Keywords: factors governing the formation of the reserve outside the control of the central bank control
(Independent) .. criticized the Governor of the Central Bank of Iraq, on the Keywords, the "other" of non-professionals, has launched remarks on monetary policy and the work of the Central Bank of Iraq, noting that the majority of these statements marked "fallacies and pessimism and confusion, either because of the absence of an accurate understanding or intent It is the objective that stems from different motives linked to the political reality, and harassment and interests. "
Keywords and he said that the central bank's policy-established is the distance away from the controversies and reactions to the statements, but he also noting that the size of the inaccuracies and confusion reached an "detrimental to public stability and the stability of the market and damaging the reputation of Iraq externally and the consequent serious implications for Iraq transactions of financial and Monetary and Banking ", which claim to clarify some things.
He said that "the Central Bank is working on the application of parallel policy to maintain the overall stability of prices and curb inflation as a mission president of the basis of the target under the law of this bank, and at the same time working to maintain reserves prevailing dinar and high coverage in spite of the prevailing and known to everybody economic conditions, He thus kept whole and preserves the purchasing power of the Iraqi dinar. "
"The waste of concerns about the value of the dinar and international reserves refer to" that with the decline of dollar resources, due to lower oil prices, the reserves are still enough level, but much higher and according to international criteria, namely: the standard of the local currency to cover its equivalent in foreign currency, and the ability of the reserve to cover imports for a period of 6 months. "
"The International Monetary Fund forecast at the beginning of 2015 and the arrival of the reserve to $ 40 billion at the end of the year, we have explained at the time that the reserve will be up to $ 60 billion at the end of that year and months after the beginning of the year Justice Fund I expected."
He said the reserve was estimated at $ 50 billion, and is still expected in accordance with the actual data and indicators we have the reserve - as we expected - it will be up to the 60 billion.
As between the difference between our purchases of the dollar (from the Ministry of Finance) and sales of the dollar for the period from 01/01/2015 up to 09/30/2015, it amounted to about $ 600 million a month, and the central bank to cover this difference to balance the balance of payments and to maintain the exchange rate and thus the general price level, and it is clear that even with the continued decline in oil prices and hence lower revenues from the dollar, the reserve can hold enough coverage and adequate presence of about $ 60 billion of reserves.
He stressed that what is happening from the low and high in reserves is frequent occurrence in countries that rely on exports of oil, has happened in the year of 2009, when oil prices fell, then stood at the bank sales rate of the dollar to its purchases of dollar 148% and then returned to accumulate new reserves after prices returned to their rates higher.
He explained that of the common mistakes connect low or high reserve of the Central Bank, as this reserve is governed by the nature of the composition and the nature of the use of outside control or the central bank control and is represented in the set of the dollar is doomed to exports of crude oil: the quantity and price, and other sources virtually non-existent ( remittances from abroad, whether from living abroad or foreign investment, or non-oil exports).
"The state budget expenses represent the main source of aggregate demand for goods and services, which are mostly imported, due to the absence of local production base." The "migration of funds from Iraq is a clear phenomenon because of the situation of the country."
He also noted the continuing shortfall in the state budget and covered loans, bonds, drafts and "this means an increase in money supply which is not offset by revenue dollarised, this creates additional demand for goods and services imported more than it received by the Central Bank of the dollar, which exchanged usually the Ministry of Finance in Iraqi dinars through Bank ".
Keywords and concluded that "the factors governing the formation of the reserve control is outside the central bank's control, and that the reserves under what passed consists of the difference between the dollar sales through the bank window and purchases of Bank of the dollar from the Ministry of Finance if sales were less than received by the Reserve rises and if sales Reserve fall further. "
And raise the question on the possibility of central bank control the amount of sales through the restrictions put on the sale and conversion processes, Keywords said that restrict the sale of dollar operations and lead to the results of several phenomena are:
First, contrary to the guidelines of the International Monetary Fund approved and committed to by the Member States (including Iraq)
Second: the restriction intersects with the Central Bank Law, which stipulates in Article 28 thereof on (buying or selling simple unconditional "cash or deferred" of foreign exchange).
Third: the creation of a large deviation between the official rate and the market price of obscene and achieve gains for speculators, brokers, and lead to a general rise in prices and harm the purchasing power of the Iraqi dinar.
