Iraqi Econimists Network


Economist: the issuance of a class 50 000 dinars, will not contribute to the stability of the market

November 12, 2015 - 15:02

Economy & Business

Alsumaria News Details Back
Economist :...
Alsumaria News / Baghdad 

confirmed former economist at the Central Bank of Iraq on behalf of Abdul Hadi, Thursday, that the issuance of 50 class thousand dinars will not contribute to the stability of the market, stressing that large transactions are covered through the dollar. He said Abdul Hadi in an interview with Alsumaria News, that " the issuance of monetary Category 50,000 dinars by the Central Bank will not contribute to the reduction of non-market stability, especially price index of the market and inflation, "he said, adding that" there are changes in the data economies on the ground and contraction of the Iraqi economic reality. "said Abdul Hadi said" this Category cash would raise imposed on a bank in the management of operational costs and the organization of the currency, "explaining that" there will be no desired results to facilitate transactions. " He said Abdul Hadi that "monetary category currently in circulation, amounting to 25 000 dinars are sufficient to deal them through individual transactions and companies, while the big deals are covered through the dollar." The Central Bank of Iraq, on Wednesday (November 11, 2015) for issuing New banknotes fifty thousand Dinars category, attributing this to the completion of the Iraqi Securities monetary structure and the development of high value in the trading category.




Economist: deletion of zeros from the dinar is necessary but it is premature

Saturday, May 16 2 015

Economist: deletion of zeros from the dinar is necessary but it is premature

BAGHDAD / Dar es Salaam

The economist said, the Secretary-haven, that: the restructuring of the dinar and deleting three zeros from the process are necessary, but the implementation of it but he also premature for the lack of economic, financial and security conditions that ensure a positive impact on the national economy.

The Secretary in a press statement, I followed (Dar es Salaam), "The restructuring of the national currency project is very important and the process of deleting the zeros Mnhadharorah to stop rising inflation in the currency figures, which made ​​traders and contractors are reluctant traded on the internal and external transactions and replace it with cash in foreign currencies, especially the dollar ", adding that" this is reflected negatively on the currency and the value of its power and popularity and speed of circulation, in addition to the confidence of the citizen. "

He added that "the project to delete the zeros put up eight years ago, but the study and application of mechanisms passed many obstacles delayed its implementation, including the agreement on the form of the new currency and provide financial guarantees to be printed and safety for not rigged amounts."

The Secretary "the importance of the economic, financial and political conditions are met prior to the implementation of the project to ensure its success and benefit from in terms of cash transactions internally and externally and put competitive strength coin," noting that "part of the conditions is the security and the political stability that followed economic stability with the diversification of income sources National and the development of productive sectors and to ensure sustainability and support the national currency exchange rate against the dollar ", adding that" these things are all currently Ataatovr, and that talk on this subject is premature. "

He continued that "the national currency's strength is currently affected by the oil quantities exported and the price per barrel is stable, in addition to opening up the doors of depleted budget spending through fighting the terrorist Daash buy weapons and equipment gangs and relief to the displaced with reconstruction campaigns, and other expenditure sections that negatively affect the value of the Iraqi dinar against the dollar, "noting that" the stable economic environment in the country offers is very important to ensure the success of the restructuring process of its currency and to delete the zeros of them with positive repercussions on the national economy in general. "

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Specialists call for reconsideration of the banking sector to activate the Iraqi economy

Specialists call for reconsideration of the banking sector to activate the Iraqi economy
05/04/2015
BAGHDAD / long-Presse

Counting specialists, economists, on Sunday, that the legislative and financial obstacles highlighted the problems faced by the Iraqi banking sector, while criticizing the conflict of the implementation of the Iraqi Central Bank instructions between private and public banks, called for a reconsideration of the work of this sector and to find capable banking system to attract investment and management of the country's resources.
The director of the Euphrates Center for Development Studies strategy, Khaled Aerada, in an interview to the (long-Presse), said that "the Iraqi banking sector, private and public, are suffering real problems most notably the legislative and financial obstacles", it returned it necessary to "shed light on those barriers and treatment."
He Aerada, that "the proportion of foreign investment in Iraq is low and not exceeding the 2 percent of the total investment," ruling out "the possibility of activating the Iraqi economy and achieve sustainable development without capable of attracting investment and management of the financial resources of the country by about an integrated banking system."
He called on the Director of the Euphrates Center for Development and Strategic Studies, to "re-examine the work of the Iraqi banking sector and find solutions that reduce losses in the current financial crisis in the country."
For its part, Director of the Trade Bank of Iraq in Karbala, Uras Abdel-Nour, in an interview said to (the long-Presse), said that "the Iraqi banking sector suffers conflicts of implementation of the Central Bank of instructions between the private and public sectors", calling for "the unification of labor between banks and private systems and the year. "
So economist said Ahmed Rehn, said in an interview to the (long-Presse), said that "the Iraqi banking sector faces caused by the work environment risks, and the limited resources available to credit, as well as other administrative problems," noting that "banks suffer big debts are difficult to restore what It increases the size of the loss and reflect negatively on the interest rates. "
Rehn added that "banks independent economic entities councils departments and their capital, and it has to devise effective solutions to their problems and to convince the State by the possible application commensurate with their resources," pointing out that "the state can help in improving the banks conditions and improve their performance."
Meanwhile, the adviser said the National Investment Commission, Abdullah al-Bandar, in an interview to the (long-Presse), "The banking sector suffers many obstacles related to the banks themselves and their boards of directors and shareholders and limitations of the central bank imposed on both private without government".
He revealed al-Bandar, for "having problems legal Balaanaat and complaints from the money that is holding in banks and can not be disposed of," returned to "the banking sector's problems need to be radical solutions will not be identified, only direct meeting between decision-makers and concerned government agencies and the private sector."
He criticized the National Investment Commission adviser, "the Iraqi banking sector failure has led to the reluctance of many investors from entering the local market, and form a negative factor, plus the security and economic problems", calling for the need to "restructure the Iraqi banks."
The bankers and economists, carried in (15 May 2013), the Ministry of Finance and the Central Bank of Iraq responsible for the decline and the reality of local private banks, while the latter accused of encouraging Arab and Iranian banks on the Iraqi account.
The International Monetary Fund said in a report issued in (the 21st of March 2013), that an improvement in the financial sector, but stressed that it still needs to be greater by the central bank in the revision of monetary policy and strengthen banking supervision tools efforts, and to accelerate the restructuring of the banking system .
And the Iraqi banking system consists of 54 banks, including seven state-owned newly established Islamic one, and there are 23 private commercial banks, including Islamic nine. There are also 15 branches of foreign banks, and there are many institutions that do some banking, of which 34 money transfer company, and nearly 200 belonging to the banks foreign exchange company or deal with the banks, with the Loan Guarantee Company and to finance small and medium enterprises, with two companies for services of electronic banking and card Smart, in addition to nearly 800 branches and subsidiary banks spread over Iraqi provinces.

