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Iraq set to take its place on the world stage

Iraq set to take its place on the world stage


Posted 3/8/2012 6:30 PM by Emerging Money

Iraq has started loading oil from a long-awaited new floating Single Point Mooring (SPM) platform, with the average loading rate into the tanker Maersk Hirado coming in at 22,000 barrels per hour.

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Iraq’s oil exports have been held back by a lack of loading capacity in the Gulf after decades of neglect of infrastructure caused by war and economic sanctions. The opening of its new platform — built by Australian construction firm Leighton — had been held up for weeks, with officials blaming poor weather.


The new terminal is the first of four planned, each of which will ultimately have a capacity of 850,000 barrels per day, adding 3.4 million barrels of export capacity to make way for a doubling of Iraq’s oil production in the next few years.

For now, the South Oil Company says the first platform will increase its exports by 300,000 barrels per day.
Iraq said this week it had increased total output to above 3 million barrels per day for the first time since 1979. Iraq’s output last month was just 2.65 million bpd, with production held back by a lack of export capacity. Its exports have been slightly more than 2 million bpd.


The Iraqi government aims to more than double its oil output in the next few years and has set a long-term goal of 12 million bpd, which would rank it alongside Saudi Arabia and Russia as one of the world’s oil superpowers .
By that point, Iraq will probably be added to the world’s mutual funds and ETFs as well, making it a factor in portfolios likeMES ( quote ), which tracks stocks in the Persian Gulf region.


by Simon Watkins for Emerging Money


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Statement by on Proposed Redenomitization of the Iraqi Dinar

Further to my statement of last week , I wish to state the following :-

  • We have been dealing in Dinars since March 2003 . We are not investment advisers and have never purported to give investment advice . We have never expressed any optimistic opinions about a so called RV (revaluation) that appear in bulletin boards and other forms of social media that we have never taken part in. Whilst we are obviously aware of never ending rumors regards this and have clients that firmly believe in this , it is our opinion and has been , that as Iraq rebuilds the currency will slowly appreciate .
  • Purchasing any currency is HIGH RISK . I would never personally advise anyone to purchase what they cannot afford to lose . It is imprudent to put your life savings for example into the Dinar in my opinion .
  • The Iraqis have stated various times since 2005 that they intend to redenominate (zero lop) three 0´s from the Iraqi Dinar. The Central Bank of Iraq , CBI , has now indicated that they have Parliamentary approval for this now and plan to change the old currency currently in circulation for New denominations after a zero lop in September later this year and to run the two currencies side by side for a period of 1 year whilst they do the change . In reality the initial change will have zero impact on the value of the Dinar as it is merely a change of denominations as many other countries have done after having periods of high inflation and then seeing stability in their economy . In the long run , it is my opinion that it could appreciate slowly as the outlook looks brighter in Iraq .
  • With this in mind we have discussed the issue of currency change with principal dealers we currently deal with in the Middle East and whilst we will try our best to have some process to exchange the old for the new , we cannot guarantee this as there are many complications with such a change and many steps involved with returning the currency for change as well as many risks involved . At this stage we are looking at a potential buy back of old currency plan instead of change provided certain criteria are met . These are our current plans , they can and may change over the coming months .
  • Since we commenced dealing in Iraqi money in 2003 we have faced many challenges and shipping of the currency as well as government regulations and controls of the shipping agencies we use to move the money has changed dramatically . It is largely due to this that a change of physical currency for new is complicated for us at the moment . The Iraqis are fully aware that a large percentage of their money supply is in foreign hands , so we hope they will assist also in this process since Buyers always showed immense optimism in their money . Since they have decided to change it now , they should make provisions for the large currency holdings outside their country and provide some means of exchange as well . In no way can we have predicted or be held responsible for any currency change like this . Our responsibility was purely to deliver what what was bought at the time of purchase and this is what we have done for the past 9 years without any complaints of any kind .

