Letter of Intent (Iraq) and the IMF

C. Foreign Exchange Policy
18.
The government will maintain the peg with
the 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 rema

ining exchange restrictions and multiple

currency practice (MCP) with a view to elimi

nating exchange rate distortions. Such a move

towards acceptance of the obligations under Articl

e VIII of the IMF’s Articles of Agreement will

send a positive signal to the investment co

mmunity that Iraq is committed to maintain an

1

See
Country Report No. 15/235. Iraq: 2015 Article IV Consul
tation and Request for Purchase under the Rapid
Financing Instrument
.

IRAQ
6
INTERNATIONAL MONETARY FUND
exchange system that is free of restrictions and
MCPs for current international transactions and
thus facilitate creation of a favorable business c
limate. As a first step, the government will, by
end-February 2016, amend the Investment Law, or i
ssue clarifying implementing regulations, to
remove the limitation on transfer of invest
ment 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 im
prove the integration of the domestic financial
system into the global economy and lower trans
action 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 ad
opt a by-law to set up a mechanism to comply
with the relevant United Nations Security Counc
il 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






New item about your countries of interest:

Iraq: Staff-Monitored Program-Press Release; and Staff Report

http://www.imf.org/external/pubs/cat/longres.aspx?sk=43615.0









Iraq: Letter of Intent, Memorandum of Economic and Financial Policies, and Technical Memorandum of Understanding, December 22, 2015

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

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Press Release: IMF Managing Director Approves a Staff-Monitored Program for Iraq

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