Iraqi Prime Minister Nouri al-Maliki said on Sunday that the process to re-evaluate the Iraqi dinar has to do with economic conditions that have to be strengthened.
“The Iraqi dinar has every reason to grow stronger thanks to an increase in revenues and development of the economy,” Maliki said in response to questions through the National Information Center.
“The government would not rush matters but would rather work on finding guarantees to render this measure a success. The Central Bank of Iraq (CBI) is currently entrusted with drawing up a study on the whole issue and would give its decision soon,” said the Iraqi premier.
The Iraqi dinar’s exchange rate is suffering from low value against foreign currencies as a result of decades of wars and economic embargo that brought the local currency’s exchange rate to the rock bottom from three dinars per dollar in the late 1970s and 1980s to 3,000 dinars per dollar after the 1990 invasion of Kuwait, followed by a 13-year crippling sanctions regime.
The exchange rate fell even more after 2003 to reach 1170 dinars per dollar due to the CBI’s policy of daily auction, in effect for more than five years now.
The policy was lambasted by several economists on the grounds that these auctions do not give the real value of the country’s local currency.
(Aswat Al Iraq)