Thread: Iraq/Dinar News. 09/05 to 01/14/07

Undersecretary of the Ministry of Finance spoke to Kamal visual from inflation and the decline of purchasing power

Iraq : the public sector is 580 thousand industrial workers and government support 480 million Dolarbsbb weak production
Baghdad-Adel Mahdi life-23 / 10 / 06 / /
Translated version of http://www.alhayat.com/business/10-2006/Item-20061022-7127d4b7-c0a8-10ed-0055-76e2e1003b17/story.html

Said Undersecretary of the Iraqi Ministry of Finance Kamal Al-Basri «life», The policy of economic reform required to reduce the financial allocations to support petroleum derivatives for the current year by half, to become a $ 200 million monthly. instead of 400 per month in 2005, This is based on the government's desire to reduce the subsidy gradually, and make prices consistent with the neighboring countries.

He disclosed that the scheme had been providing for the issuance of a presidential decree, summarized end the State monopoly for the import and sale of oil derivatives, and to allow the private sector to participate in the practice activity, but this has not taken place, The fuel crisis as it is.
He explained that the recent period of 2005, have stopped importing oil derivatives from Turkey, due to the irregular payment of financial dues of the Turkish side, what makes prices more than the regular market prices are not supported. As a result, the rate of domestic spending on oil derivatives, approximately 40% of the family income, according to the statistical survey of the city of Baghdad. conducted by the Central Bureau of Statistics this year.

He pointed out that the rate of inflation in the months of July (July) and father (August) two years 70%; , and 76.6%, respectively, reflected negatively on the Iraqi economy. The negative effects, a reduction in the purchasing power of individuals, as well as the decline in the real value of savings and deposits, especially if the inflation rate is higher than the rate of interest, what led to a decrease in the volume of investment in the national economy, and discourage the process of economic development.
He added that despite the government's support for importing oil derivatives, to meet the shortfall in production internally, the local market has been experiencing a big shortage in bridging the growing demand, because of the entry of a large number of cars imported by the private sector. The constant interruptions to electricity, increased use of generators that rely on the operation of these derivatives, as well as the suffering of the distribution sector major problems, The existence of administrative and financial corruption. These are all factors that contributed to the rise in the overall level of prices, , which impacted negatively on the food basket.

Inflation

He attributed the reasons for the high inflation rate to several factors other, the most important of the high prices and scarcity of oil derivatives, power outages, impedes the production of goods and services, The downsizing of the supply on the market. weak capacity of the government machinery in the implementation of projects services. as well as the deterioration of the security situation, which contributed to the irregular supply of goods and services. The weakness of the structure of GDP.

He pointed to the negative consequences resulting from the weakness of the banking system to attract cash. He said that the Central Bank of Iraq, In an attempt to curb inflation, the oldest recently to raise interest rates from 10 to 12%. Observers believe, This increase was unable to make any positive impact, They are unprofitable, Valtakl impact of inflation in the capital. more interest rate, Therefore, this policy is not sufficient to maintain the purchasing power of the Iraqi currency.

Unemployment

In analyzing the growing problem of unemployment. he said that the unemployment rate is 27-30%. although the majority of the workforce is in the services sector with marginal influence in the overall GDP, while they do not exceed 2% in the oil sector, the backbone of GDP.
He said that there are flaws in the structure of the Iraqi economy, In the industrial sector, public works 580 thousand, However, the weak production, push the government to support at $ 480 million, He pointed out that government support direct and indirect in the state budget constitutes about 80% of GDP. Therefore there is a clear imbalance between the sectors of production and services sectors.

He believed that dealing with the phenomenon of inflation come through steps including the stabilization of the security of confidence in the local market. and to address the scarcity of oil derivatives, by ending the monopoly of the State, and to allow the private sector to import. The increase of interest rates in general. have a role in collecting cash, It is an established procedure in many countries stable, However, the impact will not be significant, due to the lack of a tendency to save, The absence of investment opportunities that can be fed savings. The understanding of the rich prefer to transfer their capital abroad. Therefore it is hard to imagine that the rate of interest rate role, as long as the difference between the inflation rate significantly.

The rise in ( RV ) the value of the Iraqi currency against the dollar would reduce the value of imports, and raising the value of exports. As exports are negligible, the economy will benefit from the policy of raising the rate of the Iraqi dinar. He emphasized that this action has positive effects, when used with other procedures, the most important financial policy, which is based on controlling public spending, The use of fiscal policy to reduce the cash, They are difficult to apply.

If you are not excited, go to bed!

Originally Posted by CharmedPiper

I ran across an old article when the new currency came out and we know there are 2 coins in circulation but according to the article there were 3 coins printed. Can anybody confirm if typo or are they being sneaky and hiding currency on us??

