March 5, 2014,
The central bank began to examine the decision to amend the categories of the Iraqi dinar since 2010 as it seeks today to the deletion of three zeros from the Iraqi currency, a project raises many concerns on the street level and the business community in Iraq.
The delayed implementation of the project after it has been amended, the central bank more than once due to concerns based predominantly to counterfeit currency circulating in the market and the security situation uncontrolled and open market for foreign goods.
It seems that economists are divided between supporters of the project see it as an opportunity to reduce the proportion of counterfeit currency and high inflation, unemployment, and between forewarned of economic shocks may dominate the Iraqi market due to the application of this project.
Where postponed the process of deleting the zeros more than once, until the called the Economic Committee in the House of Representatives on the seventh of July of the central bank, accelerate the process of deletion of zeros from the Iraqi currency, stressing that the process of deleting the zeros will increase the value of the Iraqi dinar will be reflected positively on the issue of reducing the rate of unemployment and poverty in the country.
The aim of the process – according to the Central Bank of Iraq – to reduce the enormous mass of cash flabby, and easing inflation, which he considered the bank (monetary inflation) caused by an increase in the amount of cash pumped into the street, which invited him to foot the deletion of three zeros from the currency.
According to reliable sources that the process of deletion of zeros will be this year, noting that the measure will gradually until full absorption banknotes old from the market completely, memory that the currencies of existing and new will work at the same time without reducing the value of any of them until the full absorption currency Current or that would be (old) time.
A member of the Finance Committee in Parliament Abdul Hussein al-Yasiri: “The year 2014 will see the deletion of zeros from the Iraqi currency, to be done in coordination with the Central Bank of Iraq.”
Abdul Hussein al-Yasiri
The Yasiri that this project will lead to the reduction of the size of the national currency in circulation than four billion Iraqi dinars to one billion only.
For his part, Deputy Chairman of the Finance Committee in the Iraqi Parliament Ahmed Hassan Faizullah to delete the zeros will not change the purchasing power of the Iraqi dinar because it is linked to the size of the industrial production, import, and what saved the Iraqi dinar and whenever replaced the currency in 2007, is owning the central bank cash reserve of hard currency Osafth has formed a cover of the dinar.
For his part, said a member of the parliamentary Economic Committee Mahma Khalil said that “the current currency big bloated and not worthy of the country’s citizens have a strong desire to keep the Iraqi dinar to compete with the dollar and other currencies.”
He said: “It is possible to delete the zeros from the current currency, but it has been postponed until after the parliamentary elections, pointing out that studies are now to put safeguards in order to reduce fraud, or make sure not to current currency trading again.”
A member of the parliamentary Economic Committee Abdul-Hussein Abtan that “the increase of the Iraqi dinar against the dollar is so vital to the citizen, where not enough that we have billions in deposits at the central bank in exchange rate of poverty and unemployment and a weak purchasing power of the citizen.”
He says an economist and head of economic studies at the Center for Mustansiriya Dr. Abdul Rahman al-Mashhadani: “The process of deletion of zeros formality through which to change the face value of the coin without compromising real terms and have no raised real economic because the currency change will not lead to an increase in GDP of the country, explaining that the process is applied without any damage in many countries of the world during the last thirty years, including Bolivia in 1986, Russia in 1998, Turkey in 2005, North Korea in 2009. “
He called for Mashhadani to the need to distinguish between the process of change in real currency, which means changing the exchange rate of the local currency compared to the currencies of leadership as dollar Mthelaoho is leading to re-evaluate the prices of goods and services due to the change the real value of the currency, such as what happened in Iraq in 2007 when the value of the Iraqi dinar against the U.S. dollar to 1267 dinars after it was sold at a price of 1475 dinars in 2006, and like what was done when China devalued its currency iwan compared to other currencies even compete with Chinese goods other commodities in the world markets being cheaper.
And the expert a number of pros, where he said that the process of deletion of zeros will be provided by the new currency, considering changing the currency order will boost confidence with one of the symbols of national sovereignty of the country, and can increase confidence in the national currency with the citizen at home and the foreign investor abroad, as well as reducing process ( Dollarization) using this currency as a store of value and measurement, as well as to facilitate the process of trade within the country, and to facilitate the process of converting the dinar to other currencies.
As justification for the replacement process Vl_khasha follows:
– Gangs and mafias attempt to juggle the Iraqi currency and pumped into the local market for the destruction of the national economy, which spread recently.
– The presence of a cluster of cash has a big exporter leaves four trillion paper and worth more than $ 30 trillion dinars to the various groups, a large block size and the value in the economy is recovering day by day.
– Currently the largest category of cash is 25 000 dinars, equivalent to $ 21 almost and this requires a larger and a major effort to settle the daily transactions in terms of the time of counting, sorting, acceptance and safety and so we find the settlement of most of the daily transactions that increase Akiemha for the 20 million are in dollars.
– The presence of damage to a large proportion of the currency, especially in small denominations and inadmissible in circulation and constitute almost one-third of the money supply and not replaced gradually by the central bank.
– The difficulty of making the calculations under the numbers increase the number of Ocefarha zero for 14 of the practical and technical error occurred and the possibility of adding either zero or deleted.
From here, the process of lifting the zeros are in the attraction between economists between positives and its negatives is that there is almost a consensus that money laundering, forgery and the spread of financial and administrative corruption and economic instability will be a severe negative factors influencing the process of replacing the currency.
