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About Iraq and It’s Dinar Currency

by admin ~ May 30th, 2013

Iraq is best known for its massive oil reserve, which is the fifth largest in the world. However, there’s a lot more to this Middle Eastern country than what most people know. For starters, the Iraqi dinar currency exchange rate may be poor, but it’s actually fairing much better than it did after the string of events which succeeded the 2003 invasion of Kuwait.

Giant oil companies such as Shell, Lukoil, ExxonMobil and British Petroleum are playing a big role in propelling this nation forward and strengthening the Iraqi dinar. While it’s currently exporting over 3.2 million barrels per day (bpd), experts are predicting that its export levels will reach over 12 million bpd by 2017. Thanks to the continuous investments of these oil companies, plenty of industry observers predict that Iraq will indeed reach the targeted export levels as major corporations continue to develop Iraq’s inferior infrastructures.

On the other hand, this oil-based nation isn’t completely dependent in its number one product alone. It produces other products as well, including chemicals, construction materials and fertilizers. It’s also in the business of food processing and metal fabrication.

According to recent studies, Iraq’s gross domestic product has increased by 12.6 percent. Meanwhile, core inflation has decreased to 6.3 percent, which is a far-cry from the 32 percent witnessed in 2006. Moreover, the dinar currency exchange rate has increased by 17 percent – a notable improvement that was brought about the Central Bank’s policy to raise interest rates by 20 percent.

Iraq has managed to pay off roughly 80 percent of its debts, thereby allowing a larger budget for the country to rebuild itself. On top of this, unemployment is down to 15 percent, while inflation as whole is down to 5.8 percent.

As the economy begins to get stronger and stronger, many believe that the Iraqi dinar currency exchange rates will significantly shift in favor of the Iraqis, and ultimately help fortify the Iraqi economy.

Banks Auctioning Iraqi Dinars Under Question

by admin ~ May 27th, 2013

While investing in Iraqi dinars is a welcomed practice within the Middle Eastern nation, there are certain times when the sale of these notes can be quite questionable. Banks – such as the Central Bank of Iraq – have been questioned in forming exclusive financial groups in which the board members of private banks are given the right to invest.

The CBI has been engaged in the sale of hard Iraqi currency since 2004. The goal of these auctions is to stabilize the Iraqi dinar exchange rate and prevent market speculation plus imbalance.

Forming these financial groups has prompted observers to speculate due to a variety of reasons. The first one is the fact that the unreasonably high criteria participants have to comply with. To become a member, a bank or company must have a capital that’s at least greater than $400,000.

This reason is somewhat justifiable, as keeping auction participation at a certain level was widely viewed as necessary. However, the local currency subsequently began to devaluate as the dollars have become scarce due to the lack of participants.

To counter the devaluation, the CBI authorized a few banks to sell US dollars to Iraqis (who’d in turn spend them on traveling or medical needs abroad). Nevertheless, more speculation was formed around these authorized banks, as some private companies are claiming that the financial institutions are selling US dollars through intermediaries for special commissions.

According to Amin Abbas, a member of the Financial Committee in the Iraqi parliament, the fall of Iraq’s dinar exchange rate is due to the restrictive measures implemented by the CBI for their auctions. He also stated that the responsibility of reversing the damage dealt to the value of Iraqi dinars lies on the shoulders of the CBI.

Another reason that has observers fostering thoughts of doubt over the formation of these exclusive financial groups is tied to the arrest of CBI’s former governor, Sinan al-Shabibi. He was accused of leaking information that’d help smugglers get money from Iraq to Iran in an attempt to satisfy the latter’s needs for hard currency (which was in turn was triggered by Iran’s issues with international sanctions.)

Foreign Banks Setting Up Business In Iraq Regardless Of Investment Dangers

by admin ~ May 24th, 2013

Considering the volatile investment environment of Iraq – which includes internal conflict, low dinar exchange rate, fragile security, and political instability – it’s not so difficult to understand why any type of business (except for the giant oil corporations) – would be hesitant in expanding their trade within this Middle Eastern nation.

Regardless, dinar news reports indicate that several foreign banks are still interested in investing in the future of Iraq. To understand the significance of their decision to push forward, it’s important to see what type of “hurdles” they’ll be pushing through along the way.

First and foremost, there are currently 54 banks operating in Iraq – 32 private, 15 foreign, and 7 state-owned. Regardless, two state-owned banking institutions are handling the majority of the country’s business. Private entities are currently deprived of reaching their full potential because public sector funds can only be accessed by banks operating within the public sector. These establishments have the right to draw funds the oil industry, which means they have access to massive capital.