  • We cannot be held responsible for government controls , changes of regulations , currency changes and other factors that may occur over time . Purchasing currency always involves risk much like does any purchase of any item , and it is up to our buyers to be fully informed at the time of purchase as to what they are buying and the risks involved .
  • As stated above , we are actively looking into plans to assist with the currency change for clients we have dealt with and who might be interested in what we are able to propose . As the issue becomes clearer we will divulge further information .
  • Potential buyers and holders of current Iraqi Dinars are fully entitled to opinions they might have on the Dinar , the above is our honest opinion on things as they stand now as of today . The Iraqis may still delay the zero lop and external factors may affect it but I felt it necessary to make the above statement based on what we are aware of .

Central Bank of Iraq Currency Redenomitization – Statement by

Statement regards CBI intention to Redenomitize the Iraqi Currency commencing September 2012 – by

1. There has been talk for many years now (since 2005/2006) that if there was a redenomination or a dropping of the three zeros there would be a recall of all denominations of notes printed in 2003 and replaced by the New Iraqi Currency

2. We will try our best to exchange the old 2003 currency for the new one providing we are able to move the currency freely through normal logistical channels and in turn we will charge a fee for this and in addition the re shipping fee . It will be our client´s responsibility to return the old Dinars for exchange to our main dealing office in Amman , Jordan .

3. The Central Bank of Iraq indicates they will allow a period of 1 year for these notes to be changed and that during this period both old and new currencies will run side by side .

4. What do dropping three zeros(re-denominitization) mean? When governments drop zeros in currency it means several positive things, one being that the currency is restructuring and the second being that it is trying to lower the inflation rate. The 25,000 Dinar Note would become 25 Iraqi Dinar, and the 10,000 Dinar Note would become 10 Iraqi Dinar for example , but the value of all the notes would be the same. The new money would have the same value in trade as the old money , the only difference would be for accounting purposes of Iraq as a country as the money supply in Iraq currently is too large for realistic accounting purposes.

Removing zeros from Iraqi dinar to start in September

20 Feb 2012

BAGHDAD – The process of removing three zeros from the Iraqi dinar and replacing current banknotes with new ones will begin in September, announced the economic committee of the Council of Representatives as part of an agreement with the Iraqi Central Bank (ICB).

The announcement, which will see the ICB re-print 30tr dinars ($26bn), was made despite government fear over the project.

Economic committee member Abdul-Hussein Abtan said: “The agreement includes granting the process of switching currency [for a] full year where [both the] old and new currencies will be dealt in the market during this stage.”

The ICB described the project as a positive move for the Iraqi economy. But particular arms of government expressed fear that the project will increase cases of money laundering and are working to convince the ICB to stop the process. The securities committee said deletion of the zeros will affect negatively financial trading in the stock market.

Abtan added however that the process “will contribute to dealing [with] inflation and facilitating economic cooperation with international banks and reducing social differences in the community.”

The ICB previously said that it will consider the requirements of the project with the Council of Ministers to determine whether or not a law needs to be implemented.

The financial committee of the Council of Representatives said on Sunday that the passing of such law would allow Iraq to address economic inflation.

The move to delete the zeros will reduce the number of bank notes in circulation and simplify Iraq’s payment system.

The ICB is responsible for maintaining price stability, implementing monetary policy and regulating the banking sector.
© AK News 2012

Iraq has more than $60 billion in foreign reserves

Iraq business
07 Feb 2012

Iraq now has over $60 million in foreign currency reserves as a result of the country’s oil sales, according to a report from Azzaman.

Mudher Saleh, a consultant with Iraq’s Central Bank, said the reserves are the highest in the country’s history, and are more than enough to cover the total volume of national currency currently in circulation.

Saleh made the remarks following a surge in demand for the US dollar, fueled mainly by sanctions on neighboring Syria and Iran, saying the Central Bank was determined to meet demand for dollars. The bank had no problems selling dollars in return for dinars, he added, and this has boosted confidence in the local currency.

External trade with the dinar as the currency of choice was on the increase. Trade flow between Iraq and Iran and Syria has skyrocketed recently, according to Azzaman, with Iraq supplying the demand for sanctioned goods.

