Iraq’s Central Bank Considers New Currency

Iraq’s Central Bank Considers New Currency

Iraq’s Central Bank says the country is in need of a new currency in which the current zeros are removed to facilitate commercial transactions, according to Azzaman.

The bank’s Governor, Sinan al-Shabibi, said he was in talks with the prime minister, Nouri al-Maliki, on how to go ahead with the bid to issue currency with a lower denomination and higher value.

Shabibi said Iraqis were now relying a lot on the U.S. dollar, particularly in settling cash transactions that required a lot of money.

The use of credit cards is still limited in Iraq and cash is still the main source in trade and commerce.

Allocations even for small projects and to carry out simple commercial deals are in millions or billions of dinars.

Three bundles of $10,000 require carrying or paying about 40 million dinars.

The new arrangement, once implemented, will make transactions simpler and easier, the Central Bank governor said.

Calculating and paying with the current currency makes trade deals rather “awkward and difficult” for a small country like Iraq, Shabibi said.

Other countries, like Turkey and Brazil, successfully dealt with the same problem by removing zeros from their currency.

In Turkey, people dealt with millions of liras for simple purchases and transactions. Today a dollar is worth about 1.6 new liras.

Shabibi said there was a lot for Iraq to learn from Turkey.

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