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ENORRSTE: Although the translation of these articles leaves a lot to be desired it appears to be indicating that the "quotas" for banks in Iraq are being raised in order to allow them to handle larger foreign currency transactions.
There may be several reasons for this that I am not aware of, but the most important one that comes to mind is that the CBI is EXPECTING that the banks will be in need of additional funds in order to handle the transactions.
It is therefore doubling the "quota" to allow for a better managed situation overall.
Read More Link On Right
This brings to my mind the following question: Why would they be expecting a need of this nature that would require a doubling of their "quotas"?
The answer to that may be that they are about to open the doors to international financial transactions with the dinar. If that is the case it would explain the doubling of the quotas, so that the banks would be ready for increased foreign currency traffic (into and out of the dinar).
Therefore, it seems to me that this is very good news indeed. Of course my understanding of this may be incorrect, but I can't seem to come up with any better explanation for a doubling of quotas over a short 2 day period. Enorrste
TLAR: Errnorste, you are absolutely correct that this article is hard to read. There is at least three or four ways this action can be looked at. You've stated that it might be opening the door between Iraqi banks and foreign banks in preparation to the dinar going international.
Kap suggests it might be a 2 day event to collect more dinar and or, it is an attempt to close the gap between the street rate and the program rate.
Another interpretation could be that the bank is just showing some flexibility in administering the new regulation they just imposed, allowing the companies to complete orders for goods that exceeded the regulation limits. When the bank imposed these limits on companies two things were noted.
The first is that it could take up to three days for the movement of remittances to take place which seems way too long to me. The second thing the bank said is they will adjust the limits on an as needed basis to allow for the commerce activity requirements.
In other words all commerce activity does not fall within the set guidelines of the new regulations. So the bank, in order not to stifle international trade and commerce, will adjust from time to time these set regulations and dollar amount restrictions.
The base purpose of these regulations is for the CBI to control all outbound transfers and remittances in order to control the money that has been being smuggled out of Iraq,' not to limit commerce.
I see this article as the CBI temporarily adjusting the limits to allow for companies with needs that don't fit the "mold" of the regulations recently imposed, to conduct their business.
I also feel the CBI will be looking very closely at the deals that go beyond the regulations to make sure that there is no outbound snuggling, and that the deals legitimately are for Iraq's economic interests and not some other purpose.
The regulations are limits, but from time to time and or special situations, the CBI will bend the rules so as not to stifle economic progress. They are intended to control the money being sent out of Iraq only. Of course I too could be wrong.
TIMSTERS: hey buddy did iraq have this much trouble introducing the dinar we hold now ...I THINK NOT !!! so why so much teaching on this topic from iraq???
TLAR: Timsters, I'm not sure what you are asking. First off, Iraq did not introduce the currency we hold. The Bremmer Provisional government introduced it and our Treasury printed it.
The BPG passed it out and was instrumental along with the IMF in determining the value, 4000 to 1 The BPG determined the trade in amount deciding on making two values for the same currency.
We determined that the Saddam dinars in Iraq would get a one to one swap after we set the rate through the IMF. The BPG also determined that the trade on the swiss dinar in Kurdistan should be traded at a much higher rate than did the Iraqi Saddam dinar.
I think if I recall correctly and I'm getting old, the value of the swiss dinar traded at 16 to 1 meaning that the Kurdistan swiss dinar I believe received 16 new dinars for each dinar they held. Don't hold me to that number but the jist of what I am saying is true. Kurds got many more dinars for each dinar traded in while Iraq proper, they got a 1 to 1 trade in.
ARTICLES BEING REFERENCED :
#1 CBI doubles quotas remittance companies and foreign currency banking at a bank auction LINK
#2 The Central Bank is doubling the share of foreign currency banking companies
03 April, 2013 07:53:00
Financial sources said that the Central Bank of Iraq to double the share of foreign currency banking companies.
The CBI said that it was doubling the shares of banking companies and foreign exchange remittance dollar over the next two days, indicating that companies will increase their share is committed to help the Bank. The Central Bank sales of the dollar at an auction sale of foreign currency for the day.
Kiarash BSO LINK
#3 Central Bank doubling quotas banking companies of foreign currency
Editor: SS Wednesday 03 April 2013 08:19 GMT Alsumaria News / Baghdad
Financial source confirmed early Wednesday that the CBI in connection with the doubling of the share of banking companies of foreign currency.
The source said in an interview for "Alsumaria News", "The Central Bank of Iraq in the process of doubling the shares of banking companies and financial transfer of foreign currency (U.S. dollar) during the next two days," noting that "companies that will double the stakes are committed to the instructions of the Central Bank." LINK
#4 CBI doubles quotas remittance companies and foreign currency banking at a bank auction LINK