Central Bank of Iraq raises the value of Iraqi Dinar

Saturday, January 21, 2012 13:44 GMT

Central Bank of Iraq announced, on Thursday, that it revaluated Iraqi Dinar 3.4% in exchange with Dollar. This decision will affect the exchange rate of Iraqi Dinar against US dollar in Iraqi markets, Central Bank stressed.

“During his daily auction of foreign currencies’ exchange, Central Bank raised the value of Iraqi dinar against the dollar with a percentage of 3.4% which counts 4 Dinars,” deputy governor of Iraqi Central Bank Mazhar Mohammad Saleh told Alsumarianews noting that after the current change each 1166 Iraqi Dinars equal 1 Dollar. “Nominal rate of Dinar doesn’t coincide with its purchasing power or with its real exchange rate against the Dollar,” Saleh revealed.

“The current account of Iraq payments has a surplus of 5 to 8% in comparison with the GDP,” Saleh advanced stressing that this surplus is a strength indicator and points that Central Bank has major reserves.

“Central Bank of Iraq’s decision will affect Dollar exchange rates which slightly increased lately in Iraqi markets,” Saleh declared adding that Iraqi Dinar will become a riveter in Iraqi markets.

Central Bank of Iraq had announced, on Thursday, exchanging Dollar categories for 1166 Dinars per Dollar after it used to sell 1170 Dinars per Dollar. Auctions of the Central Bank are taking place, daily, with the participation of 23 different banks.

At the end of this week’s sessions, Central Bank of Iraq scored a slight decrease of about 1 million Dollars reaching therefore more than 199 million Dollars in comparison with the 200 million Dollars scored on Wednesday.

Deputy Governor of Iraqi Central Bank Mazhar Mohammad Saleh revealed, on December 14, that Central Bank is willing to create 3 money categories following the deletion of 3 zeros from Iraqi Dinar. The currency exchange requires about two years, Saleh pointed out.

Reserves of foreign currencies in Central Bank of Iraq increased, for the first time in Iraqi history, to 60 billion Dollars, Saleh announced on December 6 explaining that Central Bank can curb inflation if it reached two decimal ranks. Current levels don’t raise concern though, he assured.

STATEMENT on so called “RV” Speculation in Iraq

January 3rd 2012

I have been trading the Iraqi Dinar since March 2003 and am one of the oldest Dinar Dealers in the world . We have never written nor followed any bulletin board nor other posts on so called overnight , magical “RV” – Revaluation of the Iraqi Dinar . We do believe in long term appreciation of the Dinar against traditional currencies such as the Euro and US Dollar which we have steadily seen over the past 9 years but urge caution in believing in dramatic overnight currency increases . With this in mind , BEFORE investing in Iraqi currency , please consider this :-

1. Investing in any currency is a HIGH RISK investment – only invest what you can afford to lose .
2. Be fully informed of the political and economic situation of the currency you are buying.
3. Bear in mind that the Iraqi Government has CLEARLY stated VARIOUS times over the past year that they intend deleting 3 zeros from the current Iraqi money . ie. a zero lop in order to ease financial transactions as written about previously in my blog .

If this was to become a reality we will make every effort to exchange the old currency for the new ones for our clients provided we have a sufficient time window and it is carried out in and orderly and patient manner and provided the appropriate authorities allow us to move the old and new currencies freely . We are not responsible in any way for sudden chnages in government policies towards movement of currencies nor any change of currency overnight .

We strive to serve our customers needs but there are limitations to which we can act at times and this needs to be borne clearly in mind .

For this reason we have clients whom we have recommended in the past purchase Call Optiosn through us as well as hold cash within the Iraqi banking system , but equally like any investment , this too comes with risks .

We still belive the long term potential for Iraq is good and over the long term the currency has good potential for appreciation , but all the above mentioned factors must be taken into account before making any decision to purchase the currency . Certainly not on rumours spread over social media and bulletin boards .
3rd January 2012

U.S. military marks end to nearly nine bloody years in Iraq

U.S. military marks end to nearly nine bloody years in Iraq

By Missy Ryan and Patrick Markey | Reuters – 1 hr 24 mins ago

BAGHDAD (Reuters) – The U.S. military officially ended its war in Iraq on Thursday, rolling up its flag at a low-key ceremony with Defense Secretary Leon Panetta nearly nine bloody years after the invasion that ousted dictator Saddam Hussein.

