**Iraq’s cash reserves are reassuring and budget deficit in 2015 funding sources available **compulsory staff and employee savings will turn to liquidity and investment will benefit **500 billion and 80 million dinar in losses from Mosul disaster ** We completed a draft law against money laundering and terrorist financing Interviewer: Dr. Abdel Amir Al Faisal That the CBI is one of the oldest financial institutions in the history of the Iraqi State.. hesitated alot before 2003, then jumped strongly to the forefront when events for Iraqis found the only guarantor of the dinar in the domestic market was the dollar and what that means stability in various areas of life swing depending on the exchange rate of the dollar. A giant financial institution through which we can know where our financial policy is moving us to safety or vice versa. Today a foundation in economic policy, financial, monetary and budget of 2015 all surrounding details of war on one of the central bank’s tasks measured gives an advisory opinion on the features of the budget deficit not knowing the previous budgets, as well as evoked much controversy here and there about compulsory saving for employees and where the State is heading, amount of Bank losses from the recent fall of Mosul which hit every State without exception, with many other questions by “Baghdad news” on the table The Governor of Central Bank on the relationship between the known information in a few meetings, This was dialogue with editor on relationship, which exceeded the usual frankness on a line points of complex equations and situation that Iraq faces serious challenges. Distinctive front He was greeted by Mr. Ali al-allaq’s Baghdad newsletter highlighted the positive atmosphere of dialogue in every sense of the word, very well run before tripping questions initiated by saying the Central Bank is the cornerstone of fiscal, monetary and economic policy for the country, through the Central Bank they achieved things that represent the Foundation of the economy when we talk about the exchange rate and inflation, control of the banking sector in General, we are talking about a fundamental aspect of the economy, which is the basis for everything the country needs development and fast advancement. Budget deficit and effective treatment • Much talk about the budget deficit and talk of superstitious numbers of the Central Bank’s cash reserve and do citizen get cash reserve? The foreign exchange reserves for Central Bank is still excellent by international standards and the world’s central banks, usually seen through the reserve for money supply of local currency in circulation in the market if the local currency in circulation in the market is a good thing, some States placed 70 percent of currency in circulation, for Iraq has one and three quarter of the currency reserve ratio percentage reassuring, therefore the Iraqi dinar has maintained his power, recently Because of low oil prices and being the source of the country’s dollar, when NYMEX oil sales than from the dollar and this affects the reserve if drawdowns and sale to the dollar at the same level, so we are watching this case very carefully and not unlike our equation to balance out and sold, and the State cannot Benefit from the reserves because it is governed by the law of the Central Bank, which does not allow to act up and the Government did not apply for Bank reserves, but consulted with the parties and we are going to deepen the practice as we aim to have the Central Bank as a financial advisor to the Government and coordination between fiscal and monetary policy, if each one of them separately, it will impact on the economic situation that we are trying to create a kind of consultation and coordination so that the Government took the view on the subject given us a certain section for ideas The retrenchment personally participated in the preparation of the structural balance by pressing certain expenditures and at the same time as the deficit can be covered by issuing treasury bonds, in the bond is not from the Central Bank, but the Central Bank helps to promote and coordinate with banks in Iraq, we need to create a bond market that doesn’t exist and this time we tried Expand the bonds to be custom and culture in the stock market, we participated directly on budgeting and attended the Cabinet meeting which approved the budget to clarify some things and I think that the budget was designed to contain the deficit, but at the same time proved how to eliminate it, unlike previous years when the budget deficit issue left a shortfall of surpluses and a subsequent bond issue this time deficit specific coverage as well, the deficit limit of 23 trillion reassuring presence of sources For funding and part of these sources is the budget to the Finance Ministry. Save for what? • Why is the State of compulsory savings for employees? Our proposal was the subject of savings should not reduce staff salaries and then convert them to operational expenses, be pressed to the employee not on expenditures, this proposal the Cabinet should not use this money to finance the budget, so agreed when reading the budget will not be clear, there are certain compulsory savings ratios will be taken from appropriations and not pay for it, it will exceed the limited income categories. • Are the ministries selected reporting compulsory savings? No Ministry but the income levels of allocations, we proposed that this amount is not used in the financing of the budget, so it is not part of the shortfall but will provide liquidity, we have proposed to invest and the payback is in favor of the employee, thus