Thread: Iraq/Dinar News. 09/05 to 01/14/07

08 December 2006 (KurdishMedia)

Iraq Study Group report should be taken as a strong wake up call by Kurds in Northern Iraq. The report is clearly rewarding Sunni and Shia troublemakers and malicious neighbours at the expense of law abiding and peaceful Kurds. The report is rewarding Iran, Syria and Turkey for creating obstacles for peace and stability in Iraq. With this logic, it is extremely costly for Kurds to remain quiet. Some of the most alarming suggestions in this report are delaying the implementation of article 140 in Kirkuk and management of all oil reserves by central government, which are in sharp contrast to the democratically adopted Iraqi constitution.
This report is not only neglecting Kurds and their plight, but it is not respecting Iraqi sovereignty and Iraq’s only democratically adopted constitution.
This report is taking Kurds for granted. It counts on the facts that Kurds support for US policies in Iraq is unconditional. It is critical for Kurds to prove the contrary. Kurds should send a very strong signal to US and the rest of Iraq that delaying the implementation of article 140 will lead to unrest in Kirkuk and not implementing it. It should become very clear that Kurds have been demonstrating restraints with respect to dealing with the Kirkuk issue to abide by the Iraqi constitution. If the Iraq Study Group report is not showing any sign of respect for Iraqi constitution and democratic behaviour, why Kurds should deprive themselves from claiming their legitimate rights.
This report is naive and simplistic and does not comprehend the realties and facts in Iraq. It cannot stop the current pseudo civil war between Sunni and Shia, unless if it awards unreasonable concessions to Iran, Syria, Turkey and insurgents. Clearly, offering such indulgences to parties that are part of the problem will derail factions that are part of the solution. It will bring the peaceful Kurdish region into the center of the conflict and create a bigger problem that most probably overflows to Iran and Turkey.
The chances for success with the recommendations outlined in this report are quite remote even if Kurds agree to go along with it. But, if hypothetically the report is successfully implemented, Kurds will be sidelined and gradually replaced by Sunnis in central government. Power will be shared between Sunni and Shia and Kurds will only have a symbolic presence in Baghdad and probably a very weak regional government in northern Iraq.
The ball is in Kurds court now. Kurdish leaders must demonstrate their uncompromising position with respect to their lawful demands. Kurdish leaders have to prove once again that they can not be taken for granted.
They must be ready for taking whatever action it takes to implement their legitimate demands of implementing the article 140 of the Iraqi constitution, managing regional oil reserves and controlling of security in Kurdistan. These reactions may results in short term losses, but the long term gains are enormous. Lack of resolute actions may prove disastrous and melt down most of recent Kurdish gains.

Cheers!
DayDream

Originally Posted by Jola

However, here is an article dated today....

Iraqi dinar builds head of steam amid nation's chaos - Los Angeles Times

Iraqi dinar builds head of steam amid nation's chaos
The currency nears its peak value since being reissued in 2004. With the state buying to curb inflation, the strength may be temporary.
By Molly Hennessy-Fiske, Times Staff Writer
December 11, 2006


BAGHDAD — An unexpected bright spot has appeared in this war-ravaged Iraqi capital: The national currency is strengthening against the U.S. dollar.

The dinar has appreciated to about 1,400 dinars to the dollar, near its two-year high, triggering a dinar buying frenzy among currency traders.

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"I had people call to sell $150,000, $100,000. I had to tell them I didn't have that many dinars," said Alaa al Shemry, deputy manager at the Beirut Exchange Co., where he sat last week, watching a man sell dollars for the blue 5,000-dinar notes adorned with waterfalls and desert fortresses.

Economists and investors say the dinar's rise is temporary and largely driven by the Iraqi Central Bank, which is buying the currency as it seeks to raise interest rates to combat rampant inflation.

But that hasn't stopped currency speculators from seeking to cash in.

A.F. Alhajji, an associate professor of economics at Ohio Northern University who has studied the Iraqi economy for 15 years, received e-mail from Mideast currency speculators urging him to buy Iraqi dinars, similar to messages he got after the dinar was issued in 2004.

Alhajji says he watched teenagers in Jordan and Saudi Arabia respond to the e-mail, buying up the currency.

"They seriously think they can gain money by buying Iraqi dinars. This has become like a fever over there," he said.

And not just over there.