“After a lot of blood spilled by Iraqis and Americans, the mission of an Iraq that could govern and secure itself has become real,” Panetta said at the ceremony outside Baghdad’s still heavily-fortified airport.

Almost 4,500 U.S. soldiers and tens of thousands of Iraqis lost their lives in the war that began with a “Shock and Awe” campaign of missiles pounding Baghdad, but descended into sectarian strifeand a surge in U.S. troop numbers.

U.S. soldiers rolled up the flag of American forces in Iraq and slipped it into a camouflage-colored sleeve in a brief, symbolically ending the most unpopular U.S. military venture since the Vietnam War of the 1960s and 70s.

The remaining 4,000 American troops will withdraw by the end of the year, leaving behind a country still tackling a weakened but stubborn Islamist insurgency, sectarian tensions and political uncertainty.

“Iraq will be tested in the days ahead, by terrorism, by those who would seek to divide, by economic and social issues,” Panetta told the rows of assembled U.S. soldiers and embassy officials at the ceremony. “Challenges remain, but the United States will be there to stand by the Iraqi people.”

Saddam is dead, executed in 2006, while an uneasy politics is at work and the violence has ebbed. But Iraq still struggles with insurgents, a fragile power-sharing government and an oil-reliant economy plagued by power shortages and corruption.

In Falluja, the former heartland of an al Qaeda insurgency and scene of some of the worst fighting in the war, several thousand Iraqis celebrated the withdrawal on Wednesday, some burning U.S. flags and waving pictures of dead relatives.

Iraq’s neighbors will watch how Baghdad tackles its problems without the U.S. military, while a crisis in neighboring Syria threatens to upset the region’s sectarian and ethnic balance.

U.S. President Barack Obama, who made an election promise to bring troops home, told Iraqi Prime Minister Nuri al-Maliki that Washington will remain a loyal partner after the last troops roll across the Kuwaiti border.


Iraq’s Shi’ite leadership presents the withdrawal as a new start for the country’s sovereignty, but many Iraqis question which direction the nation will take without U.S. troops.

“I am happy they are leaving. This is my country and they should leave,” said Samer Saad, a soccer coach. “But I am worried because we need to be safe. We are worried because all the militias will start to come back.”

Some like Saad fear more sectarian strife or an al Qaeda return to the cities. A squabble between Kurds in their northern semi-autonomous enclave and the Iraqi Arab central government over disputed territories and oil is another flashpoint.

Violence has ebbed since the bloodier days of sectarian slaughter when suicide bombers and hit squads claimed hundreds of victims a day at times as the country descended into tit-for-tat killings between the Sunni and Shi’ite communities.

In 2006 alone, 17,800 Iraqi military and civilians were killed in violence.

Iraqi security forces are generally seen as capable of containing the remaining Sunni Islamist insurgency and the rival Shi’ite militias that U.S. officials say are backed by Iran.

But attacks now target local government offices and security forces in an attempt show the authorities are not in control.

Saddam’s fall opened the way for the Shi’ite majority community to take positions of power after decades of oppression under his Sunni-run Baath party.

Even the power-sharing in Maliki’s Shi’ite-led government is hamstrung, with coalition parties split along sectarian lines, squabbling over laws and government posts.

Sunnis fear they will be marginalized or even face creeping Shi’ite-led authoritarian rule under Maliki. A recent crackdown on former members of the Baath party has fueled those fears.

Iraq’s Shi’ite leadership frets the crisis in neighboring Syria could eventually bring a hardline Sunni leadership to power in Damascus, worsening Iraq’s own sectarian tensions.


U.S. troops were supposed to stay on as part of a deal to train the Iraqi armed forces but talks over immunity from prosecution for American soldiers fell apart.