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The economic and investment commission hosts the Governor of the Central Bank

May 03 .2015

The economic and investment commission hosted on Sunday, 05/03/2015, headed by MP Jawad al- Chairman of the Committee and the presence of Messrs members, Mr. Ali Keywords Governor of the Central Bank to discuss the monetary policy of the Bank and ways to encourage the private sector.

The head of the economic and investment commission during the meeting that it is important at this stage where the country is suffering from the financial and economic crises that operate fiscal and monetary policies to promote economic reality which is viewed with hope for investment and the private sector. "

He said al-Bolani said on relevant policy monetary act now and quickly to invest the money supply available and channeled properly to support private sector companies and banks sector, and here this liquidity will work as an engine driver of investment which will generate additional financial returns and increases the total national income and gross domestic product (GDP).

For his part, Governor of the Central Bank announced the completion of the final touches to issue a new currency of 50 000 dinars category which would reduce the volume of cash in circulation.

He Keywords that the central bank began lending process biggest banks sector and private banks and invest the money in investment projects and also support various economic sectors such as agriculture, industry, housing and others.

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Superficial inch recommended the collection of the tax from the oil with determining the value of the dinar as a springboard for development

Superficial inch recommended the collection of the tax from the oil with determining the value of the dinar as a springboard for development

Superficial inch recommended the collection of the tax from the oil with determining the value of the dinar as a springboard for development

Author: Muhammad Salim on: April 15, 2015 

Interviewed by: Laith Mohammad Reza

BAGHDAD / Center Brief for the Iraqi Media Network (IMN) - recommended the General Coordinator of the Network economists Iraqis Superficial an inch, that the reform of the Iraqi economy begins and solve the dilemma rentier, building efficient tax system starts from the oil sector itself, because the diversification of the production base strategy can not be the beginning economic development, because they will not give quick results but you may need to dozens of years, indicating that the start to raise tax collection from the oil sector efficiency, are after the separation of the oil companies produced and marketed by the Ministry of Oil administratively and financially, and the revival of the national oil company as a holding company include all production companies marketing and liquidation.

The Central Bank of Iraq urged the peg to the US dollar, a fixed exchange rate with the devaluation of the dinar and not 1,500 dinars, stressing the need to carry some of the negative effects of this decline.

He called an inch in an interview with the Center Brief, for dialogue between the central and the private sector, especially traders, to agree on a contingency plan and a national face of declining oil revenues, the development of standards to audit the import requests and identified as necessary and important, national necessarily and convince them to reduce the value of the Iraqi dinar, because they have to lobby influential rejects reduction currency, "and urged the central bank to resume publication of demand for the dollar and the amount of data met, whatever the mechanism in place, because the central stopped publishing data currency auction disrupted as analysts and reduced transparency.

He told (IMN), that "the mentality of a lot of politicians and decision-makers and even some economists are still wedded to the concepts of the command economy, has already warned us of restricting the supply of foreign currency, and we have said that this restriction would encourage the parallel market and this is what is happening today, as there are two prices for foreign currency in the market, "adding that he" can accept this procedure in the near term, but in the long run should have a solid base material to withstand external shocks. "

He said an inch, an international consultant, that "the peg to the dollar and stabilizing the exchange rate, will pull the rug from under the feet of the currency speculators who are making obscene profits at the expense of the Iraqi economy."

"The first benefits of devaluation will stimulate the agricultural sector, because it will make imported goods more expensive than the local product, and this encourages farmers to move the agricultural economy, while still the infrastructure of the industrial sector is weak and need a long time to stimulate, and the yield rapid positive will come from the sector agricultural ".

He said an inch, "I disagree with my colleagues experts who focus on the need to raise customs duties as a tool to protect the domestic industry, forgetting that we do not have the infrastructure to move the industry, and the collection of customs system is very weak recognition of its officials", recommending a "limited package to impose duties on imports of important industries in Iraq, such as cement, which deserves temporary protection. "

He stated that "we have to ask why escapes national investment? Before looking at attracting foreign investment, noting that production costs in the Iraqi industry is very high, and the investor has choices and temptations in other countries ", noting that" 25% of the investment in the Jordanian industry is the Iraqis to investors, and that the Iraqi investments in Jordan reached 37 Billion dollar ".

