Policy 02/20/2020 21:44 165
Baghdad today – Baghdad,
the Finance Committee of the Iraqi parliament, Thursday (2 July 2020), commented on news that there are possible intentions to change the exchange rate of the dollar against the dinar within the expected financial reform law.
The committee’s rapporteur, Ahmed Saffar, said in an interview with (Baghdad Today), that “until now we have not seen the draft financial reform law, but there are information and leaks, we report that there is an intention to change the exchange rate of the dollar against the dinar, but we do not know its accuracy until the moment, as there is Some deputies went for this option, and there is also parliamentary opposition to this approach. ”
And Al-Saffar said that “any devaluation of the dinar or dollar will cause inflation in prices because it will reduce the purchasing power of the Iraqi dinar, and here the affected people with limited income from employees, contracts and renters will be affected,” noting that “within monetary policy, this is the last solution to the crises.”
The economist Rasem al-Akidi warned, Thursday (14 May 2020), of floating the Iraqi dinar against the dollar, that is, reducing the value of the Iraqi dinar against the dollar, according to a proposal put forward by economists to provide additional funds for the Iraqi budget to be paid as salaries for employees.
Al-Aqidi said in an interview with (Baghdad Today), “The issuance of any decision to float the dinar against the dollar in light of the current conditions in Iraq is very dangerous for the country which is basically suffering from uncontrollable losses, namely fees, customs, taxes and many other financial resources.”
And that “the flotation does not constitute an increase in the value of the Iraqi dinar, but rather we will see an increase in the exchange rates of the dollar because of the lack of its acquisition in the global market, especially with the decline in international oil prices.”
He added that “the flotation will lead to a significant increase in prices and will be paid by the poor,” noting that “the flotation is taken in light of the stable financial conditions of the state, as well as the diversification of the economy and its dependence on resources other than oil.”
Al-Aqidi pointed out that “floating the dinar against the dollar is launching the process of buying and selling without any limits, and the country will face an unprecedented rise in prices with limited and steady salaries, so conditions will be more difficult, especially in the humanitarian context.”
Economists suggested reducing the value of the Iraqi dinar against the dollar by a value ranging between 1300 dinars or 1400 against one dollar to provide additional budget resources that allow part of the salaries to be spent, while others considered that any proposed float process may go out of control and cause a significant increase in the price of the dollar against the Iraqi dinar.