CBI announces that it will dispense with foreign transfers next year

Baghdad-INA
The Central Bank of Iraq(CBI) announced on Sunday, the dispensation of external transfers next year.

The Governor of the Central Bank, Ali Mohsen Al-Alaq, said in a statement received by the Iraqi News Agency (INA), that “the bank is proceeding to dispense with external transfers “next year” and to rely on banks licensed in Iraq on correspondent banks in external transfer operations, as transfers through banks reached Correspondence represents 60% of the total transfers (outside the electronic platform of the Central Bank), while the implementation rate of verified transfers reached more than 95%,” indicating that “this came after an agreement between the Central Bank of Iraq and the US Federal Bank, similar to countries of the world, where it is not practiced central banks are executive functions, and their role is focused on supervision and control."

He stressed, during the meeting with the heads of the boards and authorized directors of the banks licensed in Iraq, that “the Central Bank’s endeavor to open direct channels of communication for Iraqi banks with their foreign counterparts in correspondence, commercial exchange, etc., came in intensive stages, while what is currently underway is opening transfer channels in various currencies, including ( UAE Dirham, Turkish Lira, Indian Rupee, and Euro)."

Al-Alaq stressed, "The coming year will witness the restriction of internal commercial and other transactions to the Iraqi dinar instead of the dollar, except for those delivered to travelers."

The Governor of CBI, pointed out that "the entry of most merchants into the official transfer channels and the provision of the dollar at a price of (1,320) dinars was a direct reason for controlling the general level of prices and lowering the inflation rate, which is a basic indicator of the effectiveness of monetary policy, and that the black market price is not suitable as an 'indicator, Because it relates to cash dollars for non-fundamental transactions, and is not intended for legitimate trade purposes."

Al-Alaq pointed out that “the new system of external transfer and sale of the dollar provides protection from risks for all parties of operations, and enjoys international acceptance and praise, is consistent with the law on combating money laundering and the financing of terrorism, and achieves an important initiative for direct relations between Iraqi banks and accredited international banks."

The statement added, “The meeting reviewed the mechanism for establishing “Riyadah Bank” and the societal importance that the bank will be based on, especially as it is consistent with the directives and vision of the Prime Minister discussions were raised on this topic, including the banks’ contributions to establishing “Riyadah” and the working mechanisms of this bank, which will be effective for those wishing to... Opening small production and commercial projects that contribute to developing the local economy and reducing the unemployment rate with direct support from the Central Bank."