In Danbury, Conn., Jeff Pasquarella is buying billions of Iraqi dinars for customers through his currency trading website, Bet-OnIraq.com, which sells the Iraqi currency "because liberty breeds prosperity." EDinar Financial in Los Angeles and similar companies have popped up from Nevada to Wisconsin.

At Dinar Trade in Brentwood, Tenn. (formerly Bakersfield), sales dropped off during the last few months but picked up again in the last two weeks as many of its 54,000 customers took a renewed interest in the dinar, an employee said. The company expects the dinar to appreciate 10% to 20% in value.

"Picture Iraq as a company selling stock," the website says. "Each Dinar you purchase represents a share in Iraq's bright future."

On Thursday, the last day of business in this largely Muslim country, the dinar was trading at 1,424 against the dollar, according to the central bank. That was its strongest price since March 2004, when it was 1,420.

Some economists are surprised at the dinar's rise, considering that Iraq's economy is still a shambles, with trade and major industries such as agriculture and oil crippled by the ongoing conflict.

Electricity is so sporadic in the capital that the Iraq Stock Exchange — which is preparing to switch from erasable white to electronic boards on the trading floor — can still count on only two hours of power a day.

In late November, three car bombs exploded in markets near the central bank, killing at least 68 people, injuring 111 and destroying 22 businesses, police said.

The dinar's price is determined at streetside foreign exchanges and daily dollar auctions at the central bank. Each weekday except Friday, the Muslim day of prayer, traders from 30 state-run and private banks arrive at the central bank in downtown Baghdad, each bearing an envelope listing the amount of dollars they wish to buy and a bid price. Bank managers confer and set the price.

The central bank is widely believed to be trying to force the exchange rate down to 1,000 dinars per dollar, in line with the Saudi riyal and the Jordanian and Kuwaiti dinars.

Ahmed Salman Jabouri, the deputy central bank governor who oversees the foreign exchange market, said Iraqi banks were buying up dinars, reversing a recent trend.

Under a multiyear agreement with the International Monetary Fund, Iraq is required to increase its dollar reserves and bring inflation down to 15% as part of the nation's reconstruction effort. During the last two years, the bank's dollar reserves about doubled, records show, now totaling about $11 billion, while inflation has leaped this year, Jabouri said.
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An IMF report in May showed inflation of 58% during the previous 12 months, compared to 31.7% the year before. Economists and investors put current inflation even higher, at up to 80%.

A Western official in Baghdad said the Iraqi government is doing all it can to fight inflation.

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"They're basically meeting their targets," said the official, who requested anonymity. "I think this is actually a good thing for Iraqi consumers."

Most Iraqis receive oil and food subsidies but struggle to pay for cars, computers and other items, said Laith al Abadi, 30, a computer engineer who was exchanging dollars for dinars at the Beirut Exchange Co. last week. Abadi said he imports PCs on the black market to avoid taxes and keep his prices low — $300 to $1,400 for a basic model.

"If something changes, if the market is OK, then I pay taxes," he said.

Investors were more upbeat last week at the stock exchange, where 93 stocks appeared on whiteboards. In a stucco building behind an armed checkpoint and concrete barriers, men fingered prayer beads as they waited for the exchange to open. Some said they are more confident that the central bank can curb inflation as the dinar's value rises.

"It's a sign of stability because you are going to have capital that has fled the country coming back," said Saad Lutfi, 64, a trader who mostly invests in the banking sector, which he said is picking up. "But it's a long-term thing."

Alhajji, the Ohio economist, said Iraqis were following the bank's lead, exchanging dollars for dinars.

"People historically, since the days of Saddam Hussein, saved their money in non-Iraqi currency. Since the U.S. came, it was the U.S. dollar, especially since the military was paying in dollars," he said. Now people believe the economy is improving and will keep buying dinars, he added.

Even with prices rising, U.S. soldiers in the streets and bombs in the markets?

"Sometimes high inflation is a sign that the economy is picking up," Alhajji said. "In Dubai, inflation is rampant, but it is one of the most prosperous places in the world."

But Iraq is no United Arab Emirates. The Dubai skyline is dotted with construction cranes, while Baghdad's high-rises are pocked by mortar rounds. Iraq emerged from Hussein's rule with $125 billion in international debt, pared down to $76 billion, and trade ties weighted heavily in favor of foreign countries, chiefly the U.S.

Add to that the complications of post-colonial currency shifts.