The Iraqi Central Bank acknowledged the existence of Banknotes fakes in commercial markets, and face Aamama to all banks to take the necessary, and detect the presence of vigorous attempts to rig the currency, calling on all government agencies concerned to fight for it if they grew up will be a threat to the Iraqi economy and a violation of his .
You will delete the zeros of the Iraqi currency off the rigged?!
March 5, 2014,
Baghdad/Al-integrityThe Central Bank began to examine the decision to amend the categories of Iraqi dinar since 2010 sought today to delete the three zeros of the Iraqi currency which raises many concerns on the street level and the business community.
The project has been postponed after the Central Bank introduced its amendments over time because of fears based on the majority of the counterfeit currency circulating in the market and the security situation and the open market to unfettered foreign goods.
It seems that economists are divided between supporters of the project saw an opportunity to reduce counterfeit currency and high inflation and unemployment and forewarned of economic shocks might prevail in the Iraqi market by implementing this project.
Where was the deletion of zeros, until called on Parliament’s Economic Committee in July last year of the Central Bank, to speed up the process of deletion of zeros of the Iraqi currency, saying that the deletion of zeros will increase the value of the Iraqi dinar will be reflected positively on the issue of reducing unemployment and poverty in the country.
The process is designed by the Central Bank of Iraq-to reduce the enormous cash lean mass, alleviate inflation as the Bank (monetary inflation) due to increasing amounts of cash pumped into the street, which is called to delete the three zeros from the currency.
Reliable sources said that the deletion of zeros will be this year, noting that the action will be gradual until full absorption old banknotes from the market, saying the current and new currencies will work simultaneously without reducing their value until full absorption current currency or the (old).
A member of the Finance Committee in Parliament, Abdul Hussein Al-yasiri “2014 will delete the zeros of the Iraqi currency, in coordination with the Central Bank of Iraq”.
Al-yasseri said that this project will reduce the size of the national currency in circulation of four billion Iraqi dinars to 1 billion.
Said Deputy Chairman of the Finance Committee in the Iraqi Parliament Ahmed Hassan Faizullah to delete the zeros will not alter the purchasing power of the Iraqi dinar because it is linked to industrial production and import volume, what saved the Iraqi dinar currency replaced in 2007 when it acquired the Central Bank cash reserve of hard currency might formed engaging cover to the dinar.
For his part, Member of the parliamentary Economic Committee mahma Khalil “current currency large bloated subhuman and that citizens ‘ strong desire to keep the Iraqi dinar to the dollar and other currencies compete.”
He said: “it is possible to delete zeros from the current currency, but it has been postponed until after the parliamentary elections, adding that studies are now to establish safeguards to reduce fraud or not trading again in the current currency.
He is a member of the parliamentary Economic Committee, Abdul Hussein abtan said that “increasing the dinar against the dollar is very vital to the citizen, which is not enough to have deposits of billions at the Central Bank against poverty, unemployment and the weak purchasing power of the citizen.”
Economist and head of economic studies at Mustansiriya University Dr. Abdul Rahman Al-Mashhadani: “delete zeros formality through which alter the nominal value of the coin without compromising the true value and there are real economic effects of the currency will lead to an increase in the GDP of the country, adding that the process is applied without any damage in many countries of the world over the last 30 years including Bolivia, 1986, Russia 1998, Turkey 2005, North Korea 2009″.
Al-Mashhadani called for the need to distinguish between the real currency, which means changing the exchange rate for the local currency compared to the leading currencies as the dollar match and he is led to reassess the prices of goods and services because the true value of currency, such as what happened in Iraq in 2007 when the value of the Iraqi dinar against the US dollar to 1267 was sold for the price of 1475 dinars in 2006 , And like what China has done when lowered the value of its currency compared to other currencies Iwan to compete with Chinese goods other goods in world markets being cheaper.
And expert Joomla pros where the deletion of zeros from the currency, saying it would change the currency strengthen confidence in a symbol of national sovereignty of the country, and can increase the confidence in the national currency among citizens and foreign investors abroad, as well as reducing process (dollarization) using this currency as a store of value and measurement, as well as facilitate trade within the country and facilitate the process of convert KWD to other currencies.
Either on the justification for the replacement process is summarized as follows:
-Try to gangs and mafias of counterfeiting Iraqi currency and injected into the domestic market to destroy the national economy and the recently.
-A great source of cash block with its 4 trillion paper worth 30 trillion dinars in various categories and are large block size value in the economy is recovering day by day.
-Currently the largest denominations is 25,000 dinars, equivalent to about $ 21, this involves size and great effort to settle daily transactions in time for counting, acceptance and security, therefore we settle most daily transactions exceeding one of the 20 million are in dollars.
-Is damaged by a large proportion of the small groups and private currency inadmissible and constitute almost one third of the money supply and not replace them out by the Central Bank.
-The difficulty of performing calculations with numbers increase her zeroes 14 zero in practice and the probability of error occurred either by adding zero or delete.
From here the process raise zeros is attraction among economists between cons and pros, but there is near-unanimous agreement that money-laundering and counterfeiting, administrative and financial corruption and economic instability would be very negative factors influencing process replace currency.
The Central Bank acknowledged the existence of counterfeit banknotes in commercial markets, and uncles all banks take, revealing attempts to counterfeit currency, inviting all the relevant actors to fight it if you would be a threat to the Iraqi economy and violation.