On the other hand, their private counterparts may only acquire funding through the manufacturing and construction industries. To make things even harder is the Central Bank of Iraq’s implementation of a minimal capital policy. According to the rules, businesses are required to have a capital of no less than $215 million. Not only that, but the deadline for the capital is schedule for this June.

The adequacy of funds has become a major issue for numerous banks, as some refused to merge or become consolidated by others. While other establishments have decided to shutdown, other foreign banks have decided to press on.

Dinar news reports say that the most prominent force that’s attracting new banks is the nation’s booming oil industry. The Standard Chartered Bank, for example, is planning to open an additional three offices in Iraq. This establishment’s goal isn’t primarily geared towards finding new customers, but for supplementing the needs of their existing clients, many of which are in their advance stages of growth.

How Iran Played A Part In The Iraqi Dinar’s Devaluation

by admin ~ May 22nd, 2013

While the recent decline in Iraqi dinar currency may be attributed to variety of reasons, some observers and analysts speculate that Iran has played a part as well. According to these individuals, Iraqi dinars are currently trading in at 1,260 for every US dollar – a level that hasn’t been reached since 2012.

It’s believed that the Iranian companies have entered the Central Bank of Iraq’s auction for hard currency sales. The Iranians had purchased the notes in large quantities, and smuggled it into Iran. The neighboring country – which is currently in need of hard currency amidst international sanctions – was able to pull off the smuggling escapade with the help of Iraqi partners.

“This has increased the demand for the dollar at the CBI auction,” says economist Khaled Haidar. Due to this occurrence, the CBI was prompted to implement stricter standards of control over the hard currency sold, which subsequently led to a reduction in dollars sold.

To put things in perspective, $200 million were sold to 15 private banks during the auction. However, due to the tight criteria imposed upon all bidders, only $70 million was sold during this year. This in turn led to a considerable gap between supply and demand, and ultimately caused an increase in the US dollar over the Iraqi dinar.

On the other hand, Ahmed Bureihi, the former senior official at the CBI, argues that Iran has nothing to do with the decrease in Iraqi dinar value. “No supervisory authority in Iraq has noted a recent increase in these traders’ activities, which means that their activities have nothing to do with the rise of the US dollar exchange rate against Iraqi dinars,” he said.

“Politicians who spoke about Iranian companies smuggling hard currency coming from the CBI auction to Iran need to worry about resolving the chronic political crisis in Iraq and leave monetary policy to experts.”

He then goes on to explain that increased oil revenues have subsequently boosted government spending. This stimulated the need to import more goods, which led to a greater demand for foreign currency, and ultimately, a decreased dinar currency exchange rate.

Iraq Has Potential To Turn Into A Market Economy

by admin ~ May 19th, 2013

Numerous efforts are currently being set into motion to stimulate this oil-based economy and its Iraqi dinar value. While there’s no denying that Iraq’s oil products will play an integral role in the nation’s rehabilitation, the Chairman of the Securities Commission stressed the important part carried out by the country’s private sector as well.

According to dinar news reports, Chairman Abdul Razak Dawood al-Saadi specifically mentioned transforming local family businesses into joint-stock companies to take advantage of economies of scale, reduce costs, and reap other financial benefits. By growing into larger entities, these businesses will be enabled to pay more taxes (which is a good thing for the economy), create more job opportunities, and aid in the alleviation of poverty.

Iraq’s private sector is also becoming more attractive to foreign investors, as incentives, tax breaks, and fair legislative rulings await venture capitalists aiming to do business within the Middle Eastern nation. In addition, Iraq has a more competent workforce (e.g. doctors, engineers, skilled laborers) that has grown in number over the past few years, thereby providing investors with cheaper labor essential for their business operations.

Abdul al-Saadi also mentioned the importance of developing the leadership skills and professional competencies amongst the Iraqi population. Moreover, he emphasized the need to develop an internal regulatory system and segregation of responsibilities, that the country may become better equipped to handle an economic crisis should one rise again.

Experts feel that Iraq has great potential to regain a strong economy and Iraqi dinar value, but in order to reach this point, a holistic approach must be taken. The country needs to develop its oil industry and private sector simultaneously in order to gain the funding it requires to rebuild and develop infrastructures throughout the country. This should be coupled with efforts to keep sabotage and civil strife at the lowest levels possible. More importantly, better political governance is also essential for Iraq to realize its goal of becoming a better nation.

