation of the crisis after the imposition of sanctions on it, and Iran is the only beneficiary of the decline The Iraqi dinar against the dollar.
Iraqis fear that the value of the dollar will continue to rise to record numbers, and here the history will repeat itself, that is, the specter of the days of the siege on Iraq looms on the horizon, as the conditions of the Iraqi people have become complicated, and the past of the economic collapse of the recent past is still present, and it is possible that the dollar is equal to about three Thousands of dinars, after the Iraqi dinar was equal to three US dollars in the seventies and eighties. There is no guarantee in the future to stop the deterioration of the Iraqi dinar.
Undoubtedly, lowering the exchange rate of the Iraqi dinar has negative repercussions on the citizen and the economy alike, because the dinar has lost 20% of its value, while the local market depends on imported goods, which will lead to higher prices, which in turn will increase the number of Iraqis who live without The poverty line is where Marx's maxim is fulfilled: the poor get poorer and the rich get richer.
Baquba (NINA) Economic specialist Jamal Shaker ruled out dropping zeros from the Iraqi currency because it leads to the collapse of the country's economy and the Iraqi dinar. He told the correspondent of the Iraqi National News Agency (NINA) today that removing the zeros from the Iraqi currency needs a strong economy and a hard currency in order to be able to re-evaluate the price of the dinar, and this is unlikely in light of a collapsed economy, but the only treatment to gradually strengthen the exchange rate of the Iraqi dinar is an economic plan and exploitation Natural resources, activating investment, controlling outlets, developing oil fields, and completing the large FAO project. He added that floating the currency does not serve the Iraqi economy and causes great harm to the market
Deleting zeros or printing a new category? .. The Iraqi government's options to save the dinar from collapse
A new storm hit Iraq this time with the local currency depreciating against the US dollar after political, security and health storms preceded it with the outbreak of the Corona virus, the decline in oil prices, the government reaching the stage of deficit in paying its employees' salaries, and the House of Representatives having to vote on the internal borrowing law to fill the deficit. The government started with the initial steps to implement the provisions of the White Paper that it launched and talked about a lot over the past months to support its economy by raising the price of the dollar against the local currency from 1184 dinars to 1450 dinars to the dollar at the selling prices approved by the Ministry of Finance of the Central Bank, and this step was negatively reflected on the prices of goods, commodities and daily needs. For the citizen, with rates not less than 25%.