He added an inch that the "international economists are talking about the external shock in decades, Network economists warned of access down the price of oil research expert Ali Mirza was published in January 2012, but officials are now talking about it outside their control and they were surprised, and analytical surprise this is that they are not interested in past years, the economy did not listen to the advice of economic efficiencies, and did not prepare preparing special circumstances did not take advantage of the abundance of oil prices, "pointing out that" there are important measures that can be taken in preparation for the drop in oil revenues, Norway, for example, oil country and has a fund balance, its assets amounted to nearly a trillion dollars, as well as Gulf oil states. "

In response to a question about the public finance policy, General Coordinator of the Network Iraqi economists said, "The Iraqi financial and political crisis is a crisis rentier state in the era of globalization, you buy the loyalty of citizens em- ployment, and relies on oil revenues that have not stabilized since nearly 40 years, Too much spending and the absence of strategic vision of public finances, compounded by the impact of the external shock of the collapse of oil prices. "

He spoke an inch for a proposed national oil company, saying it "is a contribution in the first phase and its shares King of the Iraqi state in the first phase and to contribute to some of the ministries where, then sell the stock then starts the categories under social Court guarantee the achievement of national harmony, social justice and social peace, which will depend study the method of distribution. "

"The shareholders of this company will pay a tax of up to 75%, and with this we will find the owners of capital rather than struggling to drain cake oil revenues, they will become in solidarity and are keen to develop the oil sector and the accumulation of this wealth," noting that "most oil-producing countries no where national oil companies operating across the border, including the Republic of Angola. "

He continued that "the existence of the national oil company will encourage the front-oil industries such as petrochemicals and plastics and fertilizer industries and the rest of the industries that will contribute to a revival of the agricultural sector."

With regard to the treatment of the electricity crisis, inch said that "many countries have preceded us 30 years ago in the development of the electricity sector, and I personally contributed to the study of the restructuring of the electricity sector in Argentina and in Jordan while you're Adair project rationalization of electricity consumption within the German Technical Cooperation Foundation," explaining that "electricity sector reform should begin with the separation of production from transmission and distribution in the sense restructuring of the electricity sector and entrust production of investment firms next to public companies, to keep the Ministry of Electricity Organization and Supervisor of the electricity sector, you buy from your product and sells to distributors who are selling and Aajabun at a specified price by the ministry."

He added that "transportation entrust public company government is winning establish and is likely to pay their costs, while distribution be left to private companies, and I see that generator owners gained experience in the collection of funds, but succeeded more than the state in this task and should integrate them into these companies at the district level In residential neighborhoods. "

Turning to an inch that "the government's strategy to stimulate the private sector a good sign for optimism, because it this time with the participation of experts from the private sector, and economists Iraqis network is ready to support this initiative proposals and observations."

He drew an inch to the "Network experts are economists rattling the testimony of the international organizations that have worked in and gathered enormous experience and contributed to the construction of other countries economy, and one of our network objectives is to mobilize economic efficiencies, and melted down in Iraq, building operations, as well as disseminating economic culture on the political level At the level of the citizens, and the third goal is to create an economic lobby pressure on the owners of economic and political decision to give enough to the process of economic development and the importance they give priority to partisan political interests, we have succeeded in creating Iraqi opinion in favor of the fundamental issues in the economy. "

He said an inch "have contributed to the discussions the central bank problem and the issue of the national currency stability, and we have research mission, and participated in public budgets discussions for several financial years and provided proposals, also participated in the assessment of the National Development Plan 2013- 2017 and provided advice to the Deputy Prime Minister on this document."

He stated that "the network is currently working through a team of IT experts to prepare a proposal for the development process of the financial budget and the electronic link the Ministry of Finance and other ministries preparation, and follow-up implementation in order to adjust spending and the development of management techniques and stress experts that we are offering our services to the officials for free, as we announced in the first scientific conference which was held in 2013 in Beirut, and the network is funded activity self-donation of some of its members and work the whole voluntary subscribers, for example, I personally I used to get paid per day up to $ 800, when I was working with international organizations, but defended the work of the network and Tunai- moral and want to contribute to building the economy of Iraq, because we believe that the economy is the material basis for human freedom and democracy and social peace. "

He added that "in Consultative Relationship with the officials still in its infancy and some officials and institutions asked us advice and some of them asked us to give him a plan of action, and so we have actually integrated proposals and plans to raise the performance efficiency."

"We are optimistic after the formation of the current government, which appeared to be interested in the competencies and We are encouraged to appoint our colleague, a member of the network of Iraqi economist and expert economic Mahdi Keywords as director of the Office of the Prime Minister, as well as appointing our colleague founder of the network appearance of Mohammed Saleh adviser to the prime minister, as well as were excluded Adel Abdul Mahdi oil He is a member of the network, and assured us that he will take part and support the second scientific conference of the network which we aspire to be held in Baghdad in the fall of this year. "

Photograph: Ali Hashim

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Economist reveals the "real solution" that will raise the value of the Iraqi dinar
04/12/2015



Economic expert on behalf of Antoine, Sunday, said the cancellation of the zeros of the Iraqi currency project comes to restructure and reduce the currency in circulation process in the markets at the moment, "dollarization".

Antoine said that the process of removing zeros from the currency is a project under discussion at the State Commission in collaboration with the Central Bank, but under implementation, "stressing that" the purpose of which is to reduce the process of dollarization in the current market time to maintain the dominance of the Iraqi dinar and make it the most actively traded in the markets and ease the use of the dollar. " , noting that "the Iraqi currency sober and accept fraud."

