News
Iraqi Dinar Buzz Updates
Kaperoni: Explanation of why we will get our RV by the end of 2010
2010-10-13 22:05:33
Pulled this out direct from the 2009 IMF docs. It clearly states that the reconstruction of Iraq is a multi-level issue. Concerns over terrorism, oil production, economy all play a part in the acceleration and rebuilding of Iraq. This document lays out all those concerns and the plan to achieve there goals. I have taken a few chapters and quotes to show you why and how they plan to implement the RV before the end of this year. Keep in mind Shabibi himself also stated this on a few occasion earlier this year in various CBI articles…
This explains risks with the IMF funds to support Iraq during this process…
considerable risks. A first risk relates to the capacity to repay the Fund. The security
situation could deteriorate, in which case oil production could be adversely affected. Also,
the proposed partnerships with foreign companies could hit obstacles before implementation
and oil production may not increase as projected. A second risk is posed by fiscal
governance, given the many weaknesses still present in Iraq’s public financial management
system. A third risk is the possibility of policy slippages, particularly with regard to
Here they again mention the concern, but taking precautions in advance wiuth the budget will keep things on track!
The risk of policy slippages is mitigated by the authorities’ commitment to theprogram
. As noted, the authorities view the program as providing an essential frameworkto help maintain discipline during a period of large uncertainties. In addition, the recent
approval by parliament of a 2010 government budget consistent with the program’s
objectives provides further assurances that macroeconomic policies will be kept on track.
macroeconomic stability and advancing the unfinished reform agenda. The program will
provide an anchor for economic policy during a period of economic and political
uncertainties. Also, it will ensure that no time will be lost during the period of political
transition after the elections in improving infrastructure and public service delivery and
implementing critical reforms to strengthen fiscal governance, enhance oil sector
transparency, and develop a financial sector capable of providing essential services.
Just another confirmation that everything is on track…and they elude to the fact that the Iraqi people expect a strong, stable currency.
Staff supports the CBI’s intention to continue to manage the exchange rate witha view to keeping inflation under control
. Although difficult to assess, the exchange rateappears to be broadly in line with fundamentals, taking into account the expected increase in
oil production. Moreover, a strong and stable currency provides a solid anchor for the
public’s expectations. The CBI should continue to keep a close watch on inflation and be
ready to raise the policy interest rate if core inflation were to pick up again.
Staff also urges the authorities to move forward with their plans to liberalize theexchange regime by removing the exchange restrictions that fall under Fund
jurisdiction
. Specifically, the authorities are encouraged to establish a timetable to removethese restrictions promptly, and to subsequently accept the obligations under Article VIII,
Sections 2(a), 3, and 4.
This is an assement and another agreement to follow the procedures in place
Despite the large risks and uncertainties, staff supports the authorities’ requestfor a two-year SBA in the amount of SDR 2,376.8 million
. Risks and uncertainties covera broad range, from an increase in violence that would hamper Iraq’s development to
constraints in administrative capacity and volatility in oil prices. The new Fund-supported
program would provide a sound macroeconomic framework during the political transition
and, together with a parallel operation of the World Bank, would advance the authorities’
agenda to rebuild and improve economic institutions, thus helping to mitigate some of these
risks. Moreover, the authorities have demonstrated their commitment to implement sound
macroeconomic policies and difficult structural reforms, and Iraq’s capacity to repay the
Fund looks adequate.
February 8, 2010
Wirtten to : Mr. Dominique Strauss-Kahn, Managing Director, International Monetary Fund
From Mr. Baqir S. Jabr Al-Zubaydi Dr. Sinan Al-Shabibi
Minister of Finance of Iraq and Governor Central Bank of Iraq
Quote…
“To address these challenges, we have developed the attached economic program for 2010–
2011. Our program aims to manage the effects on the Iraqi economy of the lower oil prices
and the slowdown in global economic activity. The program focuses on keeping inflation
low, increasing growth by boosting oil production, and ensuring fiscal sustainability. While
our main focus is on macroeconomic policies, we are also accelerating the pace of structural
reforms, especially to improve public financial management and develop the financial sector.â€
“Investment remains a key priority, however, as underscored also by the Council of Representatives’
provision of additional investment spending at the time of approval of the 2010 budget. The
2010 capital budget would imply a large increase over last year’s estimated investment
outturn. In order to ensure that the disruptions of administrative capacity do not lead to poor
quality implementation, we are working hard to rebuild and expand capacity, including by
restoring information systems and strengthening project approval processes. With these
efforts, we will aim to execute the full envelope for the year.â€
And now a press release from the IMF also in this document…
IMF Executive Board Concludes 2009 Article IV Consultation with
Iraq
“They welcomed the authorities’ strong commitment to consolidate macroeconomic stability and advance the
structural reform agenda, particularly in the areas of public financial management and
the banking sector. Directors underscored the importance of steadfast implementation
of the economic program, which would help unlock much needed resources from other
donors and multilateral development banks.â€
Here is a link to all this information and much more…the plan is on schedule!
imf.org/external/pubs/ft/scr/2010/cr1072.pdf
This explains risks with the IMF funds to support Iraq during this process…
———————————————
considerable risks. A first risk relates to the capacity to repay the Fund. The security
situation could deteriorate, in which case oil production could be adversely affected. Also,
the proposed partnerships with foreign companies could hit obstacles before implementation
and oil production may not increase as projected. A second risk is posed by fiscal
governance, given the many weaknesses still present in Iraq’s public financial management
system. A third risk is the possibility of policy slippages, particularly with regard to
containing current government spending.