After World War I, when Iraq fell under British rule, the official currency was the Indian rupee, with rates set by the empire. Once Iraq gained independence in 1932, leaders created a national currency board to set exchange rates for the dinar but not shape monetary policy.

Under Hussein, the exchange rate fell from $3.30 per dinar to a low of 3,000 dinars per dollar in 1995 as the government, bedeviled by international embargoes, massively printed old dinar notes, including those emblazoned with the dictator's likeness.

The new central bank was created with U.S. and British oversight in part to help stabilize the dinar. Some say the currency's rise amid the sectarian war is the result of the bank's dysfunctional money management.

"Given their history with money in Iraq, they should never have had a central bank," said professor Steve H. Hanke, co-director of the Institute for Applied Economics and the Study of Business Enterprise at Johns Hopkins University in Baltimore.

He said Iraq should replace the central bank with the currency board it had before or adopt a foreign currency. Ecuador, El Salvador and East Timor have adopted the dollar, he noted, while Montenegro and Kosovo use the euro.

Hanke called the dinar's rise "both very dangerous and the worst of all possible worlds" because it is not curbing inflation.

"This is a major train wreck waiting to happen," he said.

The head of the Iraq Stock Exchange, Taha A. Salam, said the dinar will inevitably decline in value. When it does, he said, "you will have more problems in the streets" as Iraqis' buying power wanes.

Shemry, the exchange dealer, advises clients like Mudhaffar Jenari, an employee at the Ministry of Oil, to keep their dollars as insurance against further unrest. Just a few months ago, a car bomb exploded up the street, wounding the owner of another foreign exchange shop and killing an employee. After the blast, thieves stole $40,000.

"Everything depends on the security situation," Shemry said.

This is true for the dinar as with everything else. "One thing goes badly, and we lose everything."

Is this info from a web site designied to naysay any investment in Iraq? Is this old info just posted today to curb any new investors? If all this info is correct and the Quotes accurate then why hasnt anyone talked about it here ?This is by far the most damaging post I have read on this forum, but average on the IIF!!!!

Interesting to note the recent percentage in the increase of the dinar is almost exactly the same as the recent percentage in the fall of the dollar.

Please excuse this post

Originally Posted by jer6925

Is this info from a web site designied to naysay any investment in Iraq? Is this old info just posted today to curb any new investors? If all this info is correct and the Quotes accurate then why hasnt anyone talked about it here ?This is by far the most damaging post I have read on this forum, but average on the IIF!!!!

That's a post from today's Los Angeles Times newspaper.
Well, yeah, it could be " to curb any new investors".
The info is NOT correct and the quotes suck.
The only piece of information that I got as true is the fact that some dinar holders started to offload, which we assumed that will happen once the dinar value starts raising a little.

BTW, Are you trying to say that I am a naysayer??

Cairo : No arrangements for the reception of the Iraqi president and al-Maliki this week

Cairo : Rabi Shahin
Arab League sources said that the university had not received any calls from the Iraqi government to participate in the national dialogue, which the Iraqi government has announced yesterday the start of its next Saturday in Baghdad, was skeptical of the success of the conference, which considered that it would not exceed «dialogue among the parties to partner with the political process not only differences of interests and tactics There are no significant differences between». The sources believed that the conference would not yield any result, said «This conference will be a dialogue on how to Louis XIX negotiating Luis», and added that the conference will not succeed as long as he advocates the exclusion of the main parties, considering that the invitation States and several parties from outside Iraq to the conference that was the aim will be to give it legitimacy and to provide international cover him.
.On the other hand, diplomatic sources denied - ranking Egyptian and the existence of any arrangements for the visit of Iraqi President Jalal Talabani and Prime Minister Nuri al-Maliki to Cairo this week, contrary to what Iraqi Foreign Minister Hoshyar Zebari after a meeting with Egyptian President Hosni Mubarak last week on the arrangement to visit Taliban and al-Maliki to Cairo this week, the sources ruled out the visit prior to the convening of the national dialogue called for by Maliki in Baghdad next Saturday.

