Strategy to Raise the Value of the Iraqi Dinar
|April 17, 2010||Filled under All Dinar Trade Articles|
An Iraqi official announced the adoption of a new strategy intended to raise the value of the Iraqi dinar against foreign currencies.
The chancellor said the Central Bank, Dr. Mohammed Saleh appearance in a statement: “I’ve been working for years to improve the value of the Iraqi dinar exchange, several measures have been taken until we came to the stability of its value at 1170 dinars to the dollar.”
He explained that he had talked with some fluctuations up and down according to the impact of the overall situation in Iraq in the absence of stability.
He disclosed that the new strategy has begun the reform of management system of the national currency and payment system of Iraq, said that this will be the basis for the application of strategy to reform the currency. He favored the Iraqi official that these steps will take a year or more.
On the zeros added in the Iraqi currency, which made the value of the disbursement of land, Saleh said that the zeros added that high inflation rates since the Iran-Iraq war and the subsequent siege and invasion, and thus doubled the cash block several times.
In 1990, the cash block of 28 billion dinars, and became a six trillion dinars in 2003, while now stands at 25 trillion dinars. He said that this has become necessary to change the payment system because the Iraqi economy on the verge of developing and producing oil major which leads to spending significantly.
According to the adviser at the CBI, the new strategy will shift the current monetary mass (25 trillion dinars) to 15 billion dollars through the adoption of coins and currency Iraqi few.
And the ability to withstand the Iraqi dinar against foreign currencies, Saleh said that “the Iraqi economy is strong, has great resources to qualify to stand in front of foreign exchange if there are economic and monetary policy is correct, and political and economic stability and security.” He expressed optimism that the Iraqi economy will recover, which is reflected in the rise of the dinar against foreign currencies.
For his part, said a banking expert, Mohammed al-Samarrai said the Iraqi dinar was relatively stable at the present time, is affected by the conditions of security rise and fall of a simple not as great as in the past.
He stressed that the dinar is witnessing now balanced and influenced by the simple economic decisions and political inappropriate in the exchange rate does not prejudice was balanced.
He hoped that the high value if foreign investors have entered the Iraqi market, or if there is openness towards the private sector. Samurai called to re-construction of the many industrial projects that have been stalled as a result of the blockade and invasion which led to the destruction of industrial equipment.
He pointed to the neglect of 36 factories giant in the past seven years. And the actions necessary to raise the value of the dinar against foreign currencies, “said Samarrai, including stabilizing the security situation and the political decisions and laws that encourage private sector support, and encourage the entry of foreign and domestic investment, and encourage the return of capacity to rebuild it.
The Iraqi banking expert Mohamed Kamel Hussein said that there was a perception among the Iraqi Central Bank to lift three zeros from the value of the dinar, by issuing a new currency to improve its value.
However, he believed that the lifting of the three zeros will not change anything because the factors affecting the exchange rate of the dinar against foreign currency depends on the surplus that is supplied by oil revenues.
Provides lift the productive capacity of large oil revenues diminish the value of inflation, and thus raise the value of the dinar by providing a surplus of foreign currency.
The exchange value of the Iraqi dinar was the strongest in the region late seventies of the last century but started to decline during the Iran-Iraq war before riven by the blockade.
Have fallen to their lowest levels during the U.S. invasion in 2003, amounting to U.S. dollar exchange rate four thousand Iraqi dinars.