Iraqi Economy Steadily On The Rise

by admin ~ May 17th, 2013

The Iraqi Economy has managed to survive decades of war, corrupt political investment, massive unemployment, and a sever lack of infrastructural development. While these unfortunate events have crippled its economic progress, and subsequently caused a significant devaluation of the Iraqi dinar exchange rate, the nation is now heading in the right direction towards rebuilding itself.

As Iraq continues rehabilitate and mature as a democracy, the idea of it becoming a wise investment becomes more and more plausible. While there’s plenty of ways for any individual to bank on its predicted growth, investing in the Iraqi dinar itself seems to be the simplest way of garnering excellent returns through minimal investments.

In addition, investing in its currency also eliminates the need to worry about other aspects when engaging traditional business, such as marketing, site evaluation, establishing a reputation, etc.

All that’s needed to be done here is to purchase the Iraqi notes, and sell them when its value increases (as the experts predicted it to). However, this particular venture – just like any other out there – comes with risks. That being said, making informed investing decisions is still necessary in order to significantly reduce the dangers involved.

Having said that, is one website that not only facilitates the wholesale/retail of Iraqi dinars, but it also posts the latest info on Iraq’s economy and government-related issues. It’ll also provide information that’ll give interested investors deeper insight on Iraq’s growth patterns, its market, and the arrival of other major investors coming to do business in Iraq.

As a matter of fact, everything that could possibly impact Iraq’s economy positively or negatively in a direct/indirect manner will be covered as well. Most importantly, info relevant to the dinar exchange rate and everything that could affect it as well shall also be covered at

Iraq’s Oil Reserves Up By Five Percent

by admin ~ May 15th, 2013

Iraq’s massive oil reserves have just gotten bigger. According to Oil Minister Abdul Kareem al-Luaibi, the estimate of crude reserves increased to 150 billion barrels, which is five percent more than previous calculations. According to previous dinar currency reports, the reserves were previously pinned at 143.1 billion, five percent les them current estimates.

“The increase comes from the Dima oil field and some new studies in some oil fields, and we will soon announce the details,” said al-Luaibi to reporters during an interview in Baghdad. Oil Ministry’s spokesman Asim Jihad says that oil producers have recently discovered were conducting exploration tests at Dima, southern Iraq, and found one billion barrels of light crude reserves.

According to a recent Iraqi dinars report this year, Iraq produces an average of 3.15 million barrels per day. The Oil Minister says Iraq’s output will increase by an additional 135,000 barrels daily by as early as June this year. The Majnoon oil field is expected to produce 100,000 barrels daily starting May, while the Ghaffar field will begin producing 35,000 barrels a day starting June.

Further predictions reveal Majnoon’s output could very well increase to 175,000 bpd by the end of 2013.

The latest estimates of the Middle Eastern nation’s reserves exclude the ones located within the semi-autonomous Kurdish region. According to the Kurdistan Regional Government, their land holds approximately 45 billion barrels of oil.

In a conference held in London last April 18, 2012, Hussain al-Shahristani, Iraq’s deputy prime minister for energy affairs, says that additional deposits could bring its current reserves up to 214 billion barrels.

Iraq has relied on foreign investment (including the sale of Iraqi dinars) for the development of its oil sector. To help expedite the process, Baghdad has awarded several lucrative oil exploration/production contracts over the past years. Winners of these contracts include giants such as British Petroleum, ExxonMobil, and Shell. Kurdistan has awarded its own contracts with other companies as well.

Iraq Urged By IMF To Develop Non-Oil Sectors for Sake of Iraqi Dinar

by admin ~ May 12th, 2013

The bulk of the Iraqi economic strength lies within its oil exportation businesses. According to a recent forecast conducted by the International Monetary Fund, this nation’s economy is expected to grow at least nine percent due to its booming oil business alone. Regardless Iraqi dinar news reports quote the IMF urging the Middle Eastern country to stimulate development amongst the non-oil and private businesses to boost the Iraqi dinar value.

The IMF stated that the Iraqi economy “continues to suffer from severe structural weaknesses such as a small non-oil sector, high unemployment, public sector dominance, and a weak business environment.” The organization advises Iraq to open more opportunities for private banks to operate; as such opportunities are usually handed to the state-owned governments.

The IMF also pointed out that Baghdad has to regain better control over state-related expenditures, which included the need to end off-budget disbursements. They also stressed the importance of improving bank monitoring, while simultaneously working to liberalize the foreign exchange market.