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Cheers!
DayDream

To cope with the circumstances of the stage : the Ministry of Commerce considering increasing emergency and strategic stocks of foodstuffs


Iraqi national-Luna / trade /

The Ministry of Trade Chamber of multi-purpose and goals followed the minister's office, will be responsible for the distribution of the ration card items. This was emphasized by Dr. Hassan Abdel farmer Sudanese Minister of Trade and added that the Ministry of Commerce formed several committees to examine the balance of which increase food sector emergency and the need to know the future of the country's population. He added that the objective of the study and these committees is to know the strategic stockpiling of emergency stocks in addition to assisting in the case of emergency situations and natural disasters, God forbid, and this is a step behind them Preparing for all cases and the fact that the Ministry is in charge of the file of food for the Iraqi people. He added that other committees formed for the purpose of the actual need to know the future and the amounts and the nature of the increases in transport fares, which is in conformity with the approved international prices. The minister pointed out that these studies will be submitted to the Cabinet and Parliament for approval and certification after they have been checked and the statement of the utility of the information it

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DayDream

In the distribution of oil derivatives
Each station devoted distribution of the country

Baghdad Najla Al-Khalidi
Dedicated to the petroleum and energy of the Baghdad governorate to the station distribution of the oil products each municipal council to be distributed among vendors who deliver to the citizens dependent on the oil card
The part the ration card in the distribution and said official source in the Council that the Council demanded During an expanded meeting of the Energy Commission bringing together the heads of municipal councils and the six districts affiliated to the city of Baghdad the presence of the President of the Baghdad governorate a certain-Sadir and the Chairman of the Energy Commission Nizar-Sultan the need to protect the stations of terrorist operations during the gathering citizens and the transfer of Media Bureau in the governorate Baghdad in a press statement the President of the Council as saying at the beginning of the meeting that there multiple problems suffers municipal councils lies in the mechanism adopted by the Ministry of Oil for the distribution of oil products, especially and potatoes. Paraffin and gas.
He added we want to be the agreement of all parties in this meeting to appropriate mechanism for distribution For his part, the Chairman of the Energy Commission that the problems that impede the delivery of petroleum products to the citizen - is the lack of the existence of a special section in Baghdad and the lack of the product and the absence of control over the carriages, oil the Rangers from his part, Zaidun Khalaf representative of the Ministry of Oil Director of Branch-Karkh of petroleum products, member of the emergency committee that the Ministry of Petroleum continue in cooperation with the Council of Baghdad governorate and municipal councils in order to find appropriate solutions to deal with the paucity of Products oil in the city of Baghdad and districts affiliated to it.

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DayDream

Iranian students disrupt Ahmadinejad's speech
Dec 11, 2006, 11:30 GMT

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Tehran - Tens of Iranian students on Monday disturbed a speech by President Mahmoud Ahmadinejad in the Amir Kabir University in Tehran, Fars news agency reported.

The students interrupted the president's speech by shouting 'Death to the Dictator' and even tried to storm the podium but were prevented by other students.

The incident also led to a fight between pro- and anti-Ahmadinejad students, Fars added.

Ahmadinejad, however, reportedly remained calm and just said that those against suppression of freedom of opinion were themselves preventing the majority in the audience to hear his speech.

The students were reportedly taken out of the hall where the president was holding a speech to hundreds of students.

Eyewitnesses said that the protesting students also burnt pictures of the president on the university compound.


© 2006 dpa - Deutsche Presse-Agentur

The government considers the sale of $ 150 million dues of Egyptian companies in Iraq to the banks

Source : Middle East -- 11/12/2006

The Egyptian government is currently mulling the sale of the debt owed to the Egyptian companies exporting to Iraq within the framework of the memorandum of understanding that was signed between the two countries for trade exchange in the framework of the oil-for-food program for a group of banks have not yet settled. The Ministry of Trade and Industry meeting last week attended by representatives of Citibank, and the Iraqi Central Bank, the International Bureau American Forget Plant to discuss how to implement the process of selling the debt after the despair of Egyptian companies to recover their dues since the outbreak of the Gulf War in 1990.
The Ministry of Trade has conducted exclusively for the preparation of dues and Egyptian companies exporting to Iraq and it balances owed to the Iraqi government, have been counting the origin of religion in collaboration with one of the public banks Egyptian blaming interest rate of the euro as a rate on loans between banks in the London market, and these benefits amounted to about $ 150 million.

The number of companies that have dues from the Iraqi side to about 58 companies affiliated to the public and private sectors, and included a list of companies Egypt Aluminum, Channel of the ropes, Al-Ahram Beverages, Memphis medicine, the metals, Eastern Spinning and Weaving, Arab foreign trade, the development of chemical industries, Misr Spinning and Weaving Mahalla, Kafr Al-Zayat to pesticides.

http://64.233.179.104/translate_c?hl...language_tools

Cheers!
DayDream