Sunday, January 2nd 2005
Central Bank issues coins of 25, 50 and 100 dinars for circulation

The Central Bank of Iraq will be issuing coins of 25, 50 and 100 dinars for circulation starting today. The coins have been issued according to the following specifications of the Central Bank:

The front side of the coin shows the map of Iraq with two dates Hegira, 1425 and A.d., 2004.

The back side of the coin contains a circle that has the denomination of the coin within the circle (25, 50, 100 dinar); "Central Bank of Iraq" is written on the top of the coin, while the denomination of the coin is written on the bottom.

Dinar denomination ; Metal ; Diameter mlm ; Weight, Gram ; Shape

100 ; Nickel plated steel ; 22 ; 4.3 ; Circle/jagged

50 ; Brass plated steel ; 20 ; 3.5 ; Circle/smooth

25 ; Copper plated steel ; 17.5 ; 2.5 ; Circle/smooth

they discontinued the 50 dinar coin as most of them were stolen and never retrieved.

Originally Posted by fsndirector

It was a little bit confusing, and I was on the road for part of it so could not write it all down, even some friend that were on the call said it was confusing for them as well, If I hear from any others I will let you know. I do know that he divided by 4 the amount of dinar that Iraq bought and said that that told him they could handle a $3.00+ rv. ??????????

a 3.00 r/v would keep all speculators away....and i would cash in

Originally Posted by Barbara919

Pipshurricane, I am so sorry that I posted the Kurds seeking dialogue, after you had already posted it. I must have over looked You posting it. Barbara

No problem Barbara i'M nut upset at all.Many news to read right here

I was just on about Dinar and oldskiier had posted this really neat video piece about the real truth about Iraq that the rest of the media do not want to tell you. I though I would bring it over here. The reporter is Glenn Beck who I personally really like and I enjoy his show.

The Real Story

Dinar-Excited

Originally Posted by Mike5200

I believe it was the 50 Dinar coin that the shipment was stolen - this was discussed at IIF in July or August - some of the 50 Dinar coins surfaced on Ebay recently

i bought ten for posterity.

Originally Posted by jedi17

a 3.00 r/v would keep all speculators away....and i would cash in

Yes arn't the neighbouring countries around this value too? They would just be inline, & hav'nt I seen postings that they're considering r/v'n their currencys

I went to Chase Bank today to purchase another $1Million Dinar. Cost was $767.60. Will have it tomorrow at 3PM.

Oh and by the way, the manager said the bank has been selling alot of Dinar and that she has been buying some as well!

Hmmmm...... http://www.rolclub.com/images/smilie..._nocomment.gif


http://www.rolclub.com/images/smilies/new.gif

Originally Posted by robinhoodof sherwoodpark

Yes arn't the neighbouring countries around this value too? They would just be inline, & hav'nt I seen postings that they're considering r/v'n their currencys

I read an article about the Saudis considering a small rv. I can't remember the link.

That would be nice.

One item to remember is that the Middle Eastern Countries are trying to implement a unified currency by 2010. So they will all need to peg to the same currency or standard before they can be successful.

Originally Posted by cigarman

Why did he say .30 for a reval? I think it will be middle of the road at $1.46 or higher. Remember, their revaling to lower the cost of imports for the people. To do that it at least needs to be equal to $1.00 USD. Then again, it might have to be higher if they import most of their stuff from Jordan or Kawait. Does my theory make sense? It does to me but us rednecks like to simplify everything.lol

i can see where you are coming from with that assumption, but the logic is a little off for me personally. any country that has an exchange rate of 1500 to 1 would see a much larger difference in the price of imported goods going to 3 to one, that is a huge gain in buying power. if you look at it relative to the current situation, anything higher than 3 to 1 is just icing. you can even take the dinar investor as a perfect example, if you paid 800.00US for a million dinars, and then it revalued at 3 IQD to 1USD, you would be thrilled. if it revalued at 1to1 you would be even more thrilled. but if you look at the relative gain you make on the investment, the biggest difference is made going from a value of $800 to a value of $300,000, than going the rest of the way from $300,000 to $1,000,000.

the important thing want to keep in mind is that the investor still needs the perception of value to put money into the country. if they go too high they run the risk of having investors feel they are overpaying to invest money. don't forget, the dinar is not supportable at $3.22 if they can't get the money in country to build refineries, infrastucture, etc and at that price i don't think they would be able to. i would rather see them start low between .30 and .80 and be able to get the needed money, than to see them start at 1.50 and have trouble getting investment. if it starts lower, they will get what they need and the value of the dinar will take care of itself.