He added that the confusion that demand for the dollar and not pumping dinars in large quantities by the central bank increased led to increase more demand than supply, which led to the appreciation of the currency from the dollar in the local market. "

"The Central Bank on the terms of any transfer must be proved in the papers martyrdom on the import of goods against the dollar, with the imposition of the tax, which is 8% 0.5% fee Comerk and 3% income tax."

http://www.faceiraq.com/inews.php?id=3711468

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الأحد 12 أبريل 2015 | 11:57 صباحا
| Number of Views: 826
Economist: Cancel zeros from the currency will raise the value of the Iraqi dinar against the dollar

Baghdad /...qal economic spokesman Antoine, Sunday, that the expert Cancel zeros from the Iraqi currency project comes to restructure and reduce the currency in circulation process in the markets at the moment, "dollarization".

Said Antoine's "Eye Iraq News" that the process of deletion of zeros from the currency is a project under discussion at the State Commission in collaboration with the Central Bank, but under implementation, "stressing that" the purpose of which is to reduce the process of dollarization in the market this time to maintain the dominance of the Iraqi dinar and make it the most heavily traded in the markets and ease the use of the dollar, "adding that" the Iraqi currency sober and accept fraud. "

He added that the confusion which has increased demand for the dollar and not pumping dinars in large quantities by the central bank has increased more demand than supply, which led to the appreciation of the currency from the dollar in the local market. "

"The Central Bank on the terms of any transfer must be proved in the papers martyrdom on the import of goods against the dollar, with the imposition of the tax, which is 8% 0.5% fee Comerk and 3% income tax." Ended 7










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About the IEN                           

Despite relatively high growth rate achieved in 2011 and expectedly in 2012, the structure of the Iraqi economy is still dominated by the oil sector, which is presently the main dynamo for economic growth in Iraq. The Iraqi government economic policy failed to introduce major institutional and structural reforms that can lead to a dynamic and sustainable growth, particularly in the non-oil sectors. Public investment policy failed short of achieving set targets to rebuild infrastructure and to provide basic public services such as electricity, water, sewage, health care and education.

The Iraqi Economists Network was founded in 2009 aiming at:

  • Mobilization of Iraqi experts and professionals living outside the country to promote the transfer of know-how and expertise through networking and interacting with Iraqi economists working inside Iraq and initiating joint research and capacity building projects.

  • The formation of an actively involved group of experienced Iraqi economists offering professional participation in decision-making processes related to policy measures aimed at reforming and rebuilding the Iraqi economy, such as those related to the formulation of sustainable development strategies, programs and economic policy measures, as well as projects related to transparency and good governance.

  • Provision of advisory services to Parliament and decision makers in government agencies as well as promoting scientific research in Iraqi universities and research centers by linking them with international think tanks and academic institutions.

  • Promoting awareness of economic issues among policy makers and government officials, members of Parliament and political parties as well as among civil society organizations.

During the last three years, the IEN has established an active online forum for dialogue, which has attracted increasing number of qualified Iraqi economists and oil experts worldwide as members. Views are exchanged in lively debates on present economic issues such as monetary policy, inflation, fiscal policy, oil policy, oil service contracts with the International Oil Companies, trade policy and the introduction of tariffs. The Arabic Website was launched in August 2011. Both have marked the beginning of active interaction and linkages among Iraqi economists working worldwide. This reflects their commitment to help their home country to overcome the state of underdevelopment and assist in the formulation of a coherent development strategy as well as effective economic policy. Furthermore, the process underscores their high motivation and willingness to contribute to the reconstruction of the Iraqi economy and sustainable economic development in Iraq. The launching of the English version should mainly serve to achieve the objective of the IEN with regards to linking Iraqi economists with the international academic and research community as well as promoting the process of know-how transfer into Iraq. The IEN also envisages the promotion of development co-operation projects with Iraq.

IEN is a non-profit and politically independent NGO

Founder and coordinator: Dr. Barik Schuber

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Iraqi currency and economic imbalances and structural value

Iraqi currency value

Economic and structural imbalances

D. Kamal Al-Basri and professor harmful Sbahi

Iraqi Institute for Economic Reform

The article seeks to study fluctuations in the value of the Iraqi currency and interpretation of structural imbalances and the weakness of the application of good governance vocabulary behavioral and other factors. And concludes that the following factors may have led to increased demand for foreign currency and the lack of supply: foreign policy, and the weak economic business environment, fiscal policy, and the lack of political and economic instability, and weak domestic productive capacities, and the improvement in the Iraqi per capita income was a factor is the other, and the weakness of good governance and the rule of law, and the decline of family remittances from abroad, and the growing presence of remittance companies and brokerage firms (parallel market), and the emergence of trade areas in the border ports.

Progress thanks to Dr. Ahmed Hamdi al-Husseini to his participation in the preparation of this paper

Iraqi currency and economic structural imbalance value

Article seeks to study fluctuations in the value of the Iraqi currency and interpretation of structural imbalances and the weakness of the application of good governance vocabulary behavioral and other factors.

1. Structural imbalances

Iraqi currency derived from the contents of the economy recover, and it can not study the stability of the currency value of eating away from economic reality. Currently the economy is suffering from weakness in the core of its components, and boils down to the reality of the Iraqi economy by looking at the gross domestic product for 2011 components accounting for the different sectors to GDP as follows: Oil 54.74% and Agriculture 4.15% and the industry about 1.83% .... Etc. It is clear that the Iraqi economy's dependence on the oil sector. GDP, the value of the current 53 499 prices have risen to 211.31 billion Iraqi dinars for the period 2004-2011, for the same period GDP at current oil prices, excluding value increased from 22 691 to 95 822 Mlyardinar.