we have achieved two goals: first, we used economic stimulus money because if we put the expenses on citizens and employees extensively we would influence negatively the economic cycle and therefore have a negative impact on the budget in terms of income from Other taxes, so 40 trillion to 2 trillion salaries taken to invest savings and be a payoff for the employee, there are areas for investment with high risk and we are in Iraq have great investment opportunities if we all narrowed opportunities can be used as bonds, traded on the market, that the 23 trillion from section will be rounded to the Ministry of Finance within 3 trillion is the parcels of TBI bank who own an estimated 3 trillion surplus and bonds with the Rafidain, Rasheed banks who have liquidity and foreign bonds are also hoping to be active in this aspect, some foreign banks operating in Iraq is ready to help us in this aspect and bring buyers of these bonds. • Is it possible to have a compulsory savings benefit to the employee? Our proposal in the Cabinet was that of compulsory savings interest on employee approved by the Cabinet then will consult on means to achieve best value for the employee after a meeting between the Government and the Central Bank. Scary numbers of ISIS disaster • How much money the Central Bank lost on ISIS entering to Mosul? -Lost approximately 500 billion and 80 million dinars to banks and private banks and that there are no accurate statistics about. To follow the Central Bank? • Is the Central Bank part of the Government or Parliament? The Central Bank is not Government but is an independent body but within the Constitution and the law on the Central Bank to be a coordination between monetary and fiscal policy by the Central Bank, the Government was endeavoring to implement greater exchange as possible as there was no brake because the Government cannot go without spending accounts for the economic impacts this may create inflationary effects and the Central Bank would be problematic in stemming the inflation. • Do you feel political pressure? Through my time at the Central Bank did not feel any pressure from politicians, but the pressure through the media and through messages from politicians, so I don’t find any intervention at the present time I am trying to reverse the equation, the Government always interfere with the work of the Central Bank today, trying to reverse the equation. Connect with money is important • Is it possible to link money to create a State strategy under this circumstance? No doubt that the State cannot live as scattered islands and all authorities must meet for the service of the State cannot be spaced apart for policies that depart affect each other and that if Central Bank had not coordinated with justice cannot exercise its activities for example money laundering activity, you are interested in some States if the model of justice in this case, govern the issues to it if not effective elimination of this I need activity to a competent judge with money laundering not leaving it to another judge does not know what is the issue of money laundering being the case relating to the financial aspects in need of background knowledge, therefore the authorities should be integrated with each other and in some States, the Central Bank called the monetary authority of that key authority operate independently in determining policy for each country that I came today with a decision I might change the economic and political situation and security as a whole. Combat money laundering • What are the arrangements about the phenomenon of money laundering? Unfortunately, in previous years the Bank’s point of view about assuming responsibility in combating money laundering does not see that this activity is through the Central Bank personally, I disagree with the Central Bank in this matter because according to the law of the Bank money laundering reporting Office is linked to the Central Bank, so see the previous administration that had led to the failure of anti money laundering activity for that activation of the money laundering Act on the Central Bank was trying to convert it to others in discussing the law against money laundering, today we are working to correct the deficiencies in existing resolutions, we as a member of the Financial Action Task Force concerned primarily with money laundering, this year we chaired the Organization looking at a few gaps on reporting and assessment prepared by the World Bank, the Organization follow-up observations since direction in The Central Bank activating Office giving a kind of autonomy on administration and its staff, we completed today the draft law against money laundering and terrorist financing, this was the demand of organizations concerned with this issue was given this topic a priority today, the draft was sent to the State Council and will be an important act at the national level, although we are late in the preparation of this project but now we have prepared the latest developments in this area. Banks funded terrorism • What are the procedures for the Central Bank to bank sponsors of terrorism? The fact that this is possible for not only in Iraq, but also in some neighboring countries thus we practice today might be troublesome regulatory role for banks and remittance companies but this happens due to the gravity of what is happening in the banking and remittance companies at present, there is a large movement observation remittances, deposits, etc. and there are no specific figures, but the focus of our attention and put it most of our focus. • Have you been raising ceilings to exchange