CBI solid steps in achieving development goals

2016/10/02 | 00:20


Date: October 1, 2016



That central banks in the countries are financial institutions sovereign sober and independent in carrying out its tasks and monetary policies which oversees and monitors the banking sector is the financial advisor to the government and the Central Bank of Iraq, his role was fundamental in the economic Alamelihh administration in Iraq after the change in 2003 through his stewardship of monetary policy to achieve its objectives because it's been Iraq during the years (2003-2016) an important stage in its economic system since the beginning of the change included new applications for economic construction depends build introductions transition from the philosophy and strategies of the central economic system in the management of the economy to the philosophy and strategies and mechanisms of a market economy.

The most important hallmark of this stage is the pilot exercise and assumptions that economic policies that rely primarily on the experiences of countries preceded us in the application of market economy mechanisms without relying on the fundamental economic underpinnings for this transition, as all the studies and reports issued by the World Bank and the IMF Ata.an confirmed the confusion of vision and lack of coordination between fiscal and monetary policies and different economic policies and the lack of clarity in the economic approach of the new building of the economy's contribution clear contributed to the fragmentation of applications in the monetary policy and the different visions and strategies to reach the central objectives set, in addition to the lack of some of the legislative environment materials of economic laws that regulate the economic process, which led to trouble in the application, but the Iraqi Central Bank and the banking sector's footsteps great strides evolution toward transition from Sairafi activity to development activity since the issuance of the laws governing the banking business in 2004 and the issuance of central bank law 56 of 2004, great achievements have been made in reducing hyperinflation, which was suffered by Iraq and bringing it to the good rates for the year 2016 amounted to 2 percent as data and financial indicators suggest that the Iraqi Central Bank was able to maintain for several years until the present time the Iraqi dinar exchange rate against the US dollar in a balanced way in spite of fluctuation and variation up and down depending on the difficult economic conditions financial and economic crisis due to the decline in oil prices and the war on terrorism and speculation that occur in markets where noted that the daily intervention of the Central Bank of Iraq in the management of the sale and purchase of foreign currency in the light of the details of monetary policy which has been adopted since (10/04/2003) despite criticism the many observations exports are really made a significant contribution in maintaining monetary stability and face any amounts needed by the market for the purpose of trade financing to the private sector and to meet the needs of the Ministry of Finance of the local currency.

To address these criticisms Bank issued instructions and controls and try to control the violations that occur review and daily monitoring of money laundering offices in the bank and in banks and oversight of pre-emptive E also issued a recent money laundering guide Takeda to adjust the application of Money Laundering Act and the new anti-terrorism, in addition to continuing his thinking to adopt a style of documentary credits and their replacement gradually instead of the current approach to control the foreign currency movement and reduce the disposition other than economic targets set for the applications of policy Alnkadih.an handle the buying and selling of foreign currency is one of the largest open market operations to control the levels of domestic liquidity and put surplus cash in the safe in the budget tracks public and consumer spending, as the Iraqi Central Bank maintained in 2016 to stabilize the Iraqi dinar exchange rate against the US dollar on the parallel market up (1290) dinars per dollar, as recorded in 2012/2015 rates ranged between (2230-2250) dinars per dollar knowing that the central bank has kept the official price of transactions daily at fixed an economist's a good sign that the stability of the exchange rate during these years, despite the difficult economic conditions experienced by Iraq during 2014 and 2015, and is still going on because of the sudden drop world oil prices up most (65 percent), compared to prices in 2014 and the lack of security and stability and the war on terrorism and speculation in the currency market, but he maintained a balanced rates of up and down, and we expect to return to a normal level, especially after the relative improvement in global oil prices and increased volumes of oil for marketing purposes and the application of the mechanism new approved by the Central Bank of Iraq in 2017.

The CBI also managed to retain cash reserves foreigner up to $ 50 billion because of falling world oil prices and the conditions of economic recession. However, the form of Secretary of the Iraqi dinar cover to cover Trade up to a six-month period and is globally certified standard rate and this marks the obvious fact that the central bank Iraq had been able to clear the efforts over the past two years to boost the tally of foreign exchange in the bank lockers in foreign banks and reserves of gold in Baghdad and abroad well commensurate with the oil prices and developments on the local and regional scene.

Has to be noted here that the big role played by the Iraqi banking system as a tool of monetary policy implemented by planned by and oversees the implementation of the Central Bank of Iraq, which constitutes the basic wheel in the financing and management process of economic development and attracting investment Iraqi, Arab and foreign.

Despite what indicated by studies and official reports issued by international organizations and the Central Bank of Iraq that the Iraqi banking sector because of the challenges faced by not contributing requested contribution to the economic development over the past above despite its evolution rates growing since 2003 until 2014, in terms of total assets and capital funds and Odaiah and its credit evolved cash granted and capital adequacy in terms of total assets developed by (8 percent) in 2014 compared to 2013 as Ttoralaytman cash granted by 28 Balmayh 2014 compared to 2013.

Recorded warheads money and increase Alodaya ratios (Balmayh 13) and (23 Balmayh), respectively, which is a positive indicator of the important role played by the sector in Almsrgi sustainable development.

Samir Abbas Alnasiri

Banking expert

Member of the World Union of Arab Bankers

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