————————————–
But all systems are go! They found stability and higher oil prices!Here they again mention the concern, but taking precautions in advance wiuth the budget will keep things on track!
————————————-
The risk of policy slippages is mitigated by the authorities’ commitment to theprogram
. As noted, the authorities view the program as providing an essential frameworkto help maintain discipline during a period of large uncertainties. In addition, the recent
approval by parliament of a 2010 government budget consistent with the program’s
objectives provides further assurances that macroeconomic policies will be kept on track.
———————————-
Here there saying everything is on target and they want to finish the plan!———————————
macroeconomic stability and advancing the unfinished reform agenda. The program will
provide an anchor for economic policy during a period of economic and political
uncertainties. Also, it will ensure that no time will be lost during the period of political
transition after the elections in improving infrastructure and public service delivery and
implementing critical reforms to strengthen fiscal governance, enhance oil sector
transparency, and develop a financial sector capable of providing essential services.
——————————–
Just another confirmation that everything is on track…and they elude to the fact that the Iraqi people expect a strong, stable currency.
————————————–
Staff supports the CBI’s intention to continue to manage the exchange rate witha view to keeping inflation under control
. Although difficult to assess, the exchange rateappears to be broadly in line with fundamentals, taking into account the expected increase in
oil production. Moreover, a strong and stable currency provides a solid anchor for the
public’s expectations. The CBI should continue to keep a close watch on inflation and be
ready to raise the policy interest rate if core inflation were to pick up again.
——————————–
——————————–
Staff also urges the authorities to move forward with their plans to liberalize theexchange regime by removing the exchange restrictions that fall under Fund
jurisdiction
. Specifically, the authorities are encouraged to establish a timetable to removethese restrictions promptly, and to subsequently accept the obligations under Article VIII,
Sections 2(a), 3, and 4.
———————————————
Again they say “promplyâ€This is an assement and another agreement to follow the procedures in place
———————————————-
Despite the large risks and uncertainties, staff supports the authorities’ requestfor a two-year SBA in the amount of SDR 2,376.8 million
. Risks and uncertainties covera broad range, from an increase in violence that would hamper Iraq’s development to
constraints in administrative capacity and volatility in oil prices. The new Fund-supported
program would provide a sound macroeconomic framework during the political transition
and, together with a parallel operation of the World Bank, would advance the authorities’
agenda to rebuild and improve economic institutions, thus helping to mitigate some of these
risks. Moreover, the authorities have demonstrated their commitment to implement sound
macroeconomic policies and difficult structural reforms, and Iraq’s capacity to repay the
Fund looks adequate.
———————————-
———————————-
February 8, 2010
Wirtten to : Mr. Dominique Strauss-Kahn, Managing Director, International Monetary Fund
From Mr. Baqir S. Jabr Al-Zubaydi Dr. Sinan Al-Shabibi
Minister of Finance of Iraq and Governor Central Bank of Iraq
Quote…
“To address these challenges, we have developed the attached economic program for 2010–
2011. Our program aims to manage the effects on the Iraqi economy of the lower oil prices
and the slowdown in global economic activity. The program focuses on keeping inflation
low, increasing growth by boosting oil production, and ensuring fiscal sustainability. While
our main focus is on macroeconomic policies, we are also accelerating the pace of structural
reforms, especially to improve public financial management and develop the financial sector.â€
——————————-
———————————-
“Investment remains a key priority, however, as underscored also by the Council of Representatives’
provision of additional investment spending at the time of approval of the 2010 budget. The
2010 capital budget would imply a large increase over last year’s estimated investment
outturn. In order to ensure that the disruptions of administrative capacity do not lead to poor
quality implementation, we are working hard to rebuild and expand capacity, including by
restoring information systems and strengthening project approval processes. With these
efforts, we will aim to execute the full envelope for the year.â€
——————————–
And now a press release from the IMF also in this document…
——————————–
IMF Executive Board Concludes 2009 Article IV Consultation with
Iraq
“They welcomed the authorities’ strong commitment to consolidate macroeconomic stability and advance the
structural reform agenda, particularly in the areas of public financial management and
the banking sector. Directors underscored the importance of steadfast implementation
of the economic program, which would help unlock much needed resources from other
donors and multilateral development banks.â€
——————————
Here is a link to all this information and much more…the plan is on schedule!
imf.org/external/pubs/ft/scr/2010/cr1072.pdf