The problem is, when oil revenues are much greater than the financial returns obtained from taxes, the government will find usually a financial asset at its disposal a large gain easy (no checks on the financial resources of the citizens account). This phenomenon will be encouraged in the absence of democracy (full sense of the term) to give the government a large area to act in public money is inefficient. An example of this resort for governments to adopt:

1) sterile economic policies in the aftermath: represented an increase of salaries and wages away from labor productivity accounts, and expansion in the creation of employment for non-productive purposes resulting from them inflated prices, and pursue a policy of supporting non-economic updated deformation in the structure of the economy and market signals, and the trend towards spending is a political product In essence, aims to connect the citizen power.

2) non-economic policies of spending: represented activities have no economic justification such as grants and aid and open diplomatic and foreign cultural circles do not add real value to the economy and citizens, and this is at the expense of pressing economic areas related to the dignity of the citizen.

A result of all the foregoing, the private sector in these countries enjoy the presence of a weak and marginal, because he does not enjoy the support (as is the case in the public sector), which is concentrated in the commercial and service areas of the economy. The absence of the real role of the private sector means the absence of creativity and speed of adaptation to the needs of the market and provide workers outside the public sector. The uniqueness of the public sector production and the absence of private sector competition will lead to the continued deterioration of the efficiency of the public sector production infrastructure to require government intervention and the protection of the public sector through financial support and policy of customs protection (currently support the annual rate of $ 3 billion). Thus, the government is working to protect the productivity of organizations inert citizen who finds unchanged compelled to buy goods or services at a higher price and the quality is poor account. That this sacrifice is usually also emphasizes international experiences do not lead to short-term and term to improve the performance and efficiency of the public sector production. The absence of a political role for the private sector to prevent citizens cake and staff hired for the government belonging to the orientations of the government, and undoubtedly it would affect the independence of the individual from the government and then the breadth Square independent civil society organizations. The government's move in those contexts eventually lead to the division of citizens into different factions of the beneficiaries and others.

Because of the limited job opportunities that can be created by the public sector, the government is seeking to create jobs by strengthening the role of the security of power by increasing the number of employees of the police and army and take advantage of surplus cash in the purchase of arms and military equipment. That encourages the growth of military capabilities to address internal and external differences militarily, and then pre-empt any signs of growth and development in absolute terms. On the other hand the oil revenue dependence on the price of oil to the global market presents economies of those countries to the waves of the tide, which is reflected in the sharp fluctuations in oil revenues (as flip it in the federal budget for 2008 planning - 2009. Finally, the oil revenues of the states usually benefit including the cities over the countryside, and this is what causes the case of migration from the countryside to the city, but no doubt that this migration is usually in a short period of time, resulting in severe bottlenecks due to inadequate supply of services in relation to demand and to multiple social and economic problems. But Aaktefi impact of this situation on the the level of services available in the city to exceed the weakness of the countryside contribute to agricultural and livestock production and for changes in the fertility of the land, which lead to heavy losses. The truth is that what progress can we find him credibility in the Iraqi economy, especially during the time period 1968 - 2003, is no doubt that the effects of these policies and nature has not radically changed, because of the political pressure of existing and reflected the lack of political will for change.

2. The market value of the Iraqi currency

Released in 1930, the first special law to issue currency Iraqi Dinar, and in 1932 was the issuance of the Iraqi dinar and the dinar = 3.3 pounds sterling, and in 1958 was decoding dinar link with the pound has been linked to the US dollar on the basis of the dinar = 3.3 US dollars. During the period from 1932 until 1990 was issued 12 emissivity of the dinar, and after 1990 the currency was printed locally in Mesopotamia presses and multi-exchange price, and after 2003 were printed issue new coins of the dinar, and became the exchange rate floating around. Figure (1) the exchange rate of the Iraqi dinar against the official explains the US dollar at the Central Bank (Auction currency) and in the parallel market (the local exchange market) for the period from January 2011 to February 2013.

Source: Central Bank of Iraq

The local currency is part of the sovereignty of the state and also is reflecting the amount of economic well-being, and the exchange rate plays an important role in the economic activities of the countries whether it be a commercial or investment activity, where it occupies the exchange rate a pivotal position in the monetary policy, where it can be used as a target or a tool, a as well as the indicator of the competitive state through its impact on economic growth components, such as investment and the degree of openness to international trade and capital flows, and the evolution of the financial sector.

The exchange rate is the rate that gets on the basis of foreign exchange swap national currencies. The exchange rate is determined according to the law of demand and supply, the more the demand has increased the price of the currency has increased and the lower the demand for less price. There are two types of drainage systems used by States to determine the value of its currency:

Fixed exchange systems: Install the currency exchange rate is either the single currency is characterized by certain specifications force it and stability. Or to a basket of currencies from the currencies of key trading partners, currency or constituent unit of the Special Drawing Rights, or Althmnah such as gold and silver metals.

Flexible exchange systems is characterized by its flexibility and usability of the amendment on the basis of certain criteria, such as economic indicators.

State may follow orbit flotation system where the authorities to amend the frequency of exchange rates on the basis of the level of reserves for its gold and foreign currencies. Or free-floating, which allows the value of the currency used to the ups and downs vary according to the market, this system allows the economic policies of liberalization of the exchange rate restrictions.

Itathersar exchange first measures of the Central Bank, which represents the main administration in the state to identify and manage the monetary policy so as to contribute to the achievement of economic goals for her country, and secondly banks and commercial companies remittance where intervene in the market to implement its customers orders or for its own account, where these centers collect Customer orders are banking Palmqasat, and thirdly brokerage firms and brokers who are active are compiled Omer purchase or sale of hard currency for the benefit of several banks or other customers away from transparency.