Fourth: the practice of cheating, forgery and fraud and corruption in order to get the amounts of the dollar.
He said that from the point of view of the central bank "if they want to maintain the reserve required by, processors structural and structural macroeconomic and financial policies (revenues, expenses, taxes ...), including:
Stimulate national production and diversify the local production base to reduce the demand for imports and thus on the dollar. The central bank initiative to allocate loans of $ 6 trillion dinars initiative pour into this trend.
Reducing the budget deficit to less extent possible, to prevent the cash that is not offset by the dollar resources for expansion, thus increasing the demand for goods and services that are mostly imported.
Providing political, economic and security stability to limit the flow of funds from abroad, and to increase investment and savings within Iraq factors.
Application broken laws to protect domestic product (tariff law, Consumer Protection Law, Product Protection Act, the anti-dumping law).
Balastairadat perform relevant roles of state institutions, in the granting of licenses in the supervision and control and obtaining fees and charges and the provision of national databases.
He stressed, "The role of the Central Bank in accordance with the law and the law against money-laundering is forcing banks and financial institutions to apply the principle of" know your customer "to verify the sources of funds that enter the process of buying the dollar, and in this regard, the bank has taken a number of actions and important steps (preventive and deterrent), indicating It will be published on the central bank's website, where there is no room here to explain the details. "
As shown some statements about the invitation of the Central Bank to the expertise and advice of specialized international institutions, Keywords pointed out that the Bank founding member of the International Monetary Fund and the World Bank, as well as Arab, regional and international financial organizations, and the World Bank in communication and consultation and understanding with those organizations, but that the rules his work in the joints of the base currency is the governing principles and rules, conventions and recommendations issued by those organizations.
He noted, "The foreign currency sale in the central bank window, and management of international reserves are governed by the guidelines of the International Monetary Fund, and applied by the Member States agreed upon, including Iraq, and so in the rest of respects exercised by the Bank in accordance with the best international standards and practices."
He also noted that the central bank has "advisory contracts with the best Arab and international consultancy firms and institutions of international auditing and review, the bank continues to expand counseling channels, in addition to the support received by the Bank from international organizations and Arab and Islamic central banks and take advantage of its services free by virtue of Iraq's membership in or by virtue of the bilateral relations and memorandums of understanding. "
He explained, "The systems and electronic programs have become a framework and a way for the organization of work and practices, and through them can attract the best practices reached by the developed world, the central bank developed and developing information technology with the help of global companies with the latest software and techniques, and can be found on the infrastructure it currently in this bank, and say proudly as the best among all state institutions. "
He said that "from the models of those systems, the payments system and the clearing and settlement, which is currently applied by the bank and is one of the most systems developed in the region and the world, and which also today provides the basis for the application and development of electronic payment systems in all its forms through the National divider, which entered into Currently work, and the bank in the process of starting a comprehensive banking system Core Banking System, the largest program in the world of electronic banking, which represents a historic shift in the Bank's work. "
And "The Human Resources in the Central Bank - unlike other state institutions - representing the stable resources of this institution did not leave despite what Iraq has passed through the conditions, and therefore resources has accumulated experience and tender, and enjoy these resources special support from organizations and banks, international and regional financial institutions and Arab, and perhaps the number of workshops and training courses being considered by the Bank staff are the highest among the state institutions. "
He said, "we have strengthened cadre Bank has appointed top universities and graduates of Graduate Studies, as well as the appointment of graduates from outside Iraq (educational initiative) the terms of reference regarding the work of the bank, as well as the Centre for Banking Studies (one of the formations of this bank) of courses and training programs throughout the year.
He announced Keywords for the central bank to launch soon its strategy for the years 2016 - 2020, stressing that it "is built on the latest global developments in the banking and financial sector, the latest trends and tasks arising from developments in financial and monetary crisis, which was born and developed from the functions and roles of central banks, the first strategy in the history of Central Bank of the method of construction and in the content and direction, and on the basis of overall quality and standards in the setting, with the introduction of a special form shall follow-up and evaluation. "
He expressed the Governor of the Central Bank for a total Alastaadadal "to inform the interested ordered the bank, and documentaries on the ground, on the policies, procedures and plans."
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