offices? We put a lot of restrictions, controls and inspection committees are continuing on a daily basis with the requirements for conversion companies obviously heavy but wanted it not to have an option but to control in fact with measures we have taken in the past few days to review the cash dollar sales for all-cash to be compromised with the use of “cash” in Iraq is not with what happens in the rest of the world as there are today aircraft movement amounts from New York to the Rashid Street in order to sell the dollar for citizens the The issue became controversial from States and international organizations, we want to make everything within the banking system for movement control and direction and I can see where it went to any use as well as the other States supplement in turn also monitors standards used in most States agreed surely will be mutually complementary roles on the principle of know Your customer know what do and where source of funds so we can detect the latest attempt in the Rafidain Bank when you see a striking amount of attention it must know the client and where it came from and when the amount received instruments of large amounts of people newly in bank accounts that drew was contacted directly, although fundamentalist treatment by the employee upon contact with the responsible authorities their knowledge to pass a number of billions we could detect the network used, today we seek to move away from Cash trading, the culture we seek to strengthen the Central Bank’s recent slight increase occurred in the dollar because end of cash sales left the money orders to traders and importers of such responsibility covering foreign trade activities, but when someone requests withdrawal of a large quantity of dollar, this is difficult and eye-catching for the dollar is used by travelers with low rates. • Are private banks controlled? All banks are subject to oversight, monitoring of violations and fines if spotted bankruptcy of a bank we revitalize and impose guardianship but some understand it wrong but the right thing is to restore, rehabilitate and revitalize the Bank from bankruptcy in order not to damage the depositors, for example we run only the economy and bank transactions which constitute the Bank’s resources as a currency auction buying USD we manage as well as loans granted by the Bank to get into collection, another option is to allow a bank to bankruptcy. • What is the percentage of deposits banks eligibility? Proportion of collateral reported to the Cabinet that we give employees the salaries of around 40 trillion and 90% of them to intervene in the banking system, I suggested that putting a machine in each Ministry by which payroll staff to avoid theft and congestion that might get banks so that it provides liquidity. Where is the currency reset? • Is the currency reset process eliminated? That project still exists and such steps needed to organize the process stability for not creating any breaches and to ensure the success of the process in what we think now is replacement of paper, this is where violations occur and risks need complex management, we’re in the situation we fear of violations so that our plan is the introduction of the new currency without pulling the old currency and when the situation stabilizes, we will implement the project, after arranging with all stakeholders, in order to avoid problems that may occur in records and numbers And others, we will publish educational procedures on the subject which is an ongoing project, the regulatory framework, we will enlarge the currency as we finished issuing the 50,000 and this currency will not increase inflation. • What is your relationship with the World Bank? Our close relationship with the World Bank on several levels as Iraq part of international organizations and their shareholders thus take advantage of the facilities and the expertise provided by the World Bank in many areas to develop existing resources through the World Bank, as well as studies and recommendations offered by us, many of the recommendations by the World Bank to the present-day context currently does not allow the application and sometimes find their interest, reaffirming the Bank to restructure the banking sector particularly in the Rafidain Bank and Rasheed Bank had a great role in Recommendations. The region can benefit from the Central Bank • How do you deal with fiscal policy in the region? The Central Bank has two branches in Erbil and Sulaymaniyah, but the fact of the matter is not our direct management therein; working independently of the Central Bank this thing serves the territory because the Central Bank is a third party between the banks, the public and the Government, it organizes to avoid risk in the banks and I believe that there is disagreement in the process of overseeing the territory as a result of the territorial Government is overseeing it, we did not agree now there is a change of attitude probably that Banks there must be managed by the Central Bank because this relationship in region benefits from having an independent party capable of governing the operation, the absence of Central Bank got problems that float on the surface of reality and expect changes. • Are you satisfied with the Government’s programme under Dr Abadi? I am satisfied with his work if applied vision and program schedule. • How is the currency switch bad? Many citizens stand to switch damaged currency with new ones, we’ve worked on switching we have wages that were imposed on citizens who have damaged.
Posted on: Tue, 27 Jan 2015 10:08:18 +0000
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