“Iraq will need to address serious medium-term challenges in order to be able to create the conditions for high and sustainable growth that is necessary to improve the living standards of its people,” stated the IMF.

Aside from telling the nation what it should be doing, the IMF has presented a set information which sported a more “positive tone.” According to the group, the country’s oil output is predicted to increase by 10 percent this year, which equates to an average of 3.3 million barrels of oil per day.

According to Iraqi dinar reports last year, the Iraqi economy grew by eight percent (which is accredited to increased oil production and notably “robust” improvements within the non-oil sectors), while inflation went down by six percent. Both figures are expected to move in a more positive direction this year.h

Less Voters Appear At Iraq’s Election

by admin ~ May 10th, 2013

According to Iraqi dinar news reports, the number of registered voters who didn’t vote during the last elections of this year has gotten even higher. Statistics indicate that only fifty percent of eligible voters participated in the most recent provincial elections. In the country’s capital, the turnout reportedly has gotten worse as well, as 67 percent of the registered voters voted.

Iraqis claim that they have lost the will to vote ever since the withdrawal of US forces. Dinar reporters have concluded that some locals feel that since the departure of the US, Iraq has slowly been transforming back into an authoritarian rule.

The local elections were carefully observed, as it was used to determine whether or not Iraq’s political body and security forces were capable of conducting the process. In this regard, they managed to do so quite successfully. Security personnel were made to vote a week earlier, so that the teams deployed during the official elections would be at full strength.

Motorists were prohibited from entering the streets – and faraway from the polling stations – throughout the day. Nevertheless, several small bomb blasts caused a few injuries throughout the country. However, these instances of bombings apparently didn’t dishearten the Iraqis from voting, as they were accustomed to such attacks occurring that time of year.

On the other hand, a string of attacks which transpired a week prior to elections had claimed the lives of dozens locals, states Iraqi dinar reports. Regardless, both government officials and locals believe that the fatal attacks had little to no effects on the voters’ turnouts.

A lot non-voters chose to stay away from the polls because they felt that their votes had little impacts on the country’s future. Some believe that no matter how many votes are tabulated, it’s always the same politicians dominating the positions in the end.

Elections are happening, but politics in Iraq remains stuck in a time warp,” said Ramzy Mardini, an individual at the Iraq Institute for Strategic Studies. “The fact that these elections are taking place means very little for Iraqi democracy.”

More Iraqi Dinar Investors Investing Online

by admin ~ May 8th, 2013

Speculations surrounding the Iraqi dinar exchange rate have captured the attention of investors across the globe. The biggest force motivating more individuals to invest in this currency is the possibility of the IQD to greatly increase in value – an episode that’s predicted to become a reality through a string of events.

Websites specializing in the sale of foreign money have taken note of this growing trend, and have decided to capitalize on it by anticipating and facilitating for current/future demand. One notable site hopping on the bandwagon is giant online retailer/auctioneer eBay, which is currently listing hundreds of bids for Iraq’s money. They’ve also included a guide to purchasing this commodity, as well as the potential dangers involved with investing.

As of today, one US dollar is equivalent to roughly 1158 in Iraqi dinar currency. This makes the latter easy to afford, and quite profitable when sold if its value were to indeed increase. Another contributing factor to the sudden increase in demand from Internet dinar retailers is the fact that it sold for as high as $3 prior to the Gulf War. Moreover, there’s no denying that the Middle Eastern nation possesses the second largest oil reserve in the world, and how their oil infrastructures have hardly reached optimal output performance.

Moreover, even if the Iraqi dinar’s value were to go up by a penny per dinar, a lot of money could still be made. To put things in perspective, a 250,000 Iraqi note is worth roughly $215. If it were to go up a penny per dinar, the same note would be worth $2,490 dollars.

However, as with any other type of investment, betting for a massive fluctuation in the Iraqi dinar exchange rate should be done with caution. For starters, continuous insurgencies may prevent the value of Iraq’s notes from growing any higher. Moreover, if Iraq either devalues or inflates its currency, dinars could ultimately get demolished.

Another risk associated with investing in the Iraqi Dinar stems from its liquidity: the actual sellers of the notes are rarely willing to buy these commodities, and the same holds true for the US. Pricing also tends to vary from vendor to vendor, so canvassing will still be necessary. Lastly, there have been many cases of fraud over the past few years – some investors have placed large orders over the Internet, yet never received the notes.

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