0 تعليقات Anees Dayoub Monday, October 27, 2014
Iraq is the latest Arab and foreign countries decide to delete the zeros from its currency because of the decline in the purchasing value of the Iraqi dinar and because of the significant rise in inflation levels.
A few days ago announced a committee of economy and investment in the Iraqi parliament, that the deletion of zeros from the Iraqi currency will be working by next year (2015).
It is noteworthy that the subject of the deletion of zeros from the Iraqi currency is not new, it was the Iraqi government project about deleting three zeros from the Iraqi dinar, to reduce inflation suffered by the Iraqi currency, but it has been postponed. He was scheduled to testify in 2011 to delete the three zeros from denominations of Iraqi currency, so that it becomes the new dinar, equal to 1000 Old dinars.
What does that mean?
First, it is necessary to clarify the fact that the abolition of zeros any currency in the world, does not mean in any way an improvement in the exchange rate, and this in turn leads to another conclusion is that the deletion of zeros does not mean as well as any improvement in the Iraqi citizen’s income, it does not mean to address the many economic problems suffered by the Iraqi economy. If that is the case, for all the world’s governments scrapped zeros from their currencies. The deletion will not address inflation and will not contribute to the aggravation, and will enhance the economic reform, that if there is any economic reform originally.
The only goal is to facilitate the buying and selling processes, and the mitigation of carrying large quantities of banknotes, and perhaps give a positive psychological boost for Iraqis, so that they feel, even if only from the door of the feeling, that the purchasing power of the dinar, has become the best. In any case, we must clarify here is the fact that the Central Bank of Iraq, the authority is independent of the government is not entitled to state intervention work.
Of course, this only theoretically, but practically, God alone knows.
If we go back to the reasons, which led to the current situation of the Iraqi dinar, it is possible to say, that, during the period of the comprehensive embargo on Iraq between 1990 and 2003, Aracaah economic crisis stifling strong collapse of oil exports, and the deterioration of the production wheel, industrial, agricultural, and high unemployment have emerged and inflation, and the lack of external debt repayment, and a chronic deficit in the state budget.
Therefore it was intuitive falling exchange rate sharply until it reached parity value of the dollar to 3,000 Iraqi dinars in 1995.
Because of this situation, it has become necessary to issue new cash categories and reached the nominal value of 250 dinars, but in fact, is not equal in terms of real value only 25 fils of the value of the Iraqi dinar during the years of the seventies. Thus emerged three numbers on the Iraqi currency. When the United States occupied Iraq in 2003, was quick to cancel and replace cash categories, in order to facilitate internal trade in everyday life, it has become necessary to add other numbers. Instead of dealing with a paper dinar and five dinars, as well as Algchrh, and twenty-five dinars, Pat dealing in the currency of the seven categories are 50 and 250, 500 and 1,000 and 10,000 and 25,000 dinars.
Therefore, the thinking is now heading to the road is easier and faster, which is deleted 3 zeroes from the dinar. The paper of 5,000 dinars category, for example, will be replaced by other Aorkh $ 5 dinars. Again I say, if the reasons for the deletion of zeros is almost confined to the psychological aspect of the desire of a high exchange rate of the currency, it will enter the joy to the hearts of all Alaraceyen, by suggesting that the dinar will return to the glorious past. But in fact, these false joy, nothing else.