On: Wednesday 19/09/2012 07:56 am d. The appearance of Mohammed Saleh in light of economic conditions and volatile financial and inflationary pressures that has befallen our country before, and led to negative effects on the regularity of the commercial market and labor markets and production and citizens ' standard of living, has generated many distortions in the structures and economic relations, and which included the presence of mass cash, many zeros, of little value, and in a manner not commensurate with future developments in the present and future of the Iraqi economy, which requires a Solution to these circumstances and offal, of these solutions fix the cash management system through restructuring and delete the zeros to control the flow of money supply cost management optimally.
Trading block cash from more than 37 trillion Iraqi dinars in various categories and the number of cards in circulation amount of 4 billion banknotes are the product of a long phase of inflation, economic decline, for example consumer price index, based on 1993 100 to 200,000 in the year 2003, which means that the goods that were sold for 100 dinars became sold 200,000 dinars. And so on. Under such circumstance, the deterioration of the value of the currency of currency category rose 25 dinars to 25,000 dinars, which means that inflation is adding these zeros. * Current currency categories are not commensurate with the current and future economic situation. For example, such as the outbreak of the Iran-Iraq war, the class was equivalent to $ 75 25 dinars, purchasing power, so the time or equivalent at the moment 300,000 dinars. I've also added inflation in the country over three decades Isfara to currency, though this did not raise those zeros of the purchasing power of the largest category of currency, the 25,000 dinars, which Equal to $ 21. We need to restructure the currency. The big zeros mean big cash block in circulation today is some 30 trillion dinars which requested Tadawul direct cash and at great cost in counting and spent time and spatial characteristics. In the price system, the price is the value, expressed in cash, then the cost structure and wage payments and payroll transactions, all of which are wakiam are not commensurate with the needs of the country to the cash management system, consistent with the structure of the real sector and the price levels. The country needs to easy handling and monetary system of the small and large categories reflect the real cost of that structure. (See details in the margin of the page later). And note that during the period 1990-2007 increased inflation CPI% to 400,000, with a view to streamlining the product that was sold to 100 dinars before the start of the war Kuwait in 1990 became sold 400,000 dinars 2007. Note that the value of the Iraqi dinar fell twice and during the period 1990-1998 at a rate of more than 99% against the US dollar. The decline was in 1990, and the other was in 1997, and by 93.2%, making the total decline in the exchange rate of the Iraqi dinar against the dollar (minus 99.99%) At the end of 1998, and that during this period alone the inflation in the CPI 45,000%. Taking what we learned that inflation means higher prices for the same money cash price for goods and services (i.e. how much money we need to exchange the specific package of goods and services ... the more money allocated to increase the amount in exchange for the package itself mean that there higher rates of inflation or money). Noting that the value of money is inversely proportional with the cash price, and that price is the value of the goods and services reflected cash *.
(*) Refers to social studies income monthly Iraqi doctor was not equal as purchasing power in the 1990s only buy 30 chicken eggs and 20 pieces of bread in that month, and over the years the economic blockade. Many workers in the different institutions has quit working for the monthly revenue does not cover transport costs to the workplace. And don't forget how I created the barter markets distorted by materials used for furniture and durables and apparel to buy flour or sugar and fill the minimum food needs of families. And the agricultural sector by itself as a food producer sector had deteriorated conditions since the 1970s due to degradation of the countryside and indulging in oil rents in public office and the militarization of the country, during the period 1972-1982, for example, the annual growth rate in the agricultural sector (minus 1.1%). While the rate of growth in the sector between the years 1962-1972 amounted to 7.1% annually. With all commodity sectors witnessed growth during the 1990s and particularly agriculture and industry.
Today, the average per capita income [You must be registered and logged in to see this link.] increased Iraqi annual gross domestic product to over $ 5300, does not exceed $ 750 before 2003. The average Government employee income almost twice the average per capita GDP is estimated at about $ 10,000 per year. Since the money is anything agreed to become a mediator of Exchange and a store of value and unit of account, the money (legal) issued by the Monetary Authority under the law and force the discharge of liabilities, is seen as a social institution Social Institution, where the efficiency of the economy and its move efficiently Exchange that money no social institution and vice versa. Inflation has continued to rise in the currency number of 23 billion dinars in 1991 to about 30 trillion dinars at present, higher class done 25 dinars to 25,000 dinars over time. Thus, draw new numbers inflation currency by adding three zeros which has increased the amount of Nominal cash operations and arranged the production costs of large quantities, storage and distribution operations accompanied by the promise of rice and accompanying check, double standards, helped to increase the operational risks associated with Operational Risk under price stability and optimism to the future development of Iraq is necessary radical reform, currency management system by structure commensurate with the new price structure is different and stable levels of wages and salaries which differed significantly from the last thirty years, as well as deal with large cash block weak components are the largest category Do not equal to only 21 dollars at present. Noting that the rise in GDP for Iraq from 140 billion dollars at the end of the year 2011 to more than 230 billion dollars at the end of 2015, will increase the money supply issued 37 trillion dinars to about 70 trillion dinars. Poor composition and structure of the currency as mentioned above has taken the cost adds cost cash transactions are called terms of trade both between individuals themselves, individuals and banks within the banking system itself.