Memories of U.S. abuses, arrests and killings still haunt many Iraqis and the question of legal protection from prosecution looked too sensitive to push through parliament.

At the height of the war, 170,000 American soldiers occupied more than 500 bases across the country.

Only around 150 U.S. soldiers will remain after December 31 attached to the huge U.S. Embassy near the Tigris River. Civilian contractors will take on the task of training Iraqi forces on U.S. military hardware.

Every day hundreds of trunks and troops trundle in convoys across the Kuwaiti border as U.S. troops end their mission.

“Was it worth it? I am sure it was. When we first came in here, the Iraqi people seemed like they were happy to see us,” said Sgt 1st Class Lon Bennish, packing up recently at a U.S. base and finishing the last of three deployments in Iraq.

“I hope we are leaving behind a country that says ‘Hey, we are better off now than we were before.’”

(Editing by David Stamp)

Iraq federal reserves near $58bn


Published: Sep 5, 2011 22:20 Updated: Sep 5, 2011 22:20

BAGHDAD: Iraq’s foreign currency reserves have risen to close to $58 billion and are expected to increase further thanks to a rise in oil revenues, a central bank official said.

Mudher Kasim, a deputy central bank governor, said higher global oil prices had boosted Iraq’s federal revenue and could result in a budget surplus for 2011.

“(The amount of reserves) has gradually increased since the beginning of last year, when it was $40 billion. Now it is close to $58 billion,” Kasim said.

Last October, Kasim had put reserves at around $50 billion, with 45 percent held in dollars, 45 percent in euros and 10 percent mainly in gold and British pounds.

Iraqi federal revenue depends mainly on oil, and higher oil prices have helped the country earn billions of dollars this year.

Iraq earned $34.1 billion in oil revenue, an increase of $8.7 billion, or 34 percent, over budgeted revenue, in the first five months of this year, Deputy Prime Minister Hussain Al-Shahristani said in June.

Iraq’s parliament approved an $82.6 billion budget for 2011 in February, based on an average oil price of $76.50 per barrel and 2.2 million barrels per day in crude exports.

If international oil prices remain at over $100 this year, Iraq would see a 2011 budget surplus of 15 percent, Kasim said.

While the country’s current year deficit had been projected at $13.4 billion, officials have said the shortfall will be eliminated if world oil prices remain at current high levels.

The deputy governor said inflation – which quickened to 7.1 percent in July from 6.4 percent in June – was under control but being monitored carefully.

Iraq, battered by years of war and economic sanctions, depends mainly on imports for most goods, including food and building materials.

“If prices continue to increase and the inflation rate approaches two digits, monetary policy tools will be strongly activated to fight inflation,” he said.

Kasim said a plan to take off three zeroes from Iraq’s currency to simplify financial transactions was awaiting parliamentary approval and said the government should approve the project sooner rather than later.

Iraqis’ per capita income to shoot to $9000 in 2014

Azzaman – [7/31/2011]

Per capita income in Iraq will surge to $9000 from the current $4000 in 2014, the Central Bank says.

The new per capita income forecast means that Iraqis’ living standards are expected to more than double in less than four years.

The promising economic prediction for the war-torn country is a rare good piece of news.

“The per capita income will more than double by the end of the investment plan in 2014″ said Mudher Saleh, a Central Bank consultant.

Saleh put the country’s growth rate at a little more than 9 per cent and said his figure was based “on the aggregate growth forecast for 2014-2014.”

If Iraq achieves the growth rate predicted for the investment plan, the country will see an explosion in income, he said.

There will be enough income to finance infrastructure projects in various fields, he said.

Saleh said the country’s bloated civil service sector was currently among the most prosperous in the country.

He said while average per capita income was $4000, civil servants earned an average of $6000 a year.

Oil revenues, he said, would still make the lion’s share of the country’s income.

“The importance of oil royalties in financing investment projects is of vital importance,” he said. “Maximizing oil earnings is the philosophy the oil sector is pursuing to provide steady access to resources to finance the national development plant.”