Factors affecting the currency in Iraq

Recently and over the past few months, the value of the Iraqi dinar dropped against foreign currencies until he was sometimes the market Parallel 1300 dinars per dollar after it was stable at 1185 dinars per dollar rate in spite of the stability of the sale of the Central Bank rate of 1166 dinars with the commission 13 dinars of remittances any 1179 dinars and 1171 dinars cash for sale and this indicates a high demand for the dollar in the domestic market due to the following factors:

• 1- External factors: formed a political and economic crises in neighboring countries (Syria and Iran) and embodied in these countries need to coin the dollar and foreign currencies. What happened is the depreciation of the local currency in those countries and reflected down the price of exports to Iraq, and create windows to attract dollar from Iraq to those countries through attractive transactions for the Iraqis and the same time a source of hard currency to the Iranians and the Syrians. On the other hand there are social coherence and family with these countries may also be a port to exit the dollar but it is difficult to predict Bmekdarh.

• 2- economic business: represented by the factors that lead to the result of domestic capital flight of foreign investors and declining environment, including political instability and the absence of the rule of law in economic transactions. There is no doubt that the time period that followed the 2008 has seen an improvement in the security situation, and in the rate of inflation in the exchange rate. However, the economic environment is still repellent acts do not encourage planning medium or long term. Which led to limiting the activities of some businessmen and yielding profit quick commercial projects, but I doubt that the percentage of it turned into another countries suffer from the scarcity of liquidity arising from the impact of the financial crisis that began in late 2008 (reaching ranked Iraq 165 of 183 countries in 2012)

• 3- public financial policy: Previous years have seen a rise in government spending rates than any other country in the world rates (public spending of 34.6 trillion dinars rose in 2004 to 117.1 trillion dinars in 2012) and most of the images are consumer spending, leading to the rise in spending the outside world (travel, medical services and scholarships, and the import of goods and investments in real estate projects, etc.), and also led to the rise in net Iraqi currency in circulation to $ 36 trillion dinars in 2013, raising the demand for foreign currencies, where the value of the Iraqi imports rose from 37302.7 million dollars in 2010 40632.5 million dollars in 2011 at a rate of change was 8.9%.

• 4- weak tax policies: also include the non-application of the customs tariff law, and of course that result in flooding the market with goods and services payable in dollars in most cases. Also, twice as efficient collection of dues check Aldharbah ensures extra earnings may find their way because of the weakness of the Iraqi banking credit to overseas Authority dollars.

• 5- political and economic stability: because the countries of Iraq described as transition and lack of political and economic stability, we find the proportion of individuals held accounts in foreign banks abroad tend to be of senior officials and wealthy, and increasingly these transfers directly proportional to the rise in oil revenues.

• 6- weak domestic productive capacities: the improvement in the rate of Iraqi per capita income of US $ 1670 to $ 5400 it looking for the initiation of more quantitative and qualitative terms. This factor in the market through external spending reflected on the import of machinery and new materials or by increasing spending on foreign consumer goods.

• 7- weakness of good governance and the rule of law: it embodies Bagr public money, corruption, and an example to determine estimates for projects with more than its real value, of course, lead and raise the frequency conversion of the Iraqi dinar to the dollar.

• 8- family remittance from abroad: in previous years there has been a significant proportion of the family of overseas remittance made to the interior and on the impact of improved Iraqi per capita income, but that these remittances have now eased to large ranges.

• 9- money transfer companies and brokerage firms (parallel market): The presence of these companies to encourage engage in foreign remittances which constitute pressure on the assets of the dollar and was the first to adopt documentary transfers.

• 10- decline in earnings of non-oil foreign currencies because of international grants and aid for reconstruction and the decline of the US presence in Iraq Akhas low.

• 11- trade zones in the border ports: The presence of these areas has encouraged the cash payment directly to the dollar at the border points of contact, which thus leads to higher direct demand for the dollar.

Recommendations

That what is happening in the deformation of the structure of the Iraqi economy is a foregone conclusion rentier economic policy, is not expected to dominate this deformation near the extent. Also, institutional work requires the application of the vocabulary of the adoption of good governance competencies, strategic vision, a sense of responsibility, transparency, securing the rule of law, ensure participation and unanimous acceptance and equality which targets can not be achieved in the near term as well. Generally the solutions in the monetary policy requires a long time to achieve the desired results, and based on the factors affecting the local currency in Iraq find it necessary to divide the solutions and actions into two parts:

Quick fixes (short-term):

• 1- reduce pumping hard currency (cash sales) in the central bank auction and increase the adoption of foreign remittances.

• 2- increase cash sales price at the central bank auction of equivalent sales price in the auction of foreign remittances in order to eliminate the profit realized because of the difference between the two prices.

• 3- sale and purchase of foreign companies and remittance companies to mediate the currency is done by licensed banks in Iraq in order to reduce non-compliant transactions of the conditions and procedures adopted.

• 4- compel traders and dealers in the trade between Iraq and neighboring countries to deal the financial transfer and letters of credit instead of cash purchase areas.

• 5- commitment to transparent auction information and cash transfers and the development of an electronic information system.

Radical solutions (long-term):

• 1- audit of the financial policy of the state and reduce inflation in operational spending.

• 2- need to speed up plans for banking reform in order to facilitate the cash exchange procedures.

• 3- to improve the tax code and work to expand horizontally while reducing tax evasion.

• 4- activate customs tariff because of its important role in providing incentives for producers with economic advantage, leading to a reduction in the volume of imports as well as improved operating revenue law.

• 5- to improve the economic business environment in order to raise production efficiency for companies and institutions of local production that would reduce the imports and increase the intake of foreign currency through exports, as well as attract foreign investment.

• 6- to use modern electronic mechanisms in the distribution of salaries and the use of banking instruments and encourage savings.

• 7- can be to issue a new currency or deletion of zeros from the current currency to have a positive psychological effect on the local currency dealers.