* Become the demand for US dollar (especially the $ 100) an urgent need to settle cash transactions in the domestic market outside the will of monetary policy that the market looks in its dealings to larger groups are not available currently but reflected the large American currency category for easy carrying, circulation to reduce the cost of trading cash or cash transactions. So the Iraqi monetary system has become an urgent need for reform of administrative system of cash payments for cash are categories of high purchasing power, easy to carry and acquisitions, facilitating exchanges cash for transactions or trading. Noting that the imbalance in the structure or composition of the current currency units has the depth of problems (the State) that are arranged on the effectiveness of the undesirable effects and performance of monetary policy. In Sweden for example, having being one of the best cash payment systems in the world, however, the cost of cash circulation of delegation made and transfer and storage of the coin, costing the national economy by 4% Of Sweden's GDP. How do we compare that in a country like Iraq managed by huge cash amounts thus weak composition, which adds the cost of cash transactions possibly up to 8% or more of GDP, a burden borne by the individual in his dealings, taking reduces efficiency of criticism as a social institution support to institutions of different economy including market, and proof of this is significant cash transactions for payment in USD, which means another currency substitution in circulation to assign cash transactions because of falling efficiency and installed the current money supply. Raises the multiplicity of zeros on a currency with low purchasing power have difficulties are difficult to express in monetary terms, as well as the difficulties of monetary operations and technical problems in registering and recording of statistical data Accounting books and change computer systems and settlement systems, as well as show price figures long difficult to sometimes even counters or digital devices from reading its zeroes at gas stations or other digital devices. On this basis, there is a need to reform the system of cash payments through the following advantages: i. horizontal: delete the three zeros.
-Conversion 37 trillion dinars to 37 billion dollars by deleting three zeros from the current currency and replace it with a new currency which makes it easier to deal with numbers arithmetic are fewer in number in the federal budget accounts, balances banks and businesses, as well as family balancing (individual) without cash to arrange any change or alter on income or wealth cash for natural persons and moral, as well as its impact on engagements and obligations of natural and legal persons. Known as the generation of homogeneous function of degree zero sports Homogenous Function of Degree Zero, as long as the amount of new money to cover a smaller in terms of commodity package itself The largest number of old money. On this occasion, like David Hume (one of the pioneers of Economics preschool classics in his famous political debate or Political Discourse of political debate in General 1752) impact of nominal price levels with a high amount of money such as the transition from Roman numerals to Arabic numbers (numbers English currently), this move does not change the basic principles of arithmetic or mathematics. High amounts of money leads to higher prices for the same results without affecting the real economy. II. vertical level: restructuring and currency The large category of 25,000 dinars are alone (two thirds of the amount of paper in circulation) the issuance of larger groups reduced implies four billion banknotes in circulation and convert it to a number equal to (01.18) billion banknotes. While large groups will write shorthand of the coin approximately 80%-90% of the total exported to new categories (such as groups of 50, 100, 200 new dinars). Based on the foregoing, the cost of cash transactions between individuals, banks and between individuals themselves natural or moral, in terms of costs would inevitably counting and auditing. If known, the banknotes in circulation are being eroded by medium During a period of five years which means enormous block replacement installation costs and weak printing with high security specifications is another burden on the authority of the critical edition is the remnants of a cash management system, generated by the previous economic downturn, have become disproportionate to the desired stability and economic progress. In conclusion, the reasons for changing the current currency reflects the fruit of economic stability and the success of the Iraqi Central Bank policies in maintaining stability, the stability of the Iraqi dinar exchange rate and inflation to one decimal place and build foreign reserves to support Iraqi dinar achieved unprecedented levels over the past 30 years, which is a cover of the Iraqi currency. In addition to improving the Cash payment system and make it leave if the current structure and its imbalances and economic reconstruction [You must be registered and logged in to see this link.] percent on future economic development and the impact of real and nominal terms. Therefore, the CBI has prepared a strategy viable long-term future when appropriate opportunity gradually, in accordance with clear instructions and regulations, provides protection to the various rights and interests, to stage the next prosperity and economic growth forecast, where average per capita income will increase in the coming years to more than once, and the economy would take steps towards progress which would require a reform of the remnants of the stages of inflation and would probably require some legislation in this regard. The Deputy Governor of the Central Bank.
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