Economy| 06:48 - 11/18/2023
Mozaine News - Baghdad
The economic expert, Abdul Rahman Al-Mashhadani, revealed the impact of the Central Bank’s steps on the dollar exchange rate in Iraq.
Al-Mashhadani said in an interview with Mawazine News,
“The recent measures will contribute to lowering the exchange rate by allowing banks to bring remittances from companies that have bank accounts in them or from their balances abroad, and
this will achieve two things.
The first is that the central bank will be freed from the Fed’s oversight and penalties, given that any dollar Of these dollars, if they leak into the markets of the sanctioned countries, they are not from the Central Bank’s dollars.
The second is that these transfers mostly belong to foreign companies operating in Iraq that employ Iraqi employees and receive their salaries in dollars, or that have contracts with Iraqi companies that supply them with materials such as food, for example, or deliver them to them.
The contracts of these companies are denominated in dollars.
They will certainly be exchanged in the parallel market and will be an important resource for financing the market.” He added,
"This is also the case with the banks being freed from transfer control through the platform and returning to its old method by enhancing the balances of banks that have foreign correspondent banks or that have partnerships with foreign banks.
This measure will lead to reducing the period for issuing the transfer from 15-30 days to two or three days." Days, at the same cost, and the
auditing of these transfers is carried out by JP Morgan or the American Citibank,
while previously the process of auditing and filtering was carried out by the Central Bank, then the Federal Reserve, and then Citibank or JP Morgan.” He added,
"The Central Bank's measures remain insufficient because they require the support of supporting government agencies such as customs, border crossings, the Ministry of Commerce, and the stability of the political and security situation."