D.kamal visual

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ABOUT THE ABOVE ECONOMIST AND PROFESSOR!

About Kamal Al-Basri

Kamal Field Al-Basri

Kamal Al-Basri has occupied several academic positions with a number of British Universities. Subsequently, he has worked for a number of international financial institutions GE Capital, Barclays and Lloyds Bank. In 2003, he moved back to Iraq and served as Deputy Ministry of Finance and Economic Advisor to the PM. He has experience in making strategic decision in: Banking Reform, Public Subsidies and Privatization.  As the Deputy Minister of Finance he has been engaged with national and international organisations, such as, IMF, World Bank and DFID, on economic development and reforms.

Dr Al- Basri is the founder of the Iraq Institute of Economic Reform (IIER), the first think tank organisation based in Baghdad. The institute involved in drafting economic policy papers, organising regular public debates and training. Building links with other think tanks organisations such as: International Republic Institute (IRI), United State Institute of Peace (USIP), Centre of International Private Enterprise (CIPE), and the Organisation for Economic Co-operation and Development (OECD). The institute website can be found at: www.iier.org

Achievements:

a) Dr. Kamal has contributed to major international economic literatures and written several policy papers.  Amongst his achievements are:  contributed to the policy design and implementation of economic reform in Iraq. Launched and founded by Iraq Institute for Economic Reform,

b) Drafted several policy papers on the economic and financial situation in  Iraq;

c) Lead on providing training to members of the new Iraqi parliament and senior members of Iraqi government on strategic economic needs and simulation exercises;

d) Developed analytical solutions to identify business opportunities for financial institutions and high-street retailers

e) On the academic level whilst working in the UK as health economist, he  provided evidence that targeting those with high blood pressure and history of coronary diseases is more cost effective than universal screening for prevention of coronary heart diseases, using random control trial data. This paper was published in the British Medical Journal 1995;

f) Provided critical and Quantative Analysis explaining that the motivation of mergers amongst British Building Societies cannot be explained in terms of improving economic efficiency, but rather by managerial objectives, ie power and prestige. The paper was  published in Applied Economics Journal in 1991, and.;

g) Provided initial analysis and justifications of road pricing in London and its impact on road congestion and  on health and the environment.

Specialist Expertise

He has working experiences in the following subjects: Expert on Iraqi Economic Affairs, Banking Reform, Credit Scoring and Modelling, Marketing Campaign, Health Economist and Applied Econometric.

Work Experience

In the past he occupied several positions including:

  • Advisor to Prime Minister of Iraq on Economic affairs
  • Deputy Minister –  Ministry Finance, Iraq
  • Advisor :  Minister of Trade,  Iraq
  • Senior Business Analyst – Lloyds TSB  Bank, London
  • Senior Business Analyst – Barclays Bank, London
  • Senior Business Analyst – GE Capital, Leeds
  • Occupied several positions at the following British Universities:

London as Senior Research Fellow in Health Economist,

Surrey as Senior Research Fellow in Health Economist,

Leeds as Research Fellow in Transport Economics,

Manchester as Research Associate in Labour Economics,

West of England as Senior Lecturer in Economics.

Wales as Senior Lecture in Economics,

Honorary Positions

  • Research Associate, Economics Department, West of England University 1997 – 1999.
  • Associate Lecturer in Economics, the International Islamic University, London, 1997-2003.
  • Member of the Executive Board of the American University, London, [1987]-1995.
  • Associate Lecturer, Economics Department, Surrey University 1989-1991.
  • Research Associate, Economics Department, Manchester University 1988-1991.

Education

PhD in Economics – University of Strathclyde 1985

BS.c. in Economics (First Class) – University of  Basra 1976

Profile

  • Experience in managing large organizations such as the Iraqi Ministry of Finance and Trade with over 20,000 employees.
  • Experiences in making strategic decision such as Banking Reforms, Public Subsides, Privatization… etc
  • Dealing with international organization such IMF and World Bank and other government institutions.
  • Developing analytical solutions to identify business opportunities for Financial Institutions and high-street retailers.
  • Experience in building models for predicting risk and fraud, improving the response rate for personal loans and other mailing campaigns, cost-benefit analysis, forecasting consumer behaviour, and productivity analysis.
  • Segmentation, targeting potential customers and providing analytical solutions to the Small Businesses.
  • Statistician and computer programmer, analysing large data files and using standard software such as SAS, SPSS and other data-mining tools.
  • Teaching experience in economics, managerial economics advanced statistical methods, econometric and operational research techniques and health economics.
  • Supervising and implementing standard quality techniques to ensure effective executions of projects.

Summary of Achievements

  • Contributed to policy design and implementations with regard Economic Reform in Iraq (2003-2007).
  • Managing Director Iraqi Institute for Economic Reform, which is first “Think Tank“in Iraq recognised on international level.
  • Drafted several policy papers on the economics and financial situation reforms in  Iraq
  • Provided training to members of the Iraqi Parliament and senior members of Iraqi government on Strategic Economic needs and Simulation Exercise
  • Provided evidence (using random control trial data) that universal screening for prevention of coronary heart disease is not cost effective, whereas targeting those with high blood pressure and history of coronary diseases is. See British Medical Journal, April 1995.
  • Established merger activities of British Building Societies that cannot be explained in terms of improving economic efficiency, but rather by managerial objectives. See Applied Economics, March 1990.
  • Developed a method for updating and forecasting input-output technology.  This method has the potential to provide accurate forecasts for firms/industry input requirements.
  • Provided evidence on the economic efficiency of British universities and hospitals, and identified the source of their inefficiency.
  • Undertook a cost-benefit analysis on the impact of road pricing (in London) on road congestion.
  • Developed an econometric model to explain, the variation in unemployment across UK regions and over time.
  • Developed an econometric model for analysing consumers demand in Scotland.
  • Contributed to the debate of re-structuring  Iraq’s economy

