What are the reasons for the weakness of the Iraqi dinar compared to other currencies?.. An economist answers
Aug 12 19:46
Information / special.
Today, Saturday, the economic expert, Abd al-Rahman al-Mashhadani, explained the
reasons for the instability of the Iraqi dinar in the local markets compared to other Arab currencies, while
confirming the existence of a large discrepancy between import and export in the country's markets.
Al-Mashhadani said, in an interview with Al-Maalouma Agency, that
"the central banks of the Gulf countries, whether they are Jordan, Kuwait or even Saudi Arabia, have taken a decision to price their local currency, which depends on a basket of currencies, including Iraq, as bulletins previously appeared in the newspaper in the seventies." of the last century, measured on the basis of this basket.” He added,
"All global currencies are attributed to the dollar,
but the economies of these countries are stable and there is no problem, and
the difference is obtained at the prices of market materials,
that is, inflation occurs and the rates of rise increase, which happened in the UAE, Saudi Arabia and Kuwait as well." The economist explained,
"These countries do not deal in dollars in the markets at all, given that
all financial transfers are obtained in the local currency only, and
this is one of the reasons for the stability of the market," noting that
"Iraq was unable to control this situation completely." And Al-Mashhadani said,
"The other matter is trade, that is,
import and export, without relying on the government sector in particular. In Iraq's markets, as a result of the large discrepancy between import and export,
it is natural that there is a great demand for dollars." He stated,
"The Iraqi dinar was linked to the dollar before 2003, that is, from the Kuwaiti war in 1991, given that the market has always fed the import of the private sector, so there will be no stability."
The Iraqi dinar has been in an unenviable situation for nearly 20 years.
After one dinar was equal to 3 and a half dollars during the past century, it reached more than 1550 against one US dollar,
which caused problems in the Iraqi economy. Ended / 25R