******* This is from the IMF

December 22, 2015

Letter of Intent, Memorandum of Economic and Financial
Policies, and Technical Memorandum of Understanding



C. Foreign Exchange Policy


18.    
The government will maintain the peg withthe U.S. dollar. The peg provides a key
nominal anchor in a highly uncertain environment with policy capacity weakened by the conflict
with ISIS.

19.    
The government will gradually remove remaining exchange restrictions and multiple
currency practice (MCP) with a view to eliminating exchange rate distortions. Such a move
towards acceptance of the obligations under Article VIII of the IMF’s Articles of Agreement will
send a positive signal to the investment community that Iraq is committed to maintain an
exchange system that is free of restrictions and MCPs for current international transactions and thus facilitate creation of a favorable business climate. As a first step, the government will, by end-February 2016, amend the Investment Law, or issue clarifying implementing regulations, to remove the limitation on transfer of investment proceeds that gives rise to an exchange
restriction, as recommended by a recent technical assistance mission of the IMF.

20.    
The government will implement reforms on anti-money laundering and combating the
financing of terrorism (AML/CFT). This will improve the integration of the domestic financial
system into the global economy and lower transaction costs, improve governance, and reduce
the size of the informal sector. As a first step, the government will, by end-February 2016, draft, with the help of IMF technical assistance, and adopt a by-law to set up a mechanism to complywith the relevant United Nations Security Council resolutions related to terrorism financing and Recommendation 6 of the Financial Action Task Force on Money Laundering (FATF).


http://www.imf.org/External/NP/LOI/2015/IRQ/122215.pdf

IMF Managing Director Approves a Staff-Monitored Program for Iraq
Press Release No. 16/04
January 12, 2016

The Managing Director of the International Monetary Fund (IMF) approved a Staff-Monitored Program (SMP) 1for Iraq covering the period of November 2015-December, 2016, on which the authorities and staff had reached ad-referendum agreement in November 2015 (see Press Release No. 15/509).

Iraq is facing a double shock arising from ISIS attacks and the sharp drop in global oil prices. The conflict is hurting the non-oil economy through destruction of infrastructure and assets, disruptions in trade, and deterioration of investor confidence. The impact of the oil price decline—already felt in 2014—intensified in 2015, affecting the budget, the external sector, and medium-term growth potential. The authorities are responding to the crisis with a mix of fiscal adjustment and financing.

To help address the present and urgent balance of payments and budget needs triggered by the ISIS attacks and the collapse in oil prices, the authorities have also requested an SMP to establish a track record of policy credibility to pave the way to a possible Fund financing arrangement. Under the SMP, the authorities will implement fiscal consolidation that will contain public expenditure in line with available revenue and financing, and aim to reduce the non-oil primary deficit by US$20 billion or 12 percent of non-oil GDP between 2013 and 2016. Under the SMP, agreement has also been reached on measures to strengthen public financial management, anti-money laundering and countering the financing of terrorism (AML/CFT), and financial sector stability.

The IMF has assisted Iraq in strengthening economic institutions and in providing advice to the government on economic policies and reforms for more than a decade. IMF staff will work closely with the authorities to monitor progress in the implementation of their economic program. In addition, the IMF will continue to provide technical assistance to support Iraq’s capacity-building efforts and its reform program.

1 An SMP is an informal agreement between country authorities and Fund staff to monitor the implementation of the authorities’ economic program. SMPs do not entail financial assistance or endorsement by the IMF Executive Board.


http://www.imf.org/external/np/sec/pr/2016/pr1604.htm

[ltr] 2016/01/13 | 11:20[/ltr]

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(Encyclopedia of the day for News | Iraq) -
[ltr] Direct: it agreed Christine Lagarde, Director General of the International Monetary Fund on a program for the management of informal agreements between the members and experts to follow up the Iraqi Fund economic program set by the government.
[/ltr]
[ltr]IMF official statement added that those agreements do not involve financial assistance or followed by approval of the IMF Executive Board.
[/ltr]
[ltr]It was for this program reached last November, the International Monetary Fund, which pointed out that it allows the Iraqi authorities to establish a positive track record of accomplishments, positioned to the possibility of obtaining financing arrangement from the Fund.
[/ltr]
Iraq and is facing several economic challenges of the most important organization Daash the sharp fall in oil prices, and aims to reduce the non-oil primary deficit $ 20 billion and 12% of the total gross domestic product of Iraq from 2013 to 2016.

http://hathalyoum.net/888091