Selected Academic Papers

Published and presented numerous papers in the fields of Statistics, Economics and Operational Research these include:

  • Farmer Decision-Making under Uncertainty: Constraint Game Approach. Mimeo, Basra University, 1977.
  • Evaluation of the Agricultural Structure of Basra City, Journal of Arabian Gulf, 1979.
  • Mathematical Notes on Marxian Transformation Problem and Sraffa Standard Commodity. Mimeo, Basra University, 1980.
  • Testing the Economic Efficiency of a Firm with Multi-input and Multi-output: Mathematical Programming Approach, Mimeo, Fraser of Allander Institute, 1982.
  • Estimating Cost Function under Incomplete Technology Diffusion (with Dr C. Robertson), Mimeo, Department of Mathematics, Strathclyde University, 1983.
  • Scottish Dynamic Expenditure System for the Period 1963-1980. Discussion Paper in Economics, University of Strathclyde, 1985.
  • Input-Output Technology Forecasting: A Micro-econometric Foundation Approach, Discussion Paper in Economics, University of Strathclyde, 1986.
  • The Estimation of Direct and Indirect Production Functions: An Example from Indian Paddy Production, Discussion Paper in Economics, Strathclyde University, 1986.
  • Critical Survey of the Methods of Up-dating and Forecasting Input-Output Technical Coefficients. Discussion Paper in Economics, University of Strathclyde, 1987.
  • Production Efficiency of British Building Societies. Applied Economics, Vol. 22, No. 3, March 1990.
  • Decomposing Overall Production Efficiency of Indian Paddy Farmers (with Dr P H Kuishari). Discussion Paper in Economics, University of Strathclyde.
  • Non-parametric Approach to Test Performance: A case study of Chilalot District, Ethiopia (with Dr M. Demak).
  • Male and Female Unemployment, 1980-1990, with (Dr Derk Lesli), Economics Department, Manchester University.
  • Testing Co-operative Efficiency: The Important of Management and Multi-Production, with R. Welford, In: Small Business and Business Development: A Practical Approach, Edited by R Welford, European Press, 1991.
  • Measuring Economics Performance of Acute Hospitals, With Professor Charles Normand, London School of Hygiene and Tropical Medicine.
  • Cybernetics and Performance Measurement of UK Universities, with K. Al-Naji, Systemist, vol. 15(3), Aug. 1993
  • The Cost of Pressure Sores, with M. Clark, Report to Department of Health, 1991.
  • Cost Effectiveness of Radon Grant, report to Department of Environment, 1993.
  • Strategies for Coronary Risk factor Prevention in Primary Care: which is most effective?, with M. Thorogood and C. Normand, British Medical Journal, April, 1995.
  • Input-Output Models in Economic Policy and Forecasting, Presented to Workshop Arab Planning Institute-Kuwait, Jan.1996 and to be published in a book entitled ‘Economic Models for Policy Analysis’.
  • Economics Efficiency of Baby Care Units (Scottish Hospitals) paper presented at Operational Research Society Conference, September 1996.
  • The Productive Efficiency of British Universities: An Historical Data Envelopment Analysis, with G. Al-Naji & A.T. Flegg. Working Paper in Economics, No. 25, April 1998, University of the West of England, Bristol.

Selected Business Reports

  • Reject Inference for Personal Loans: New Development.
  • Modelling Attrition for Consumer Loans: Case of GE-SOVAC (France).
  • GE Europe Auto Sale: Improving Sale Effectiveness.
  • Customers’ Response Model for Insurance company: Case of Boiler Insurance.
  • BHS Profitability Analysis: Choice Card vs. Choice & Credit cards.
  • Modelling Unemployment & Mortgage Insurance Claims: A case study for Halifax Building Society.
  • GCF-UK Fighting Strategy: Debenhams Customer Attrition Models.
  • Bank Card Model : A net present value analysis for customers’ financial behaviour?
  • GE Capital United (Brazil) Behavioural Profitability model: Net present value to customer behaviour.
  • GE Capital United (Brazil) Merchandise models for Mappin: Forecasting model to customer spending
  • Response / Net Conversion Model for Personal Loans
  • Response Model for Sale Promotion : Case of Laura-Ashley Stores
  • Personal Loan Model for GE-PASTAN, Sweden
  • Risk Model for Loans: GE Capital Austria

Selected Policy Papers (in Arabic)

  • Fuels Price Reform in Iraq 2005
  • Critical Review to Investment Law in Iraq 2006
  • Inflation & Monetary policy in Iraq 2006
  • The Budget Strategy for 2007
  • The Oil Law and Economic Challenges
  • Economic Reform and IMF condition
  • International Compact with Iraq

Other Publications

  • The Conflict between Private and Social Interests & Decline of Civilisations, Al-Sahwa, February .91.
  • Economic and Social Objectives of an Islamic Society, Journal of Al-Twhied, No. 38, 1998.
  • Marxian’s Historical Materialism: A Critical Analysis. Al-Minbur News Paper, May, 1996
  • The Social-Economic Problems: An Islamic Prospective. Al-Minbur, April 1996.
  • The Main Aspect of Islamic Economics, Al- Sahwa, May 1991.
  • Privatisation in Islamic Economics, Al-Hayat Newspaper, May 1997.
  • Private vs. Public Enterprises and Economic Development, Al-Hayat Newspaper, 23 of April 1998.
  • Iraq Foundation for Economic Recovery, Al-Hayat Newspaper, 21 of Sep 2004.

http://kamalfield.net/about/

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